Climate Change Finance, Analysis of a Recent OECD Report: Some Credible Facts Needed

Climate Change Finance, Analysis of a Recent OECD Report:
Some Credible Facts Needed
India raises the issue on a roadmap for USD 100 billion in climate change financing a year by 2020 and calls for more credible, accurate, and verifiable numbers on the true size of the mobilization of climate change finance commitments and flows from developed to developing countries: Shaktikanta Das, Secretary, DEA
During the recent Lima World Bank/IMF meetings, India had raised the issue on a roadmap for USD 100 billion in climate change financing a year by 2020. This is stated by ShriShaktikanta Das, Secretary, Department of Economic Affairs (DEA), Ministry of Financein his ‘Foreward’ to the Discussion Paper entitled “Climate Change Finance, Analysis of a Recent OECD Report: Some Credible Facts Needed” prepared by the Climate Change Finance Unit, Department of Economic Affairs, Ministry of Finance, Government of India. The Discussion/Review Paper is also attached here with for ready reference and record.

Shri Das has further stated in his aforesaid ‘Foreward’that India had also raised questions on the correctness of the recent OECD report---which claimed that significant progress had already been made. Secretary, Department of Economic Affairshas also stated that in the conclusion of their Review of OECD report, our Climate Change Finance Unit, Department of Economic Affairs, Ministry of Finance and its experts have mentioned that the OECD report appears to have overstated progress. The attached Discussion/Review paper suggests that much more work has to be done. Shri Das further mentioned that we need to establish more credible, accurate, and verifiable numbers on the true size of the mobilization of climate change finance commitments and flows from developed to developing countries.
http://pibphoto.nic.in/documents/rlink/…/nov/p2015112901.pdf

Every election is presidential

 

Elections are not won and lost due to major shifts in the core vote. It is the ‘non-core’ voter and the first generation voter, with no firm loyalty to aparty, who defines the final outcome.

Actor Shatrughan Sinha summed it up correctly when he said that it was a victory of the Bihari over the bahari (outsider) in the elections to the Bihar legislature. But, then, most State Assembly elections over the past two decades and more have been contests between local alternatives. The days of national leaders overpowering regional ones in State elections are long gone. Some recent exceptions prove the rule.

Sanjaya Baru

It is surprising, therefore, that Bharatiya Janata Party president Amit Shah and Prime Minister Narendra Modi chose to ignore this fact — that elections in parliamentary India have become presidential. After all, Mr. Modi’s own victory in Gujarat and New Delhi symbolised this reality.

Belated recognition
It appeared that there was a belated recognition of this shift in political sentiment when the BJP national leadership named Kiran Bedi the candidate for Delhi Chief Minister against Arvind Kejriwal. Her defeat only underscored the importance of credible local candidates. Mr. Kejriwal’s victory was his, not that of his party. Even a political scientist and psephologist like Yogendra Yadav did not want to concede this reality when he challenged the bossism of Mr. Kejriwal. But Mr. Kejriwal ran a presidential campaign to win an essentially mayoral election.

More than development or the caste and communal loyalties of voters, or the simple arithmetic of pre-election alliances, the Bihar verdict was shaped by the fact that the voters had to make a choice between local leaders and no one else in particular. Regional and caste-based parties may have initially been voted to power on the strength of their ideology and manifesto, but their fortunes have become increasingly linked to the popularity of their leaders.

True, the core support of any political party is composed of its loyalists, of those who share the party’s ideology and programme. But elections are not won and lost on the basis of the size of the core. It is the swing vote — the accretion to the core — that makes all the difference.

In 2009, while loyalists of the BJP and the Sonia Congress might have voted for their party of choice, the floating voter took a call on who he or she wished to see as the Prime Minister of India — Manmohan Singh or Lal Krishna Advani. Both the BJP and the Congress went into that election having named their prime ministerial candidates. The votes that made a difference were cast in favour of Dr. Singh.

In 2014, the voter opted for Narendra Modi over Rahul Gandhi. Both national parties ran presidential campaigns, seeking votes for their chosen or perceived candidate for the top job. What has been happening at the national level over the past decade and more has been happening at the State level for some time now, cutting across parties and States. Consider the record.

