Thursday, April 27, 2000, Chandigarh, India
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Whose
drought is it anyway? Unborn
Jharkhand Signals
from Iran
THE
BIG DIVIDE IN PAKISTAN |
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Why govt loves foreign investment by Bharat Jhunjhunwala THE respect being bestowed on Indian political and economic power by the industrialised countries is a welcome development. France and other countries have endorsed Indias claim for a permanent seat in the Security Council. India is already being ranked as a major economy. But there is need to be careful as well. We should not forget that the industrialised countries have similarly endorsed and destroyed Pakistan, Latin America, East Asia and Russia earlier. We must not repeat those mistakes. Operation Bluestar a
mistake
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Whose drought is it anyway? Only 50 members were present in the Lok Sabha on Tuesday to discuss the drought havoc in three states. That works out to 10 per cent of the strength of the House and it accurately reflects the degree of interest rural affairs evokes among politicians and bureaucrats. The same chamber was packed to capacity to hear the Prime Minister and the Congress president exchange verbal barbs, which actually turned out to be a non-event. Two other developments on the same day showed how insensitive and callous the system has become to the sufferings of voiceless millions. An all-party meeting convened two days after the Prime Minister appealed for funds and the Cabinet woke up to the grave crisis, witnessed finger pointing and entrusted monitoring to a committee of secretaries. There are ministerial committees to tackle several less important and urgent problems; perhaps India is once again trying to close its eyes to an ugly reality in the belief that it will just fade away. Ideally, a high-powered body with members from all major partries would have been an appropriate response and would have galvanised those in charge of the relief work. The other was a curious admissioon by the Centre that though formal orders have gone out to release concessional foodgrains, some villages and blocks may have to wait for a week or so to actually receive them. There is the problem of paper work and arranging trucks. What is remarkable is that there is a FCI godown in every district and it should not take more than a day to reach any point there. So the real bottleneck is the cumbersome and often self-defeating procedures. All this in tackling what everyone readily describes as a national calamity. It is scandalous that
there was no monitoring of the situation at the Centre.
It was known as early as last winter that the three worst
affected states of Rajasthan, Gujarat and Andhra Pradesh
were heading for an acute shortage of water in the summer
months. Yet Delhi was waiting for the scorching sun to
first dry up all water sources and then increase the
demand for the precious liquid. Nearly a month back a
reporter, who was on a private visit to the desert state
of Rajasthan, talked of animals dying in hundreds and of
piles of bones lining the dusty roads. Precious time was
lost, time that could have been used to plan and put in
place fodder stocks and railway water specials. Fodder
has to be arranged from other states. For instance,
Punjab can have fodder if it does not use combine
harvesters which leave the wheat stalk in the field
forcing the farmers to burn them. Now the state has
returned to the traditional way of manually cutting the
standing crop and plans to sell the fodder to Rajasthan.
Relief work is a sham. As one tehsil official wryly
admitted, it is a dig and fill job. It loosens the dry
land and fierce wind carries off part of the top soil as
dust! Gujarat has fixed a daily wage of Rs 40 for relief
work but Rajasthan follows the ancient method of
sanctioning a lump sum for each work; the workers share
the money and if there are a large number of job-seekers,
the wage dips. Women labourers have a second problem.
Either they can work or stand in the queue to collect
water from a tanker. In one district the local
authorities have taken off three tankers and kept them as
stand by. Idling the vehicles when they have become
precious cannot be anybodys idea of drought relief.
One reporter commented sarcastically that Coke and Pepsi
daily send their product to even remote villages but the
mighty government is still drawing up plans to transport
foodgrains to fair price shops. |
Unborn Jharkhand The ratification by the state legislature on Tuesday of the Bihar Reorganisation Bill-2000 is a matter of conditional and limited significance. The document presented before the two Houses speaks of Vananchal at the unrecognised behest of the Bharatiya Janata Party which suffers from a chronic jargon syndrome. For most of the people of South Bihar, the new state, if and when it is formed, would be known by another nameJharkhand. The Bill, in a slightly different form, had a good Delhi darshan. The President of the Republic had referred it for further legislative opinion. At least three Prime Ministers had seen its movement, back and forth, to Patna. Bihar was bifurcated two years after the devastating earthquake of 1934. Then Orissa, which had considerable tribal population and distinct cultural and linguistic dissimilarity to the rest of the huge state, became a separate organism under the British. The situation over the years, however, has become more devisive and the recent idea of reorganisation is heavily politicised. Mr Laloo Prasad Yadav is opposed to fragmentation. So are most of the people in North and Central Bihar. The demand for reorganisation or division does not have overwhelming support or any urgent regional craving. (Jharkhand, which means a portion covered by green forests.) The economic unviability
of the Jharkhand region is its most negative factor.
