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Guns vs. butter at Wuhan meeting

By M K Bhadrakumar | Indian Punchline | May 2, 2018

The anxiety syndrome in the American write-ups on the Wuhan summit is truly tragi-comic. An analyst at the Brookings Institution confidently predicted even before the summit between Prime Minister Narendra Modi and Chinese President Xi Jinping that the event was much ado about nothing. The US government-funded Voice of America in an analysis has now arrived at the same conclusion, after the summit. Why are these American analysts in such tearing hurry to debunk the Wuhan meeting?

It’s geopolitics, stupid! The prestigious Stockholm International Peace Research Institute (SIPRI) released a report today which says amongst other things that India’s defence spending rose by 5.5 per cent to US$63.9 billion in 2017, overtaking that of France as one of the world’s top five military spenders. The report estimates that one of the main motivations behind India’s plans to expand, modernise and enhance the operational capability of its armed forces lies in its tense relations with China.

From the US perspective, the situation is ideal to advance the business interests of America’s vendors of weaponry. Last year, business deals worth $15 billion were chalked up. Any improvement in India-China relations will profoundly hurt American interests. Fueling India-China tensions is a major objective of the US’ regional strategy.

Alas, there are Indians too who are eagerly serving the US interests. A prominent Chinese expert on South Asia recently wrote (in the context of the Wuhan meeting), “Many strategic elites in India are financially backed by the West and hence speak for Western countries.” It is a national shame, but true.

Be that as it may, these guys are missing the plot. Prime Minister Modi’s recent decisions to improve India-China relations, adjust India’s neighborhood policies and to rebalance India’s ties with the major powers are linked to his political agenda. Of course, the good part is that this agenda is also in the national interests.

Take India-China relations. The Voice of America is stupid to assume that the Wuhan meeting was about border tensions. No doubt, it is important that peace and tranquility prevails on the border with China. The Doklam standoff was an eye-opener for the political leadership. Hence the “strategic guidance” to the military issued from Wuhan (which is actually an order from the civilian leadership to the generals) to defuse confrontations during patrols in accordance with existing protocols and mechanisms. The military people may not like it, but that’s how a democracy prioritizes butter over guns.

Clearly, Modi’s top priority is about Chinese investments in India. The drivers of the Indian economy in our establishment played a decisive role in bringing about the strategic shift in the thinking toward China – and in preparing for the Wuhan meeting.

The fact of the matter is that China is already positioning itself as among India’s top investors. In 2017, despite Doklam, China tripled its investment to $2 billion. Bilateral trade touched $84.44 billion in 2017, which is an increase of 18.63% over 2016. (By the way, Indian exports to China went up by 40%.) This year, bilateral trade in the first quarter already hit $22.1 billion, up 15.4% year on year. In April, the two countries signed over 100 trade agreements, worth $2.38 billion, when a Chinese trade delegation visited India.

According to a report in Forbes magazine recently, India is courting Chinese companies to bridge its infrastructure deficit. Last year, China’s Sany Heavy Industry planned an investment of $9.8 billion in India, while Pacific Construction, China Fortune Land Development and Dalian Wanda planned investments of more than $5 billion each. Earlier this year, the China-led Asian Infrastructure Investment Bank approved funding of $1 billion for projects in India.

Meanwhile, Chinese investors have been pouring money into sectors outside the remit of government agencies. In 2015, Alibaba invested $500 million in Snapdeal and $700 million in Paytm. In 2016, Tencent invested $150 million in Hike, a messaging app, and a consortium of Chinese investors paid $900 for media.net. In 2017, Alibaba and Tencent announced or closed deals valued close to $2 billion—Alibaba’s second tranche of $177 million in Paytm, $150 million in Zomato, $100 million in FirstCry and $200 million in Big Basket. Tencent’s investments included $400 million in Ola, $700 million in Flipkart and a second round of investment in Practo. Last year, China’s drug giant Fosun Pharma acquired a 74% controlling stake in India’s Gland Pharma for $1.1 billion. Chinese smartphone makers Xiaomi, Huawei and Oppo all are operating manufacturing plants in India, and have had great successes in Indian market, too.

These plain facts may not be significant enough for our ‘China hands’, but they are a compelling reality for the PMO and North Block. Let me quote from the report in the Forbes magazine:

  • Seemingly, there’s a shared belief in both countries (India and China)  that a position of hostility undermines their interests, and stabilizing relations at a time of global uncertainty will yield economic dividends. India’s competitive edge in information technology, software and medicines, and China’s strengths in manufacturing and infrastructure development make the two sides natural partners…

By the way, it is yet to sink in that the single most far-reaching outcome of the Wuhan meeting could be that India is sidestepping the CPEC controversy and is moving on to join hands with China in the construction of the so-called Five Nations Railway Corridor connecting Xinjiang with Iran. It is a prestigious flagship project of the so-called Silk Road Economic Belt, which was proposed by President Xi Jinping in 2013. Conceivably, this could be the first step in a long journey. China has shown great interest in developing economic corridors to India across Nepal and Myanmar.