In the 2004 Lok Sabha elections, the victory of the Congress was defined by the impressive gains it made in Andhra Pradesh under the leadership of the late Y.S. Rajasekhara Reddy. It was Dr. Reddy’s sustained grassroots campaign that unseated the Telugu Desam supremo, Nara Chandrababu Naidu, and gave the Congress a decisive edge over the BJP. The National Democratic Alliance led by Atal Bihari Vajpayee lost also because in Tamil Nadu the Congress ally, M. Karunanidhi, ousted J. Jayalalithaa. Dr. Reddy repeated his performance in 2009 with his highly personalised campaign and helped Dr. Singh return to power.

In most other States where the Congress won the elections, the vote was as much for its chief ministerial candidate as it was for the party — Oommen Chandy in Kerala, Tarun Gogoi in Assam, Shiela Dikshit in Delhi and Siddaramaiah in Karnataka. The Karnataka voter punished the BJP because of B.S. Yeddyurappa’s tenure and rewarded Mr. Siddaramaiah.

All regional or caste-based parties have long approached the voter in the name of the leader. Which is at least one reason all of them have become family controlled parties. The phenomenon of ‘dynasty’ in Indian politics began with Indira Gandhi’s personalised campaign of 1980, managed by her younger son Sanjay. The natural consequence was the feudal succession that was staged after her death when Rajiv Gandhi was made party leader and Prime Minister. The leader’s family slowly took possession of the party.

Regional and caste-based parties may have initially been voted to power on the strength of their ideology and manifesto, but their fortunes have become increasingly linked to the popularity of their leaders.

In his recently published memoir, The Chinar Leaves, Indira loyalist Makhan Lal Fotedar reminds us that even as late as in the early 1980s, party leaders such as R. Venkataraman, P.V. Narasimha Rao, Pranab Mukherjee and even Madhavrao Scindia were viewed as potential prime ministerial candidates. Once the family domination of the Indian National Congress was complete, regional parties followed suit.

Thus, the Dravida Munnetra Kazhagam transformed itself from being a normal, ideology-based party to a party dominated by the leader’s family. The All India Anna Dravida Munnetra Kazhagam and the Telugu Desam Party, as indeed the many Congress breakaway groups, began as ‘leader-oriented’ parties rather than cadre-based parties. The Lohia Socialists of the north imitated these examples. Coming to power on the strength of an ideology and in pursuit of a cause, they all became ‘leader’ oriented.

Even in ideology-based parties like the BJP and the CPI(M), elections have been fought in the name of the leader with a mass appeal. In 1998 and 1999, the BJP’s Lok Sabha campaign revolved around the personality of Mr. Vajpayee. The turning point came, as BJP observers pointed out at the time, when the crowds came to hear only Mr. Vajpayee speak and thinned out when Mr. Advani rose to speak.

In Gujarat, Mr. Modi became the BJP’s face, as did Vasundhara Raje Scindia in Rajasthan, Shivraj Singh Chouhan in Madhya Pradesh and Raman Singh in Chhattisgarh. Mr. Modi’s attempt to secure control of his party in these States has been refuted by the assertion of State leaders. Mr. Modi’s success in Maharashtra and Haryana in ‘nominating’ State Chief Ministers after the elections were fought in the name of the party, a la Indira Gandhi and Rajiv Gandhi, may have encouraged him to overreach in Delhi. He failed to learn the lesson in time for Bihar.

The experience of the Left only underscores the point. In West Bengal, the CPI(M) was made invincible by the personality of the late Jyoti Basu. It was only when a dynamo like Mamata Banerjee arrived on the scene, and Basu was followed by a less charismatic figure, that the CPI(M) lost power. In Kerala, the victory of the Left Front in 2006 was defined by the personality of ‘Comrade VS.’ It remains to be seen what alternative the Left will present in West Bengal and Kerala to the popular incumbents — Mamata Banerjee and Oommen Chandy — in next year’s elections.

Many political analysts made the point in the 2012 State elections in Uttar Pradesh that the Congress would have repeated, or even improved upon, its 2009 Lok Sabha performance had the voters been given the choice of electing Rahul Gandhi their Chief Minister. In many ways, Mr. Modi repeated in Bihar the mistake Rahul made in U.P. — seeking votes for a party rather than an individual.

