Posted by: John Elliott | November 10, 2014

Bribe-free Railways Minister in Modi’s reinvigorated cabinet

Suresh Prabhu, who has been made India’s new railways minister, is most famous for losing his job in 2002 as power minister in the last Bharatiya Janata Party-led coalition government because he was not collecting bribes for his Maharashtra-based Shiv Sena party. His party boss, the late Bal Thackeray, insisted that he was replaced by a more pliant minister and Atal Bihari Vajpayee, then the prime minister, obliged in order to placate a coalition partner – a gesture that became a habit for Manmohan Singh when he succeeded Vajpayee.

PTI11_9_2014_000057BPrabhu, a chartered accountant and former co-operative society banker (left, with President Pranab Mukherjee at the swearing-in ceremony yesterday), has been brought back into front line politics as railway minister in a big ministerial expansion announced yesterday that marks the second phase of Narendra Modi’s BJP government.

The first phase was notable for a lean council of ministers, most of whom were dominated by Modi, who let it be known that he preferred to deal direct with top civil servants.

The latest appointments involve ministers who are expected to take initiatives and responsibilities themselves within parameters laid down by Modi, which should broaden the effectiveness of the government in key areas.

The Congress Party however has today launched a detailed attack on the choice of several of the new ministers who have legal charges pending against them, ranging from a criminal case of attempt to murder to possessing unaccounted wealth. There were reports that a third of the total number of government ministers are facing some sort of legal charges.

In addition to Prabhu, a notable appointment is Manohar Parrikar (below), who till last weekend was the chief minister of Goa and is now the minister of defence. A metallurgical engineer, he takes over from Arun Jaitley, the finance minister, who held the portfolio on a temporary basis after the general election. Parrikar has a major job modernizing the poorly equipped armed forces and opening up defence purchases to Indian companies, which will boost India’s manufacturing industry and create new jobs.

Another key appointment is Jayant Sinha, son of former BJP finance minister Yashwant Sinha. He has been a successful investment banker in the US and becomes a minister of state in the finance ministry.

Prabhu had other ministerial posts before the power ministry and since then has been involved with moves to inter-link India’s rivers and others issues. He has had difficult relations with the Shiv Sena and resigned from the party and joined the BJP just before the new appointments were announced. This worsened a row between his old party and the BJP over the Shiv Sena’s role in Maharashtra’s new BJP-led state government.

05-manohar-parrikar-goa-cm-601The railways ministry has been regarded for many years by most politicians as a populist patronage post that enabled them to benefit their home states. Prabhu’s predecessor, Sadananda Gowda, failed to make a mark of any sort in the six months he had held the job and has been moved to the law ministry, taking over that job from Ravi Shankar Prasad who keeps his other role as telecom minister.

The railway network is badly run and prone to serious crashes that rarely lead to remedial action once the minister has fended off critics by awarding generous compensation payments to relations of those killed. Modi expects Prabhu, who is also one of his economic advisers and has a ‘Sherpa’ role at the coming G20 international conference, to carry out significant reforms.

Twenty-one new ministers were appointed on Sunday. Arun Jaitley has taken over the Information and Broadcasting Ministry, which makes him the government’s top spokesman.

Jaitley’s priority as finance minister is to prepare next February’s budget where he is expected to add shape to the government’s policies. Speaking at a conference over the weekend, he talked about changes to land acquisition laws that are being planned, plus introducing a long overdue goods and services tax, and steering through parliament a measure to raise the foreign direct investment limit in insurance companies from 26% to 49%.

There has been some criticism in recent months that too few of Modi’s ministers had adequate experience and clout, and that his central control was restricting government action. The test is now whether Modi will manage both to control and invigorate his new ministerial team, while at the same time following his preferred path of relying on bureaucrats for delivery.