Eighteen tribal districts comprise the proposed state.
Forest wealth means long-term richness. One cannot trade
in timber regularly if the ecological balance is to be
preserved. Support can be obtained from the mineral belt.
If the administrative set-ups of the North and the South
would be different, the financial resources for the South
would entirely have to come from allocations (and
earnings) made specifically. Mr Laloo Yadav wants a huge
package from the Centre by way of compensation for the
revenue losses expected to be incurred as a consequence
of the creation of a separate state. His argument that
the economy of almost the entire agricultural and
unindustrialised North and Central Bihar of today would
be depleted after the bifurcation is logically sound. New
Delhi would not cough up Rs 1.87 lakh crore without
ruining its own financial equilibrium. So, the formation
of Jharkhand does not seem to be easy in spite of the
urgency shown by the Rabri Devi government following
diktats from the Congress. The Bill would travel to Delhi
once again. Its fate is not even as bright as that of
Chhattisgarh. Remember the tags attached by Rabri raj to
the document? All Central loans to the undivided state
should be waived in the interest of the reconstruction of
the new state. At least 30 sugar mills should be made
operative quickly in the North. The dream thermal power
station at Nabinagar and Barh should be commissioned
forthwith. The cost involved would be around Rs 16, 000
crore. A sum of Rs 57, 869 crore should be delivered at
Patna for laying new roads and repairing old ones. It
would take half an hour at least to compete the list of
demands. In Bihar, more than geography regional
integration has been under a cloud over the years. The
division of the already violent state is bound to sharpen
the disintegrational trends even if the case of unity in
diversity is over-emphasised. Jharkhand or Vananchal
would be born only by a traumatic Caesarean section. The
foetus may have to stay in the womb of uncertainty for a
longer period than politicians think. |
Signals from Iran The attempt to derail the process of reforms in Iran is not an unexpected development. The crackdown on 12 pro-reform publications was ordered by the judiciary which is still under the control of the conservatives. In an open society, which Iran is seeking to become under President Mohammad Khatami, even rabid fundamentalists should not be stopped from expressing their views and promoting their agenda. For that would be repression of another kind, similar to the one which forced the Shah to flee Iran. The pro-reformists want the repressive structure of the Khomeini era to be dismantled without further delay. But the fundamentalists favour the continuation of the strict Islamic code of conduct introduced after the 1979 uprising. The reformists are getting impatient with the slow pace of progress. The fundamentalists, on the other hand, have begun to show signs of desperation over their shrinking control on most levers of power. The judiciary is still under their influence and, therefore, has done whatever it could for delaying the process of change. Among the charges hurled at the suspended publications was one which said that their contents disparaged Islam and the religious elements of the Islamic revolution. The Justice Department claimed that what was being written in the banned journals was part of the cultural assault of the foreign enemies of Iran. The pro-Islamic rhetoric would sound familiar to those who still remember the shrill and strident utterances of Khomeini. The fact that President Khatami is still in control of the situation and is relentlessly pushing his agenda for reforms, in spite of the scowl on the faces of the conservatives, is a clear indication that even judicial intervention cannot turn the clock back. The crackdown on the pro-reform Press may, in fact, prove to be a blessing for the advocates of a more open civil society within the framework of the countrys Islamic system. For a correct assessment
of the likely impact of the judicial crackdown on 12
publications, hurting Islamic sentiments, on
the reforms movement it is important to remember that
three liberal newspapers are still being published. They
should prove adequate for sustaining the campaign for the
restoration of civil rights available to people in most
open societies. Iran-watchers believe that the judiciary
may have helped the cause of the reformists because
too many publications were actually adding to the
confusion of the average Iranian and causing avoidable
feeling of insecurity among the fundamentalists.