‘Winners’ preferred

Bihar shows that the era of centrally nominated Chief Ministers is over. Even national parties have to pick ‘winners’ now as CMs. Going forward, therefore, the Congress ought to know that victory in Assam would depend on whether the voters in Assam want more of Mr. Gogoi or would like to see him go.

All this is not to suggest that party loyalties and ideology do not matter. Of course, they do for a large majority of voters who remain loyal to their party. That forms a party’s core support base. But elections are not won and lost due to major shifts in the core. It is the ‘non-core’ voter and the first generation voter, with no firm loyalty to a party, who defines the final outcome.

The ‘floating’ voter opted for Manmohan Singh in 2009 and for Narendra Modi in 2014. The challenge for the prime ministerial candidates of 2019 will be to retain the loyalty of the core constituency while gaining new voters — both from rivals and from first generation voters. It is a race in which Mr. Modi still remains leagues ahead of all potential rivals, and there are so many of them among the self-made CMs around the country!

A well-functioning insolvency resolution framework is fundamental for dealing with business failures

From non-performing to performing

A well-functioning insolvency resolution framework is fundamental for dealing with business failures 

A well-functioning insolvency resolution framework is fundamental for dealing with business failures

The ministry of finance recently released the draft Insolvency and Bankruptcy Code (IBC), proposed by the Bankruptcy Law Reforms Committee. The government of India greeted this bill as among its biggest and most crucial reforms. To a person unconnected with finance, it may be unclear why this is important or what ails the current framework. A well-functioning insolvency resolution framework is fundamental for dealing with business failures that inevitably occur in any economy. Additionally, an effective insolvency resolution process is one tool, among others, for banks and other creditors to address low recovery rates.

This is particularly relevant for India where economic growth is contingent upon the financial health of the banking sector. Banks in India face acute problems of asset quality. Perceiving that laws did not sufficiently empower secured creditors to activate recovery by seizing security, the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, and Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002, were enacted to facilitate the enforcement of security by banks and financial institutions.

Asset reconstruction companies were constituted under SARFAESI to buy bad debts from banks and recover from defaulters. Domestic banks also have recourse to corporate debt restructuring and joint lenders forum mechanism to resolve stress in consortium loans.

None of these initiatives seems to have helped. Gross non-performing assets (NPAs) as percentage of total advances went up from 3.4% in March 2013 to 4.45% in March 2015. The picture is grimmer when volume of restructured assets is also considered in stressed advances. As a percentage of total advances, overall stressed advances increased from 9.2% to 10.9% between 2013 and 2015. Average recovery rate for secured debt is as low as 20%. One factor responsible for all this is a weak legal framework for resolving failure. Once debts go bad, creditors’ ability to realize value is predicated on a robust insolvency resolution mechanism.

Accumulation of bad debts in bank balance sheets has systemic risk implications for the entire economy. As capital gets tied up in provisioning for bad debts, banks get inhibited from extending fresh credit, slowing down the real sector. Absence of a well-functioning insolvency framework that protects creditors’ rights also thwarts the development of alternative lenders, such as corporate bond market. There are admittedly other issues systemic to the banking system and capital market that compound these problems. However, an insolvency law focused on preserving viable businesses as going concerns and liquidating unviable ones is the cornerstone of a mature financial system and India urgently needs one.

Aparna Ravi highlights in a paper titled The Indian insolvency regime in practice—an analysis of insolvency and debt recovery proceedings that the current framework in India is highly fragmented with decisions frequently stayed or overturned by judicial forums having overlapping jurisdiction. There is no clarity on whether the right of secured creditors initiating recovery under SARFAESI will prevail, or unsecured creditors initiating winding-up under the Companies Act or the company triggering proceedings under the Sick Industrial Companies (Special Provisions) Act, 1985, (SICA).

Substantive issues exist with even initiation of insolvency resolution or the process of winding up. SICA is triggered when more than half a company’s net worth has eroded. Board for Industrial & Financial Reconstruction (BIFR) and the high courts are reluctant to liquidate unviable companies. Ironically, the trigger for winding up a company is too low. The default is Rs.500. Courts, therefore, do a full hearing on merits at admission stage itself, limiting efficacy. Creditors, especially non-banks, do not have access to a mechanism to assess the viability of an enterprise and address the problem, without the threat of other proceedings initiated by the debtor or other creditors torpedoing them. Even when proceedings are triggered, debtor’s existing management retains control, thereby creating the risk of asset stripping.