This article appears on Asia Sentinel, a Hong Kong based news website - http://www.asiasentinel.com

troops boarding a ship in Dar-es-Salaam - the cover of Vedica Kant's book

troops boarding a ship in Dar-es-Salaam – the cover of Vedica Kant’s book

It has taken a century for Britain and India to commemorate more than 70,000 Indian troops who died fighting in World War One, and it has taken India over 60 years to decide fully to mark the fallen in that and later wars.

Over 1.4m Indian volunteers served in Europe, Africa and elsewhere between 1914 and 1918 in what has become known as “India’s Forgotten War”. They were scarcely mentioned by either side during the 50th anniversary in 1964.

India has now moved on from the post-colonial period that made it difficult for it to honour the troops who had been fighting with a variety of motives for an imperial power that then did not respond with rapid moves towards independence. The new Bharatiya Janata Party government is also nationalistically conscious enough to want to honour Indians who fought in wars before, as well as after, independence – and probably finds it easier to do that than past Congress governments. Till now, there has only been the India Gate memorial in Delhi, erected by the British in 1931.

Defence Secretary Visits IndiaThe common view that now unites the former colony and its old colonial ruler emerged unpredictably at an evening event held at the Delhi residence of Sir James Bevan, the British High Commissioner, on October 30. Arun Jaitley, India’s finance minister (who, till a government reshuffle today, has also been the temporary but very active defence minister since the general election), paid a tribute to those who had fought in the war. He announced that a war museum covering all India’s battles would be built, in addition to a war history in printed, digital and film form that he had talked about before.

The visiting UK Defence Secretary (Minister), Michael Fallon, (above, with Arun Jaitley) honoured those who lost their lives, and unveiled memorials to six Indians who won the Victoria Cross. India’s chief of army staff attended the reception along other senior officers and representatives of families whose successive generations had served in the Indian forces. When the event was first planned, it was not clear whether any senior Indian representative would bother to attend what might have been seen as an essentially British occasion. The top-level turnout was therefore significant in terms of recognising the history because the UK is not one of the current government’s top priority countries.

The commemorations continued today with a BBC World Service radio discussion, (recorded in Delhi a week ago) on the motives and impact of the volunteer force, and with traditional Remembrance Sunday ceremonies in Delhi and Mumbai.

Various books have been published to bring alive a part of India’s history that had largely been ignored. One of them is by Vedica Kant, an academic who has studied the Ottoman empire and has written ‘If I die here, who will remember me – India and the First World War, which is illustrated with original photographs (seen on this blog) and documents. Another, by Capt Amarinder Singh, a prominent Congress politician from the Punjab, comes with the eye of a former army officer – Honour and Fidelity, India’s Military Contribution to the Great War 1914-18.

Indian infantry in France with an early version of gas masks (photo from Vedika Kant book)

Indian infantry in France with an early version of gas masks

It seems strange, looking back, that 1.4m men should volunteer to fight in a war far from home that had absolutely no immediate impact to their country, and that politicians who were then beginning to campaign for independence should not have objected to the contribution of the people and of the costs that were fully covered by India.

Few of the soldiers would have ever travelled abroad before. When they arrived for battle, they had insufficient clothing for the cold climate and were given weapons they had never used before. They were certainly not “a patriotic army”, said one of the experts on the BBC programme.

Their contributions were controversially summed up in the broadcast by Shashi Tharoor, an author and former senior UN official who is now a Congress Party politician.

Putting the cost to India at £30 billion in current prices, he said: “It was Indian jawans [soldiers] who stopped the German advance at Ypres in the autumn of 1914, soon after the war broke out, while the British were still recruiting and training their own forces. Hundreds were killed in a gallant but futile engagement at Neuve Chappelle. More than a thousand of them died at Gallipoli, thanks to Churchill’s folly. Nearly 700,000 Indian sepoys [soldiers] fought in Mesopotamia against the Ottoman Empire, Germany’s ally, many of them Indian Muslims taking up arms against their co-religionists in defence of the British Empire.”

