Introduction

The BRICS summit in Goa scheduled for mid-October (2016) has spawned a number of events all over the country on a whole host of subjects. It would not be incorrect to say that the word BRICS has appeared in the media more often in the last two months than over the past 10 years. Post- Cold war and with the unilateral moment in international affairs seemingly over, does BRICS present India with a viable alternative to carve out its own geo-strategic space? Many India strategic thinkers do not appear reconciled to the increasing irrelevance of the Non Aligned Movement and stress on retaining strategic autonomy. There is a distinct discomfort with what is seen as India hitching its fortunes with that of the United States.

It is therefore necessary to understand what BRICS is before one can see whether it has a future? There is scepticism that an acronym (BRIC) that came out of a global investment firm (Goldman Sachs) to draw the attention of international investors to the potentialities of large emerging markets that were currently under-priced with possibilities of huge gains. These countries with large domestic markets had the potential to become engines of global growth but needed sustained investments in infrastructure and productive investments, an attractive proposition for pension and long-term funds that were not looking for quick payoffs; such a relationship could benefit both once these economies could trigger sustained growth. But what is BRICS at present beyond an acronym? Samir Saran of the ORF very clearly explains, BRICs is not ‘a trading bloc or an economic union per se, nor a political union.’ What brings these countries together is ‘neither attractiveness of the economics of these countries nor a cosy ideological confluence.’ It does, however, reflect a desire for a new multipolar world order. Critics have pointed its members are ‘dysfunctional misfits.’ Their geopolitical compulsions have considerable variations with more dissonance than agreed agendas. Similarly, the structures of their economies have more competing and opposing interests than complementarities, e.g. China and India would like low petroleum prices while Russia’s imperative is high petroleum prices. Similarly Brazil relies on high international prices of soya and maize which it exports to China, who would like to pay less for its food imports.

Emergence of BRICS

So what accounts for the continuance of BRICS, if increased salience is still not on the horizon? It would be necessary to look into the historical context in which BRICS emerged. Though the acronym was coined in 2003, one can really trace its origin in the political sense to 2008. The Afghan and Iraq wars had exhausted the United States and there was a major inward shift to American politics. The rise of Obama as a presidential candidate overcoming the far more internationalist Hillary Clinton reflected this shift. The collapse of Lehman brothers and Obama’s subsequent sweeping win in the Presidential elections sealed this shift. (The rise of Bernie Sanders as a credible challenge to Hillary Clinton in 2016, and Trump’s emergence as the Republican candidate to challenge her indicates that insularity not global inter-connectedness is still the most important pole in American politics. And the BREXIT vote is a sign that this phenomenon is much larger than what most analysts gave it credit for). Economically, the 2008 financial crisis lead to a loss of confidence the US had in its abilities to affect global change far in excess of the physical loss it actually caused. What made it worse from the US point of view was that many others, like China and Russia saw it similarly.

In fact, globally this was seen as the end of the unipolar moment that the US had occupied since the fall of the Berlin Wall though it was still seen as predominant. This shrinkage of the US’s abilities and confidence was attributed to hubris of the Bush years. So while the US was able to lean on China to get India the NSG waiver as part of the US-India nuclear deal in 2008, it had to do considerable heavy lifting, a sign that its influence was waning. Similarly, Russia could prevent President Saakashvali  from ending the illegal status of North Ossetia and Abkhazia, parts of Georgia which functioned as de facto independent regions but the Russian army had to do so under the guise of ‘peacekeepers, a fig leaf it would not need when it seized Crimea from Ukraine in 2013. Similarly, China made aggressive moves in the South China Seas (SCS), far in excess of its actions in the past, but did not precipitate matters. Unlike again the 2015-16 seizure and build-up of defence assets on ‘islands’ created by reclamation in different parts of SCS and its brazen disregard of the ruling of the Permanent Court of Arbitration in the case brought by the Philippines.

However, as the financial crisis unfolded and became contagious and the West unable to reverse its affects, Russia and China saw this as a good opportunity to increasingly challenge the extant international system. China’s ability to keep on adding capacity and capturing more and more of the western markets, running huge trade surpluses was unprecedented. This gave it financial resources that it used adroitly to invest in infrastructure and prestigious projects in developing countries across continents. And launch its One Belt One Road initiative by merging the New Silk Road and the Maritime Silk Roads initiatives. However, the situation is not as simple as it looks, with the BRICS countries themselves, by and large, mired in economic and political difficulties.

Status of BRICS’ Economies

The Chinese economy is saddled with considerable excess capacities, with recent growth driven by public investments in non-viable infrastructure projects funded by the repressed financial sector. The shift from export-led growth to one fuelled by domestic demand is turning out to be much more difficult than expected, and but for the (unnecessary) investments across the country, the growth rate of the economy would be far below the expected 6.2%. Simultaneously, the success of President Xi Jinping in centralising powers has made him the arguably most powerful Chinese leader since Mao. This and the political purges carried out in the name of the anti-corruption campaigns threatens to upset that institutional arrangements that Deng Xiaoping had put in place to ensure collective leadership of the Chinese Communist Party, and by implication of the Chinese State. The apparent refusal to choose a successor anytime soon underscores the political tensions, which combined with economic stagnation could be potentially destabilising.

Brazil’s economy was driven by exports to China and high petroleum prices, the unravelling of which has led to recession with no signs of recovery, not even little green spouts in any sector. The unprecedented political crisis with the impeachment of President Dilma Rousseff has left it with an unpopular caretaker government that is unable to break the political logjam needed to adopt necessary policies to restructure its economy.

Putin’s political opportunism in the Ukraine and the ensuing economic sanctions would have hurt Russia but when compounded by the collapse of petroleum prices led to a free-fall of the economy. While this has since stabilised, but not recovered, the Russian leadership needs political diversions to retain credibility. The armed intervention in Syria in support of the Assad regime while popular in the short-term could land up bogging Russia down in wars that no one would win. While Putin has adroitly brought, or bullied, Turkey into breaking away from the West insofar as Syria is concerned, the fundamental contradictions in the strategic objectives of both countries would ensure that the alliance is likely to be short-term.

South Africa, a politically correct add-on to the original BRIC, has the smallest, and weakest, economy amongst the BRICS nations. President Zuma is bogged down in corruption scandals and its economy is going nowhere. Other than optics, it has no reason for being grouped along with the others. If Nigeria could get its politics right, and improve its governance systems, it has the potential to become the engine of growth of Africa and a better claim to be seen as a major emerging economy. But that seems some time away.

India, under Prime Minister Modi, is the odd one out for the moment though in sheer impact on the global economy, it would continue to lag China for some time. However, in the short period of just over two years, it has demonstrated the imagination and willingness to create new instruments that has started delivering growth, a far cry from the policy paralysis and crony capitalism of the UPA days. A whole range of activities e.g., re-starting the infrastructure story, the emphasis on skilling India, financial inclusion (Jan Dhan Yojana etc.), improving the investment climate, transparent access to natural resources (think coal, spectrum), cooperative federalism through enhanced devolution of taxes, Goods & Services Tax etc., have changed the mood and image whose real impact would only be felt over the medium term. No wonder, India is, and would remain, the fastest growing large economy for some time.

Expectations of China, India and Russia

In the face of an obvious economic rationale for the group, it is useful to try and understand why these countries meet as BRICS, which is a subset of their world view. China is not just the leading country of this grouping but also the only one with immediate international aspirations. Its actions and policies suggests that it is not in thrall of the existing world order having ridden it successfully to emerge as the second largest power, poses the USA a challenge that the erstwhile Soviet Union could never do. China’s rise, as that of Germany in the last decades of the 18^th century is hugely disruptive; the Soviet Union’s heroic role in the defeat of Nazism enables it along with the USA to emerge as the only two real victors of World War, thought at huge human costs. This allowed the Soviet Union to become a very important rule maker of the post-War world order. China’s effort to become a rule maker is not going to be readily accepted as there is no Carta Blanca waiting to be written upon. Its forcible seizure of atolls in the South China Seas and rejection of the verdict of the order of the Permanent Court of Arbitration coming on top of other unilateral actions have caused trepidations in the neighbourhood. And made it less likely to win friends despite the seeming unlimited cash it is rolling out worldwide in infrastructure projects.

India, on the other hand, though hurt by past humiliations has never let history complicate its faith in its future. And since 1991, underscored the need to interact with the world to achieve its ‘manifest destiny’; a tendency strengthened dramatically with the assumption of office by Prime Minister Modi. It has no wish to challenge the international order based on liberal principles of rule of law, even though it would like them tweaked to accommodate its rise, or recovery of past position. Hence the desire to become a permanent member of the United Nations Security Council, of the Nuclear Suppliers’ Group and so on. However, it is not prepared to gatecrash and accepts that it would be though its emergence as a major economic power and as a provider of security in the Indo-Pacific that its case would be taken seriously. It remains prickly about formal alliances and accepts that while there may be strategic congruence with the USA, as there was with the Soviet Union for a while, ultimately each country must pursue its own interests.

For Russia, BRICS like SCO and the attempted Eurasian Union, represents its efforts to remain globally relevant even as economically it is a middle power unlikely to emerge as a major economy. The continued reliance of export of natural produce limits its ability to even retain its traditional markets of Central Asia, which though largely dependent on remittances from Russia, are much more plugged to China economically. Russia itself frequently lands up looking like China’s junior partner; the recent aggressive moves in Syria and challenge to the US should be seen in the light of Putin’s moves at retaining a larger role for Russia in world affairs.