Under SARFAESI, creditors are empowered to take over management of a company but only that part of the company connected to the secured asset. Since potential liability to creditors is high, this is rarely invoked. There is no corresponding provision for non-banks. There is also no linearity of proceedings. Under SICA, even if BIFR recommends liquidation, a reference is made to the high court, which would re-examine the recommendation and might even reverse it.

With the proposed IBC, the labyrinth of extant Indian laws dealing with corporate insolvency are being replaced by a single comprehensive law that (a) empowers all creditors—secured, unsecured, financial and operational to trigger resolution, (b) enables the resolution process to start at the earliest sign of financial distress, (c) provides a single forum overseeing all insolvency and liquidation proceedings, (d) enables a calm period where other proceedings do not derail existing ones, (e) replaces existing management during insolvency proceedings while keeping the enterprise as a going concern, (f) offers a finite time limit within which debtor’s viability can be assessed and (g) under bankruptcy, lays out a linear liquidation mechanism.

The proposed framework strengthens creditors, without discrimination. While this will not necessarily be a magic bullet that will make the mass of NPAs vanish from bank balance sheets, it can facilitate better recovery and faster closure of troubled assets. IBC will prevent new loans from getting added to existing stock of NPAs. It will aid development of alternative debt securities, spread the risk of corporate failure across larger sets of creditors, and lead to the double benefit of lower systemic risk as well as deeper debt finance for a rapidly growing economy of entrepreneurs.

A sunny alliance to fight climate change With progress in technology, solar energy is rapidly becoming competitive

A sunny alliance to fight climate change

With progress in technology, solar energy is rapidly becoming competitive 

More than 130 heads of states are expected to speak at the 21st session of the Conference of Parties (COP 21) to the United Nations Framework Convention on Climate Change (UNFCCC) starting in Paris on 30 November. On the inaugural day, Prime Minister Narendra Modi and French President François Hollande are expected to jointly launch an international solar alliance of more than 100 countries located between the tropics. Mooted by the prime minister, the alliance aims to bring together countries endowed with a rich supply of sunlight on a common platform to jointly pursue the development of solar power through effective sharing of finance, technology and best practices.

With rapid progress on frontiers of technology and the availability of capital at low costs, solar has emerged as an attractive source of energy. A recent tender floated for a solar park in Andhra Pradesh’s Kurnool district by state-run NTPC received a record low bid of Rs.4.63 per kilowatt-hour by US-based SunEdison Inc. The convergence in tariffs with other sources of energy is unmistakable. The solar alliance may further bring down the costs by permitting effective exploitation of economies of scale and comparative advantages of different countries in research and development, manufacturing and finance. The gains from such an alliance will also depend on the design of the institution and how its objectives are aligned with the national interests of the participating countries.

The world famous entrepreneur Peter Diamandis once said, “We live in a world bathed in 5,000 times more energy than we consume as a species in the year, in the form of solar energy. It’s just not in usable form yet. But there are amazing breakthroughs there… Technology can help that.”

It is exactly what technology is doing. According to a study by Bloomberg New Energy Finance (BNEF), the year 2015 has seen significant enhancement in the competitiveness of onshore wind and crystalline silicon photovoltaics against coal-fired and gas-fired electricity generation. The SunEdison’s bid in Andhra Pradesh is indicative of the same trend in India.

Since coming to power, Modi has taken a number of steps to ramp up the use of renewable energy and combat climate change. He stepped up the target for solar energy set by the previous government five-fold to 100 gigawatts (GW) to be achieved by 2022. The target for renewable energy is now 175 GW for the same year. With financial and technological assistance from developed countries—as stated in its Intended Nationally Determined Contribution submitted to the UNFCC in the run-up to the Paris climate talks—India aims to achieve 40% cumulative electric power installed capacity from non-fossil fuel-based energy resources by 2030. These targets have served as an appropriate signalling instrument for India’s commitment to the fight against climate change.