To be sure, Modi travelled to Wuhan with the “big picture”. Read a perspective on the Wuhan summit featured in the CNBC entitled China and India are trying to write a new page of the world economy, here.

May 3, 2018 Posted by | Economics | , , , , | Leave a comment

Cuban missile crisis yields more secrets

By M K Bhadrakumar | Indian Punchline | October 17, 2017

History lends itself to re-interpretation when more facts become available or when ulterior motives creep in. There is a surfeit of the latter happening in India currently. Nothing is spared, even symbolically, in India’s history today – starting from Nehru’s legacy  to Taj Mahal to Vinayak Damodar Savarkar. However, such revisionist history (‘historical negationism’) is interchangeable with fiction or folklore and on the whole it fails to stick. Historical reappraisals are an entirely different thing.

Based on new archival materials becoming available every now and then, a slice of Cold War era history that is still dissected and understood from new perspectives is the so-called Cuban Missile Crisis of 1962. The narrative that was dominant initially was that the Soviets surreptitiously tried to deploy inter-continental ballistic missiles (ICBM) to Cuba targeting the US and the attempt was nipped in the bud with the Kennedy administration staring down the then Kremlin boss Nikita Khrushchev through a display of naval blockade of the island.

As time passed, the informed sections of opinion came to know that it was a settlement negotiated through nerve-wracking back channel negotiations directly between the Oval Office and the Kremlin – even Fidel Castro was kept in the dark – that brought the crisis to an end, with the Soviets and the Americas rolling back their missile respective deployments to each other’s backyard – Cuba and Turkey. The Soviets, true to character, eschewed triumphalism so long as the strategic objective was realised, leaving the Americans free to claim ‘victory’.

However, what still remains less understood is that the crisis in 1962 was not just about the Soviet missile deployment. There was also alongside a full-bodied American agenda of ‘regime change’ in Cuba. Incredibly enough, the Pentagon had drawn up a detailed report on the overthrow of Fidel’s government by a military government headed by a US commander and military governor – something like the American occupation of Japan led by General Douglas MacArthur in September 1945. Proclamation No 1 that was to have been issued, which vested “all powers of government, executive, legislative, and judicial and all jurisdiction in the occupied territory and over its inhabitants” in the hands of the US military governor. The Proclamation stated:

  • All persons in the occupied territory (Cuba) will obey immediately and without question all enactments and orders of the military government. Resistance of the United States Armed Forces will be forcefully stamped out. Serious offenders will be dealt with severely. So long as you remain peaceable and comply with my orders, you will be subjected to no greater interference than may be required by military exigencies.

Also, leaflets were to be airdropped in their thousands all over Cuba advising that “U.S. armed forces will take temporary charge of your country.” They were to warn Cuban citizens to “remain at home” because “everything that moves is a target.”

Meanwhile, the Soviets too were factoring in a possible American invasion of Cuba, the fledgling socialist state in the Western Hemisphere, and therefore had deployed tactical battlefield nuclear weapons to Cuba. With all the formidable intelligence gathering capacity at the disposal of the United States, the Americans had no inkling that if they invaded Cuba, they would have had a nasty surprise. In sum, the crisis had every potential to escalate into an apocalyptic event. (I am reminded of the recent bullish claim by our air chief that he knows precisely where and how to destroy Pakistan’s nuclear assets in one sweeping Indian air strike.)

The above are facts culled out from documents that have been declassified in the US this week under the Freedom of Information Act (here). To my mind, the most fascinating document is the (redacted) post-mortem report on the entire episode of the Cuban Missile Crisis authored by the famous CIA spook Richard “Dick” Lehman who worked with 7 American presidents from John F. Kennedy to George H.W. Bush and was credited with creating the president’s daily intelligence briefing and regarded as one of 50 trailblazers who created the CIA. (For connoisseurs of Cold War history, Lehman’s recount of his 33 years in the world of intelligence archived in the CIA’s Library, here, makes fascinating reading.)

Much of what Lehman wrote will not come as stunning disclosure, but it is useful to know how carefully, meticulously, factually (backed with empirical evidence) an adversary’s strategic challenge needs to be studied and assimilated before the intelligence is taken to the desk of the political boss and gets morphed into decision-making. (I wonder how we fared in the run up to the recent Doklam standoff with China.) Read Lehman’s Top Secret report to the CIA Director, here.

October 17, 2017 Posted by | Militarism, Timeless or most popular | , , , , , | Leave a comment