9. November 2010 by admin.

Why Obama’s India Trip Matters? President Barack Obama is on a high-profile diplomatic trip to India this week, furthering Obama’s goal of deepening U.S.-India ties and addressing a number of related issues. Since entering office, Obama has continued President George W. Bush’s emphasis on building a special relationship between the two countries, making Indian Prime Minister Manmohan K. Singh the guest of honor at Obama’s first official state dinner. Here’s what’s happening on the visit, why it matters, and what it could mean for the two countries and beyond.

• Why the U.S. and India Want to Be Best Friends  The New York Times’ Jim Yardley writes, “Both countries are eager to build on their improved ties and set up a unique, special relationship, given that together they represent the world’s richest and largest democracies. Faced with a rising authoritarian China, and an economically wounded Europe, a weakened United States is casting about for global partners. India would seem a nice fit.”

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9. November 2010 by admin.

The other elephant

Barack Obama thinks that the rise of India will be good for American jobs. There is another side to the story

ON THE eve of the 2008 New Hampshire primary Bill Clinton finally gave vent to his fury with the Obama campaign. He dismissed Barack Obama’s message as “the biggest fairy tale” he had ever heard. (“Give…me…a…break,” he roared at the startled crowd.) And he denounced underhand tactics, particularly a description of Hillary Clinton as “the senator from Punjab”.

On November 5th Mr Obama, fresh from his humiliation in the mid-term elections, flies to India accompanied by an entourage of almost 250 businesspeople. His message for the folks back home will be that India could be a goldmine for American jobs. And he will clinch a succession of huge business deals with India—not least a $5.8 billion aircraft sale by Boeing.

Mr Obama’s win-win rhetoric is plausible enough. India is growing at about 8% a year at a time when America can barely manage 2%. It is also set to add 240m people to its working population by 2030. And America produces all sorts of things that Indians crave, from iPads to MBAs to fighter planes.

Yet the rise of new economic powers always brings problems as well as opportunities for incumbents. New companies displace old ones. New business models disrupt established ones. Comfortable workers in the rich world are forced to compete with hungrier ones in the poor world.

India is producing a legion of new global giants that are competing head-to-head with established American companies. Look at Arcelor Mittal and Tata Steel in steelmaking; Bharat Forge and Sundram Fasteners in car parts; Hindalco in aluminium rolling; and a host of companies, including Infosys, Tata Consulting Services (TCS), Cognizant and HCL Technologies, in information services. Twenty years ago India had no global companies worth mentioning. Today the Tata group earns 60% of its revenues abroad, and Indian companies ranging from natural-resource firms, such as Reliance Industries, to health-care companies, such as Pirmal Healthcare, have been snapping up American brands.

American companies are also setting up shop in India. Bangalore and Hyderabad have “electronic cities” crowded with America’s leading companies. In Bangalore Cisco spent $1 billion on its Globalisation Centre East and General Electric (GE) opened a swanky research centre. IBM employs more people in India than in the United States.

For American workers the most worrying thing about all this is the flight of brain-intensive jobs to India. Americans reconciled themselves to the loss of manufacturing jobs with the thought that they would keep the smart jobs. But they reckoned without two things: the power of the internet and the hunger of emerging-market companies.

India has long since turned itself into the world’s back-office—subjecting paper-processing hubs such as Kansas City to the same forces of competition that devastated former industrial cities such as Gary, Indiana. Now Indian-based companies are moving into an wider range of services: reading CT-scans and X-rays, processing legal documents and helping with animation. They are also moving into sophisticated niches. TCS and Infosys compete directly with IBM and Accenture in consulting. American companies are adding to the trend by moving more of their important operations to India: John Chambers, Cisco’s boss, has decreed that 20% of the firm’s leadership should be in Bangalore.

Companies in India are challenging American ones in an area that they have long considered their own—innovation. The Boston Consulting Group’s 2010 survey of innovation notes that the number of American companies on its list of top innovators is declining while the number of Indian companies is rising. It also points out that the Indian firms place a higher value on innovation than the American companies.

Most strikingly, Indian companies have produced a new type of innovation, variously dubbed “frugal”, “reverse” and “Gandhian”. The essence is to reduce the price of a product or service by a breathtaking amount—80% rather than 10%—by removing unnecessary bells and whistles. Tata Motors is selling its “people’s car” for $3,000; GE’s Indian arm offers a medical ECG machine for $400; Bharat Biotech sells a single dose of its hepatitis B vaccine for 20 cents and Bharti Airtel provides one of the cheapest wireless telephone services in the world. These frugal products are likely to disrupt established Western companies (including GE itself) by forcing them to engage in a bloody price war.

Luring them back

To add to this general turbulence Indian-based companies are also on a hiring binge. For decades America has gorged itself on a seemingly limitless supply of brilliant Indian PhD students and entrepreneurs. Half of Silicon Valley’s start-ups were either founded or co-founded by Indians. But these paragons are now returning en masse to the mother country (just as America makes life more difficult for immigrants). Why work for a sluggardly American firm when Infosys is growing at double digits? Why live in a flimsy bungalow in the Valley when an Indian company will provide you with a villa in a gated community, membership of a country club and a chauffeur-driven car?

There is an upside to these downsides. Frugal products will be a godsend for America’s pinched consumers. They may even prevent the American economy from being crushed by the health-care Godzilla. But Americans need to get back on the treadmill. In a recent speech Mr Obama told schoolchildren in Philadelphia that: “When students around the world in Bangalore or Beijing are working harder than ever, and doing better than ever, your success in school is not just going to determine your success, it is going to determine America’s success in the 21st century.” That is not a bad theme for the next two years of his presidency.

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7. November 2010 by admin.

GLOBAL AGING

A gray tsunami is sweeping the planet and not just in the places you expect. How did the world get so old, so fast?

BY PHILLIP LONGMAN

The World Faces a Population Bomb.

YES, BUT OF OLD PEOPLE. Not so long ago, we were warned that rising global population would inevitably bring world famine. As Paul Ehrlich wrote apocalyptically in his 1968 worldwide bestseller, The Population Bomb. In the 1970s and 1980s hundreds of millions of people will starve to death in spite of any crash programs embarked upon now. At this late date, nothing can prevent a substantial increase in the world death rate. Obviously, Ehrlich’s predicted holocaust, which assumed that the 1960s global baby boom would continue until the world faced mass famine, didn’t happen. Instead, the global growth rate dropped from 2 percent in the mid-1960s to roughly half that today, with many countries no longer producing enough babies to avoid falling populations. Having too many people on the planet is no longer demographers’ chief worry; now, having too few is.

It is true that the world’s population overall will increase by roughly one-third over the next 40 years, from 6.9 to 9.1 billion, according to the U.N. Population Division. But this will be a very different kind of population growth than ever before, driven not by birth rates, which have plummeted around the world, but primarily by an increase in the number of elderly people. Indeed, the global population of children under 5 is expected to fall by 49 million as of midcentury, while the number of people over 60 will grow by 1.2 billion. How did the world grow so gray, so quickly?

One reason is that more people are living to advanced old age. But just as significant is the enormous bulge of people born in the first few decades after World War ii. Both the United States and Western Europe saw particularly dramatic increases in birth rates during the late 1940s and 1950s, as returning veterans made up for lost time. In the 1960s and 1970s, much of the developing world also experienced a baby boom, but for a different reason: striking declines in infant and child mortality. As these global baby boomers age, they will create a population explosion of seniors. Today in the West, we are seeing a sharp uptick in people turning 60; in another 20 years, we’ll see an explosion inthe numbers turning 80. Most of the rest of the world will follow the same course in the next few decades.

Eventually, the last echoes of the global baby boomers will fade away. Then, because of the continuing fall in birth rates, humans will face the very real prospect that our numbers will fall as fast if not faster than the rate at which they once grew. Russia’s population is already 7 million below what it was in 1991. As for Japan, one expert has calculated that the very last Japanese baby will be born in the year 2959, assuming the country’s low fertility rate of 1.25 children per woman continues unchanged. Young Austrian women now tell pollsters their ideal family size is less than two children, enough to replace themselves but not their partners. Worldwide, there is a 50 percent chance that the population will be falling by 2070, according to a recent study published in Nature. By 2150, according to one U.N. projection, the global population could be half what it is today.

That might sound like an appealing prospect: less traffic, more room at the beach, easier college admissions. But be careful what you wish for.

Aging Is a Rich-Country Problem.

NO. Once, demographers believed, following a long line of ancient thinkers from Tacitus and Cicero in late Rome to Ibn Khaldun in the medieval Arab world, that population aging and decline were particular traits of “civilized�” countries that had obtained a high degree of luxury. Reflecting on the fate of Rome, Charles Darwin’s grandson bemoaned a pattern he saw throughout history: “Must civilization always lead to the limitation of families and consequent decay and then replacement from barbaric sources, which in turn will go through the same experience?”