A number of global green firms like SunEdison are seeking opportunities to invest in clean energy projects. As India stakes its claims for these investments, it faces tough competition from other major developing nations. India has slipped down by one position in the past one year in the 2015 Climatescope report published by the BNEF, which ranks the top countries for renewable energy companies to do business in.

Among the 55 countries from Asia, Africa, Latin America and the Caribbean studied by the BNEF, India now stands at No. 5, behind China, Brazil, Chile and South Africa. The top performing states in India are Tamil Nadu, Karnataka and Madhya Pradesh. In a healthy sign, Rajasthan and Uttar Pradesh, perceived to be laggard states, find a place in the top 10.

The planned move to establish the international solar alliance comes at an interesting time. At the Paris climate talks, many believe that India might be pressured to accept far more stringent targets than it has committed to. On the other hand, the initiative of building an international solar alliance will accord India with a soft power image and leadership position that will blunt the pressure tactics of the developed countries. The task for India at Paris, however, remains tough as it has to display its firm commitment towards combating climate change while at the same time preserving for itself the rightful space to grow, a process which will inevitably involve significant growth in carbon emissions. Not discounting its potential long-terms benefits, an international solar alliance can be a useful part of India’s balancing strategy in Paris.

Will an international solar alliance help in reducing the cost of solar power?

हिमालय पर विश्व वन्य कोष की रिपोर्ट

भारत उन प्रमुख राष्ट्रों में से एक है जिन्हें प्रकृति ने प्रचुर जैव-विविधता का अमूल्य उपहार प्रदान किया है। उत्तर में विशाल हिमालय तथा दक्षिण-पश्चिम एवं पूरब में समुद्र से घिरा भारत विश्व की 7-8 प्रतिशत जंतु एवं वानस्पतिक प्रजातियों का निवास स्थल है। 96000 पशु प्रजातियों तथा 45500 पौध प्रजातियों के निवास वाले भारत में विश्व के 12.5 प्रतिशत स्तनी; 4.5 प्रतिशत पक्षी, 45.8 प्रतिशत सरीसृप एवं 55.8 प्रतिशत उभयचर पाए जाते हैं। भारत के 4 जैव-विविधता वाले क्षेत्रों को जैव-विविधता हॉट स्पॉट घोषित किया गया है।
जीवन की विविधता धरती पर मानव के अस्तित्व और स्थायित्व को मजबूती प्रदान करती है। संयुक्त राष्ट्र संघ द्वारा 22 मई को अंतर्राष्ट्रीय जैव-विविधता दिवस घोषित किए जाने के बावजूद यह जरूरी है कि प्रति दिन जैव-विविधता से संबद्ध मामलों की समझ और उनके लिए जागरूकता बढ़ाई जाए। इसी लक्ष्य के दृष्टिगत ‘विश्व वन्य कोष’ (World Wild Life Fund) ने 5 अक्टूबर को ‘विश्व पर्यावास दिवस’ (World Habitat Day) के अवसर पर पूर्वी हिमालय की जैव-विविधता से संबंधित एक रिपोर्ट जारी की, जिसके माध्यम से 10000 पौध प्रजातियों, 300 स्तनी, 977 पक्षी, 176 सरीसृप, 105 उभयचर तथा 269 ताजे पानी की मछलियों वाले इस पूर्वी हिमालय क्षेत्र में बढ़ रहे पर्यावास संकट के प्रति लोगों को आगाह किया गया है।