The issue needs to be seen in perspective. The emergence
of President Khatami as a relentless champion of civil
liberties and his increasing popularity among the people
for promising them greater freedom in itself has been a
revolutionary development since the overthrow of the Shah
and the death of Khomeini. President Khatamis
coming to power on a liberal agenda was significant
because for most Iranians the 1979 revolution had meant
walking out of one jail into another, equally dank and
suffocating. And the decision not to clamp down on three
of the 15 pro-reforms newspapers should
Khatami-supporters give sharper focus to the movement for
freedom expression. One newspaper, which saw the order
for suspension of publication being revoked for
unexplained reasons, hit the stands with a daring
headline blaming a power hungry mafia for the
crackdown on the Press. Iranian students too did not lag
behind in showing their collective displeasure over the
attempt to muzzle the pro-reform newspapers. To prove
that they were willing to face the consequences of their
open defiance of the order some of them put tapes on
their lips while others carried copies of the banned
publications. Because of the judicial intervention the
process of reforms may be delayed. But so long as
President Khatami is around reforms delayed may not
necessarily translate into reforms denied. |
THE BIG DIVIDE IN PAKISTAN WE in India do not understand the cynicism that pervades the Pakistani mind. We wonder why the conviction of Mr Nawaz Sharif in a false case evoked no public response, no loud protests, no demonstrations. All that we heard were Mrs Kulsoom Nawazs plaintive cries for justice to her husband, and he had come to power with a massive mandate. The people showed great faith in him, and then forgot him. We are so used to injustice in India and Pakistan that a glaring injustice is accepted without a murmur. What dismays me is that in India too neither the end of democracy in Pakistan nor the conviction of Mr Nawaz Sharif has created much interest. None of our business was the official response. Is it none of our business if fanatics, who never win an election, take over the country? Is it none of our business if the army of Pakistan, a fine fighting force, becomes suspect in the eyes of every democratic government in future, or never allows democracy to be firmly established in their land? A few editorials in Indian papers said a few despairing words. The drawingroom classes felt that military rule was expected, and may even do good to Pakistan. The average man had put down these events as of no consequence to us. Yet I believe these two events the takeover and the conviction should arouse our concern. The seizure of power by Gen Pervez Musharraf was probably due to a sudden pique, a spurt of anger, a desire for revenge, which had not been widely discussed by him and his friends. Some sort of a plot had probably been revealed to Mr Nawaz Sharif by rivals in an exaggerated way. General Musharraf did not even have time to consider the implications of the takeover. In a couple of minutes he had to decide the fate of a nation. It must have raised a tumult in his mind. I am inclined to think that if Mr Nawaz Sharif had not dismissed him summarily when he was away, the whole drama of a military takeover would never have occurred at all. When I said this to a friend, he replied: No, no, you are absolutely wrong. The plan to topple democracy must have emerged when the bus ride to Lahore raised hopes of an understanding between India and Pakistan, which would have reduced the influence of the army. And if it had gone further, it might have even made an expensive army redundant in the affairs of Pakistan. You recall how top brass avoided being present for the reception to the Prime Minister of India, and how many times resentment was openly shown at meetings with him. For the officers of the Pakistan army, who had preached and trained mercenaries for jehad against India, the meeting with the Indian Prime Minister for peace was a negation of all that they had believed in, and impressed on others. It was a scornful bitter joke for them. Mr Nawaz Sharif miscalculated, or was not informed about the strong feelings among his officers, and impatiently sent out the order which has given a setback to the whole subcontinent. In Pakistan, there is a big divide between those who want democratic rule, are modern and US oriented, and those who have a deepset religious approach, are orthodox and believe that Pakistan needs to identify itself with Islamic aspirations. The politician and the soldier have different objectives, and a totally different culture. Yet there are politicians who are fanatics, and army officers who are liberal. It is from this substratum of common culture and beliefs that the future democracy of Pakistan will emerge. The drought that is affecting the whole region will pose grave problems for Pakistan. It cannot defy President Clinton. It cannot offend the financial institutions, and the need for aid will increase desperately. It follows that to expect peace is futile as long as the army is in power. Yet there will be no war; they know the dangers, only threats, reverberations and mercenaries and financial bleeding. The