Today, however, we see that birth rates are dipping below replacement levels even in countries hardly known for luxury. Emerging first in Scandinavia in the 1970s, what the experts call “subreplacement fertility” quickly spread to the rest of Europe, Russia, most of Asia, much of South America, the Caribbean, Southern India, and even Middle Eastern countries like Lebanon, Morocco, and Iran. Of the 59 countries now producing fewer children than needed to sustain their populations, 18 are characterized by the United Nations as “developing”, i.e., not rich.

Indeed, most developing countries are experiencing population aging at unprecedented rates. Consider Iran. As recently as the late 1970s, the average Iranian woman had nearly seven children. Today, for reasons not well understood, she has just 1.74, far below the average 2.1 children needed to sustain a population over time. Accordingly, between 2010 and 2050, the share of Iran’s population 60 and older is expected to increase from 7.1 to 28.1 percent. This is well above the share of 60-plus people found in Western Europe today and about the same percentage that is expected for most Northern European countries in 2050. But unlike Western Europe, Iran and many other developing regions experiencing the same hyper-aging—from Cuba to Croatia, Lebanon to the Wallis and Futuna Islands’ will not necessarily have a chance to get rich before they get old.

One contributing factor is urbanization; more than half the world’s population now lives in cities, where children are an expensive economic liability, not another pair of hands to till fields or care for livestock. Two other oft-cited reasons are expanded work opportunities for women and the increasing prevalence of pensions and other old-age financial support that doesn’t depend on having large numbers of children to finance retirement.

Surprisingly, this graying of the world is not by any means the exclusive result of programs deliberately aimed at population control. For though there are countries such as India, which embraced population control even to the point of forced sterilization programs during the 1970s and saw dramatic reduction in birth rates, there are also counterexamples such as Brazil, where the government never promoted family planning and yet its birth rate went down even more. Why? In both countries and elsewhere, changing cultural norms appear to be the primary force driving down birth rates—think tv, not government decrees. In Brazil, television was introduced sequentially province by province, and in each new region the boob tube reached, birth rates plummeted soon after. (Discuss among yourselves whether this was because of what’s on Brazilian television mostly soap operas depicting rich people living the high life or simply because a television was now on at night in many more bedrooms.)

The West Is Doomed by Demographics.

MAYBE. But the outlook is even worse for Asia. Those who predict a coming Asian Century have not come to terms with the region’s approaching era of hyper-aging. Japan, whose “lost decadeâ€� began just as its labor force started to shrink in the late 1980s, now appears to be not an exception, but a vanguard of Asian demographics. South Korea and Taiwan, with some of the lowest birth rates of any major country, will be losing population within 15 years. Singapore’s government is so worried about its birth dearth that it not only offers new mothers a baby bonus of up to about $3,000 each for the first or second child and about $4,500 for a third or fourth child, paid maternity leave, and other enticements to have children, it has even started spon-soringspeed-dating events.

China, for now, continues to enjoy the economic benefits associated with the early phase of birth-rate decline, when a society has fewer children to support and more available female labor for the workforce. But with its stringent onechild policy and exceptionally low birth rate, China is rapidly evolving into what demographers call a 4-2-1� society, in which one child becomes responsible for supporting two parents and four grandparents.

Asia will also be plagued by a chronic shortage of women in the coming decades, which could leave the most populous region on Earth with the same skewed sex ratios as the early American West. Due to selective abortion, China has about 16 percent more boys than girls, which many predict will lead to instability as tens of millions of unmarriageable� men find other outlets for their excess libido. India has nearly the same sexratio imbalance and also a substantial difference in birth rates between its southern (mostly Hindu) states and its northern (more heavily Muslim) states, which could contribute to ethnic tension.

No society has ever experienced the speed of population aging or the gender imbalance now seen throughout Asia. So we can’t simply look to history to predict Asia’s future. But we can say with confidence that no region on Earth is more demographically challenged.

The U.S. Baby Boom Has Saved It From an Old-Age Crisis.

FOR NOw. On its current course, the U.S. population of 310 million will continue to grow relative to that of the rest of the developed world, primarily because its birth rate, while barely at replacement level, is still higher than that of almost any other industrialized country. In purely geopolitical terms, this suggests American influence over Europe, Japan, South Korea, and other allies could grow. Yet the United States has no reason to be smug about its comparatively favorable demographics. As its allies age and even shrink in population, the United States could be forced to assume even more of the burden of policing the world’s trouble spots. Like a person in middle age, the United States now has to worry not only about its own aging, but also about how to provide for other family members who are becoming too old to fend for themselves.

And age America will. The main reason for its comparative youthfulness so far has been immigration, both legal and illegal. But according to a recent study by the Pew Hispanic Center, the number of illegal immigrants thought to be entering the United States has plunged to just 300,000 people annually—down from 850,000 in the early 2000s. More than a million immigrants from Mexico and elsewhere in Latin America have returned home in the last two years. These falling numbers are largely driven by the soaring U.S. unemployment rate, which has at least temporarily reduced the economic rewards of moving to El Norte, but they could herald a permanent shift.

Demographics explain why. Birth rates are falling dramatically across Latin America, especially in Mexico, suggesting a tidal shift in migration patterns. Consider what happened with Puerto Rico, where birth rates have also plunged: Immigration to the mainland United States has all but stopped despite an open border and the lure of a considerably higher standard of living on the continent. In the not-so-distant future, the United States may well find itself competing for immigrants rather than building walls to keep them out.Old People Will Just Work Longer.

BUT ONLY IF OLDER WORKERS ARE HEALTHY. And that’s a big if. You might have noticed a lot more middle-age Americans using canes, walkers, and wheelchairs these days. So many of Walmart’s customers are now physically impaired that the giant retailer has replaced many of its shopping carts with electric scooters that allow shoppers to remain seated as they cruise the aisles. Such sights are reflected in statistics showing that, for the first time since such recordkeeping began, disability rates are no longer improving among middle-age Americans, but getting worse.

According to a recent Rand Corp. study published in Health Affairs, more than 40 percent of Americans ages 50 to 64 already have difficulties performing ordinary activities of daily life, such as walking a quarter mile or climbing 10 steps without resting a substantial rise from just 10 years ago. Because of this declining physical fitness among the middle-aged, we can expect the next generation of senior citizens to be much more impaired than the current one.

It isn’t just Americans. Obesity and sedentary lifestyles are spreading globally. Between 1995 and 2000, the number of obese adults increased worldwide from 200 million to 300 million with 115 million of these living in developing countries. From Chile to China, McDonalds and KFC are opening franchises every day, even as people everywhere spend more and more of their time in automobiles and in front of flat-screen tvs and computer monitors. More than a billion people worldwide are now estimated to be overweight, creating a global pandemic of chronic conditions from heart disease to diabetes.

Sure, countries can and will do much more to help people age gracefully and to encourage older citizens to remain in the workforce. A recent report from the European Commission has pointed out, for example, that providing for more part-time jobs would not only encourage delayed retirement, but could also help boost birth rates by smoothing the tensions between work and family life for parents. Encouraging healthier diets would enormously lengthen productive life spans, as would building or preserving more walkable communities. But there are clear limits to how many seniors will be fit enough, mentally or physically, to compete in the global economy of the next 20 years.

These trends undermine the argument, now common around the world, that standard retirement ages must go up. Not only are improvements in life expectancy at older ages very modest and now trending toward zero, but disability rates are exploding to the point that it would be difficult for many older workers to perform in the workplace even if they had the job skills that a modern economy demands. This explains such paradoxes as the fact that U.S. employers report it is nearly impossible to find the engineering talent they need, while the unemployment rate among U.S. engineers remains extraordinarily high. The faster-evolving and more technologically sophisticated a society becomes, the more rapidly job skills—and elderly workers, sadly—become obsolete.

An Elderly World Will Be More Peaceful.

NOT NECESSARILY. Some strategists, such as scholar Mark L. Haas, speak of a coming geriatric peace. Here’s the argument: In a world of single-child families, popular resistance to military conscription should grow, as tolerance of military casualties falls. The rising cost of pensions and health care should also make sustaining military buildups increasingly difficult. Societies dominated by middle-age and older citizens may also become more risk-averse, more preoccupied with practical, domestic concerns like crime and retirement security, and less driven by adherence to violent ideologies. Japan is often held up as an example of a country that has grown more stable and peaceful as it has aged. Western Europe was wracked by domestic unrest when its vaunted Generation of 68 was still young, but as these postwar baby boomers aged and produced few children, the political and social agendas of Europe became far less radical. But there are some problems with this rosy scenario. To start, even countries that are rapidly aging can, paradoxically, produce youth bulges with all the attendant social consequences, from more violence to economic dislocation. Consider Iran. By 2020, the number of 15-to 24-year-old Iranians will have shrunk by 34 percent since 2005, according to the U.N. Population Division. This largely reflects the sharp downturn in the Iranian economy that occurred after its 1979 revolution, as well as the clerical regime’s embrace of contraception. But from 2020 to 2035, the number will again swell by 34 percent, even if birth rates continue to decline. Why? A very high proportion of Iranian women are now of childbearing age, which means that even though young Iranian women are having far fewer children than their mothers did indeed, not enough to sustain the population over time their numbers are still sufficient to create a temporary echo boom.

