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EDITORIALS

The Saradha fraud
Frequent regulatory failure is worrying
Once again, ill-informed investors driven by greed have lost money — this time in West Bengal. The Kolkata-based Saradha group, floated in 2008 by a Naxalite-turned- tycoon, raised Rs 2,000 crore from 2.5 lakh investors, promising lucrative returns.

Flash crash
Another Twitter effect
You can say a lot in 140 characters that Twitter messages normally run to. Actually, you can cause much damage in less, say 61, characters when you say “Two Explosions in the White House and Barack Obama is injured.” 


EARLIER STORIES

Faster growth possible
April 25, 2013
Anguish over rape
April 24, 2013
Masters, not servants
April 23, 2013
Package for Bihar
April 22, 2013
Burning twigs can’t secure energy needs of 1.2b
April 21, 2013
The Musharraf factor
April 20, 2013
Terror in Bangalore
April 19, 2013
Politics over Bhullar 
April 18, 2013
Terror in Boston
April 17, 2013
Nitish’s ultimatum
April 16, 2013


Army shows the way
Counselling needed for cadaver donation
More than 1lakh Indians suffer from end-stage kidney failure every year, but barely 3,000 receive a donour kidney. The figure for cadaver organs donation is abysmally small in India. This is so despite the fact that in 1994 the Transplantation of Human Organs Act was made to provide for the regulation of removal, storage and transplantation of human organs for therapeutic purposes and for the prevention of commercial dealings in human organs.

ARTICLE

Road’s end for Pervez Musharraf
Worse than other Pak military despots
by Inder Malhotra
W
HICHEVER way the Hitchcockian drama in Islamabad plays out there is at least one certainty in the grand confusion: that Pervez Musharraf, arguably the most delusional of the four military dictators that have ruled Pakistan for nearly half its existence, has reached the end of the road.

MIDDLE

Soft skills
by S Raghunath
Inaugurating an international exhibition of modern office equipment at Pragati Maidan in New Delhi, the Prime Minister, Dr Manmohan Singh, urged Central government employees to visit the show in large numbers and see for themselves how computers, automation and information technology (IT) had revolutionised office management.

Oped World

Understanding the standoff in Ladakh
China’s approach to its core territorial interests has become uncompromising in recent years and is manifesting across the board from a climate of discord in the South China Sea, the dispute with Japan over the East China Sea islands, to the Himalayan dispute with India.
Zorawar Daulet Singh
In the cacophony of media coverage a nuanced portrayal of the Ladakh standoff has fallen by the wayside. Since context is so important, it is worth exploring both the macro and micro causes for such incidents.

China strategy: Mackinder vs Mahan
India’s geostrategy is being contested by Mackinder and Mahanian images and some of India’s strategic ambivalence can be traced to the lack of a well-defined geopolitical image to ground a debate on grand strategy. A Mahanian solution to the China challenge is that India can overcome some of its continental disadvantages vis-à-vis China by posing a nuisance to China’s sea lines of communication (SLOCs) or even involving itself in East Asian disputes.





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The Saradha fraud
Frequent regulatory failure is worrying

Once again, ill-informed investors driven by greed have lost money — this time in West Bengal. The Kolkata-based Saradha group, floated in 2008 by a Naxalite-turned- tycoon, raised Rs 2,000 crore from 2.5 lakh investors, promising lucrative returns. Chit funds are supposed to be monitored by state governments and are allowed for a short period of eight to 10 months and limited to a small number of people. However, when entities registered as companies run what is called the Ponzi or "collective investment scheme" on a large scale, it becomes difficult to regulate them.

The Securities and Exchange Board of India (SEBI) started an inquiry into the Saradha affairs in 2010 but the group tried to scuttle it by submitting as many as 230 boxes of documents following an example set by the controversial Sahara group. The state government and the Centre have ordered their separate inquiries. In a letter to the CBI the Saradha group chief, Sudipta Sen, has added a new dimension to the case by claiming that politicians from West Bengal, Assam, Orissa and Jharkhand have taken money from him, used and "back-stabbed" him. Among those named are two MPs belonging to the Trinamool Congress. Given the powerful interests involved, the outcome of the inquiries should not get influenced.