• 5 अक्टूबर, 2015 को विश्व पर्यावास दिवस के अवसर पर विश्व वन्य कोष ने पूर्वी हिमालय की जैव-विविधता से संबंधित एक रिपोर्ट जारी की।
• हिडेन हिमालयाजः एशियाज वंडरलैंड (Hidden Himalayas : Asia’s Wonderland) नामक इस रिपोर्ट में उन नवीन प्रजातियों का वर्णन है जिन्हें वर्ष 2009 से वर्ष 2014 के मध्य इस क्षेत्र में खोजा गया था।
• वर्ष 2009-14 के मध्य पूर्वी हिमालय क्षेत्र में 211 नई प्रजातियों की खोज की गई। इसमें 133 पौधे, 39 अकशेरुकी, 26 मत्स्य, 10 उभयचर, एक सांप, एक पक्षी तथा एक स्तनी शामिल हैं।
• इस रिपोर्ट में नेपाल का तराई क्षेत्र, भूटान, उत्तर-पूर्वी भारतीय राज्य (अरुणाचल प्रदेश, असम, सिक्किम तथा उत्तरी बंगाल) उत्तरी म्यांमार एवं दक्षिणी तिब्बत के क्षेत्र को सम्मिलित किया गया है।
• इन खोजी गई नवीन प्रजातियों में 15 भूटान एवं 60 से अधिक नेपाल से संबद्ध हैं।
• नवीन प्रजातियों में हिमालयन पिट वाइपर (प्रोटोबो थ्रोप्स-हिमालयंसुस), लघु ड्रेकुला फिश (डनियोनेल्ला ड्राकुला), बोनी स्नेक हेड मछली (चन्ना एंड्राओ), चपटी नाक वाला बंदर (रिनोपिथेकस स्ट्राइकेरी) तथा नीली आंख वाला मेंढ़क (लेप्टो ब्राचियम बोम्पू) प्रमुख हैं।
• पौधों की 133 प्रजातियों में 15 सुंदर आर्किड की प्रजातियां सम्मिलित हैं। ये पौधे 35 विभिन्न वानस्पतिक परिवारों से संबद्ध हैं।
• लेफ्रागुरी (पश्चिम बंगाल) से स्नेक हेड मछली की एक नवीन प्रजाति की खोज की गई है।
• 1.2 मीटर तक अधिकतम लंबाई वाली यह मछली 4 दिन तक स्थल पर जीवित रह सकती है। पानी के अंदर होने पर इसे सतह पर सांस लेने के लिए आना पड़ता है।
• स्पाटेड एलाचुरा या स्पाटेड रेन (Wren) बब्लेर (एलाचुरा-फारमोसा) घने जंगलों में पाई जाने वाली गहरे भूरे रंग की एक चिड़िया है।
• इस चिड़िया की किसी पक्षी, परिवार या प्रजाति से कोई समानता नहीं है।
• अरुणाचल प्रदेश में मेंढक की एक नई प्रजाति की खोज की गई है। यह लेप्टो ब्राचियम प्रजाति में सबसे अलग है क्योंकि इसकी आंखों का रंग नीला है।
• अरुणाचल प्रदेश से सींग वाले एक मेंढ़क की (मेगोफ्रायस अंक्राए) खोज की गई है।
• साथ ही इस रिपोर्ट में पूर्वी हिमालय के क्षेत्र में बढ़ रहे संकटग्रस्त वनस्पति तथा जंतुओं की प्रजातियों पर चिंता व्यक्त की गई है।
• इसका प्रमुख कारण घटते आवास को बताया गया है रिपोर्ट के अनुसार, 25 प्रतिशत ही जैव आवास शेष बचे हैं। रिपोर्ट में जीवों के आवास बचाने तथा अन्य उपाय करके इन्हें बचाने का भी सुझाव दिया गया है।
• रिपोर्ट में जलवायु परिवर्तन को इसके लिए प्रमुख जिम्मेदार माना गया है। साथ ही जनसंख्या वृद्धि, निर्वनीकरण, अत्यधिक चराई, मानवीय अतिक्रमण, वन्य जंतुओं का व्यापार, खनन प्रदूषण एवं जल-विद्युत विकास भी पारितंत्र के लिए नुकसानदेय है।

भारत के प्रमुख जैव-विविधता हॉट स्पॉटस हिमालय-संपूर्ण हिमालय क्षेत्र जिसमें भारतीय हिमालय क्षेत्र सहित पाकिस्तान, तिब्बत, नेपाल, भूटान, चीन तथा म्यांमार सम्मिलित हैं। इंडो बर्मा-इसके क्षेत्र में उत्तर-पश्चिम भारत, म्यांमार, थाइलैंड, वियतनाम, लाओस, कंबोडिया तथा दक्षिणी चीन सम्मिलित हैं। सुंडालैंड-सुंडालैंड हॉट स्पॉट के अंतर्गत निकोबार द्वीप समूह के साथ-साथ इंडोनेशिया, मलेशिया, सिंगापुर, ब्रुनेई तथा फिलीपींस को सम्मिलित किया गया है। पश्चिम घाट एवं श्रीलंका-इस हॉट स्पॉट में पश्चिम घाट एवं श्रीलंका सम्मिलित हैं। स्रोत-इनविस (Envis) सेंटर ऑन फ्लोरल डायवर्सिटी-स्पांसर्ड बाई-मिनिस्ट्री ऑफ एनवायरनमेंट, फॉरेस्ट एंड क्लाइमेट चेंज, गवर्नमेंट ऑफ इंडिया।