Many other Muslim countries, from Libya to Pakistan, will experience similarly huge oscillations in their youth populations. Most of the Central Asian republics, too, will face large echo booms in the 2020s. Long a battlefield for larger powers from the Mongols and Persians to the Russians and British, these newly independent states are once again the object of geopolitical competition due to their natural gas and oil reserves. The same is true of two of Latin America’s most volatile countries, Peru and Venezuela. This isn’t just a numbers game. As the darkest recent chapters of European history suggest, the point of transition from growth to demographic decline can be an unsettling and dangerous one. Fascist ideology in Europe was deeply informed by Oswald Spengler’s The Decline of the West, Lothrop Stoddard’s The Rising Tide of Color Against White World-Supremacy, and the writings of other eugenicists obsessed with the demographic decline of Aryans.� Now, just as the horrors of fascism are passing from living memory, a new generation of Europeans is again feeling demographically besieged, this time by the arrival of Muslim immigrants. Fear of demographic decline also fuels the resurgence of Hindu nationalism in India, and it contributes to the backlash in the United States against immigrants and the controversy around the building of the Ground Zero mosque near the site of the 9/11 tragedy.

Over the next few decades, not only will echo booms be producing youth bulges in many of the world’s trouble spots, but much of the developed world’s population will be passing into advanced old age. It’s a recipe for maximum demographic danger, Neil Howe and Richard Jackson of the Center for Strategic and International Studies warn. If you think the teenies are looking ugly, watch out for the 2020s.

A Gray World Will Be a Poorer World.

ONLY IF WE DO NOTHING. The connection between a society’s wealth and its demographics is cyclical. At first, with fertility declining and the workforce aging, there are proportionately fewer children to raise and educate. This is good: It frees up female labor to join the formal economy and allows for greater investment in the education of each remaining child. All else being equal, both factors stimulate economic development. Japan went through this phase in the 1960s and 1970s, with the other Asian countries following close behind. China is benefiting from it now.

Then, however, the outlook turns bleak. Over time, low birth rates lead not only to fewer children, but also to fewer working-age people just as the percentage of dependent elders explodes. This means that as population aging runs its course, it might well go from stimulating the economy to depressing it. Fewer young adults means fewer people needing to purchase new homes, new furniture, and the like, as well as fewer people likely to take entrepreneurial risks. Aging workers become more interested in protecting existing jobs than in creating new businesses. Last-ditch efforts to prop up consumption and home values may result in more and more capital flowing into expanded consumer credit, creating financial bubbles that inevitably burst (sound familiar?).

In other words, a planet that grays indefinitely is clearly asking for trouble. But birth rates don’t have to plummet forever. One path forward might be characterized as the Swedish road: It involves massive state intervention designed to smooth the tensions between work and family life to enable women to have more children without steep financial setbacks. But so far, countries that have followed this approach have achieved only very modest success. At the other extreme is what might be called the Taliban road: This would mean a return to traditional values,� in which women have few economic and social options beyond the role of motherhood. This mindset may well maintain high birth rates, but with consequences that today are unacceptable to all but the most rigid fundamentalists.

So is there a third way? Yes, though we aren’t quite sure how to get there. The trick will be restoring what, in the days of family-owned farms and small businesses, was once true: that babies are an asset rather than a burden. Imagine a society in which parents get to keep more of the human capital they form by investing in their children. Imagine a society in which the family is no longer just a consumer unit, but a productive enterprise. The society that figures out how to restore the economic foundation of the family will own the future. The alternative is poor and gray indeed.

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7. November 2010 by admin.

The Ambani brothers

A durable yarn

A revealing account of India’s most colourful business family.

DHIRUBHAI AMBANI grew up in a two-room home with an earthen floor in the Indian state of Gujarat, close to the Arabian Sea. Later this month his eldest son, Mukesh (pictured, right), head of Reliance Industries and the world’s fourth richest man, will throw a party to show off his new home in Mumbai, a towering vertical palace with six floors of parking space, three helipads and a hanging garden.

The story of how the Ambanis moved from dusty provinces to city skyscrapers is a tale of pluck, guile and vaulting ambition. But telling it also requires courage and tenacity. Hamish McDonald, an Australian journalist who was posted to Delhi in the 1990s, brought out his first book on Ambani, The Polyester Prince, in 1998. Publication in India was scrapped after Reliance set its heart on legal action, but the book became required reading for anyone interested in Indian industry. In his new work, Mahabharata in Polyester, Mr McDonald brings the story up to date, adding chapters about Dhirubhai’s death in 2002 and the subsequent feud between his two sons, Mukesh and Anil.

The young Dhirubhai lacked money, but not charisma. He raised his first 100,000 rupees (now $2,250) from a second cousin’s father and was introduced to yarn trading by a nephew. His first ventures into textile-making were run by Gujaratis back from Yemen, where Dhirubhai had worked for a petrol company during the day while trading rice, sugar and other commodities in the souk after hours.

Indians complain that social connections trump hard work. But no one worked harder than Dhirubhai at forging connections. His philosophy was to cultivate everybody from the doorkeeper up, Mr McDonald remarks. With the help of these relationships, Reliance set about making the most of India’s famous License Raj.

At that time the government took a suffocating interest in a firm’s imports and output. In 1987, for instance, the Customs Directorate alleged that Reliance’s yarn factory had more than twice its permitted capacity and that it had evaded over 1 billion rupees of duty on imported machinery. Reliance denied breaking the rules and the charges were subsequently dropped. But the rules themselves were strangling Indian industry. In exceeding these limits, Reliance made the case for their removal, according to Arun Shourie, a journalist, former minister and one-time critic of Reliance who later made his peace with the company.

Some of those restrictions also worked to Reliance’s benefit. In 1982, for example, the government raised duties on imported yarn to over 650%, which allowed Reliance to charge high prices for its homespun polyester yarn. Later in the decade import restrictions on paraxylene, a petrochemical, forced India’s other big polyester-maker to buy the crucial ingredient from Reliance, its bitterest rival. Clumsy curbs on trade are bad for the economy, but they are not always bad for individual businesses.

Dhirubhai Ambani knew how to appeal to the people as well as the powerful. By the late 1980s, Reliance Industries boasted the widest shareholding in the world. Dhirubhai held annual meetings in football stadiums and scattered subscription forms for one debenture from a helicopter. His roguish side only added to his appeal. Like India’s most popular Bollywood stars, Dhirubhai was an anti-hero, cocking a snook at complacent and hypocritical guardians of privilege.

By the time Dhirubhai died, Reliance was one of India’s biggest companies. But it was not big enough for both his sons, who soon fell to squabbling. Their mother brokered a split of the family’s assets in 2005. Mukesh got the heavy industry (hydrocarbons, petrochemicals and polyester) with the rich cashflows. Anil got the weightless businesses (telecommunications and financial services) with their rich share valuations. Both had inherited a driving ambition from a father who did not let them rest on their laurels. Within hours of his final MBA exam, Anil left Wharton (where, among other things, he learned to cook and iron his clothes) to look after a textiles factory in Gujarat. Mukesh returned to set up a polyester factory even before completing his MBA at Stanford. Their father told them they could either command respect through their efforts, or be left vainly to demand respect from people who badmouthed them behind their backs.

Outsiders rarely have the patience to dig through the details of India’s corporate life. Mr McDonald is an exception. His book puts the reader in the thick of the sweatiest corporate wrestling matches. He cannot quite sustain that intensity in the later chapters, in part because they were written from a distance long after he left India, but also because less is at stake. Dhirubhai Ambani’s rise symbolised a struggle for the heart and soul of India. His sons squabbles seem petty by comparison, even if the sums involved are huge.

Mukesh’s new palace is in the same neighbourhood he lived in as a youngster. In the intervening years this middle-class address has become an exclusive neighbourhood for Mumbai’s rich and famous. Reliance has grown, but India has grown with it. The Ambani brothers are big fish and swimming in a much bigger pond.

Mahabharata in Polyester: The Making of the World’s Richest Brothers and Their Feud. By Hamish McDonald. UNSW Press; 432 pages; A$34.95Sent from my iPad

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6. November 2010 by admin.