Chief Minister Mamata Banerjee, meanwhile, has resorted to damage control. She has promised a Rs 500 crore fund to meet the loss of depositors. She has raised the tax on cigarettes by 10 per cent to collect Rs 150 crore and does not yet know from where the balance will come. It is uncommon for a government to compensate victims of a private fraud. The depositors are mostly poor and middle-class people, constituting the vote bank of the Trinamool Congress. Some have committed or attempted suicide. Their continuing protests could harm Mamata's political prospects in the coming general election. Using the taxpayers' money, she has tried to buy political peace. With corporate frauds becoming common and influential perpetrators enjoying political patronage, the need for a stricter regulation of the financial sector has become imperative.

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Flash crash
Another Twitter effect

You can say a lot in 140 characters that Twitter messages normally run to. Actually, you can cause much damage in less, say 61, characters when you say “Two Explosions in the White House and Barack Obama is injured.” The Twitter message, purportedly from the account of a news agency, caused panic on the Wall Street as investors moved like lightning to dump stocks, causing a flash crash that made the Dow Jones industrial average plunge by more than 140 points. The information was wrong, the account had been hacked, a correction followed shortly and the market recovered but it would be wrong to assume that all is well.

Twitter needs to enhance its security and provide safeguards that ensure that such incidents do not happen in future. Various accounts have been hacked, including those of news agencies, in the recent past, and this points to a weakness in its security setup. In this particular case, phishing is said to have been used to get the password. However, better security measures could have prevented the account from being maliciously used. Indeed, as social media sites become a major source of online interaction commonly used by millions of individuals and organisations, such websites need to be extra vigilant in providing security to their users and in preventing accounts from being hijacked.

The media in the digital age has to cope with a huge volume of information that moves at a tremendous speed. Social media has a phenomenal capacity to spread information, but the credibility of such information depends on its sources. When misinformation is given from an account that purports to be a trusted source of news, it is taken seriously and this makes such websites a target for those with malicious intentions. The latest incident should again underline the need to ensure cyber security and reinforce the fundamental imperative of cross-checking every bit of information before acting on it.

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Army shows the way
Counselling needed for cadaver donation

More than 1lakh Indians suffer from end-stage kidney failure every year, but barely 3,000 receive a donour kidney. The figure for cadaver organs donation is abysmally small in India. This is so despite the fact that in 1994 the Transplantation of Human Organs Act was made to provide for the regulation of removal, storage and transplantation of human organs for therapeutic purposes and for the prevention of commercial dealings in human organs. The Act accepted 'brain death' as a definition of death, thus allowing relatives to pledge the cadaver organs for the benefit of a living person through organ transplant.

But according to the Directorate-General of Health Services (DGHS), only 1,000 of the 35,000 transplants, performed after the Act came into force have used organs from cadaver donation. The most serious challenge that this modern and well-meaning Act faces comes from a total lack of counselling of the bereaved families that do not take to organ donation easily due to the superstitions attached to it. But the armed forces have shown the way. A number of retired armed forces volunteers have counselled families for cadaver donation. With over 8000 soldiers and their families who have registered and pledged their organs with the Armed Forces Organ Retrieval and Transplant Authority, it has so far facilitated 44 liver, 70 renal, and three heart transplants, showing the way to save more lives.

Though the Union Health Ministry has an ambitious plan for a National Organ Transplant Programme and has already set up an Organ Retrieval Banking Organisation (ORBO) at the All India Institute of Medical Sciences (AIIMS). The ORBO has performed close to a thousand transplants since it was established in 2003. But with no urgency for greater awareness, no more donours are added. Even the medical community is not made aware of its need. If only they were told, a single donated cadaver could yield 37 organs and tissues, giving a new lease of life to as many as seven people.

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Thought for the Day

The most effective way to do it, is to do it. — Amelia Earhart

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Road’s end for Pervez Musharraf
Worse than other Pak military despots
by Inder Malhotra

WHICHEVER way the Hitchcockian drama in Islamabad plays out there is at least one certainty in the grand confusion: that Pervez Musharraf, arguably the most delusional of the four military dictators that have ruled Pakistan for nearly half its existence, has reached the end of the road. His pipedream of landing in his country after five years of exile, like a triumphant Caesar - in the hope of being welcomed by people still nostalgic about what he had done for them in the past and anxious to give him another chance to lead them - has turned out to be a nightmare. He can now rue over his folly during his house arrest in his sprawling farmhouse at the edge of the Pakistani capital.