Conclusion

Has BRICS delivered? If no, or not sufficiently, should the grouping continue to exist? The reform of International Monetary Fund’s quotas to better reflect China’s, and to a lesser extent, India’s economic weight, the establishment of the New Development Bank (NDB) and of the Contingent Reserve Facility is considerable achievements. However, the quotas would need further reforms going along and how credible the NDB emerges as a reliable and independent funding agency indicate that the journey is far from over. In fact the establishment of the China-promoted Asian Infrastructure Investment Bank (AIIB), where unlike the NDB, it is the dominant shareholder signals China’s discomfort at having to share power at multilateral forums. On the positive side, the rise of the NDB and the AIIB has forced the World Bank and the Asian Development Bank to simplify its lending norms; these so-called Safeguards were put in place to placate Western NGOs that saw themselves as speaking for the poor of the world since they mistrusted governments of developing countries who the NGOs saw as predatory. As a result, the autonomy of borrowers to frame their own social and environmental policies was seriously compromised. Worse, in effect lending cost went up as borrowers had to undertake various interventions and processes that were time-consuming and costly. This has been slightly rolled back and if NDB and AIIB were to develop into major financiers of development, the World Bank and other multilateral development agencies would be forced to become more sensitive to the needs and circumstances of the borrowers.

Politically, BRICS did coordinate their positions on the Libya issue, preventing a full-fledged international military intervention but failed to prevent the disintegration of the State and the country. Similarly on Syria, the initial discomfort with foreign military involvement finally gave way in the face of the persistent conflict and the rise of the Islamic State. It must be accepted that there are limitations in how politically relevant BRICS as a grouping can ever become. As three of the members (Brazil, Russia and South Africa) have varying degrees of economic dependency vis-à-vis China, they can be left out of the discussion for the time being. China and India have as many issues of dissonance as there are of congruence, with the former becoming larger over the years as China seeks to expand its footprint over areas and issues that threaten India. Internationally, India is committed to freedom of navigation and therefore of keeping the Sea Lines of Communications open. China’s unilateral moves are a serious challenge to this. Regionally, the continued use of Pakistan to keep India bogged down in its neighbourhood and to distract from its growth efforts far from reducing seem on the ascendant with China’s refusal to accept the naming of known Pakistani terrorists and the launch of the China Pakistan Economic Corridor that runs through India’s territory in the illegal occupation of Pakistan. Prime Minister Modi’s best efforts to isolate problem issues from others where cooperation should be further developed have not been reciprocated by the Chinese leadership, yet.

That however does not mean that BRICS should be disbanded or could have no role to play in global affairs. Technological disruption, Climate Change combined with the relative ‘withdrawal’ of the Western societies from globalisation poses substantial challenges to the growth stories and plans of BRICS, particularly China and India. Inward looking USA and the European Union lack the capability and credibility to lead on these serious issues, e.g., e-Commerce, monetary flows, agricultural coping strategies and others. The WTO negotiations seem to be going nowhere, challenged by plurilateral arrangements like Trans Pacific Partnership and the Regional Comprehensive Economic Partnership (RCEP). If the different components of BRICS are to achieve their geo-economic and geo-political goals, this grouping offers them a platform where they can develop common understanding and values that would contribute to global rule-making that is transparent, non-hegemonic and supportive of sustained economic growth. And for that BRICS would have to be sensitive to aspirations of its members and work in a spirit of partnership and equality.

The author is Director, South Asian Institute for Strategic Studies (SAISA). This is an adapted excerpt of key note address delivered at the One Day national Seminar on ‘Brick-Upon-Brick, For a Stronger ‘BRICS’: Challenges and Opportunities’, hosted by the Centre for Latin  American Studies, Goa University with the International Centre, Goa, August 12, 2016

 

The Twenty First Century world politics is seeing a sea change in the power calculus through the emergence of some of the major economies of the world in the form of BRICS. It leaves us with no doubt that this new phenomenon in  International Politics has created a new constellation and has been challenging the existing notion of the super power on several fronts. It needs to be noted that the West has been constantly making an effort to put down the BRICS initiative through different propaganda and several academic writings. The Wall Street Journal came up with a series of articles warning the readers and investors across the world to be wary of  growth and also not to get carried away. Today, BRICS together account for 30 per cent of global land, 43 per cent of global population, 17.3 per cent of the world’s merchandise trade, 12 per cent of global commercial services and 45 per cent of the world’s agricultural production and yet the West does not accept the fact that others are growing along with the United States and other developed economies. A question would emerge then-why is the West wary of the rise of BRICS?

The answer to the above question is quite interesting as it is not just the economy that is making the West to behave in a particular manner, rather it has to be credited largely to the courage and effort from the BRICS nations to boost their economies and the confidence in their approach to the world order. If we  look at the present scenario of the BRICS nations, on several counts  it is challenging the present world order. Firstly, on the economic landscape; secondly, on the leadership component, and lastly, the alternate view on politics which they have discovered from within and have not  borrowed from the West unlike  in the past. Each of these issues need elaboration to make a case that these factors seems to be unsettling the West and making them to go out of their way to somehow destabilise  BRICS as an entity.

If we look at India, China, Russia and to an extent South Africa with an exception of Brazil for the time being, all of these countries are economically doing well. India under the leadership of Narendra Modi has found a new direction in its economy. Though there are detractors who would not want to give credit to his economic reforms,  statistics prove otherwise. The present economic condition of India is considered one of the best since the adoption by India  of the LPG (Liberalisation, Privatisation and Globalisation) strategy in 1991. One may argue that the economy during UPA I was also good but the conditions were different as the world financial crisis came only in 2008 and by then the UPA I was finishing its last lap of the term in office. By the end of UPA II, the economy had gone from bad to worse and the scam ridden government was unable to sustain growth in a scenario of high inflation. It is at this juncture that Narendra Modi had to step in and take the mantle of the country . The type of radical economic reforms Modi has been able to bring in whether it is GST or transparent auction of the telecom spectrum, has put the country in the right direction ensuring high growth rate. No doubt that these reforms were also part of the mandate of the previous government, unfortunately they were unable to garner enough support of the legislators and States and also to a large extent,  willingness too was  lacking. One of the senior economist of the country said ‘If the Monsoon in 2016 is as expected, then the first three years of Modi will be the best three years since 1996, and possibly the best three consecutive years for Indian economy since independence’. It is this achievement that West did not anticipate with regard to India and also did not expect radical reforms in the economic sector. India has been steadily growing at 7.6 %, though  this was expected only in the beginning of 2016. The vibrant Make in India campaign and boosting the manufacture sector is a cause of concern for the Western market  as they have had monopoly in certain sectors for centuries now.

Same is the case of China, which since 2006 has been the largest holder of foreign currency reserves, estimated in 2015 to be more than 3.8 trillion dollars. According to the International Monetary Fund (IMF), China’s gross domestic product (GDP) surpassed that of the United States in 2014, making it the world’s largest economy in purchasing-power parity terms.

Even when there is constant propaganda against Russia from the West, there are some scholars who have taken realistic view of the economy and what Putin has done to Russian economy after Boris Yeltsin. One of the scholars opines that ‘net private capital outflows in 2014 stood at $150 billion, which is equivalent to 8 percent of GDP.  This is a record high for Russia, a country well-known over the past couple of decades for its capital flight, owing to an erosion of the population’s confidence of investing at home’. Yet the world goes blind as it wants to demonise Russia and its influence in the continent in particular and world in general. Another scholar says that ‘according to data from Bloomberg, some 78 percent of Russian companies on the MICEX index showed greater revenue growth in the most recent quarter than their global peers did. And Russian companies on the whole are now more profitable than their peers on the MSCI Emerging Markets index’.

There can be an argument that the other two members, Brazil and South Africa, are in trouble and not doing so well .  Similar is also the case of the European Union and yet it is  acceptes it as a success. The RIC (Russia-India-China) of the BRICS are capable of helping Brazil and South Africa.  Also there is a hope that very soon with political stabilisation there would be recovery.

With regard to the second argument, namely  the leadership component, the RIC countries have probably  the strongest leaders of the world at this juncture. United States, probably by default being the super power might want to call its President a strong leader but the RIC countries have leaders who are capable of speaking their mind and ability to back  their words with deeds. Xi Jinping and Putin were anyway known as strong leaders whereas India has got one now in the form of Narendra Modi. Without any hesitation and probably with the lone exception of some of his detractors in India, the rest of the world has accepted him as one of the most charismatic leader, who is part of the agenda setting in the international affairs. Meeting with Barack Obama  six times over last two years of him since coming to power  proves that even Obama seems to be convinced of the leadership qualities of Modi. Xi Jinping is experimenting with his country and the people have accepted him. He is even hailed as the greatest after Mao by many. Jonathan Fenby says ‘Projecting a folksy image domestically as “Xi Dada” (Uncle Xi), he appears popular, as a leader with ambitions that match China’s economic weight, the strongest chief of the world’s most populous nation since Mao Zedong’. This is a considerable achievement in international politics to lead a country of the might of China. Putin has been made to look like a villain and also has been dubbed by the West as the next Hitler. Putin is much more strategic than Hitler;  for that matter he is the Mr. Cool and task master in the international politics. One just needs to  to remember what he has done to Syria where the Western powers seem to have  no clue about their mission. Look at someone like Erdogan and see how he has succumbed to pressure and has gone back to Putin, and not to the Western powers, to fight the ISIS and extremists.