The new wave of global terrorism

The recent series of dastardly and heinous attacks hold several important lessons for international efforts to counter terrorism

he recent series of dastardly and heinous attacks in places as dispersed as Baghdad, Beirut, Bamako, Kabul and Paris by myriad terrorist outfits ranging from the Taliban to Islamic State and al-Qaeda hold several important lessons for international efforts to counter terrorism.

First, cities, especially those with a significant international presence (such as Bamako, one of the fastest growing cities in Africa and the world with a population of two million) or megapolis’ that are centres of the globalized world (such as Madrid, London, Mumbai or Paris) have predictably emerged as the preferred targets of terrorism for a number of reasons. In contrast, attacks in rural areas, such as Gurdaspur, fade out of the public eye.

The role of cities as engines of global economy coupled with their dense populations, openness and dynamism makes them particularly attractive for assault. Unsurprisingly, even small groups of less than 10 have effectively terrorized and paralysed a city for days. Consequently, as the world continues to urbanize—more than 50% of the global population will be living in cities by 2030—cities will become battlefields of terrorism. How acts of terror are prevented and dealt with in cities will be significant in blunting the objectives of terror groups.

This is being increasingly recognized and acted upon by national and local leadership. Most recently, following the Paris outrage, French President Francois Hollande called a special meeting of all city mayors to strengthen their ability to prevent and combat attacks. Similarly, cities such as New York have dedicated counter-terrorism units whose personnel are not only proactive in the city, but further afield in countries where such attacks are planned and practised.

In contrast, Indian cities, even after the 2008 Mumbai attacks, remain woefully ill-prepared at the local level to respond to, let alone prevent, such attacks. Here, the government’s smart cities initiative is a useful opportunity to build the necessary resilience of Indian cities to protect themselves against acts of terror.

Second, cities and states—particularly democratic ones—struggle to find the appropriate and effective response to terrorist groups, which will on the one hand deter or destroy the terrorist group and on the other uphold the democratic and pluralistic values that the states are built upon. Often, given the traumatizing and stunning nature of the attacks, states are inclined to prioritize the former at the cost of the latter.

However, the shock and awe of urban terror attacks notwithstanding, it is important to remember that no terrorist group has ever succeeded in entirely defeating and overwhelming a state. The only exception is the Taliban-al-Qaeda combine, which was able to capture Afghanistan in the 1990s. However, even this group was able to accomplish this reportedly only with the help of other states—notably from Pakistan and Saudi Arabia. Thus, states confronting terror attacks can choose the time and place to retaliate, although managing public outrage is a formidable challenge.

Finally, in many of these incidents—notably Paris and London—the attacks were carried out by disgruntled and marginalized citizens, holed up in their suburban ghettos, bitter at being excluded from the mainstream polity and prosperity of their countries, and seeking extremely destructive ways to express their grievance. This is evident from the fact that over a thousand French citizens and around 750 Britons have joined Islamic State. In the long run, assimilating such individuals (mostly belonging to the minority) would be imperative to weed out the scourge of terrorism. India, which has lost only 100 or so of its citizens (despite its much bigger population) to this extremist cause by building a viable counter narrative and an inclusive pluralistic society, needs to ensure that both are strengthened.

Countries can choose to ignore these lessons from the new wave of terrorism only at their own peril.

Can India deliver in South-East Asia?

India cannot afford the luxury of inaction if it wants to preserve credibility in East and South-East Asia

Prime Minister Narendra Modi’s visit to Malaysia and Singapore has once again focused the attention of Indian diplomacy on a region that is not only a hub of economic growth and prosperity in Asia, but is also critical for global stability against the backdrop of China’s rise. While trade and investment remain central to India’s outreach to South-East Asia, the larger strategic context should not be lost sight of as India engages with the region. India has been building strategic partnerships with Malaysia and Singapore, but New Delhi needs to engage with the region as a whole more substantively.