As a matter of fact, Islamabad-based foreign correspondents who had gone to Karachi to cover Musharraf’s “momentous arrival” have reported that it should have been clear from that moment that the former president had no future. His candidature in the four constituencies has already been rejected and most of the political leaders he expected to be with him have already joined other mainstream parties. He has no role in the ongoing elections or any influence on their outcome.

Incidentally, the most delightful and appropriate comment on his present plight has come from Xinhua, the official news agency of China, Pakistan’s “all-weather” friend where at one time Musharraf used to be welcome. There was, says Xinhua, “poetic justice” in Pakistan when the Islamabad Supreme Court issued an arrest warrant against the former president - something he had done “against dozens of judges when he arrested them in 2007”.

On the fate that awaits him, opinions differ widely. Some hope, rather than think, that the judiciary that he humiliated so disgracefully in 2007 would not be content without hanging him, especially because the three main charges against him are heinous and include the assassination of Benazir Bhutto and the murder in cold blood of the eminent Baloch leader, Sardar Mohammed Akbar Bugti. Some others believe that if the law and the judicial process don’t get Musharraf, the lawless Taliban would. In my view, this possibility should also be ruled out in view of the enormous commando security the Pakistan Army has provided this former commando general.

As of now, the most plausible scenario seems to be that Musharraf’s judicial custody up to May 4 will be extended beyond the date of elections that is May 11. Thereafter his trial can begin, if the judiciary and the new government insist on it. But then it can go on and on for years, if only because in this and many other basic practices the underlying unity of the subcontinent endures. However, overall it is a safe bet that Pakistan’s power structure cannot afford to hurt the sentiments of the all-powerful Army by executing or even imprisoning a former army chief.

According to available information, General Ashfaque Pervez Kayani, though a one-time protégé of Musharraf, did not want him to come home, leave alone take part in the elections. It is said that messages to this effect were sent to him several times. However, when the megalomaniac former military ruler having hallucinations about his popularity with the Pakistani masses did arrive, the Army considered it its bounden duty to see to it that no harm came to his person and that his, and more importantly, the Army’s izzat (an expression dear to both the Indian and Pakistani armies) was not besmirched in any way. This situation will prevail regardless of the dispensation resulting from the May 11 poll. It would be no surprise if some kind of an understanding already exists among the major stakeholders in Pakistan on this subject.

Come to think of it, even under a caretaker government, whose only duty is to hold free and fair elections, all concerned have treated Musharraf with kid gloves. Remarkably, Xinhua has taken note of “the speculations” that despite the apex court’s clear order to arrest him, “some bigwigs” in the government told the police to “go slow on Musharraf”.

It would, indeed, be instructive to look back on the events in 1999 when, after his successful coup, Musharraf wanted to “fix well and proper” his bete noir and then Prime Minister, Nawaz Sharif. But then Saudi Arabia intervened and the military dictator agreed to let Sharif go in exile to Saudi Arabia for 10 years. Today, the Saudi stakes in the stability of Pakistan are even higher than before.

There are two other points that call for comment. The first is the rather intriguing fact that the United States is refusing to comment on Musharraf’’s house arrest one way or the other. Does this lend any credence to his calculation while planning his strategy to take part in elections that, given the configuration of forces in the post-poll Pakistan, the Americans would prefer a government led by him?

After all it was he who, on the morrow of 9/11, had reversed Pakistan’s policy on Afghanistan and lined up his country with the US in the “war on terror”. Moreover, as revealed only recently, in 2003Musharraf unhesitatingly allowed the Americans to use drones to kill as they wished in North Waziristan as long as they left the Lashkar-e-Toiba (LeT), Jaish-e-Mohammmed and other Pakistani terrorist outfits operating against India well alone? Today, the US desperately needs Pakistani cooperation for its plan to withdraw its combat troops from Afghanistan by the end of 2014.