Though  the spark of  great leadership  was seen in Dilma Rousseff and Zuma, off late these two have fallen prey to corruption charges. This is seen as the only  rough patch in managing BRICS leadership. The RIC countries are confident than ever before to take the mantle and move further. This has been done so even when the two leaders of Brazil and South Africa have been in trouble.

The last argument to put forward is that of the alternate politics and ideology being provided by the RIC leaders of the BRICS. Putin has proved his mettle as a strong leader and has proved this against all his opponents in Russia and abroad. His politics is still not understood by many in the world; he has continued to remain as one of the strongest leaders of the world. He has strengthened his United Russia as one of the strongest political parties in Russia. When everybody wrote Russia off, it was he alone who believed that he could bring stability to the political situation of his country. His tactics and manoeuvrings can be called as his politics from within. He is least bothered about the glorified concepts of the West used to abuse him. He has convinced his people to accept him as he is and  he has proved through  elections every time. Xi Jinping believes that China’s “consultative democracy” – or system of consultative conferences – as the country’s unique way of fostering public consensus and reaching out to citizens on important matters. He does not see the democracy envisaged by the West as the model. Though it may sound that China is an authoritarian country and it has to become democratic, the Chinese leader feels that the Western model need not be the only model. He is one who has been able to be popular as a leader by taking up issues of corruption and many other evils of the society without copying everything from the West. The urge to come up with their own model and ideas itself is a point of departure from the hegemony of the West in some concepts based on ideology. In case of Narendra Modi, though he endorses the present day ideals such as democracy and human rights, he feels that these have been practiced and preached by India much before the West was a civilised society. He would every time get back to ‘Vasudaiva Kutumbakam’ and ‘Ekam Sat Vipra Bahuda Vadanthi’ rather than ‘Liberty, Equality and Fraternity’ slogan. He fought against all the odds that came in his way to the most powerful office of India. The West painted him as a villain with the Godhra incident, yet he did not spew venom on them and grew beyond their expectation by embracing them and calling them good. This itself is seen as one of the biggest failures of some of the Western countries. His ‘country first’ slogan, Make in India to Clean India have gone past regular rhetoric’s used by the leaders of the world. His politics is not borrowed one but a genuine understanding of his country and the soil. This component of politics from within is highlighted to prove the point that these leaders are not in dearth of ideas and are capable of pulling their respective countries out of crisis.

The emerging world order is shaped by BRICS due to their capability to give alternate options to the present system in the world and that emerging world order would be shaping the politics of the Twenty First Century. Every step of BRICS, whether it is a bank or university or for that matter even thinking beyond the boundaries to create alternate politics from finance to literacy, would be the greatest point of departure in world politics.

Introduction

The BRICS cooperation is at the crossroad,   initially tagged with five major emerging economies, is now far beyond the original concept tailored for the financial markets. One the one hand , BRICS has rapidly become a new and promising political-diplomatic entity, explored different kinds of dialogue mechanisms covering economic, trade, finance, business, health, education, academic, combating transnational crime and security among others, enhancing the grouping’s ability to shape the global agenda. One the other hand, BRICS cooperation is facing some common economic and political challenges, with some Western analysts non-stop trying   to “bury” the alliance, saying that it will inevitably fall to pieces because of the differences existing within the organization’s framework.  The fact is that BRICS cooperation is standing at a new historic starting point to reshape their cooperative strategy. BRICS needs to continue deepening their mutual-political trust, fulfilling the current consensus and transforming itself into an influential common voice.

The Common Challenges

With the rapid changes in the   international economic situation, the world economy is slowly recovering, however geopolitical issues are still to be settled. There are also lots of global challenges that are coming up. It is in this backdrop, that BRICS cooperation is faced with new situations and new problems. Firstly, the BRICS countries’ economic growth are facing unprecedented challenges and they continue with the adjustment process; the complicated external economic environment continues exacerbating divisions in the BRICS countries’ macroeconomic policies. Secondly,  multiple dialogues leads to  better understanding among five countries but are still far away from substantial cooperation which leaves the impression amongst the public  that as far as BRICS cooperation was concerned, form prevails over  substance.. Therefore, BRICS could consider setting up a standing committee to prioritise agreements and ensure implementation. Thirdly, BRICS needs to deepen the areas of cooperation  to build the confidence of the outside world  about its future, properly handle the sensitive issues that could enhance the mutual-political confidence and help propel rapid development of the BRICs economies.

BRICS: Speak with One Voice

BRICS has become an important player in the international arena, having an influential voice in international discourse and in shaping the international agenda. This mechanism was established as a marked feature of the global multi-polarization in response to the needs of the time. It carries the burden of  expectations not only of  the people of BRICS countries, but also of those from emerging markets and developing countries.  The BRICS members are committed to coordinating in multilateral forums with focus on economic and political governance. To deal with the complex and volatile international situation, BRICS countries should enhance their abilities to speak with one voice.

BRICS countries should improve the global economic governance. The volatile global stock market and energy prices are caused by the limitations of the global governance system which should respond to  the international reality of developing countries’ collective rise and reflect the changed international political and economic landscape. Consultation and decision making based on equality between developing and developed countries would make for historic progress. BRICS should continue to guide the international community to form rational expectations over cooperation in BRICS,   help boost reform  of global economic governance and elevate the  representation and voice of emerging market countries and developing countries.

BRICS countries should advocate international cooperation in development. BRICS countries are active promoters of global development partnership. The Hangzhou Summit formulated the G20 Action Plan for the Implementation of the 2030 Agenda for Sustainable Development and proposed the G20 Initiative on Supporting Industrialization in Africa and the Least Developed Countries.  This highlighted development the most and yielding the best outcomes. BRICS countries should proceed to improve the global development partnership and urge developed countries to fulfil their promises of supporting developing countries. BRICS is playing a more and more important role in safeguarding world peace. In recent years, with efforts of all sides including BRICS countries, the Syrian crisis didn’t repeat the tragedy in Libya and has moved on to the path of political settlement. The purposes and principles of the UN Charter have been maintained and an increasing number of countries are offering their support in establishing a new model of international relations with win-win cooperation as the core. BRICS countries need to continue to promote dialogues and negotiations and solve hotspot issues through peaceful and political measures.

BRICS: Reshape Confidence to Lead the Global Economic Growth

BRICS cooperation has already gained historic achievements and should continue its leading role in promoting world economic growth and implementing the sustainable development agenda. BRICS should reshape its confidence to lead the global economic growth and make concerted efforts to push forward the reform on global governance and cope with global challenges together. In face of the complicated international situation, BRICS should stay confident and determined to handle challenges together, give firm support to each other and launch innovation cooperation in order to let the BRICS cooperation burst out stronger vitality. Also, BRICS countries should continue promoting the establishment of a fairer and more just international order and stepping up coordination and cooperation on major political and economic issues, so as to tackle all kinds of global challenges together and build a favourable environment for the development of all countries.

After a decade of development, BRICS cooperation has gradually grown in strength. The five countries have also exchanged views on international counter-terrorism cooperation, the 2030 Agenda for Sustainable Development, climate change, the Middle East situation and peacekeeping in Africa, forming an all-round and multi-layered cooperation framework that covers extensive areas and setting an example for cooperation among emerging market countries and developing countries. These year have witnessed effective cooperation in different fields including people-to-people and cultural exchanges, agriculture, railway and tourism among BRICS countries. BRICS countries should reinforce cooperation in innovation, digital economy, poverty reduction, public health and other areas. All countries should ratify the Paris Agreement as early as possible and fulfil relevant commitments on emission reduction. All parties should deepen the BRICS cooperation and support such initiatives as the BRICS credit rating agency, the New Development Bank Academy and the agricultural network.

BRICS: To Enhance the Mutual-Political Confidence

Over the past few years, BRICS has made big progress over the economic and financial cooperation. With the support from BRICS countries, the G20 Hangzhou Summit has achieved a complete success, charting the course for the global economy. However, down the road BRICS cooperation would seem to face  rising geopolitical risks which could badly influence  the mutual-political trust among the BRICS members. Lacking mutual trust, powers usually come into increasing structural conflicts which  would be reflected in: Sino-Pakistan ‘quasi-alliance’, China’s ‘March West’ and India’s ‘Act East’, also the quadrangle of China, India, Russia and United States.

It is hoped that such cooperation could be further deepened as the BRICS working together towards a cooperative strategic partnership. BRICS countries should condemn terrorist attacks together and join efforts in combating terrorism, and strengthen confidence in growth and boost coordination within the emerging-market bloc so as to jointly cope with global challenges. Last but not the least, standing at a new historic starting point in BRICS cooperation, the BRICS countries should respect mutual core interests in order to promote  friendly people-to-people exchanges . Next year China would assume the rotating presidency of the BRICS mechanism, and as the five BRICS members have strong willingness to push forward the BRICS cooperation, this mechanism would continue to achieve the fruitful results.

The writer is an Associate Researcher at Hainan Institute of World Watch

China’s aggression in the Indian Ocean reflects India’s significant presence as its interest stems from the fact that approximately 50 percent of its trade with Asia passes through that route. Thus, it is important to explore several other strategic interventions in strengthening relations with ASEAN nations. One such example can be with the Mekong region countries to signal a significant shift in the balance of power.