New Delhi, which so often likes to sit on the margins and avoid taking sides, must assume it can no longer afford the luxury of inaction if it wants to preserve credibility as a significant actor in both East and South-East Asia. New Delhi has an ambition to expand its footprint in the region, which has so far been viewed as outside India’s core interests. At a time when China’s bullying behaviour has been evident in its actions and pronouncements, India should be doing more to signal that it is ready to emerge as a serious balancer in the region. The regional states have often complained about Indian diffidence and its lack of seriousness. The Modi government is more serious than its predecessor, though it remains far from clear if it is well-prepared to challenge China on its own turf.

India is wading into the South China Sea dispute between China and its neighbours by not only calling for “freedom of navigation in international waters, the right of passage and over-flight, unimpeded commerce and access to resources in accordance with recognized principles of international law including the 1982 United Nations Convention on the Law of the Sea”, but also agreeing to cooperate with the US in “safeguarding maritime security and ensuring freedom of navigation and over-flight throughout the region, especially in the South China Sea”. Presenting a contrast to China’s aggressive policies in the South China Sea, India is also showcasing its own maritime dispute with Bangladesh, which it successfully resolved through international arbitration, as an example worth following in the region. Recently, in its joint statement with the Philippines, India referred to the South China Sea as the West Philippine Sea, a term that Manila has been using since the escalation of its maritime dispute with China. Defence cooperation is soaring with regional countries ranging from Japan, Vietnam, the Philippines and Singapore to extra-regional powers such as the US and the UK.

But India needs to do more and move fast. The engagement of East and South-East Asia remains a top foreign policy priority for the Indian leadership. India has been a full dialogue partner of the Association of Southeast Asian Nations (Asean) since 1995, a member of the Asean Regional Forum, the regional security forum, since 1996, and became a founding member of the East Asian Summit launched in December 2005. India is also a summit partner of Asean on par with China, Japan and South Korea since 2002. India has also cultivated extensive economic and trade linkages with various countries in the region, paralleling a gradual strengthening of security ties.

India and Asean marked their 20 years of partnership with a commemorative summit in New Delhi in December 2012. The highlight of the summit was the conclusion of talks on a free trade agreement (FTA) on services and investment, which is expected to increase bilateral trade to $200 billion by 2022 and lead to talks on the Regional Comprehensive Economic Partnership, which also includes Australia, China, Japan, South Korea and New Zealand. India was admitted as a sectoral dialogue partner of Asean in 1992 and went on to become a full-fledged dialogue partner in 1996. There has been a significant increase in India-Asean trade from $42 billion in 2008 to an estimated $100 billion this year. The FTA on goods was signed in 2010 despite some significant opposition in India, and the FTA in services and investments with Asean came into force in July 2015, paving the way for freer movement of professionals and further investment opportunities.

It is time now for India to push for its membership in the Asia-Pacific Economic Cooperation, especially as this is something that India’s partners in the region and beyond are enthusiastic about under a proactive Modi government.

India’s efforts to make itself relevant to the region come at a time of great turmoil in the Asian strategic landscape. Events in recent years have underlined China’s aggressive stance against rivals and US allies in Asia. And there may be more tension to come. With its political and economic rise, Beijing has started trying to dictate the boundaries of acceptable behaviour to its neighbours. As a result, a loose anti-China balancing coalition is emerging. India’s role becomes critical in such an evolving balance of power. As Singapore’s elder statesman Lee Kuan Yew suggested long back, India should be “part of the South-East Asia balance of forces” and “a counterweight (to China) in the Indian Ocean”.

New Delhi needs to assure the regional states of its reliability not only as an economic and political partner, but also as a security provider. As the regional balance of power in Asia changes and as the very coherence of the Asean comes under question, there will be new demands on India. The rapid rise of China in Asia and beyond is the main pivot even as New Delhi seeks to expand economic integration with the region. India is also developing strong security linkages with the region and trying to actively promote and participate in regional and multilateral initiatives. Smaller states in the region are now looking to India to act as a balancer in view of China’s growing influence and America’s anticipated retrenchment from the region in the near future. And larger states see this as an attractive engine for regional growth.

It remains to be seen if India can indeed live up to its full potential, as well as to the region’s expectations.