Secondly, the speculation in some quarters in both India and Pakistan that should the civilian government resist the Army’s demand to let Musharraf go, Kayani and the Army would stage a coup should be dismissed. Firstly, over the years Gen Kayani has demonstrated repeatedly that he sees no point in directly taking over when the Army can get its way anyhow. Furthermore, gone are the days of the Cold War when the US had a vested interest in embracing and coddling military dictators in Pakistan. Samuel P. Huntington had then written a book to press home the point that in newly independent countries the armed forces were the best instrument for stability.

Those days are gone. Today, America is the super-salesman of democracy across the world. It can ill-afford a military takeover in Pakistan, never mind the adverse reaction of the world community in general.

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Soft skills
by S Raghunath

Inaugurating an international exhibition of modern office equipment at Pragati Maidan in New Delhi, the Prime Minister, Dr Manmohan Singh, urged Central government employees to visit the show in large numbers and see for themselves how computers, automation and information technology (IT) had revolutionised office management.

I have been talking to a section officer who works in the CGO complex on Lodhi Road in New Delhi and who has just been to the exhibition and I asked him what he thought about it.

“Oh, it was simply unbelievable”, he said, “some of the exhibits were straight out of science fiction; computers, robotics and IT have taken over in a big way and we have to install advanced systems and IT gadgets on a war-footing in all the government offices of India so that the country is able to walk with confidence into the 21st century and join the ranks of the industrialised nations.”

Did any particular exhibit catch your fancy” I asked. “Yes, said the SO. There was a highly sophisticated laptop microprocessor chip Pentium-18 exhibited by a Swedish firm and using it I could do up my TA bills claiming reimbursement for first class AC rail travel when, in fact, I’ve travelled on my old bicycle and autorickshaw and the calculations won’t take longer than 5 seconds instead of 2 hours if I’ve to do them manually.”

“Amazing”, I said “Then there was a state-of-the-art adding machine displayed by an Italian company and it would be an invaluable adjunct to my work because I can see it to precisely compute the number of times I come to the office late, the number of times I take unauthorised tea and coffee brakes and the time I waste idly chatting with my colleagues and listening to the IPL cricket commentary on my pocket transistor, and the final printout will appear on a liquid crystal display instantly on the mere press of a button,” I added.

“Fantastic.” I said. “There was a fully computerised and automated filling and retrieval system exhibit by an American firm and if I could install it in my office, it would revolutionise my working because I could file the vegetable samosas and parathas my wife packs for lunch under main heading “S” and “P” and vegetable stuffing under sub-title “Y” and the whole thing can be retrieved instantly whenever I feel puckish.”

“Oh, I forgot to tell you about a palmtop displayed by a Swedish firm and the demonstrator asked me to try it. Would you believe me, I was able to calculate the exact amount or the 17316th installment of variable dearness allowance due to me in less than 10 seconds?”

“Now that you've been to the show”, I said, “I suppose you can’t wait to install advance computers and IT systems in your office.”

“Oh no, said the SO, wandering around the exhibition has made me so tired that I’ve applied for three months’ casual leave.”

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Understanding the standoff in Ladakh
China’s approach to its core territorial interests has become uncompromising in recent years and is manifesting across the board from a climate of discord in the South China Sea, the dispute with Japan over the East China Sea islands, to the Himalayan dispute with India.
Zorawar Daulet Singh

In the cacophony of media coverage a nuanced portrayal of the Ladakh standoff has fallen by the wayside. Since context is so important, it is worth exploring both the macro and micro causes for such incidents.
A view of the Chinese infrastructure across the LAC in south-eastern Ladakh. After the April 23 flag meeting it is clear that both sides are engaged in probing up to their preferred LAC
A view of the Chinese infrastructure across the LAC in south-eastern Ladakh. After the April 23 flag meeting it is clear that both sides are engaged in probing up to their preferred LAC. File photo: Mukesh Aggarwal

The macro-narrative locates the present standoff to China’s stronger periphery control measures that are part of an increasingly sensitive and assertive China across its continental and maritime frontiers. China’s perceptions and its approach to its entire periphery has undergone changes in recent years. The reasons can be attributed mostly to internal political dynamics where the Dengist image of a pragmatic and agreeable China has been trumped by a more assertive self-image of China as a great power. The East Asian geopolitical dynamic, especially the US ‘pivot’ and renewed intra-allied cooperation in the US security network, only reinforces China’s threat perceptions and its assertive posture. This is now an ongoing game as part of the evolving balance of power in the Asia Pacific.