Mekong-Ganga Cooperation (MGC), launched in the year 2000, is a sub-regional initiative comprising India and five ASEAN countries: Cambodia, Laos, Myanmar, Thailand, and Vietnam. Rivers are more than just natural symbols, they are the core of civilisation, the Mekong mirrors the same. This initiative is an effort to signify the millennia-old cultural and commercial linkages among the member countries of the MGC. From the time it came into being, the members of MGC are working towards evolving comprehensive methods of co-operation in the field of tourism, culture, education, transport, and communication. The formulation of the MGC underlined a larger paradigm shift in India’s foreign policy, particularly with the initiation of the Look East policy under then Prime Minister Narasimha Rao.

To further the cause of the Act East policy, the MGC has to be constructively strengthened. The immediate need for the countries in the Ganga-Mekong region is to evolve a long-term strategy to deal with the rapid urbanisation. To start with, the Ganga-Mekong region is witness to the rapidly increasing population of more than 100 million over 2500 miles long river by 2025, environmental degradation (average flow reduced by 10 percent in 30 years), and considerable strain on finite resources. Therefore, there is a huge possibility that countries in these regions might face acute shortage of water, energy and other resources.

In addition to this, there is declining growth rate in rural areas in the countries of this region; Mekong region is considered the rice bowl of Asia. Close to 75 percent population of the combined Mekong region is dependent on agriculture and fisheries for protein. The annual harvest of 3.9 million tonnes (2.2 million tonnes captured) values between US$4.3 to US$7.8 billion to their economy in 2012. Therefore, it is imperative to balance growth to suit the needs of both urban and rural areas as well as remove people from abject poverty. The need of the hour is a clear cut strategy to consider urbanisation as an opportunity and not a threat.

The countries must understand the crucial function of the food-water-energy nexus in achieving sustainable development in the Mekong and Ganga regions. It is important that every policy be put into practice within the broader ambit of water governance and management, as managing water pollution and water scarcity and rejuvenation of the rivers are the key priorities for the countries in the region. Towards this, effective policies and integrated management practices are required for not just cleaning of rivers and increasing agricultural productivity with optimal resource allocation, but also to increase water use efficiency in the energy sector and reduce energy intensities in water sectors.

MGC has been hobbled by problems like absence of clear timelines vis-a-vis policies, uncertainty about sources of funding, and inadequate implementation and review mechanisms. Another fundamental problem is that, as emerging powers in the region, India and Thailand have to be the main drivers and financial supporters to the MGC. The attention of all the non-Indian members of MGC, who are also members of the older established Greater Mekong Sub-region(GMS) together with China’s Yunnan province, is more focused on the GMS. Another most important constraint in multilateral cooperation within MGC are the bureaucratic hurdles and lack of political initiative in the last one and a half decade.

It is important to understand the MGC is a valuable framework that India could use to build ties with five countries of ASEAN that are geographically and culturally closest to India. Despite the focus on MGC by all members and especially by India, there still exists a wide gap between the approved and implemented programmes, and projects are often taken up without proper follow-up. So for the success of MGC, an integrated approach is necessary. As the largest country in the region, it is in India’s interest to play the role of a leader by building a consensus while keeping the focus on the larger economic and strategic implications. For this, India needs to adopt a consultative approach that is multi-dimensional in nature across sectors and institutions. No one model of regional cooperation is perfect unless it can concentrate on things like sustainable and inclusive economic growth, poverty elimination, and infrastructure development.

India’s relations with the other MGC countries still has a lot of potential. To counter-balance China, India can use this to its strategic advantage; it is pertinent to note that MGC member countries, notably lower Mekong river, have always placed more trust in India rather than on China. (In shadow of China proposed multiple dams on upper Mekong river are on ominous threat to life on the Mekong river.) India today provides more than 900 different type of scholarships to the youth of the MGC countries on an annual basis under the bilateral and multilateral tracks. India has always supported connectivity corridors especially the concept of the East-West corridors connecting India to the Mekong region. And India’s soft power has the potential to generate larger diplomatic gains with other MGC countries.

Seamless communication between the member countries revolving around common threats, challenges, opportunities, and strengths in every sector is the need of the hour to avoid any possible conflict. Finally, for MGC to work cohesively, it is important that all members of MGC should focus on different communication strategies to disseminate information and knowledge (traditional and scientific), and maintain connectivity and solidarity among the Mekong and Ganga regions.

(Author is a Senior Research Fellow at India Foundation. The views expressed are strictly personal.)

 

Introduction

As of 2016, the five BRICS countries represent over 3 billion people, or 42% of the world population. All five members in BRICS are in the top 25 of the world by population, and four are in the top 10. China is now the ‘factory of the world’ and has risen to become the world’s second largest economy. Brazil is a major exporter of myriad natural resources. Being a leader in defence manufacturing, petroleum products and  permanent member of the United Nations Security Council (UNSC), Russia holds an enviable position in global affairs. South Africa is seen as a gateway to the African continent. As the fastest growing economy, India is now the most sought after destination for foreign investors;  its domestic market has recently joined the consumption bandwagon, paving the way for a robust  future. BRICS has become a near universal financial term. Jim O’Neill  could not have been more accurate with the prediction he made in 2001.

While all these countries have enjoyed phenomenal growth (China since the 1980s and all of them from the beginning of this millennium), there is another aspect of governance that affects BRICS: the curse of stark inequality in BRICS’ societies. Economic growth alone has failed to eliminate poverty. Crash in prices of natural resources has unleashed a crisis in Russia and Brazil. China is grappling with a slowdown for the first time in three decades and its debt problem could lead the next cycle of global economic recession. This puts at the risk the future of a billion plus people who are on the brink of poverty. However, India appears to be an outlier. This article throws light on the holistic efforts undertaken by India to ensure inclusive growth.

India’s economic liberalisation began 25 years ago owing to the extraordinary leadership skills of the then Prime Minister, P.V. Narasimha Rao. He unleashed market linked reforms and reduced the power of the state despite strong opposition within his own party. A decade down the line, Atal Behari Vajpayee as the Prime Minister undertook sector wise reforms, from telecom to infrastructure. This enabled India’s growth, spearheaded by forces of financial, technological and trade globalisation. India’s corporate sector rose up to the challenge and took on global giants, even acquiring assets in developed economies. As a result, a strong middle class emerged in the country. With the growth in revenues, governments introduced several pro-poor schemes. In 2014, Narendra Modi won the General Elections with a promise of running an administration that cares for the interests of both rich and  poor alike. ‘Sabka Saath, Sabka Vikas’ was the election slogan. The effort has been to plan and implement welfare schemes efficiently. This presents interesting lessons in inclusive growth and sustainable development for the societies and economies of BRICS countries.

J-A-M Trinity

One of the most important aspects of development is financial inclusion. A cash economy hurts the poor the most. For masses to reap the benefits of economic growth, access to formal banking is an absolute necessity. India embarked on achieving this via bank nationalisation in 1969, but the goal of a bank account for all has been achieved only now in 2016.

Financial inclusion was attempted through a targeted drive by the Union Government under the banner of ‘Pradhan Mantri Jan Dhan Yojana’. The task was to enrol 75 million households under the ambit of formal banking. The bank accounts opened under this scheme came with a zero balance facility, a life insurance cover and a debit card. This meant that people at the bottom of the economic pyramid – micro entrepreneurs and daily wage labourers – could safely deposit their money, avail government schemes and apply for a loan at a lower interest rate than charged by local money-lenders. Also, the Accidental Insurance Cover at a cost of 1 Rupee a month comes across as a major safety net for the poor. Beginning with near zero deposits in ‘Jan Dhan’ accounts, in May 2016, India had around $6 Billion in these accounts.

The second initiative towards financial inclusion was ‘AADHAR’, a Unique Identity Number and Card that contained all the details of every resident of India. Aadhar was started in 2009 under the leadership of Ex-CEO of Infosys, Nandan Nilenkani, who was keen on harnessing technology for socio-economic development. Having understood its importance, the Government, in 2016, legislated it as an Act, thereby granting it legal sanctity. The Act itself is named ‘THE AADHAAR (TARGETED DELIVERY OF FINANCIAL AND OTHER SUBSIDIES, BENEFITS AND SERVICES) ACT’. With a fool-proof identification system in place, the Government has begun to seamlessly transfer subsidies directly into the bank accounts of beneficiaries. The distribution of LPG Cylinder subsidy is now completely on this platform. Prime Minister Modi even made a clarion call to rich/middle-class people to give up that subsidy. Millions responded positively. These efforts have resulted in annual saving of more than $2 Billion for the Government .

The third pillar of growth has been ‘Mobile’. There are close to a billion active mobile connections in India. Tele-density is over 80%. Around 400 Million people are already using internet on mobile. Half of them use it on smart phones. These statistics reveal the plethora of opportunities for achieving financial inclusion and e-governance. National Payments Corporation of India has developed Unified Payments Interface which  would take the power of smart phones to its next level, making instant money transfers an every-minute possibility. Moreover, many start-ups are building financial products specifically aimed at the lower middle class and the poor. Whether it is through keeping gold as  collateral or assessing the credit worthiness of a customer using digital data, millions at the bottom of the pyramid are being provided with timely finance by private lenders swiftly and at affordable rates. The Reserve Bank of India has also granted license for Payments Bank. No surprises that PayTM, a mobile wallet platform, has usurped the market.

With majority of people in formal banking system and the power of technology, India is in a position to go ahead with Direct Cash Transfer across a host of sectors and regions. With subsidies  costing around 3% of the GDP, and historically billions being lost to corruption, J-A-M is setting the foundation for a robust future.