U.S. President Barack Obama begins a four-day visit to India today (on Nov. 6), heading a 375-member entourage of security personnel, policymakers, business leaders and journalists to demonstrate to the world that the U.S.-Indian relationship is serious and growing.Obama will begin his visit in the financial hub of Mumbai, where he will make a symbolic show of solidarity with India on the counterterrorism front by staying at the Taj Mahal Palace hotel, which came under attack in 2008, and highlight corporate compatibility between the two countries. Obama will spend the rest of the trip in New Delhi, where he will address a joint session of Parliament, a reciprocal gesture following Indian Prime Minister Manmohan Singh’s address to Congress in November 2009.Most Indians and Americans think and hope that Indo-US relations could be much better and closer than what it is now. However, regardless of what one may want the relations to be like, the geopolitical needs of both the countries are different and there are and will be numerous issues on which India and America will have to agree to disagree on. How did the biggest and largest democracies of the world drifted apart and failed to build close and deep relationship is a matter of historical and geopolitical analysis and beyond the scope of current article. But in spite of that, there is little doubt that the United States and India are sounding a much deeper and strategic relationship, as illustrated by their bilateral civilian nuclear agreement, growing business links, arms deals and a host of military exercises taking place over the next several months. Still, very real and unavoidable constraints on ties remain in place, constraints that will hamper this already uneasy partnership from developing into a robust alliance. The immediate hindrance lies in the U.S. strategic need to bolster Pakistan to shape a U.S. exit strategy from Afghanistan and try to shore up the balance of power on the subcontinent. In the longer term, however, India could use the threat of Chinese expansion in Beijing’s perceived sphere of influence to enhance its relationship with Washington.Strategic MotivationsIndia does not make friends easily (or has failed to recognize and make friends easily), particularly friends with militaries capable of reaching the subcontinent. India grew closer to the Soviets during the Cold War out of fear of the U.S. relationship with Pakistan, but only because Moscow’s military reach into the subcontinent was limited. After the Soviet Union collapsed, India was left without a meaningful ally, all the while becoming deeply resentful of the blind eye Washington turned toward the rise of Pakistan’s Islamist proxies in Kashmir and Afghanistan.The 9/11 attacks finally created an opportunity for a U.S.-Indian relationship to materialize. Both countries had common cause to cooperate with each other against Pakistan, neutralize the jihadist threat and embark on a real, strategic partnership. For the United States, this was the time to play catch-up in balance-of-power politics in South Asia. The U.S. interest at any given point on the subcontinent is to prevent any one power from becoming strong to the point that it could challenge the United States, while at the same time protecting vital sea lanes running from East Asia to the Persian Gulf via the Indian Ocean basin. The United States has the naval assets to guard these maritime routes directly, but as it extends itself more and more worldwide, its need for regional proxies grows. Though India’s capabilities remain quite limited given its domestic challenge, it is an aspiring naval power with a deep fear of Chinese encroachment and Islamist militancy.India also has a massive consumer market of 1.2 billion people and has the United States at the top of its list of trading partners. A roughly balanced and diversified relationship exists between the two economies, even as protectionist tendencies run heavily on both sides of the trade divide. According to the U.S. Census Bureau, the United States exported $16.4 billion worth of goods and services to India, mostly aircraft, fertilizers, computer hardware, scrap metal and medical equipment, while India exported $21 billion worth of goods and services to the United States, mostly information technology services, pharmaceuticals, textiles, machinery, gems and diamonds, iron and steel products, and food products. India thus makes a strong candidate for a regional U.S. proxy.But this is where a fundamental U.S.-Indian disconnect arises. India is far from interested in molding itself into a proxy of the global hegemon. India’s self-enclosed geography and internal strengths permit it to remain fiercely independent in its foreign policy calculations, unlike much weaker Pakistan, which needs an external patron to feel secure.The United States has been caught off guard every time New Delhi takes a stance that runs counter to U.S. interests, something that has happened despite the U.S. charm offensive toward India that revved up in 2005 with a civilian nuclear deal. India has refused to comply with U.S. sanctions on Iran, still has reservations about allowing U.S. firms into the Indian nuclear market after the bilateral nuclear deal, and protests what New Delhi perceives as U.S. interference in the Kashmir dispute. As a former Indian national security adviser put it, India is happy to have its partnership with the United States, but Washington is going to have to get used to hearing “no” from India on numerous issues.The Pakistan ProblemThe much more urgent misalignment of interests hindering the U.S.-India relationship concerns Pakistan and the future of Afghanistan. In 2001, when al Qaeda struck the United States and Pakistan-backed militants attacked the Indian parliament soon after, India sensed an opportunity. The Cold War shackles on ties were broken as the urgency of a broader Islamist militant threat drove New Delhi and Washington together. India hoped the bond would sustain itself, keeping Pakistan isolated over the long term, but it was only a matter of time before U.S. efforts to balance India against Pakistan disappointed New Delhi.The United States has now reached a saturation point in its war in Afghanistan. While short-term military victories have provided Washington useful political cover as they do in all unpopular wars, they obscure the core disadvantage occupiers face against the insurgents when it comes to on-the-ground intelligence, corruption, population control, and the insurgent luxury of choosing the time and place of battle. Washington is thus shaping an exit strategy from Afghanistan. This necessarily will involve some sort of accommodation with the Taliban that only one power in the region has the relationship to orchestrate: Pakistan.Pakistan has every interest in having the United States as its patron and keeping it involved in the region, but not to the extent that U.S. military activity in the Pakistani-Afghan borderland risks severely destabilizing the Pakistani state. For its part, the United States does not want India to become the unchallenged hegemon of the subcontinent at the expense of a much weaker Pakistan. This means that in return for Pakistani cooperation in tying up loose ends in the jihadist war, Pakistan will expect the United States to facilitate a restoration of Pakistani influence in Afghanistan. This would extend Pakistan’s strategic depth, stifling any Indian attempt to develop a foothold in the region that could see Pakistan wind up in a pincer grip.This naturally upsets New Delhi, which maintains that Islamabad will continue to compensate for its military weakness by backing militant proxies to target the Indian state, something Washington is ignoring to achieve its goals in Afghanistan. India sees a Taliban political comeback in Afghanistan as setting the stage for Pakistan-backed militants to regroup. More worryingly for New Delhi, a number of these militants have been drawn into a much more unpredictable, lethal jihadist network that makes it harder for New Delhi to blame Pakistan for terrorist acts in India.India’s strategic interest calls for taking advantage of Islamabad’s sour relationship with the current Afghan government to build a foothold in Afghanistan with which to create an additional lever against Islamabad along Pakistan’s northwestern rim. India has done so primarily through a number of development projects. Besides being one of the top five bilateral donors to the war-torn country, India has thousands of laborers in Afghanistan building schools, hospitals, roads and power plants. One of the most notable projects India has been involved in is the funding and construction of a 218-kilometer (about 135 miles) highway from Zaranj in Afghanistan’s southwestern Nimroz province to Delaram in Farah province.Since Afghanistan forms a land bridge between South Asia and Central Asia, where vast amounts of energy and mineral resources are concentrated, India has a deeper interest in developing the necessary transit links to access the Central Asian energy market, which the Chinese already have tapped into extensively. India cannot rely on its Pakistani rival to allow Indian goods to flow overland. Under a current arrangement, Afghan goods to India must pass through Pakistan. But Pakistan does not allow Indian goods to transit Pakistan overland to Afghan markets. Instead, India relies on its favorable trading terms with Iran to transport Indian goods via the Iranian port of Chabahar to Afghanistan and on to Central Asia. In creating transit infrastructure in Afghanistan, like the Zaranj-Delaram highway, and between Afghanistan and Iran, India is developing alternative trade routes in the region that will allow it to bypass Pakistan.The Question of Indian Troops for AfghanistanWhether India should elevate its support for Afghanistan, to include deploying Indian forces to the country, has been the subject of quiet debate among Indian defense circles. The public rationale given for such a plan is that insurgents have targeted Indian laborers involved in reconstruction projects in Afghanistan, and that the small contingent of Indo-Tibetan Border Police (ITBP) in Afghanistan has proven insufficient to protect the laborers. In addition to regular attacks on Indian construction crews, the 2008 and 2009 bombings on the Indian Embassy in Kabul highlighted the threat that Pakistan could use its militant connections in Afghanistan to try and drive India out of the country.Those arguing for an Indian military deployment to Afghanistan believe that placing Indian troops in the country would sufficiently alarm Pakistan to divert forces from its east, where Pakistani forces are concentrated in Punjab along the Indo-Pakistani border, to its northwestern border with Afghanistan. This (they hope) would shift some of the focus of Pakistani-Indian conflict away from Kashmir and the Indian homeland. Those calling for Indian troops are making a dangerous assumption, however, that the United States will remain in Afghanistan for the long haul and will be there to contain attempts by Pakistan to act against Indian military overland expansion in the region.There are a number of reasons why this troop scenario is unlikely to play out. The most obvious constraint is the enormous logistical difficulty India would have in supplying troops in Afghanistan. If India cannot convince Pakistan to allow overland trade to Afghanistan, it can certainly rule out Pakistan agreeing to an Indian military supply line to Afghanistan. India is also extremely risk-averse when it comes to military deployments beyond its borders. It already is struggling with a counterinsurgency campaign in Kashmir and in Naxalite territory along the country’s eastern belt and remembers the deadly fiasco that followed the Indian deployment of forces to Sri Lanka to counter the Liberation Tigers of Tamil Eelam in the late 1980s. And Indian troops in Afghanistan would make prime targets for hardened jihadists receiving support from Pakistan.At the same time, India is unwilling to bow to Pakistani pressure by downgrading its presence in Afghanistan. An inevitable U.S. drawdown from the region and a Pakistani return to Afghanistan translates into a bigger security threat for India. The more India can dig its heels in Afghanistan, primarily through reconstruction projects, the better the chances it will develop some say in Afghan affairs with which to check Pakistan’s regional ambitions. For its part, Pakistan will continue to demand that the United States use its leverage with New Delhi to minimize the Indian presence in Afghanistan and hand over the task of shaping the future Afghan government to Islamabad.Though little of this discussion will hit the headlines, the disconnect in U.S.-Indian strategic interests — in which India wants the United States to sustain pressure on Islamabad and serve as a check on Pakistan-backed militancy while Washington needs to bolster Pakistan to withdraw from Afghanistan and maintain some balance in the region between the two nuclear rivals — will put a cloud over Obama’s high-profile visit. India might even have to share the spotlight during Obama’s tour, as rumors are circulating that the U.S. president may make a surprise visit to Afghanistan to show his dedication to the war effort. The U.S. administration has debated whether the president could make such a trip without stopping over in Pakistan to reduce the fallout that could emerge from having Air Force One bypass Pakistan in an Afghan-India trip. The delicate nature of these issues illustrates just how high-maintenance the region is for the United States, and how urgent Washington’s need is to keep relations with Pakistan on steady footing.Leveraging a Mutual Concern Over ChinaWhile Pakistan and Afghanistan are pulling India and the United States apart, China could keep the emerging U.S.-India partnership from derailing. China’s insatiable appetite for resources, heavy reliance on export trade and overarching need to protect those vital commercial supply lines has driven Chinese naval expansion into the Indian Ocean Basin, namely through ports in Myanmar, Bangladesh, Sri Lanka and Pakistan and overland linkages through Pakistan and Myanmar on India’s flanks. Indian fears of Chinese encirclement have prompted New Delhi to modernize and expand the Indian navy. Just as the United States is interested in bolstering Japan’s naval defenses, Washington (along with Japan) views Indian military expansion in the Indian Ocean as a useful hedge against China.India has watched with concern as China has become more aggressive in asserting its territorial claims in Arunachal Pradesh and Kashmir and has broached the suspect of more robust military assistance to Pakistan during its present time of need. Moreover, while India’s Nepal policy has largely been on autopilot, China has quietly built up its clout in the small Himalayan kingdom, threatening to undermine New Delhi’s influence in a key buffer state. China also has attempted to create a closer relationship with the junta and ethnic factions in Myanmar, where Beijing seeks oil and natural gas pipelines that will give some of its energy imports an overland route that will allow it to replace the Strait of Malacca.Meanwhile, the United States is engaged in a standoff with China as it tries to end Beijing’s currency manipulation policies while Beijing is unwilling to comply due to the social and political costs of rapidly reforming its financial system. As bilateral trade tensions continue to simmer, China has sought to take advantage of the U.S. preoccupation with wars in the Islamic world to assert itself in areas of strategic interest, including the South China Sea and East China Sea and in territories it disputes with India. China’s sovereignty claims and military capability in the South China Sea are of particular concern to the United States. This level of assertiveness can be expected to grow as the People’s Liberation Army Navy continues to increase its clout in political affairs, though Beijing knows it must avoid provoking an outright confrontation with the United States.Though U.S. attention is currently absorbed in trying to work out an understanding with Pakistan on Afghanistan (an understanding that will severely undermine the U.S.-Indian relationship in the near term,) it is only a matter of time before U.S. attention turns back toward countries like China whose interests potentially are on a collision course with U.S. interests. As U.S. attention on China increases, India can highlight its own fears of Chinese expansion in South Asia to bolster the Indian relationship with Washington, especially if China is able to maintain its internal stability long enough to sustain a bold foreign policy. The China factor could prove particularly useful for New Delhi to voice its concerns over more pressing threats, like Pakistan, as India and the United States attempt to work out the kinks of their bilateral relationship. Ultimately, India and the United States will have to agree to disagree on a number of issues, relying on high-profile state visits to keep up appearances. But a mutual concern over China may help reduce some of the current tensions between New Delhi and Washington over Pakistan in the future.