The motives varied and included, as Vedica Kant points out, the chance to earn good money – a reason that has often led them to be dismissed unfairly in India as mere mercenaries. Kant reckons their earnings were the equivalent today of a respectable Rs25,800 a month (about £260, $470). Some had loyalty to the King Emperor (though not as many as, it seemed, as the BBC programme presenter would have liked), and a very few maybe to King and country. For most however it would have been the natural loyalty and bonding of a soldier with his regiment, plus the pride of going off to war, and the respect that would be earned at home – though there were desertions and mutinies.

The politicians and independence leaders, including Mahatma Gandhi, who supported the war effort, did so in the belief that Britain would in return honour a commitment to hasten moves towards some form of autonomy or at least the sort of dominion status of Australia and Canada. That however did not happen, which sharpened the subsequent demands and agitation for independence.

With such a history, one might wonder whether the fresh awareness of India’s sacrifice might now lead to the First World War being listed among the horrors of British rule, such as the Amritsar Massacre of 1919 where 1,500 peaceful demonstrators for the independence that Britain had denied India were killed on the orders of a British general. But it seems not, because India has indeed moved on.

Temporary hospitals included Brighton's ostentatious oriental-style Royal Pavilion and The Dome,  where, some reports say, the auhtorities thought injured Indian troops might feel at home!

Temporary hospitals included Brighton’s ostentatious oriental-style Royal Pavilion and The Dome, where, some reports say, the authorities thought injured Indian troops might feel at home!

This article appears on Asia Sentinel, a Hong Kong based news website - http://www.asiasentinel.com

ganesh_chaturthi_001India’s prime minister, Narendra Modi, has caused some consternation and controversy by saying to an audience of doctors and scientists last weekend that plastic surgery and genetic science existed and were in use thousands of years ago in ancient India.

That, he said at the dedication of a hospital in Mumbai on October 25, was how the Hindu god Ganesh’s elephant head became attached to a human body, and how a warrior god was born outside his mother’s womb.

The theme of Modi’s speech was that India needed to improve its (grossly inadequate) healthcare facilities, which is in line with campaigns he has launched for cleanliness and the provision and use of toilets in schools and elsewhere. Quoting the ancient Mahabharat epic, he extended this to say that “our ancestors made big contributions” in such areas and that those capabilities needed to be regained.

The speech (at a hospital funded by the Ambani family of Reliance, one of India’s two biggest groups) is on the prime minister’s office website in Hindi (click here), and the Indian Express has published some of the paragraphs with an English translation (click here):

Modi speech, Reliance Hospital - Oct 25 '14“We can feel proud of what our country achieved in medical science at one point of time. We all read about Karna in Mahabharat. If we think a little more, we realise that Mahabharat says Karna was not born from his mother’s womb. This means that genetic science was present at that time. That is why Karna could be born outside his mother’s womb…..We worship Lord Ganesh. There must have been some plastic surgeon at that time who got an elephant’s head on the body of a human being and began the practice of plastic surgery.”

This is significant for three reasons. One is the unusual position of a prime minister who makes such utterances as fact, which caused the consternation and was debated earlier this week on the Headlines Today To the Point tv channel. The second is that, apart from that programme, there has been very little coverage of this part of his speech in the Indian media, which has been largely fighting shy of criticising or questioning Modi and his ministers since the general election.

ncEXroxpiThe third reason is that it controversially illustrates how Hindu nationalist views are moving to centre stage now that the BJP is in power. Activists have a simple vision of building a strong India that is respected worldwide as a modern version of an ancient Hindu civilisation, which is the pivotal point of their view of history.

It is this vision that drives Modi and many of his ministers, raising the question of how much they would disturb India’s broad-based traditions and view of history that have been built since independence by Congress governments to embrace Muslims and other minorities. Re-writing school textbooks is part of the government’s programme, as it was when the BJP was last in power,

That Modi supports theories such as Ganesh’s head is well known. He has spoken about them before and propagated them in schools when he was chief minister of Gujarat, writing the preface of a book that claimed the ancient inventions of motor cars, airplanes and origins of stem cell research.