To some extent, locating Chinese frontier activity with India in the context of its evolving worldview makes sense. Yet, the India-China border has a distinct dynamic and Chinese intentions here cannot be simply read off from Beijing’s geostrategic posture toward its eastern seaboard.

Missed opportunities

There have been three opportunities since 1960 in resolving this dispute. Zhou Enlai made an offer to solve the dispute via an east-west swapping of claims during his 1960 visit. India’s reluctance to equate the two sectors would see this offer being rejected. In 1979 Deng Xiaoping made a formal offer for a “package solution” to Foreign Minister Vajpayee during the latter’s visit to Beijing. Once again, the Indian side could not countenance a change in its negotiating position. A third opening came with the April 2005 “Political Parameters and Guiding Principles” Agreement, which indicated that both sides had substantially converged their positions on the overarching principles that would guide a settlement. The 2005 agreement declared that a “package settlement” is the only way forward along with a mutual recognition that this would involve minor territorial adjustments by both sides.

Third time around it was China that would pull back by hardening its diplomatic position and adopting a more vigorous approach to border management via a strengthening of the PLA’s logistical network across the plateau. Partly, these measures have been attributed to China’s perceived insecurity over Tibet though this matters little because the potential spillover effects on India are real.

Lines of Actual Control

Despite having formally agreed to the principles the negotiating process got stuck since 2006. Once the bargaining process lost steam, each side shifted its posture toward reasserting claims to their preferred LACs.

Why are there conflicting LACs? In the east, the 1914 Line on which India bases its ground position was never formally demarcated. It was an alignment on a small-scale map. Both sides interpret the 1914 alignment differently creating “a dispute within a dispute.” As former National Security Adviser Narayanan has noted, “In the McMahon Line itself, because of modern cartography…There may be certain amount of changes with regard to the agreement that we may reach.”

In the west, there is no accepted treaty arrangement and China by virtue of geography occupied most of its claim line by 1960 with marginal increments during the war. The 1992 Ministry of Defence’s Official History of 1962 notes that China eliminated “possible launch pads for any offensive against the Aksai Chin highway by eliminating Daulat Beg Oldie (DBO), Chushul and Demchok positions”. Unsurprisingly, these pockets continue to witness intense probing by both sides.

After the April 23 flag meeting it is clear that both sides are engaged in probing up to their preferred LACs. China’s intrusion into DBO is probably a reaction to India’s probing elsewhere, which in turn is a reaction to the Chinese probing somewhere else. As Defence Minister Antony’s told Parliament in 2012, “Indian security forces patrol up to all areas that fall within the Indian perception of the LAC.”

In recent years, both sides have been adhering to the ‘rules’ of the game by avoiding frontal contacts. In other words, each side would transgress into a disputed pocket and withdraw. Yet, the intensity of patrolling and frequent face-to-face encounters probably touched levels where China suggested in December 2010 to establish a political-level device to supplement previous confidence-building agreements. This led to the “Working Mechanism for Consultation and Coordination on Border Affairs” agreed in 2011. In the two meetings held so far an agreement had been reached to avoid tailing of patrols.

China’s concern expressed at the flag meetings about new Indian border outposts being too close to disputed pockets compared to its own more extensive but less threatening infrastructure needs to be contextualised. Forbidding terrain on the Indian side makes the notion of a vertical logistical road-rail network running up from the plains to mountain points impossible. While Indian troops must negotiate treacherous terrain at times, the PLA can simply drive up to selected points.

Hence, India to preserve oversight on the LAC needs limited forward infrastructure to base some troops. China’s flat terrain allows it the luxury of a defence in depth with the lethal option of rapidly concentrating forces in any sector without having its troops deployed close to the LAC. Chinese sensitivity is probably more linked to its Tibetan problem than a genuine threat from India’s border management. But perceptions drive policies and this issue needs mutual reassurance.