Agriculture

Since independence, agriculture was subjected to the most minimal reforms. While cruising on the backbone of growth in manufacturing and services, governments generally neglected agriculture. Over 50% of India’s population is dependent on a sector that  contributes just around 16% of the GDP. To overcome the problems, the Finance Minister in the  Union Budget for the year 2016-17 assured to double agriculture income by 2022. A slew of measures have been initiated.

First, Minimum Support Prices are being increased each year. This is a major incentive. Secondly, for products which government does  not procure, farmers have been given direct access to consumers by doing away with the compulsion to sells their produce via controlled  markets only. This has resulted in higher earnings for the farmers and lower prices for the consumers. Third, insurance for crops have been introduced at bare minimum prices. Fourth, irrigation facilities have been expanded. With many states in the country being drought prone, crop insurance and better irrigation are extremely important for marginal farmers. Finally, network of cold storage units have been strengthened, allowing farmers to store their produce and sell at opportune times.

These measures have been supplemented with the use of technology. Updates on weather and crop prices help farmers to make informed choices. With a normal monsoon this year, Indian farmers are already staring at a bumper harvest. Most importantly, the sowing of pulses has increased at a staggering rate. This proves that incentives and information provided by the government are working, and will further reduce inflation.

Micro and Small Medium Enterprises

There are around 58 Million Micro Enterprises in India. They along with the informal sector generate 9 out of every 10 jobs. Yet, they were denied credit by mainstream banks. Hence, the government introduced the MUDRA Bank. While ‘Banking for the Unbanked’ was achieved through ‘Jan Dhan’, MUDRA Bank was about ‘Funding the Unfunded’. A “Made in India” innovation for funding micro business, it registers, regulates and refinances all small business finance institutions. With close to $20 Billion being disbursed each year to small entrepreneurs and self employed, MUDRA Bank is unleashing inclusive growth better than anything  else .

Labour

India has the unenviable task of improving the status of present workers and generating 500 million jobs over the next decade. The government is using a multi-pronged approach to achieve the targets. Firstly, it has emphasised  the need for growth in the manufacturing sector in the GDP through ‘Make in India’. While promoting Indian entrepreneurs to grow, MNCs are also being lured to invest in India and transfer technology. Secondly, a separate Skill Development Ministry has been formed to facilitate the training of a million plus youth each year. All types of skills and trades are being encouraged. Third, workers in the informal sector are being ushered in to a safety net through voluntary pension and healthcare schemes. Fourthly, apprenticeships are being pushed in the corporate sector.

Slowly, yet steadily, draconian labour laws are being amended to enable the creation of enterprises that employ hundreds of workers in a single unit. For decades, India has been home to millions of companies that are merely dwarfs.

Infrastructure

When the new regime took over in 2014, 18000+ villages in India were yet to experience electricity. So far almost 25% of those villages have received power and by 2020 every home in the country  would get electricity. Rural roads are being laid at a fast-pace alongside the network of national highways. Railway services are being extended to the remotest part of the country. The number of trains and their speed is being systematically increased.

With close to 40% of the population now living in urban areas, housing for poor remains a concern. It is being addressed through large scale affordable real estate development subsidised by the government. Also, through the new Land Acquisition Policy, owners are compensated with at least 3 times the market price by the government. This trade-off gives the state land for infrastructure development and earns a hefty sum to those who wish to exit agriculture.

The government is ushering in a bottom-up revolution rather than simply pursuing the easier top-down approach. Prime Minister Modi has stated on record that he does  not follow any particular economic ideology and has made pragmatism the mantra  of his regime. This means that the  government is ready to accept suggestions from all sections of the intellectual spectrum and pursues policies because it benefits the masses. For inclusive growth, this ideological flexibility is an absolute necessity.

India and BRICS

When BRICS was first conceptualised as a bloc that would lead the global economic growth march, and subsequently became a multilateral platform for cooperation across sectors, it seemed natural for India to be a part of it. With each country in the group, India shared a strong bond already. India borrowed the idea of socialism from erstwhile Soviet Union. Over the years it became a major supplier of defence products. Despite being a founder of NAM, India tilted towards the Soviet Union during the Cold War. Close ties with Russia have continued. Brazil  is a gateway to Latin America.

China being a neighbour became an inseparable part of national discourse in India. Its miraculous growth led to a deluge of manufactured goods exports to India. Though miniscule in comparison, India in turn exported natural resources such as iron ore to support the massive infrastructural development in China. Cricket, Commonwealth, Migration, Trade, Sea-Route and the message of peace championed by Gandhi-Mandela have strengthened India-South Africa relations ever since independence.

With the  growth of internet and global capital flows, India’s ties with BRICS blossomed. India’s trade with China stands at $60 Billion Dollars, second only to the United States which is at about $100 Billion Dollars. Even though the ‘Make in India’ campaign seeks to change the dynamics, as of now almost every smart phone bought in India is manufactured in China. Chinese exports of products, ranging from steel to firecrackers, at ultra-cheap rates are a cause of major concern for Indian policymakers and corporates. In the case of Brazil, the growth is significant. Major Indian multinationals such as Infosys, Wipro, Mahindra, Birla Corp, Reliance Industries, etc have set up base in the country. India is now gaining confidence that it can do business in Latin America, courtesy the success in Brazil. There are similar story repeats in the case of South Africa and Russia.

The relations between India and the other countries of BRICS do not stop at trade and business. There is the governance and people angle as well. Tourism is rising at an exponential rate  between the countries. Russia, South Africa and China are today favoured destinations for Indians. The drastic fall in air fares and increased connectivity via  West Asia is enabling Indians to consider travelling to Brazil for leisure. It is reciprocated by growth in tourists visiting India as well. At the same time, inter-governmental coordination is improving. China presents a role-model for development of infrastructure, especially in urban areas. India’s Smart-City Mission is relying heavily on the Chinese success stories. So is the case  with the ease of doing business. And the learning is quick. India saw the fastest rise among BRICS nations in WEF’s latest Global Competiveness Index. ‘Bolsa Familia’ and other similar programs in Brazil were used to make a case for cash transfers in India. Sportsis another area of cooperation gaining attention.

Finally, China and Russia being permanent members of UNSC, and significant geo-political powers individually, India has used the BRICS platform to further its cause on important matters such as the Anti-Terrorism agenda and nuclear policies. India’s attempt to lead the Climate Change negotiations and International Solar Alliance too gathered momentum owing to its presence in BRICS. India also won the right to Presidency for the first six years of BRICS New Development Bank, signalling a major shift in global economic diplomacy.

Conclusion

Questions will be raised as to how India sets an example in ensuring inclusive growth when its per-capita income is significantly less than the rest of BRICS and it still grapples with a lot of challenges. The answer is in the foundation of the success of BRICS nations. Russia’s per-capita income rose 10 times in the decade beginning 2000. This was possible solely on account of oil exports. With oil prices  falling to levels below $50, it spells doomsday for the Russian economy. Despite not having nurtured globally competitive manufacturing companies, Russia boasts of a high number of billionaires. Similar story repeats itself with Brazil which grew due to boom in prices of all natural resources. Today it is experiencing political crisis and inflation is unsustainably high.

Leaders of both the countries assumed that the boom would continue forever and framed welfare policies accordingly. The macro-economic uncertainty  hits the poor people the hardest. ANC’s vote share in local elections in South Africa was the lowest since the end of Apartheid. This is a sign of growing disenchantment with the government on account of unsatisfactory economic performance.

China’s story though has been miraculous. Thirty years of consistent boom in the economy is a new benchmark in economic growth. However, it has been led by a Communist State which does  not believe in transparency. As a result, no foreign agency can certify its financial health. China has always spent its way out of misery. This is no longer possible as excess infrastructure expenditure has led to creation of ghost cities. Rising wages are prompting investors to relocate factories elsewhere. Inflation and unemployment can lead to social unrest. When China’s authentic debt data is published, it could spiral into another global crisis. China cannot take its growth for granted anymore.

This is where India is different. Macroeconomic stability is of utmost importance to the Government. There is every effort being made to efficiently deliver welfare schemes. Even though social sector spending is humongous, the fiscal deficit is under  control. Government and central bank have together successfully tamed inflation. Private as well the public sectors are strong. Regulations of the financial markets are based on global standards, thus ensuring credibility. Domestic market demand makes up for the dip in export, if any. All sectors of the economy are being promoted, be it agriculture or services.

These measures mean India’s economic growth can be sustained at a high level for decades and that growth would be inclusive. With per-capita income just around $2000, the potential for the future is tremendous. India is celebrating 25 years of reforms and is preparing ground for further liberalisation. It is not basking in the limelight of past successes alone.

Untiring efforts are being put to improve our performance on ease of doing business, competitiveness, innovation, reducing corruption, etc. If BRICS has to be sustained for long, the countries would have to recognise the strengths of their society and economy; rather than being forever dependent purely on foreign factors for growth. This is a new India’s story.

*The author is Officer on Special Duty (Investment Promotion Board) to the Chief Minister of Goa.

This is an adapted excerpt of a talk delivered at the One Day national Seminar on ‘Brick-Upon-Brick, For a Stronger ‘BRICS’: Challenges and Opportunities’, hosted by the Centre for Latin  American Studies, Goa University with the International Centre, Goa, August 12, 2016

In the last two decades, China has focused strategically on water politics vis-à-vis its economy. With its rapid population growth and consumption, China has become the world’s largest bottled water consumer and a major producer. With a per capita consumption 19% lower than the global average, the market is expected to continue to grow.