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30. October 2010 by admin.

Skilled immigration: Green-card blues

 A backlash against foreign workers dims business hopes for immigration reform.BAD as relations are between business and the Democrats, immigration was supposed to be an exception. On that topic the two have long had a marriage of convenience, with business backing comprehensive reform in order to obtain more skilled foreign workers. That, at least, was what was meant to happen. In March Chuck Schumer, a Democratic senator, and Lindsey Graham, a Republican, proposed a multi-faceted reform that would toughen border controls and create a path to citizenship for illegal immigrants while granting two longstanding goals of business: automatic green cards (that is, permanent residence) for students who earned advanced degrees in science, technology, engineering or maths in America, and an elimination of country quotas on green cards. The quotas bear no relationship to demand, leaving backlogs of eight to ten years for applicants from China and India. Barack Obama immediately announced his support. But the proposal never became a bill, much less law. Mr Graham developed cold feet and withdrew his support; he was concerned that the Democrats were moving too quickly, as the economic misery that has turned Americans against foreign trade spread to dislike of foreign workers. Last year Congress made it harder for banks that had received money from the Troubled Asset Relief Programme to hire workers on H-1B visas, the most popular type for skilled foreign workers. In January the Citizenship and Immigration Service barred the use of H-1Bs for workers based on a client’s premises instead of their own company’s, a move aimed at outsourcing companies, many of them based in India. In August even Mr Schumer, needing to look tough on outsourcing, pushed through a bill sharply raising H-1B fees on firms that depend heavily on the visas. Perhaps the most naked election-year hostility to foreigners appeared during the debate in September over a Democratic bill in the Senate that would have rewarded companies for firing foreign-based workers and replacing them with Americans. Charles Grassley, a Republican senator, responded with a proposal to prohibit any company that had laid off Americans from hiring visa workers at all. The bill did not win enough votes to break a filibuster. Tightened restrictions, political aggravation and economic conditions seem to be having an effect. In 2009 the number of employment-based green cards and H-1B visas was the lowest in years (see chart). It took an unusually long time for the quota of H-1Bs for the fiscal year that ended on September 30th to be used up. Several Indian outsourcing companies have made a point of boosting local hiring at American facilities. This is partly the result of the recession, which has hurt demand for all types of workers. But in a recent report the Hamilton Project, a moderately liberal research group, notes that the number of foreign workers in America has been declining for some time. This might reflect America’s diminished appeal to the world’s most sought-after workers, as well as brightening prospects in their own countries. A survey for the pro-immigration Kauffman Foundation in 2007 found that only a tiny proportion of foreign students planned to stay in the United States. This almost certainly extracts an economic toll, since immigrants are more likely than others to start businesses or file patents. America’s immigration policies have long put a higher priority on family reunification than on employment. Legal immigrants to the country are more likely to have failed to finish high school than either native-born Americans or immigrants to other English-speaking countries. Immigrants to Canada are far more likely to have a college degree. Legislators from both parties have at various times advanced proposals that would smooth the way for skilled migrants, but they have usually foundered on the more intractable problem of dealing with illegal immigration. These two issues can and should be separate,” says Michael Greenstone of the Hamilton Project. We are giving up economic growth by putting the two issues together. Democratic Hispanic legislators oppose separating them for fear of losing business support for comprehensive reform. In principle, then, a Republican takeover of the House might increase the likelihood of a stand-alone bill on skilled immigration. That, however, is not the Republicans’ priority. Lamar Smith, the Republican who would probably become chairman of the House judiciary committee, is more focused on deporting illegal immigrants and strengthening the border.Still, it would be premature to write off the odds of immigration reform. If Mr Obama is to accomplish anything in the next Congress, he needs to find common ground with Republicans on something Business-friendly immigration reform might just qualify.

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27. October 2010 by admin.

We are a week away from the 2010 U.S. midterm elections. The outcome is already locked in. Whether the Republicans take the House or the Senate is close to immaterial. It is almost certain that the dynamics of American domestic politics will change. The Democrats will lose their ability to impose cloture in the Senate and thereby shut off debate. Whether they lose the House or not, the Democrats will lose the ability to pass legislation at the will of the House Democratic leadership. The large majority held by the Democrats will be gone, and party discipline will not be strong enough (it never is) to prevent some defections. Should the Republicans win an overwhelming victory in both houses next week, they will still not have the votes to override presidential vetoes. Therefore they will not be able to legislate unilaterally, and if any legislation is to be passed it will have to be the result of negotiations between the president and the Republican Congressional leadership. Thus, whether the Democrats do better than expected or the Republicans win a massive victory, the practical result will be the same. When we consider the difficulties President Barack Obama had passing his health care legislation, even with powerful majorities in both houses, it is clear that he will not be able to push through any significant legislation without Republican agreement. The result will either be gridlock or a very different legislative agenda than we have seen in the first two years. These are not unique circumstances. Reversals in the first midterm election after a presidential election happened to Ronald Reagan and Bill Clinton. It does not mean that Obama is guaranteed to lose a re-election bid, although it does mean that, in order to win that election, he will have to operate in a very different way. It also means that the 2012 presidential campaign will begin next Wednesday on Nov. 3. Given his low approval ratings, Obama appears vulnerable and the Republican nomination has become extremely valuable. For his part, Obama does not have much time to lose in reshaping his presidency. With the Iowa caucuses about 15 months away and the Republicans holding momentum, the president will have to begin his campaign. Obama now has two options in terms of domestic strategy. The first is to continue to press his agenda, knowing that it will be voted down. If the domestic situation improves, he takes credit for it. If it doesn’t, he runs against Republican partisanship. The second option is to abandon his agenda, cooperate with the Republicans and re-establish his image as a centrist. Both have political advantages and disadvantages and present an important strategic decision for Obama to make.