Missing forest for trees

At some point intense forward probing can tend to undermine the bigger negotiating picture with both militaries seeking marginal improvements in their LACs. If political oversight from both sides over the operational details is robust then this game can carry on a little longer. While on India’s side political oversight is strong, overzealous tactical behaviour must not be allowed to dictate the strategy of seeking a negotiated settlement.

Paradoxically, the real incentive for intense probing is structurally built into the present negotiating process where each side aspires to put forward its preferred LAC since these cartographic positions will shape the bargaining over the precise nature of territorial adjustments during negotiations. In this sense, the militaries are following the logic of the political negotiating process!

If the present negotiating structure is leading to an endless scramble over legitimating conflicting LACs, can the overall approach be amended? Yes, but this would require political will on both sides to bring both formal claims (Aksai Chin for India, Arunachal for China) and conflicting LACs claims into one single process of negotiations rather than the sequential approach of unilaterally establishing LACs and then bargaining. “Give and take” would involve both swapping the formal claims – Aksai Chin for Arunachal Pradesh – and also simultaneously making mutual adjustments on the ground based on differing LACs. This presumes some strategic trust because it would involve being sensitive to the other side’s security perceptions and tactical requirements.

The writer is a PhD candidate at King’s College London

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China strategy: Mackinder vs Mahan

India’s geostrategy is being contested by Mackinder and Mahanian images and some of India’s strategic ambivalence can be traced to the lack of a well-defined geopolitical image to ground a debate on grand strategy. A Mahanian solution to the China challenge is that India can overcome some of its continental disadvantages vis-à-vis China by posing a nuisance to China’s sea lines of communication (SLOCs) or even involving itself in East Asian disputes. The underlying logic stems from the idea of horizontal escalation where asymmetry in one theatre can be sought to overcome by escalating the conflict to a wider geographical domain. In sum, if China pursues adventurism in the mountains, India can respond on the high seas.

How can India deter serious Chinese conventional pressure from being applied on the frontiers? There is no alternative to deterrence capabilities in the continental realm where India’s core interests (territorial integrity in this case) can be threatened. Perhaps, a more systematic way to develop deterrence options is through a two-fold process. First, strengthen India’s frontier tripwires at key pockets across the LAC by enhancing logistics, heavy-lift capabilities and surveillance and reconnaissance capabilities to increase the ability to move forces forward toward vulnerable mountain passes. This would raise some costs for China.

Second, rather than escalation in peripheral domains, the ability to vertically and horizontally escalate the levels of violence is an important element of enhancing deterrence. China is logistically capable of amassing a large volume of forces and firepower to any sector at short notice. To deter such a blitzkrieg scenario, India can signal a capability and a doctrine that enables it to respond in a domain that China truly values – its continental heartland.

This implies that India requires stand-off deterrent systems – such as longer-range missiles and greater reach in air power. Some of these capabilities already exist but they have not been directed toward political and deterrence objectives by a central policymaker. Consequently, the services – the Army and the Air Force in this case – have been left to indulge their parochial preferences that preclude a joint land-air doctrine. The Army remains wedded to a manpower-intensive approach to deterrence and the Air Force is content with accumulating ad hoc capabilities without contributing to a stable deterrence posture.

It is puzzling that India is developing out of area expeditionary capabilities without first addressing the heavy lift transport requirements for its core security needs. Perhaps, it was from such a fragmented assessment, that a widely read policy document in 2012 argued to promote asymmetric deterrence by preparing to “trigger an effective insurgency in the areas occupied by Chinese forces” in the event of an invasion!

India should focus more on continental China rather than maritime China, and, it is the balance of power and influence on the Himalayan frontiers that needs constant strategic attention. The Mahanians have been urging India to discard its continental images and envisage a maritime role for India to become a “net security provider” in other regions. The Mahanians in some respects do reflect the wider changes in India’s economic and diplomatic profile that have dispersed Indian interests across the globe. It is true that a globalising India has an economic and cultural footprint in several continents and India’s institutions should reflect this. But it is by no means clear whether the maritime instrument, often projected as a potential guarantor of India’s expanding global interests, should be leading this process. And it is certainly not evident that India should pursue an extra-regional role before having produced a modicum of security and influence in its own region. — ZDS

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