Its other water needs are also significant, of course, both to keep pace with industrialization and for strategic reasons. In this context, China had built one of biggest gravity dams on the upper stream of the Brahmaputra River (Yarlung Zangbo) in Tibet, the US$15 billion Zam (or Zangmu) Hydropower Station. The dam, considered to be the world’s highest-altitude hydropower station and the largest of its kind, is set to generate2.5 billion kilowatt-hours of electricity per year.

Located in the Gyaca County, the Yarlung Zangbo River flows 1625km in Tibet, before entering Arunachal Pradesh, where it is known as the Sinag. Further down, the Sinag, after its confluence with the Dibang and Lohit, is known as the Brahmaputra, which continues to flow into Bangladesh.

China was mum about the details of the project in the initial stages. In the year 2010, Chinese Foreign Minister Yang Jiechi officially revealed that China is building a dam on the river, but extended the assurance that it would not have any impact on the river’s downstream flow into Northeast India. But there is no water sharing agreement between India and China currently and nor is one on the horizon.

China is the region’s “upstream superpower”—more than two-thirds of the 40 major transboundary rivers that flow through China and 16 other countries originate in China. To balance between upstream and downstream interests, the UN General Assembly on 21 May, 1997 adopted the UN Convention on the Law of the Non-Navigational Uses of International Watercourses (with China voting against it). The convention commits state parties to the utilization of transbounday rivers in “an equitable and reasonable manner” and require them to take “all appropriate measures to prevent the causing of significant harm” to co-riparians, presently constituting large parts of Tibet, Northeastern India, Bangladesh and Mekong region countries.

China’s aggression in the Upper Mekong is also creating animosity among countries in the region. Amid the escalation of threat to peace and stability in the Mekong region, China has been willing to cooperate with Southeast Asian countries and has signed bilateral agreements with a number of co-riparians. It has not been as forthcoming with India on the Brahmaputra. This is likely an outcome of historical animosity, pre-existing territorial disputes and the fact that it now views India as a rival for regional superpower status. Potential conflicts between India and China are likely to centre on a “war over natural resources,” with the Asian giant eyeing dominance of the “Third Pole.”

Already, China’s upstream claim over the Brahmaputra has emerged as a threat to the environment, putting into jeopardy the livelihood of millions downstream. The non-existence of a water-sharing agreement with China strategically also challenges India’s claim on parts of Arunachal. In recent years, the idea of hydropower as clean energy, though highly debatable, has dramatically changed the politics of dam-building in region. The hydropower dams proposed by China include the world’s last free-flowing rivers in southwest China—including sources of major water resources in Asia. These projects threaten the fragile ecosystem, wetlands and protected forests.

China’s upstream hydropower dams will adversely affect the livelihoods of people who are depending on water commons for small-scale fishing and subsistence agriculture. The implications of the dams on the water ecosystem Environmental degradation through its blocking of sediment-borne nutrients will surely have a negative impact on traditional Himalayan agriculture. Also, the ecosystem in the waters is also disturbed, dramatically affecting the life-cycle of high altitude fish species. It is notable that in the most of these regions, fish is a major source of caloric intake, which means that rural food security in Northeast India, Bangladesh and Southeast Asia may be compromised.

Tempa Gyaltsen, a researcher at Tibet Policy Institute, Central Tibetan Administration said, “Zangmu Hydropower Dam on Brahmaputra river at a strategically important location, Lianghekou Damn on Yalong river and the under construction Suwalong dam on Salween and Mekong rivers are already affecting life and economy of millions of people in the downstream countries.” Noting that India’s water demand per capita is likely increase to 1.5 trillion cubic meters from 740 billion cubic meters currently, he emphasized that a water treaty is essential. “China would not hesitate [in using water as a weapon] that against India. That’s another major reason for the downstream countries of the 10 Tibetan rivers to come together and force China into a water treaty.”

Prof Milap Chandra Sharma, a glaciologist at JNU, has also pointed out: “Besides having environmental issues those dams in Tibet can be disastrous for us. They can unleash their fury during earthquake, accidents or by intentional destruction can easily be used against India during war.” Interestingly, the Sichuan earthquake of 2008, which killed more than 80,000 people, has been linked by some experts to the Zipingpu dam, which may have triggered it.

Climate change is showing its impact we now need to aim for sustainability rather than unchecked growth. Preserving rivers and ecosystems that support low carbon-intensive livelihoods of rural populations need to part of our mitigation efforts.

India is leading in clean energy by signing the International Solar Alliance at CoP21 climate Conference at Paris. Two years ago, the result of general elections 2014 in India revived hope in industrialists and global business market. Once again the share market shows the increase in stock exchange and able to attract the Wall Street attention. Then Bharatiya Janata Party Prime Ministerial candidate Shri Narendra Modi pitched for inclusive development with concern over the environment. While at the inauguration of a solar power project in Neemuch in Madhya Pradesh, he said, “With the country having so much natural resources, India hasn’t progressed much in the 21st century”. India’s development was compromised by mismanagement of the country’s natural resources as a result of Energy Security. Working on his strategy for the energy sector, Modi government is working on clean energy focusing on harnessing coal, gas, hydropower, solar energy, biomass, nuclear, and wind power to bring about an “energy revolution” in the country.

India’s national action plan on climate change recommends that the country generates 10 percent of its power produced from alternative sources of energy like solar, wind, hydropower, and other renewable sources by 2015, and 15 percent by 2020 through energy project studies. India has an installed power generation capacity of 2,27,356.73 megawatt (MW), of which 12.4 percent, or 28,184.35MW, is renewable energy. There is a big gap between service and production, drawing comparisons between different regions of the country and the energy shortage. Modi said that while there was darkness on one side, 20,000MW of capacity was lying idle on the other.

Previous governments failed to fulfil the demand for power generation that is the non-availability of sufficient coal and gas in the country as a reason behind power capacity lying idle. Gas-fuelled power projects with an aggregate capacity of 8,000MW that are close to commissioning and another 1,500MW that have been already commissioned have been stranded in the absence of gas. Lack of governance and mismanagement become the main reason for the government’s inability to utilise existing resources. In addition, another 18,000MW capacity is operating at a plant load factor (PLF) of 20 percent. PLF is a measure of average capacity utilisation. The power projects require 102.61 million standard cubic meters per day (mscmd) of gas. “If we want to industrialise, electricity is the first necessity,” said Modi.

India needs a vision for the grid base power production, need to identify the location to optimise the power production with location specification. With the eastern part of the country rich in water resources, it is a heaven for hydropower generation; also our coasts are fit for wind energy. Similarly, the plains of Gujarat and Rajasthan are fit for solar energy generation, which have sufficient heat influx. If the policy planners had thought about these factors and formed a policy, then India wouldn’t be so dependent on energy imports. As per recent studies, India’s energy demand is expected to more than double by 2035, from less than 700 million tonnes of oil equivalent (mtoe) today, to around 1,500 mtoe. According to the oil ministry’s estimate, India, which is highly dependent on imports to meet its energy demand, has an energy import bill of $150 billion. This is expected to reach $300 billion by 2030, requiring a $3.6 trillion payout by 2030.

India’s current account deficit (CAD) has increased because of coal imports. The then Finance Minister P. Chidambaram had earlier said India plans to restrict its CAD to $50 billion in the year ending 31 March. For the last fiscal, CAD was at $88 billion, with total imports worth $491 billion and oil imports ballooning to $164 billion. But the major issue was proper management and a new policy framework to manage resources to harness it. If India needs to become self-sufficient we will have to become energy independent. Electricity is an important factor. India is the world’s fourth-largest energy consuming nation and imports 80 percent of its crude oil and 18 percent of its natural gas requirements. The country trails the US, China, and Russia, accounting for 4.4 percent of global energy consumption.

Emerging Energy Landscape Politics

The world has witnessed many wars over natural resources. Geopolitics over resources was always centric to foreign policy of any country. Famous Gulf War is one of such example where war waged by coalition forces from 34 nations led by the United States against Iraq in response to Iraq’s invasion and annexation of Kuwait. The recent Russian incursion into Ukraine is another example of the changing landscape of energy security across the world.

Recently, China and Russia signed a natural gas deal under which the Russian oil giant Gazprom will supply China’s largest oil company—China National Petroleum Corp.—38 billion cubic metres of gas every year for the next 30 years, beginning 2018. The deal is worth $400 billion and is the largest contract of its kind in Russia’s history. The importance of the deal transcends its monetary terms and the volume of the commodity sought to be exchanged under it. It not only points towards the tectonic shifts taking place in the global energy landscape but also brings into sharp focus India’s continuing ineptitude at securing its energy future. It is instructive to note how the deal came about to understand where India falls short. The deal was stuck in the past decade, largely on the issue of pricing. Russia was used to getting paid better, by its steady European customers, than what China was willing to shell out.

When it comes to securing such international deals, it is never as simple as paying for the gas. Indeed, it is the whole bouquet of services that a customer can provide. As a result, China has been able to develop a well-diversified energy sourcing portfolio. Compare that to India’s embarrassing past at sewing up deals and our growing dependence on imports. Myanmar is perhaps the most outstanding example. For years, India helped Myanmar to explore its gas reserves. This was the costly bit. Obviously, the idea was to get the gas, through a pipeline, to India. From the very beginning, it was a matter of energy security, not financial gain. As things turned out, India’s foreign policy was not in sync with its energy interests. India dropped the ball and as a result, China, the late entrant, now has cornered the gas through a pipeline, which became operational in 2013.