The Foreign Policy Option

Obama also has a third option, which is to shift his focus from domestic policy to foreign policy. The founders created a system in which the president is inherently weak in domestic policy and able to take action only when his position in Congress is extremely strong. This was how the founders sought to avoid the tyranny of narrow majorities. At the same time, they made the president quite powerful in foreign policy regardless of Congress, and the evolution of the presidency over the centuries has further strengthened this power. Historically, when the president has been weak domestically, one option he has had is to appear powerful by focusing on foreign policy.For presidents like Clinton, this was not a particularly viable option in 1994-1996. The international system was quiet, and it was difficult to act meaningfully and decisively. It was easier for Reagan in 1982-1984. The Soviet Union was strong and threatening, and an aggressive anti-Soviet stance was popular and flowed from his 1980 campaign. Deploying the ground-launched cruise missile and the Pershing II medium-range ballistic missile in Western Europe alienated his opponents, strengthened his position with his political base and allowed him to take the center (and ultimately pressured the Soviets into agreeing to the Intermediate-Range Nuclear Forces Treaty). By 1984, with the recession over, Reagan’s anti-Soviet stance helped him defeat Walter Mondale.Obama does not have Clinton’s problem. The international environment allows him to take a much more assertive stance than he has over the past two years. The war in Afghanistan is reaching a delicate negotiating state as reports of ongoing talks circulate. The Iraq war is far from stable, with 50,000 U.S. troops still there, and the Iranian issue is wide open. Israeli-Palestinian talks are also faltering, and there are a host of other foreign issues, ranging from China’s increasing assertiveness to Russia’s resurgent power to the ongoing decline in military power of America’s European allies. There are a range of issues that need to be addressed at the presidential level, many of which would resonate with at least some voters and allow Obama to be presidential in spite of weak political support.There are two problems with Obama becoming a foreign policy president. The first is that the country is focused on the economy and on domestic issues. If he focuses on foreign policy and the U.S. economy does not improve by 2012, it will cost him the election. His hope will be foreign policy successes, or at least the perception of being strong on national security, coupled with economic recovery or a plausible reason to blame the Republicans. This is a tricky maneuver, but his presidency no longer offers simple solutions. The second problem is that his presidency and campaign have been based on the general principle of accommodation rather than confrontation in foreign affairs, with the sole exception of Afghanistan, where he chose to be substantially more aggressive than his predecessor had been. The place where he was assertive is unlikely to yield a major foreign policy success, unless that success is a negotiated settlement with the Taliban. A negotiated settlement will be portrayed by the Republicans as capitulation rather than triumph. If he continues on the current course in Afghanistan, he will seem to be plodding down an old path and not pioneering a new one. Interestingly, if Obama’s goal is to appear strong on national security while regaining the center, Afghanistan offers the least attractive venue. His choices are negotiation, which would reinforce his image as an accommodationist in foreign policy, or continued war, which is not particularly new territory. He could deploy even more forces into Afghanistan, but then would risk looking like Lyndon Johnson in 1967, hurling troops at the enemy without a clear plan. He could, of course, create a massive crisis with Pakistan, but it would be extremely unlikely that such an effort would end well, given the situation in Afghanistan. Foreign policy presidents need to be successful.There is little to be done in Iraq at the moment except delay the withdrawal of forces, which adds little to his political position. Moreover, the core problem in Iraq at the moment is Iran and its support of disruptive forces. Obama could attempt to force an Israeli-Palestinian settlement, but that would require Hamas to change its position, which is unlikely, or that Israel make massive concessions, which it doesn’t think it has to do. The problem with Israel and the Palestinians is that peace talks, such as those under Clinton at Camp David, have a nasty tendency to end in chaos. The European, Russian and Chinese situations are of great importance, but they are not conducive to dramatic acts. The United States is not going to blockade China over the yuan or hold a stunning set of meetings with the Europeans to get them to increase their defense budgets and commit to more support for U.S. wars. And the situation regarding North Korea does not have the pressing urgency to justify U.S. action. There are many actions that would satisfy Obama’s accomodationist inclinations, but those would not serve well in portraying him as decisive in foreign policy.

The Iranian Option

This leaves the obvious choice: Iran. Iran is the one issue on which the president could galvanize public opinion. The Republicans have portrayed Obama as weak on combating militant Islamism. Many of the Democrats see Iran as a repressive violator of human rights, particularly after the crackdown on the Green Movement. The Arabian Peninsula, particularly Saudi Arabia, is afraid of Iran and wants the United States to do something more than provide $60 billion-worth of weapons over the next 10 years. The Israelis, obviously, are hostile. The Europeans are hostile to Iran but want to avoid escalation, unless it ends quickly and successfully and without a disruption of oil supplies. The Russians like the Iranians are a thorn in the American side, as are the Chinese, but neither would have much choice should the United States deal with Iran quickly and effectively. Moreover, the situation in Iraq would improve if Iran were to be neutralized, and the psychology in Afghanistan could also shift.If Obama were to use foreign policy to enhance his political standing through decisive action, and achieve some positive results in relations with foreign governments, the one place he could do it would be Iran. The issue is what he might have to do and what the risks would be. Nothing could, after all, hurt him more than an aggressive stance against Iran that failed to achieve its goals or turned into a military disaster for the United States. So far, Obama’s policy toward Iran has been to incrementally increase sanctions by building a weak coalition and allow the sanctions to create shifts in Iran’s domestic political situation. The idea is to weaken President Mahmoud Ahmadinejad and strengthen his enemies, who are assumed to be more moderate and less inclined to pursue nuclear weapons. Obama has avoided overt military action against Iran, so a confrontation with Iran would require a deliberate shift in the U.S. stance, which would require a justification. The most obvious justification would be to claim that Iran is about to construct a nuclear device. Whether or not this is true would be immaterial. First, no one would be in a position to challenge the claim, and, second, Obama’s credibility in making the assertion would be much greater than George W. Bush’s, given that Obama does not have the 2003 weapons of mass destruction debacle to deal with and has the advantage of not having made such a claim before. Coming from Obama, the claim would confirm the views of the Republicans, while the Democrats would be hard-pressed to challenge him. In the face of this assertion, Obama would be forced to take action. He could appear reluctant to his base, decisive to the rest. The Republicans could not easily attack him. Nor would the claim be a lie. Defining what it means to almost possess nuclear weapons is nearly a metaphysical discussion. It requires merely a shift in definitions and assumptions. This is cynical scenario, but it can be aligned with reasonable concerns. Destroying Iran’s nuclear capability does not involve a one-day raid, nor is Iran without the ability to retaliate. Its nuclear facilities are in a number of places and Iran has had years to harden those facilities. Destroying the facilities might take an extended air campaign and might even require the use of special operations units to verify battle damage and complete the mission. In addition, military action against Iran’s naval forces would be needed to protect the oil routes through the Persian Gulf from small boat swarms and mines, anti-ship missile launchers would have to be attacked and Iranian air force and air defenses taken out. This would not solve the problem of the rest of Iran’s conventional forces, which would represent a threat to the region, so these forces would have to be attacked and reduced as well. An attack on Iran would not be an invasion, nor would it be a short war. Like Yugoslavia in 1999, it would be an extended air war lasting an unknown number of months. There would be American POWs from aircraft that were shot down or suffered mechanical failure over Iranian territory. There would be many civilian casualties, which the international media would focus on. It would not be an antiseptic campaign, but it would likely (though it is important to reiterate not certainly) destroy Iran’s nuclear capability and profoundly weaken its conventional forces. It would be a war based on American strengths in aerial warfare and technology, not on American weaknesses in counter insurgency. It would strengthen the Iranian regime (as aerial bombing usually does) by rallying the Iranian public to its side against the aggression. If the campaign were successful, the Iranian regime would be stronger politically, at least for a while, but eviscerated militarily. A successful campaign would ease the U.S. withdrawal from Iraq, calm the Saudis and demonstrate to the Europeans American capability and will. It would also cause the Russians and Chinese to become very thoughtful. A campaign against Iran would have its risks. Iran could launch a terrorist campaign and attempt to close the Strait of Hormuz, sending the global economy into a deep recession on soaring oil prices. It could also create a civil war in Iraq. U.S. intelligence could have missed the fact that the Iranians already have a deliverable nuclear weapon. All of these are possible risks, and, according to STRATFOR’s thinking, the risks outweigh the rewards. After all, the best laid military plan can end in a fiasco.We have argued that a negotiation with Iran in the order of President Richard Nixon’s reversal on China would be a lower-risk solution to the nuclear problem than the military option. But for Obama, this is politically difficult to do. Had Bush done this, he would have had the ideological credentials to deal with Iran, as Nixon had the ideological credentials to deal with China. But Obama does not. Negotiating an agreement with Iran in the wake of an electoral rout would open the floodgates to condemnation of Obama as an appeaser. In losing power, he loses the option for negotiation unless he is content to be a one-term president. I am arguing the following. First, Obama will be paralyzed on domestic policies by this election. He can craft a re-election campaign blaming the Republicans for gridlock. This has its advantages and disadvantages; the Republicans, charging that he refused to adjust to the electorate’s wishes, can blame him for the gridlock. It can go either way. The other option for Obama is to look for triumph in foreign policy where he has a weak hand. The only obvious way to achieve success that would have a positive effect on the U.S. strategic position is to attack Iran. Such an attack would have substantial advantages and very real dangers. It could change the dynamics of the Middle East and it could be a military failure. I am not claiming that Obama will decide to do this based on politics, although no U.S. president has ever engaged in foreign involvement without political considerations, nor should he. I am saying that, at this moment in history, given the domestic gridlock that appears to be in the offing, a shift to a foreign policy emphasis makes sense, Obama needs to be seen as an effective commander in chief and Iran is the logical target. This is not a prediction. Obama does not share his thoughts with me. It is merely speculation on the options Obama will have after the midterm elections, not what he will choose to do.