solution is for the General to restore democracy in a years time and be assured of a safe retirement by the US President, wherever he wishes. I imagine that so far not much damage has been caused. Those sections of the judiciary that chose to resign rather than swear an oath of allegiance to General Musharraf will be brought back with honour. Those that took the oath may swear that they had made a mistake, and would be allowed to continue. The General may have to use all the old methods devised by General Zia which made the people turn away from him. A solution will help Pakistan if it comes before the fanatics with foreign support make Pakistan a big base for terrorism. The General will have to be persuaded to believe that restoring democracy is in the interest of the subcontinent, and that it is not due to fear that he has agreed to reinstate democracy. A soldiers worst fear is of being called a coward. General Musharrafs record in the army speaks of courage. On the whole, he appears to be a civilized person caught in a storm, which we should help him out of. He must be helped out if our subcontinent is to have a future, and it is for this reason that I feel that the Indian stand of refusing to talk to him is against our interest. If we help Pakistan and Afghanistan at this time, we will be doing a service to all in our neighbourhood. Let us not forget that it is one of the most disturbed areas of the world. Afghanistan has been ravaged by war for almost a decade. Today it has the worst drought in 25 years. Its government is isolated, its resources are good, its brave people are starving. We have to strive to get out of our minds the Kargil mood of retribution. A wounded Pakistan and a desperate Pakistan, an isolated and unsupported Pakistan, will be a real danger to us. On the other hand, if we help Pakistan out of the present predicament, it will be remembered. Unfortunately, on the Indian side, the mood is unfavourable. The reports of trouble, now in Kutch, in the desert, are keeping us on the edge. I hope the Home Minister and his Security Committee will look at the wider picture, beyond Pakistan, and work out strategies which will keep Afghanistan in view, and not fritter away our resources on the rumours of Pakistani intrusions. General Musharraf seems to be following the path of moderation. Why cant we help him to restore Pakistans economy? Instead of weakening him, we should try and strengthen his hands, so that he can control the terrorist groups that now threaten to ravage both our countries. He wants to tell us that he does not control them. It may be true to a certain extent. No mercenary group is totally disciplined, and to that extent the danger to Pakistan is always there. If they fail to make a headway in India, they are likely to turn round and hit Pakistan. The real tragedy of South-East Asia is Afghanistan. Pakistan is secondary, probably a result of the decline in Afghanistan. Years of conflict has weakened Afghanistan considerably. Poverty and hunger produce the mercenaries that General Musharraf sends to us so that they do not overwhelm Pakistan. The excuse is Kashmir, which he knows can never be separated from India. If we want to think of a peaceful future, we have to think of helping the regime in Afghanistan, to work out methods of developing trade and providing food aid that will help the whole region. Kabul is at the worst stage of adversity a city of maimed and hungry citizens. We must help them. As far as Pakistan is
concerned, either we accept General Musharraf and help
him, or tell him bluntly that we will support every move
to throw him out if he continues the proxy war. Whatever
we choose to do, can we refuse to talk to a neighbour who
is imploring us to come to the fence and settle
differences? Can we close the gate never knowing,
never understanding what he wants to say? |
Why govt loves foreign
investment THE respect being bestowed on Indian political and economic power by the industrialised countries is a welcome development. France and other countries have endorsed Indias claim for a permanent seat in the Security Council. India is already being ranked as a major economy. But there is need to be careful as well. We should not forget that the industrialised countries have similarly endorsed and destroyed Pakistan, Latin America, East Asia and Russia earlier. We must not repeat those mistakes. US Deputy Trade Representative Susan Esserman speaking at a CII function said that investment and trade barriers were combining to restrict FDI in India. The hype is that free markets would bring in more foreign investments. There is little realisation that free trade and foreign investment may be contrary to each other. The dollars that come in through FDIs have to be used mainly either for the accretion of our forex reserves or imports. To the extent that they are used for imports, it leads to less domestic production and exports. Say our foreign trade was in balance. Exports were equal to imports at $30 billion. Now $10 billion of FDI came in. The supply of dollars in the forex market now increases to $40 billion while the demand for imports remains at the earlier $30 billion. Since the supply is greater than the demand, the dollar becomes cheap and