To add insult to injury, Indian Navratna company—Oil and Natural Gas Corp. (ONGC)—is actually involved in building the pipeline to China. Another, more recent example of such slippages is Kazakhstan, where India lost out energy contracts despite bidding higher than China. The story is the same when one looks at the India-China race for resources in Africa as well. So what should India do? There are two ways to look at the Russia-China deal. One way would be to say that in any case, this gas could not have come to India through a pipeline. Our western border is too troubled and unstable and the Himalayan range makes it impossible in the north and east. While this is true, it would be missing the larger lesson. The right way to look at it is to realise that India urgently needs an energy security doctrine. India is the fourth largest energy consumer in the world and its import dependence is expected to grow to 50 percent of its total demand by 2030. India’s foreign policy must aggressively push to secure long-term and stable supply of energy.

Thankfully, the global geopolitics rearrangement also gives India some hope. With the US and Europe growing more capable of supplying their own fuel, India can turn to the Middle East and African countries, as they look for newer customers. However, we should reframe our energy security policy in accordance with the changing geopolitical energy landscape.

India is trying to emerge as self-sufficient in the Power sector to boost its economy. Economists across the world are looking at India as a big market, but only available resources and power production can’t bring India’s economy on track. We have to also look towards securing our future demand to meet with economic development, but the same time environmental concerns and sustaining our environment for future generation also a big concern.

There is debate over environment versus development, and Prime Minister Narendra Modi asserts his promise for Bharatiya Chintan of Samagra Vikas and said, “If we don’t protect the environment then development will be in danger. Environment-friendly development desires a non-renewable form of energy generation.” India urgently needs an energy security doctrine. Its foreign policy must aggressively push to secure long-term and stable supply of energy.

Reports in the recent past examine the transformation underway in the global energy system, and highlight that substantial new approaches are needed to decarbonise the global economy as the electricity sector accounts for more than 40 percent of man-made (combustion related) CO2 emissions today. The renewable energy technology is sufficiently mature, and the economics favourable to offer a viable climate change solution. Can this new energy system be a win-win situation?

This article first appeared in the editorial of The Millennium Post.

The writer is Senior Research Fellow at India Foundation, an independent think tank. Views are strictly personal.

A week after India announced the success of its “surgical strikes” against terrorist launch pads across the Line of Control in Jammu and Kashmir, contrarian voices are beginning to be heard. Some of these have taken inspiration from the Pakistan government, which maintains that the “surgical strikes” were, in effect, routine cross-border firing and that, at most, there were only three or so casualties. The attempt to seriously downplay the claims of the Indian army is understandable. Pakistan cannot readily admit, officially at least, that it hosts facilities for armed jihadis to cross the LoC and attack India. Neither, for that matter, can its army afford to lose face by admitting that the enemy crossed the LoC and delivered a few carefully directed blows. No wonder Islamabad’s complaint to the United Nations lacked any real sincerity and was more for the record.

Pakistan’s predicament is understandable, not least because it doesn’t want the issue of cross-border terrorism to attract too much international scrutiny. Less understandable is some of the tut-tutting inside India. The Congress, for example, has spoken in two voices. On the one hand, it was quick to rally behind the government after the initial announcement, while making it clear that the cross-LoC raids weren’t unprecedented. However, once it was evident that the “surgical strikes” were also accruing political dividends for the prime minister, Narendra Modi, and the Bharatiya Janata Party, it fell back on a demand to seek “substantive proof” that the raids were indeed as audacious as the official machinery claimed.

The Congress hasn’t made the same mistake it did in 1999 when its spokesmen – Kapil Sibal, in particular – made unending carping noises at the Atal Bihari Vajpayee government during the Kargil conflict. However, it clearly wasn’t happy endorsing the Modi government, particularly since there was an implication that the response of the two United Progressive Alliance governments to Pakistan-sponsored acts of terror – including the carnage in Mumbai in 2008 – lacked sufficient teeth. Consequently, the Congress has willy-nilly attached itself to that section of the media and political class which is both sceptical of the veracity of the “surgical strikes” and critical of its so-called politicization for partisan ends. This position has nothing to do with a predetermined policy towards Pakistan and anti-terrorism. In the interregnum between the attack on the army camp at Uri and the retaliation across the LoC, the government was constantly taunted by its critics for not managing a sufficiently muscular response. Modi’s speech to the BJP gathering in Kozhikode, for example, was widely debunked as empty grandstanding. Indeed, The Telegraph, in a misjudged bout of even-handedness, attached greater importance to an interview with the Pakistan high commissioner to India than to Modi’s speech to his party. Yet, when machismo was in evidence with the raids across the LoC, there was criticism of Modi for war-mongering and even nudging India towards a nuclear war with Pakistan. Today, even the reality of the “surgical strikes” is being questioned as India gradually reverts to competitive politics-as-usual.

Inconsistency is a charge that can quite legitimately be made against governments in the conduct of international relations, and more so if it involves a measure of armed conflict. Israel, for example, has acquired a formidable global reputation for its low threshold of tolerance to terror attacks. Yet, its tactical approach has been marked by considerable flexibility, even in the matter of negotiating with terror groups for the exchange of prisoners. And while it is never averse to cross-border retaliation, the timing of these exercises is governed by circumstances. Indeed, steely determination (that includes unrelenting vigilance) coupled with patience has been the hallmark of Israel’s fight against asymmetric warfare and terrorism.

As a people, Hindus have rarely displayed exemplary resolve, and this casualness has often intruded into national security. The strategic doctrine of Pakistan has, since its formation in 1947, been crafted with a blend of tactical opportunism and unwavering hostility towards India. The hostility is based on a wariness of Hindus and a fear that India will stop at nothing to hobble Pakistan. The memories of the 1971 humiliation and the loss of East Pakistan still rankle the establishment in Pakistan, both civilian and military, and have added to its determination to carry the fight into India, with Kashmir as a permanent point of friction. India’s response has, alas, never been as consistent.

While it is true that Indira Gandhi capitalized on the Pakistan military’s colossal mishandling of East Pakistan’s struggle for regional autonomy to pave the way for the creation of Bangladesh, it was the army crackdown on the Awami League in March 1971 that created the grand opening. Yet, even after the victory, India fell back on magnanimity during the Simla talks of 1972. Having been persuaded by her own advisers not to recreate another Treaty of Versailles, Indira Gandhi gave Zulfiqar Ali Bhutto a face-saver on Kashmir. While the Simla Agreement has certainly prevented the dispute from being internationalized, it has not stopped Pakistan from believing that this unfinished task of Partition is pending. India’s commitment to a stable, united and democratic Pakistan is unquestionably noble, but that hand of friendship has never been truly reciprocated. From encouraging the Khalistan movement to organizing periodic jihads in the Kashmir Valley, not to mention nurturing Islamist terrorism in the rest of India, Pakistan has taken advantage of its proximity to the West to keep the heat on India. The odd bouts of bonhomie that Benazir Bhutto and Nawaz Sharif also partnered have invariably been woefully short-lived. A policy of reasonableness (if not friendship) towards India, it would seem, lacks social and political sanction in Pakistan.

On his part, Modi began his innings with a belief that he could do business with Nawaz Sharif. That optimism suffered a reality check with Pathankot, Uri and the Kashmir troubles. Consequently, he has recalibrated India’s response to a difficult neighbour. Diplomatically, he has enlarged a bilateral dispute into one that also embraces the misgivings Bangladesh and Afghanistan have regarding Pakistan. The cancellation of the South Asian Association for Regional Cooperation summit in Islamabad marks a foreign policy departure. India has also signalled its intention to keep all options open on the longevity of the Indus Waters Treaty. Second, Modi has opened up a new front by announcing India’s solidarity with the movement for an independent Balochistan. India has let it be known that it will exploit all the fault lines in Pakistan to its benefit, just as Islamabad has been doing for many decades inside India. Finally, Modi has for all practical purposes junked the doctrine of strategic restraint that, unfortunately, Pakistan misread as evidence of India’s own shortcomings.

Pakistan and, for that matter, a section of India’s political class have often believed that anti-Pakistan moves must necessarily be tempered for fear that they could create complications within the large Muslim minority. I believe this wariness was unfounded because many of the emotional links of India’s Muslims with Pakistan were blunted after 1971. If there is a pro-Pakistan lobby, it exists only among the separatists in the Kashmir Valley. In any case, not being electorally dependant on any substantial Muslim support, Modi enjoys much greater elbow room than his Congress predecessors. Perhaps Pakistan knows this too and may recalibrate its India policy accordingly.

After the “surgical strikes”, India and Pakistan are on the cusp of a new phase in their undeclared war. How this will shape out depends quite significantly on how Islamabad digests the new Indian approach.

This article first appeared in TheTelegraph.

Swapan Dasgupta is the Director of India Foundation. Views expressed are his own.

… and a different government in India — that’s what Pakistan didn’t realise until yesterday

In the last two years, the Indian army has repeatedly foiled attempts by Pakistan-sponsored terrorist groups to infiltrate into India. Ninety-seven terrorists were gunned down in 2015, of whom 59 were Pakistanis. The number has crossed 110 in the last eight months. Again 84 of them were of Pakistani origin. At least 17 attempts by the infiltrators were foiled by the army in the last eight months.