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26. October 2010 by admin.

Prime Minister Manmohan Singh has just returned from Kashmir. He appealed for peace and requested the “separatists” to return to the negotiating table. He held a series of conferences with the officials and political leaders. And as expected, he announced over Rs. 1000 crore sops to the state. Importantly, to score some misplaced points, he threatened the armed forces to behave properly in Kashmir, forgetting the fact that but for those forces he, or any Indian Prime Minister, would not have been able to land in the Srinagar valley.

But one fails to understand what did the Prime Minister achieve overall from his two-day Kashmir visit in concrete terms? Well, the media, both national and international, went overboard. The press in Pakistan, where our homer minister and foreign secretary are heading later this month, got enough material to comment on. But the separatists have not been impressed. And what is worse, the security forces have been greatly demoralized. It has become now quite routine for the civilian regime and elites in Kashmir to effortlessly raise their fingers at the Indian armed forces for all their troubles, thus providing fuels to the extremists and separatists. And on the flimsiest of pretexts, officials of the military and paramilitary forces are being framed and suspended.

Ironically, the Prime Minister has not deemed it fit to travel to other, and in a sense more turbulent, part of the country – the North East, particularly Manipur and Nagaland. People there have been facing a blockade for more than two months now. The government has totally mishandled the Naga issue, of late. If any part of the country needed the presence of the Prime Minister to assure the affected people and encourage their morale, it is North-East. But, Singh and his advisors do not think so. And that is perhaps due to the fact that a visit to North East will not attract headlines the way a visit to Kashmir will.

I have no problem with the “news-worthiness” of Kashmir. But what is worrying is that the central government and the dominant section within the strategic community in the country find it politically incorrect to reveal the real problem in the Kashmir valley from the viewpoint of India’s national interests. And that real problem is the growing Islamisation of the valley, which, in turn, makes any negotiated settlement of the Kashmir issue almost impossible. An “Islamic Kashmir” will have nothing to do with India. Let me explain this point.

Over the years, Kashmir has been witnessing what Bangladeshi scholar Abu Taher Salahuddin Ahmed says three principal trends – Indianness, Kashmiriness and Muslimness. The Indianness has been propagated by the federal forces of the country, be it the central government or national parties like the Congress and BJP. However, the problem in the state is due to the tussle between those believing in Kashmiriness and those loyal to Muslimness. Kashmiriness is an offshoot of the much talked about Kashmiriyat, which, while coexisting with Indianness, talks of inclusive or composite identity, binding all groups together and not offending any section. No wonder why despite being a Muslim-majority area, beef-eating, until recently, was virtually non-existent in the valley.

Of course, some scholars now point out that there were always differences between Muslims and Hindus (essentially Kashmiri Pundits) in their interpretations of the concept of Kashmiriyat. But those believing in the concept did promote coexistence. Majority of the Kashmiri Muslims, therefore, had no problems with the Hindus or for that matter with the Buddhists. And the important factor key to the success of the Kashmiriyat was the fact that overwhelming majority of the Kashmiri Muslims believed in Sufism or what is said the “Rishi tradition” that believed in saint and shrine worships. Of course, it was greatly facilitated by the fact that as was the case in other parts of the subcontinent, Muslims were essentially converts from the fold of Hinduism.

In contrast, the Muslimness always advocated the exclusive concepts in the valley. Promoted by the Wahhabi and Ahl-i-Hadith sects, this school relies more on the authority of the Quran and Hadith and totally opposed to the concept saints and shrine worships. This tradition or school has always been in minority in Kashmir, but it has been there always. It was behind the oraganisations like Muslim Conference and Kashmir Jamaat (KJ).

Needless to say that almost all the separatists and terrorist, including the so-called moderate separatist elements like Huriyat Conference, belong to the school of Muslimness. They have nothing to do with India. They believe in the theory of “Kashmir for Muslims”. Their essential argument is that they cannot coexist in a Hindu-dominated India.

Interestingly, these elements became active in Kashmir only after the 1979 Iranian revolution. It was after 1979 that one heard more and more of “liberation of Kashmir” and “Islamic revolution”. These elements became more vocal in politics also and formed many small political outfits. In September 1985, twelve such outfits came together to form the Muslim United Front (MUF). Soon the MUF claimed to provide an alternative to the National Conference of Farooq Abdullah on the ground that he “sold out” Kashmiris’ interests in the Accord with the then Prime Minister Rajiv Gandhi.

Since then, the political Islam has made firmer roots in the valley. The Pakistani support and assistance to the cause has greatly facilitated the cause. But what has really helped the Political Islam in the valley is the virtual politics of appeasement on the part of the central and state governments to the separatists. The likes of Atal Behari Vajpayee and Manmohan Singh have wrongly believed that by pandering to the demands of the Huriyat and civil right activists, the situation will improve. But appeasement will never work with forces of “Muslimness”; it will rather embolden them and strengthen the cause of “Kashmir for Muslims”. Did not we hear the likes of Mehbooba Mufti and Omar Abdullah even saying during the agitation over Amarnath Yatra last year that Kashmir must not compromise its Muslim character?

Fortunately, even today the majority of the people in the state would like to remain part of India, as evident by the recent opinion poll, conducted by Chatham House (UK) on either side of the Line of Control (LoC) in Jammu and Kashmir. The poll said that showed that only 2 per cent of the people of J&K want to be part of Pakistan. As many as 58 per cent of the 3,774 polled, in J&K and Pakistan-occupied Kashmir (PoK), are ready to accept the LoC as a permanent “soft border” — an idea dating back to the famous “Simla Agreement” of 1972 between Indira Gandhi and Zulfiqar Ali Bhutto.

That being the case, it is high time the Indian Prime Minister, whichever party he or she may belong to, stopped inviting the separatist leaders to the negotiating table. Because, any amount of concessions will not satisfy them. They just need to be ignored and their militant supporters need to be disciplined. They do not represent the majority. If they are imposing the so-called bandhs and people are listening to them it is mainly because of the fear they have generated in the people’s hearts and the self-imposed helplessness of our security forces.

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19. September 2010 by admin.

An Islamic Strategy - HOW TO USE AMERICA versus AMERICA 

UK and France have recently witnessed riots and protests from muslim immigrants who have legally entered their country. The policy is simple and well tested….. and successful . Islamists have declared Southern France as an Islamic State and are working their way towards achieving the same in UK now. 

The ideology of Islam is to Islamise all the countries of the world. They are attacking America now.

How they are invading America is explained as follows.

The Strategy

You may have noticed, that the media in USA is pro-Islamist these days. Any American who is vocal about his/her concerns for the well being of this great nation, is labeled as racist/communal….and his argument is simply dismissed as “Islamophobia” . You will realize how they have a complete hold on the media. This is the first step.

The next step is to get into the judicial and political system of the country. While the media is used to brainwash people regarding the plight of minority muslims, a lot of money is also being spent to hire local Americans (in media and politics) who fight for the equal rights and religious rights of muslim minorities. The local Americans are however those people who try to project the liberal side of America. The law and the political system is being used to make this convenient. Amendments are being made in the law of the land to legally have a representative of muslims in the country’s parliament.

The next step is to use the law to declare innocent those muslims who are under suspicion of terrorist acts or have been convicted and are serving a sentence, or are under trial. The law here is again used to relieve them of sentences and they are declared innocent. In this process, people who were responsible (cops, judges, lawyers, etc) for arresting these criminals, the people who risked their lives to book the guilty are humiliated by either being dismissed from their duty and/or they are accused of falsely implicating muslims as criminals.