In a similar vein, Modi’s water resources minister, Uma Bharti, has revived a geological search for the mystical River Saraswati, which is mentioned in Vedic texts and is alleged to flow roughly parallel to the Indus from the Himalayas to the Arabian sea.

god-ganesh-photos-hdEven under the recent Congress government, the Archaeological Society of India, an official body that is in charge of ancient monuments and sites, last year authorised a (fruitless) dig under an old fort in Uttar Pradesh after a seer had dreamed that 1,000 tonnes of gold were buried there

The Ramayana, the Hindu religion’s most popular epic dating from 3,000 years ago, has for seven or more years been the basis of opposition to a project to dig a shipping channel in the Palk Straits between the southern tip of India and Sri Lanka. It has been argued the channel would breach a crop of rocks known as Adam’s Bridge (or Ram Setu) that Lord Ram built across the straits so that his armies could rescue his wife Sita from the clutches of the Lankan king.

Such suggestions and actions need to be seen in the context of Indians’ every-day lives, which absorb mythologies and religions without necessarily questioning and analysing the boundaries between mythological and religious beliefs and modern reality.

What is unusual is to have a prime minister say Ganesh was the product of plastic surgery without acknowledging that accuracy cannot be vouched for in the empirical western sense of history, even though inspirational mythology usually has some basis in truth.

This article appears on Asia Sentinel, a Hong Kong based news website - http://www.asiasentinel.com

Narendra Modi and his fellow leaders of the Bharatiya Janata Party believe they are on a ten-year mission to turn India into a successful world power with a strong nationalist base. Today (Oct 19) they have put two more building blocks in place with state assembly election victories in Maharashtra and Haryana, where they have ousted Congress Party governments and reduced that party to a humiliating also-ran role.

They have not however done as well as they had hoped because they have not won overall control in Maharashtra. Nevertheless Modi, who was the BJP’s star campaigner in both states, has broadened his and the BJP’s base in the country, and will now be able to implement his message and new policies more easily in the two states. The results also potentially improve the BJP’s minority position in the indirectly elected Rajya Sabha (upper house of parliament), where the Congress Party and other opposition parties can currently block the government’s legislation.

In Haryana, adjacent to Delhi, the BJP has won outright control with 47 seats in the 90-seat assembly, compared with just four in the last election. It has ousted a Congress government that has been in power for ten years and was widely perceived to have facilitated corrupt land deals involving, among others, Robert Vadra, Sonia Gandhi’s businessman son-in-law. Congress won just 15 seats, down from 40.

photo 3-4In Maharashtra, the BJP (celebrating, left) has won 123 seats and is by far the biggest party, but needs support to establish a majority in the 288-seat assembly. Maharashtra has been run by Congress-led governments for 15 years, and the outgoing coalition with the Nationalist Congress Party (NCP) was riven with corrupt land and infrastructure deals that Prithviraj Chavan, who was shipped in as chief minister by Sonia Gandhi four years ago to clean up the government, has admitted he was unable to stop.

In an attempt to remain politically relevant (and maybe seek protection from corruption inquiries), the NCP has offered the BJP the support of its 41 assembly members. The Shiv Sena, a state-based chauvinist and often violent party which has 63 seats and has been a BJP ally for 25 years, is however a more natural supporter despite sharp clashes during the election campaign.

There will be some debate about whether the BJP’s failure to win outright in Maharashtra marks a gradual dwindling of the popular wave that swept Modi to power nationally in May, though the BJP line is that the wave has become “a tsunami”. He campaigned extensively in the state, but could not sufficiently reduce the grip of the Shiv Sena, which is renowned for its street-level gangs and clout, nor of the moneyed NCP, whose leaders include Sharad Pawar, a veteran national and regional politician, his nephew who faces corruption investigations, and Praful Patel, a rich businessman who was a controversial aviation minister in the last Congress government.