As is said, the terrorist has to be lucky just once, whereas the security forces have to be lucky every time. Despite best efforts by our security forces, the country couldn’t escape a couple of incidents of terror, at Pathankot and Uri. The important point to bear in mind is that at a time when terror has struck many European and American cities, India has largely remained terror-free in the last couple of years. It is a well known fact that Prime Minister Narendra Modi has made sincere and genuine efforts to convince the neighbour of the futility of supporting, sponsoring and launching terror. He has met Pakistan’s Prime Minister Nawaz Sharif a couple of times in the last two years. He made an impromptu visit to Lahore on his way back from Kabul. The two prime ministers met in Russia and decided to have a three-tier dialogue process set in motion between the two countries.

But then came the infamous Pathankot attack, where the Pakistani terrorists had succeeded in penetrating into the Indian Air Force base and held on for close to 72 hours, until they were neutralised. Pathankot was the first major terror challenge thrown at PM Modi by Pakistan. The Indian government had tried one last time to deal with it in the conventional manner. It went so far as to even allow Pakistani investigators access to parts of the attack site.

Despite the Indian government’s overtures, Pakistan remained a nation committed to terror, lies and denial. Sadly, it allowed an olive branch extended by PM Modi to lapse. It didn’t realise that it was dealing with a different leader and a different government. Pathankot and the aftermath was the proverbial last nail. Any further misadventure from Pakistan was to receive a tough response from India. Uri was more than a misadventure by Pakistan. Killing 18 soldiers inside a military camp situated a couple of kilometres inside the LoC is nothing short of a war crime. If terrorism becomes the state policy of a rogue nation, victim countries are left with very few options. Uri too has left India with very limited options.

More than the military might, it was the political will that was challenged. When I used the phrase, “For one tooth the entire jaw”, at one level, I was giving vent to the strong popular anger and resentment, but at another level it meant that the government should now go all out to end this menace. The prime minister had on Day One made it clear that this time the perpetrators shall “not go unpunished”. In a way, barring the usual gang of peaceniks and mombattiwalas, largely the country and the government were on the same page with regard to responding to this misadventure by Pakistan.

Normally, it couldn’t have come at a more difficult time — the United Nations was in session. But the Indian government saw an opportunity in this difficulty. A multi-pronged action plan was quickly put in place wherein a diplomatic offensive was launched together with a publicity overdrive.

India’s aggressive response to Prime Minister Nawaz Sharif’s lies at the UN was a clear indicator of the things to come. It didn’t mince words, called Pakistan the host of “the Ivy League of terror”, described it as the “global epicentre of terrorism” and finally the young IFS lady officer, exercising the right of reply, thundered, “What we see in Pakistan, Mr President, is a terrorist state.’.

Naming and shaming Pakistan globally, isolating it on the diplomatic front and acting against terror targets were all a part of the multi-pronged strategy devised by the government. Leaving behind the policy paralysis of yesteryears and the so-called “strategic restraint”, the prime minister has taken the battle right deep inside the Pakistan territory by talking to the people of that country directly.

In his Kozhikode address, the prime minister had spoken about the need for both the countries to fight against hunger, illiteracy and backwardness; but he had not precluded action against Pakistan. In fact he told the Indian army that 1.25 billion Indians were behind it and repeated his earlier statement that he wouldn’t let the perpetrators of the Uri attack escape punishment. Some peaceniks wanted to read a different message in it. Some of those who were sworn adversaries of PM Modi, started penning blogs too, praising Modi’s “restraint”. But before their ink could dry, the operations against the terrorists waiting at the launch pads across the LoC in PoK were successfully completed by the Indian Army in a midnight operation.

Uri has changed India-Pakistan relations significantly. They will no longer be the same for at least some time to come. War nobody wants; but the alternative to war is peace; not humiliation and terror attacks. The rants of some Pakistan ministers about the nuclear first-use show the rogue nature of that country, which is the worst proliferator in recent years. Nuclear war nobody wants but the world can’t be a mute witness to the nuclear blackmail of rogue nations.

Terrorism is a global cancer. It needs surgical intervention. India has done its part. It will continue to defend its borders and citizens from this menace in the same manner. But it is also time the world community exerts pressure on Pakistan; pressure not just to ask Pakistan to “behave”, but as External Affairs Minister Sushma Swaraj exhorted at the UN, if it doesn’t behave, throw it out of all international fora. That has already happened at the SAARC.
For Pakistan, terrorism has come as a cheaper option all these years. Time to make it costly for it.

This article first appeared in The Indian Express.

The writer is Director, India Foundation and National General Secretary, BJP. Views expressed are personal

For long, Talibanisation was considered the biggest threat to the Pakistani state. This perception overlooked the fact that Taliban only threatened the government, whereas ethnic movements targeted the state and eroded Pakistani nationalism. Pakistan, from its inception, has failed to build a national identity. Consequently, all ethnicities, other than Punjabis, perceive themselves as Pakhtoons, Baloch, Sindhis or Mohajirs first, and Pakistanis later. They also feel discriminated by the Punjabi elite.

Baloch nationalism is the strongest today amongst Pakistan’s ethnic nationalisms. However, the Baloch are just five per cent of Pakistan’s population. Consequently, they have been keen to create a broad front of ethnic minorities against the Punjabi elite. The alienation in Pakistan’s second most populous province, Sindh, has provided them with an opportunity to create a united front with the Sindhi nationalists. This front has been functioning quite effectively overseas: Baloch and Sindhi activists have been protesting jointly at the UN bodies and in western countries. Of late, there has been growing convergence between them, even within Pakistan.

The tumult in urban Sindh and the movement of the Mohajirs has been making the headlines for some time. What is often overlooked is the deeper resentment in rural Sindh. At the time of Partition, Sindh had enormous untapped agricultural potential. This led to its colonisation by farmers from outside the province — immigrants from Punjab or retired army officers. After Partition, Sindh was forced to accommodate another set of immigrants — the Mohajirs, who came from the rest of India. Unlike Sindhi Muslims, who were mainly illiterate peasants at the time of Partition, the Mohajirs were amongst the most educated and elite Muslims of India. They cornered most of the government jobs and private businesses in Sindh.

Sindhis perceive themselves as being marginalised in their traditional homeland. The more than 81 per cent increase in Sindh’s population between 1998 and 2011 shows large-scale migration to the province. Karachi, Hyderabad and Sukkur, Sindh’s three major cities, are totally dominated by Mohajirs while the fertile land of northern Sindh is under the control of Punjabis. Sindhis are scattered in the barren countryside. They constitute only 45 per cent of the province’s population. Their percentage in Karachi is even lesser. They have been marginalised in various organs of the state. Only two per cent of Pakistan’s armed forces and five per cent of federal civil servants are Sindhis. Of the around 2,000 industrial units in Sindh, only a quarter are controlled by the Sindhis.

Sindhis have a strong socio-cultural identity, rich literature and a distinct script. However, Urdu-speaking migrants to Pakistan, who controlled Pakistan in the initial decades after Partition, tried to impose Urdu in Sindh. Sindhis see this as an attempt to marginalise their culture.

The first major insurrection in Sindh erupted in 1983 against General Zia-ul-Haq, who had executed a popular Sindhi leader — Zulfiqar Ali Bhutto. Numerous Sindhi nationalists defied army in the interiors of Sindh to fight for “Sindhudesh”. However, without external support, the movement lost steam. Subsequently, with the rise of PPP, with its base in Sindh, as the dominant political party, local perceptions changed . However, reduction in Sindh’s share of Indus water and reduction of the land under irrigation in Sindh and the proposed Kalabagh Dam, which could further reduce availability of water to Sindh, continue to agitate Sindhi minds. With the PPP reduced to a provincial party, Sindhi nationalism has raised its head again.

In early 2005, the Sindh Liberation Army (SLA) — allied with the Baloch Liberation Army — claimed responsibility for blasts on railway tracks and other sensitive installations in Sindh. Low-level blasts continued till 2007; SLA claimed credit for most of them. However, with the return of democracy in 2008 and the PPP’s rise to power, there was a sense of euphoria in Sindh. The turbulence started resurfacing in early 2010, when numerous bombs exploded on railway tracks. The floods in Sindh and the belief that the province was flooded to avoid damage to fields in Punjab, gave a fillip to resentment in the province.

Sindhi nationalist outfits have also been expressing dissent through legitimate political means. On Pakistan Day on March 23, 2012, the Jeay Sindh Qaumi Mahaz (JSQM) led a 1,00,000-strong “march against slavery” in Karachi and called for an end to the subjugation of Sindhis by “a Punjab-dominated, Punjab-ruled, and Punjab-manipulated state”. Bashir Ahmed Qureshi, JSQM’s chairman called for the independence of Sindh and Sindhi resources from the whims of Punjabi aspirations. However, Qureshi died under suspicious circumstances within a fortnight of this proclamation. The belief that intelligence agencies had a role in his death, and in the disappearance of large numbers of Sindhi activists, have hardened positions even more.

Recent events show that the resentment in Sindh both amongst Mohajirs in urban centres and Sindhis in the countryside is rising. However, the lack of unity amongst Sindhi nationalists and absence of an effective organisation has prevented them from being able to force Islamabad to accommodate their viewpoints.

This article first appeared in The Indian Express.

The writer is director, India Foundation and adjunct professor at New Delhi Institute of Management. Views expressed are his own