the rupee becomes costly. Cheap dollar makes imports more competitive and they increase to $35 billion. Expensive rupee renders exports more difficult and they decline to $25 billion. The net result of foreign investments would be that exports would get reduced from $30 to $25 billion and imports would increase. The idea that free trade encourages FDI in export-oriented industries does not cut much ice either. Export promotion zones allow free imports for export purposes anyway. Import duties paid on raw materials used for exports is refundable. The basic approach of the industrialised countries is to kill the Indian industry twice. Foreign trade will kill those industries in which imports are competitive. FDIs will kill those like cement, infrastructure and soft drinks in which imports are not possible. It is this deadly combination that has led to the collapse of various developing economies during the past 20 years. The idea that FDI leads to growth by providing scarce capital to the developing countries too needs to be examined. Though immediately this indeed takes place. But in the long run foreign investors begin repatriating their profits. If the same industry had been put up by domestic entrepreneurs then those profits would have been reinvested in the country. The true face of FDI emerges only when fresh investment ceases to come. Now additional dollars are not available for cheap imports. The domestic export industry has been killed. There is an additional burden of profit repatriation. The result is that a developing country now uses its reduced export earnings to meet the profit repatriation bill. This is the story of Latin America, East Asia and Russia. China is the enigma that stands against the above dismal scenario. It does seem that China has attracted large amounts of FDIs and also expanded its exports. But the figures may be fudged. In 1996, for example, according to World Development Reports, China earned foreign exchange of $234 billion ($172 billion from exports, $12 billion from remittances and $50 billion from FDIs); but the total outflow was only $ 194 billion ($154 billion for imports and an estimated $40 billion for accretion in forex reserves). There is a discrepancy of about $40 billion. For all we know, this discrepancy may be hiding the skeleton in the closet that may come out anytime akin to the capital flight from the Latin American countries in the eighties. Industrialised countries have successfully persuaded North Block to place India on the well established road to disaster. We are using FDI inflows to finance imports. In 1996 our export earnings were $43 billion, remittances $4 billion and FDIs $5 billion. We used these $52 billion plus some borrowing to finance our imports of $55 billion. We are repeating the same mistake of using capital inflows for current imports that was made by the East Asian countries. The question remains: why should a nationalist BJP-led government embrace such a disastrous course? The key to the riddle lies in the different impact of domestic and foreign investment on government expenditures. If Reliance Power were to invest $10 billion in a power plant, the company would borrow from the domestic money market. It would become more difficult for the government to borrow for its ever-growing expenditures. On the other hand, if Enron were to invest the same $10 billion, it would bring dollars. The RBI would purchase some of them for the accretion of reserves and supply rupees in exchange. Liquidity in the domestic money market will increase and that would make it easier for the government to borrow more. The reason, therefore, why North Block is embracing the call for free trade and investment is that this approach provides easy money for the government to continue with its wasteful and corrupt ways. The silver lining is
that the Indian economy may yet not collapse despite the
best efforts of the government. The reason is that the
MNCs might not be able to kill the domestic industries in
India as they have succeeded elsewhere. |
Operation Bluestar a
mistake Operation Bluestar in Punjab was certainly a mistake which the then political party in power took under political compulsions, the former Army chief, Gen Shankar Roychowdhury, MP, remarked at an exclusive interview with The Tribune in Calcutta. Gen Roychowdhury said militancy in Punjab was the first phase of the proxy war by Pakistan against India. He felt that Operation Bluestar could be avoided and the problem of militancy in Punjab could have been tackled otherwise. The former Army chief said the militancy in Kashmir or the north-eastern states and elsewhere should be handled both at the political as well as the military level. Otherwise, the problem would not be solved, no matter what assurances the US President, Mr Bill Clinton, might have given during his recent visit to India, Gen Roychowdhury observed. The following are excerpts from the interview Q: Sir, how would you assess the present problem of militancy in the country? Is it out of control? A: No, it is not out of control. Insurgency or militancy as you know affects two main areas of the country Kashmir and the north-eastern region. In other parts also there are militant activities but not of the same degree