At the same time, they use their influence to distort the history of the country. Claims are made that Islam became popular because it is a religion of peace. History books in schools and colleges have chapters singing praises of how Islamic rulers and clerics influenced your country in a positive manner. However, the original historical heroes of the country who contributed and built the nation are projected in poor light. This is done to humiliate the local people of everything that they have ever been so proud of in the history of their nation. Watch out. It won’t be long before the muslims claim that America was originally an Islamic country, and people of other faiths are actually immigrants so they should either leave America or revert to Islam.

As the number of muslims grow in a country, their very next step is to gather themselves as a vote bank….and no politician would like to lose a large vote bank. This is how and why they get political backing. Once they have their representative in the parliament, the muslims use this as a tool to make amendments in the law of the land to favour Islam.

Defaming other Faiths/Religions

Another aspect that is simultaneously worked hard upon is the ‘conversion to Islam’ factor. A huge amount of money is also being spent on internet websites and personal propaganda to defame other religions to make Islam appear as the only religion that is true and scientific, and the only surviving religion of the world. So don’t be surprised when you come across statements like “Islam was always a part of your country”, or any propaganda that says “Christianity never existed” and “Jesus Was A Muslim”.

False propaganda is being circulated now, where they claim that thousands and thousands of people are converting to Islam every day. You will hear their propaganda that Islam is spreading like wild fire and people are submitting to Islam. Actually the fact is, that after 9/11 many muslims have given up Islam and converted to other religions because they were ashamed of being muslims for following the ideology of destruction and hate (this aspect is however never highlighted by them). Don’t we often complain that the voice of “moderate muslims” is missing when it comes to condemning Islamic terror attacks? Obviously, we don’t hear their voices because “the moderate muslim” has already quit Islam. In USA itself there are several organizations that have ex-muslims who are educating the rest of the world about the real ideology of Islam. See Youtube. You will find several videos showing people converting to Islam, but the videos showing muslims converting to other religions are flagged and removed. Please google “ex-muslims” for these organizations. Their statements should be valid enough for anyone to wake up.

Sowing the seeds for a FUTURE JIHAD

The original proposal of building a “Peace Mosque” at ground zero was seen by many as a symbol of victory by Islam in an infidel land.

Actually, the proposed mosque at Ground Zero is nothing but “Sowing The Seeds Of Dispute” for a FUTURE JIHAD. The reason to build a mosque there is to refute any claims in the future by anyone that the Twin Towers really existed and that America was ever attacked. It is obvious that there would be protests against the mosque. Nobody is against building a mosque. The mosque can be built elsewhere, why only on Ground Zero??? But these protests against building the mosque on Ground Zero will be used/projected to the Islamic world as “denial of freedom to follow Islam” by America … thus instigating further hatred by muslims for America and the West. This makes any muslim (who has grown up with the ideology that all non-muslims are their enemies) a potential recruit for a never-ending jihad against America, which they propose for many many generations to come….And with the number of muslims growing within America, there would be no need to look outside for help in jihad.

The War Today

One cannot deny that conversions are on the rise in America. Aggressive conversions are happening in different states because conversions are the fastest way to grow in numbers as compared to procreation and marriages with non-muslims to convert them into Islam (which is also on the rise now). The purpose of growing in numbers is to attain muslim majorities in different geographical pockets of a country. Once the muslim population is in majority in a state, their demand for a separate muslim state comes into play. They set up terror training camps, indulge in stone-pelting, riots and blasts, and they demand for a separate Islamic State within the country, tearing away a nation, piece by piece. That is the whole idea - To have separate Islamic states spread out from corner to corner of a country/continent…and then join all the dots to form a single majority Islamic State - the best and simplest way to Islamise a nation from within.

A majority of people who are being converted into Islam these days in USA are the African-Americans….especially those from ghettos and with criminal backgrounds. This is being done on purpose. Also being targeted are the illegal Mexican immigrants. Islamists know the history of America and how the Africans came to USA. These people are shown “Islam as a religion of tolerance and brotherhood”. They are told, “they will regain their pride and dignity if they embrace Islam. Islam will give them the equality that the white Americans always denied them and suppressed them”. Using Islam as a tool, these converts are now being brainwashed into believing that they must fight the Jihad for Allah. They will use the frustrations of African Americans against the White Americans. And why not??? With the growing number of muslims in USA, it is most convenient and in their best interest to fight this war from within. This is how they are going to use America versus America in their Jihad!!!

This strategy is however, not just limited to America. All nations in the east and the west who have resisted Islam for all these years are going through this pattern of Islamisation now.

This is war, my friends……….this IS “THE WAR”.

Open your eyes before it is too late.

If you think this makes sense, please circulate it among like minded people and your community.

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18. September 2010 by admin.

Iran: Internal Political Dissent The attorney for 32-year-old Sarah Shourd, one of three U.S. citizens who has been in Iranian custody for more than a year on suspicion of espionage, on Sept. 13 said her family is asking Tehran to drop a demand for $500,000 bail. The demand came after Iranian judicial authorities canceled plans to release her Sept. 11. Iranian President Mahmoud Ahmadinejad’s conservative opponents have publicly opposed his government’s move to release Shourd — a gesture on Ahmadinejad’s part to facilitate talks with the United States ahead of his trip to New York later in September. The Shourd issue is just the latest manifestation of the internal struggle within the Islamic republic’s political establishment. In recent weeks, the Iranian media have been replete with statements from pragmatists opposed to Ahmadinejad and even from his fellow ultraconservatives (who supported him until last year) criticizing several of his foreign policy decisions. These include the decision to appoint special envoys to various regions, his calls for negotiations with the United States and his willingness to compromise on swapping enriched uranium. Clearly, the infighting has reached the point where the president’s opponents are aggressively targeting his efforts to execute foreign policy. Although the Ahmadinejad government and its allies within the clerical and security establishment effectively defeated the reformist challenge from the street, the Green Movement, the rifts among the conservatives have only worsened. The old dichotomy between the Ahmadinejad-led ultraconservatives and the pragmatic conservatives led by the regime’s second-most influential cleric, Ayatollah Ali Akbar Hashemi Rafsanjani, is inadequate to describe the growing complexity of the struggle. A key reason for the growing rifts is that Ahmadinejad — despite his reputation as a hard-liner — has increasingly assumed the pragmatist mantle, especially with his calls to the Obama administration to negotiate a settlement with his government. This has turned many of his fellow hard-liners against him, giving the more moderate conservatives like Parliamentary Speaker Ali Larijani an opening to exploit and thus weaken the president. The situation is serious enough that it has offset the day-to-day balancing act among the various factions that Supreme Leader Ayatollah Ali Khamenei has been engaged in for decades. The situation is exemplified in the open disagreement between the executive and legislative branches. A special committee within the Guardian Council was formed in late August to mediate between the two sides. The Rafsanjani-led Expediency Council was created in 1989 to settle disputes among various state organs. That an ad hoc special committee was created under the supervision of the Guardian Council (which vets individuals for public office and has oversight over legislation) to mediate this dispute shows the extent of the problems the Iranians are having in mitigating internal disagreements. Just as the disagreements in Tehran are no longer between two rival camps, they also are not limited to one institution disputing another, as elements from both sides are within each institution. Guardians Council chief Ahmad Jannati, a powerful cleric who played a key role in Ahmadinejad’s ability to secure a second term, criticized the president for trying to prevent security forces from enforcing the female dress code in public. Likewise, Maj. Gen. Hassan Firouzabadi, Chief of the Joint Staff Command of the Armed Forces — to whom Ahmadinejad is close — referred to a call by Ahmadinejad’s most trusted aide, Esfandiar Rahim Mashaie, to promote Iranian nationalism over Islamic solidarity as “deviant.” In response, Mashaie threatened to sue the general sitting at the apex of Iran’s military establishment. Perhaps most damaging for Ahmadinejad is that his own ideological mentor, Ayatollah Mohammad Taqi Mesbah Yazdi, also criticized the president’s top aide, warning about a “new sedition” on the part of “value-abiding” forces — a reference to the president and his supporters. Ahmadinejad, meanwhile, has strongly supported his chief of staff (who is also his closest friend and relative), saying he has complete trust in him. In the midst of all this, the supreme leader is trying to arbitrate between the warring factions but fears that Ahmadinejad could be trying to undermine him. Thus, Khamenei cannot support Ahmadinejad as he did during the post-election crisis of 2009, yet he cannot act against the president because doing so would undermine the stability of Iran’s political system at a critical time for several foreign policy issues — Iraq, the nuclear dispute and Afghanistan, among others. At this stage, then, the outcome of this increasing factionalization is unclear. What is clear is that the Shourd case is only one small disagreement in the midst of a much larger rift. The battling Iranian factions could reach a compromise on this particular matter, but the accelerating domestic disputes in Tehran make it very difficult for the United States to negotiate with Iran on the host of strategic issues the two are struggling over. Ahmadinejad feels that if he is able to clinch a deal of sorts with the United States from a position of relative strength, it could help him deal effectively with the domestic challenge to his power. Conversely, his allies are determined to prevent that from happening, as is clear from the statements against negotiating with Washington. At the very least, this public struggle is helping the ultraconservatives, the military and those who are the most opposed to talks with the United States.

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