The main loser is the image and clout of the Congress Party, led by Sonia and Rahul Gandhi. They made tactical mistakes in both states and must have expected defeat because they made fewer than 20 appearances during the campaigns. That compares with a total of over 70 meetings addressed by Modi and Amit Shah, the powerful BJP president. Congress came third in Maharashtra after the BJP and Shiv Sena and with almost the same number of seats as the NCP. In Haryana, it came third behind not just the BJP but also the local-based Indian National Lok Dal, whose former leader and chief minister, Om Prakash Chautala, is in jail for corruption.

This indicates a devastatingly declining role around the country, which there is no sign of Congress leaders doing much to reverse in the short term, despite criticism and dissension in many states and disagreements between Rahul’s 30-40-something generation and  older politicians about the way forward. Rahul is making occasional forays to individual states to rebuild the party with democratically elected local young officials – he was in Punjab last week. This is a very long-term task and seems, on present reckoning. to be unlikely to interrupt Modi’s 10-year prime ministerial dream and expanding role in state elections.

243955-prakash-javadekar-03Modi’s brand of personal showmanship and nationalism is currently winning, coupled with skilful election campaign management, but he now has to meet people’s aspirations with economic success and improved government administration and performance by public officials.

Yesterday the government introduced significant long-delayed economic reforms when it de-controlled diesel prices, ending subsidies, and raised natural gas prices.

Prakash Javadekar, (left)  minister for information and the environment, says that it is not just the much-discussed new middle class that is aspirational, but also the poor. “They don’t want to remain poor but to succeed through hard work and dignity,” said Javadekar on a visit to the Foreign Correspondents’ Club in Delhi two days ago. Modi, he said, reflected those aspirations as a prime minister who could deliver, was honest, kept promises and provided good governance. “This is the new reality of India”, he added.

The messages of hard work and dignity rhyme with the broader nationalism preached by the BJP and by the RSS, its arch Hindu-nationalist mother organisation, whose activists have a simple view of a strong India that is respected worldwide as a modern version of an ancient Hindu civilisation. It is this vision that drives Modi and his ministers, raising the question of how much they will disturb India’s broad-based traditions that have been built up since independence by Congress governments to embrace Muslims and other minorities.

For now, such issues do not worry most voters who are more concerned with the price of food, the availability of jobs, and the overall well-being of their families. The Gandhis and their Congress Party failed to satisfy these ambitions, so Modi has a chance to show he can do better.

This article appears on Asia Sentinel, a Hong Kong based news website - http://www.asiasentinel.com

Tyeb BluePainting Sotheby's London Oct '14Two trends emerged from Sotheby’s auction of contemporary and modern India art in London on October 7, which achieved sales totalling £4.7m ($7.6m, Rs46.3 crore).

The top lot was Tyeb Mehta’s notable Blue Painting (left) with a bid of £930,000 (£1.12m, $1.8m including buyers’ premium), which was 50% above the lowest estimate.

The first trend is that, in the current highly selective and uncertain market, freshness plus provenance produce good auction prices for India’s established modern masters and earlier works that have not been trailing round the auction circuit and that have the cachet of being part of recognised collections.

These criteria produced astonishing prices for Kalighat paintings and also for other works including the Tyeb Mehta, though 24 of the 99 lots failed to reach their minimum sale price.

Subodh Gupta trolleyThe second trend is that the slump in prices for contemporary works that were fashionable a few years ago is worsening.

An oil on canvas painting of an airport luggage trolley (left) by Delhi-based Subodh Gupta went for just £116,500 ($187,000) including buyers’ premium. That was just above the top estimate but, allowing for inflation, it was far less than 10% of a record $1.2m achieved for a similar work in the heady days of 2008. It was also far less than a $250,000 sale in 2010 immediately after the initial crash. Gupta is more famous for his installations of shiny pots and pans. Two paintings by his wife, Bharti Kher, failed to find buyers this week.