as in Kashmir or the north-eastern states. The problems have been tackled by various forces. Q: Are right steps being taken to handle the problem? What do you suggest the right steps to be taken? A: From place to place, the methods of tackling the problem differ. In Kashmir, it is Pakistans proxy war offensive, the ultimate aim is to detach Kashmir from India. It is, I feel, an attempt by Pakistan to take revenge of their loss in the Bangladesh war in which over 93,000 Pakistani prisoners of war were brought captive to India. It is, therefore, a war of revenge. The Government has been taking steps to handle the problems in Kashmir but whether it is right or wrong, time will tell. But the right steps would be to carry out intense military operation in Kashmir in tandem with political and administrative measures. As far as the north-eastern states are concerned, the administration has entered into a peace talk with the NSC and Aksumiva group which is the main insurgent unit in the region. But the talks at present are held up because Mr Muiva himself has been arrested and imprisoned in a jail in Thailand. I would suggest that the problem of insurgency whether in Kashmir or the north-eastern region should be tackled on a politico-military basis. In Kashmir, there should be deployment of adequate minimum force since the jawans will not be fighting a war. Q: In the early seventies, we could hardly hear about problems of militancy, but now it is everywhere, why? A: No, it is not true. The Nagaland insurgency had started in 1953 or earlier and in Mizoram it began sometime in 1961. Mizoram, however, is now peaceful following a peace agreement. In Tripura, insurgency started in the 80s and the problem could not be fully solved. You must note that other than Kashmir, these are basically the expressions of resentment against power. There were cultural and psychological barrier from people to people and place to place. Delhi is far off from the north-eastern region not only in geographical distance but also in perception. The people in this region feel isolated and alienated. But in places, say, in Madhya Pradesh, Tamil Nadu and Orissa, some interested groups backed by interested parties, are creating problems and their anti-national activities should be crushed firmly, jointly by the Army and the state armed police. Q: Are foreign powers behind the militants? You held the highest post in the Army and you must have informations from your intelligence network? A: Its a known fact that Pakistan is involved in militant activities in Kashmir and a section of people living in the valley have been raising the slogan of Azad Kashmir. But the people living in other areas, say Ladakh, are not making such demand. Militancy or insurgency in Kashmir, I reiterate, is a proxy-war offensive, generated, designed, trained, equipped and financed by Pakistan the funds coming from extremist organisations in Saudi Arabia and other Muslim countries and by selling of illicit drugs. As far as the north-eastern states are concerned, there is sufficient evidence of ISI linkage in the extremist activities, which were also strong in Bangladesh during the regime of the Bangladesh National Party (BNP). Now, however, the Hasina Administration has taken steps to ensure that their lands are not used for hostile activities against India. Q: Now lets talk about Punjab which witnessed serious militant insurgency during the 80s. How could a beautiful and peaceful state like Punjab suddenly became the venue of terrorists activities? A: Punjab is located in the closest proximity with Pakistan. The people in the state had certain genuine grievances, which the Delhi Administration for long ignored. And a section of people, particularly younger people, got frustrated for want of opportunities for them. Pakistan took advantage of the situation and came forward with funds and arms for them to launch an armed struggle against India. You should note that Punjab was the beginning of the present phase of insurgency in the country. Q: Do you think as an Army chief that right steps had been taken to tackle the problem of militancy in Punjab? A: No, certainly not. I dont think right steps were taken. Operation Bluestar was totally unwarranted and a mistaken step. The party in power at Delhi at that time had taken the step more on political consideration. However, the situation there has changed. Democracy has been restored in Punjab. Q: Was India right in dealing with the LTTE? A: The LTTE was an internal problem of Sri Lanka and India had no business there. We despatched the IPKF (Indian peace-keeping force) to Sri Lanka to enforce an agreement which the Sri Lankan Government itself did not want. The IPKF did an absolutely thankless job under political compulsion of the Centre. As a result we suffered heavily as the Army could not act under military operation. Q: Sir, you held the highest position in the Army and now you are an MP as an independent with support from the Congress (I) as well as Left parties including the CPM. Any plan to join any particular party in future? A: No, Im not a
member of any party and will remain so in future. No I
have no plan or desire to join any political party. |
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