Set of four KalighatsThe most remarkable prices came for four sets of Kalighat watercolours (right) on paper that originated with Bengal village painters who sat in the 1800s outside a Kali temple in Calcutta producing works for pilgrims. These works were collected by famous art historians and writers, William and Mildred Archer.

William Archer was head of the Indian department at the V&A museum in London 60 years ago, and the works (mostly around 17in x 10in) were found and brought to Sotheby’s by his son. Estimated at around £1,000-£1,500 a painting they were all bought by the same bidder for hammer prices of £6,000 to £8,000 each (plus 25% buyers’ premium).

There were good examples in this auction of works by members of the Bombay Progressives Group of the artists from the 1940s and 1950s, including F.N.Souza, M.H.Husain, S.H.Raza, Ram Kumar and Tyeb Mehta, though some works by all of them apart from Mehta did not sell, mainly because they did not pass the freshness test.

The star success after the Blue Painting was Akbar Padamsee’s oil on board, Prophet I, (below) which fetched a hammer price nearly three-times the low estimate at £440,000 (£530,500 including buyers’ premium). Painted in 1952 when Padamsee was establishing himself in Paris along with Souza and Husain, this work was the first of his famous Prophet series. The work was sold in 1968 by its first owner to a collector in Brazil, so it has been out of circulation over 45 years and was one of several works in the auction from the same collector.

The 45in x 35in Tyeb Mehta Blue Painting was acquired in 1992-93 by Masanori Fukuoka, a Japanese dealer and collector of Indian works that are kept in his Glenbarra museum in Japan.

Padamsee Prophet 1The auction was one of three this week staged in London for the first time by Sotheby’s as an Indian and Islamic Week, which together netted £13m. This breaks the pattern of past years, when Sotheby’s has held its annual London auction in June at the same time as Christie’s, it’s main rival and the leader in the market.

An Art of Imperial India auction netted £1.78m and included an impressive collection of 31 albums of over 2,000 mid-late 1800s photographs from the collection of Sven Gahlin, an Indian art historian. Apart from eight individual photographs exhibited in London in 1983, none of the albums had been seen in public for over 40 years. There was also a collection of Indian miniatures from the Duke of Northumberland’s collection. An Arts of the Islamic World auction netted £6.59m.

The modern art auction was in line, among others, with two successes. One staged by Saffronart Art in Delhi last month which netted $6.38m (Rs38.27 crore) and one by Christies in Mumbai last December – its first in India – which produced an astonishing $15.45m (Rs96.5 crore). The next one to watch will be Christie’s return to Mumbai this December.

This article appears on Asia Sentinel, a Hong Kong based news website - http://www.asiasentinel.com

Posted by: John Elliott | October 3, 2014

Modi wows the US and sweeps the streets – now for the hard part

Just back from a tumultuous five-day visit to the US, Narendra Modi yesterday launched his Swacch Bharat Abhiyan (Clean India Movement) by sweeping up rubbish in Valmiki Basti, a Delhi neighbourhood where Mahatma Gandhi, once stayed. It was the father of the nation’s birth anniversary, and a public holiday at the beginning of the long festival weekend of Dussehra that celebrates the triumph of good over evil.

INDIA-POLITICS-SANITATION-ENVIRONMENT-HEALTHIn his first radio broadcast to the nation this morning, marking Dussehra, Modi asked people to “pledge to remove dirt from our lives”. He ordered thousands of bureaucrats to go to work and clean their offices in a drive that started a week ago, and the Delhi symbolic street sweeping was repeated in other state capitals where the Bharatiya Janata Party is in power.

After four months as prime minister, Modi is emerging as a motivated hands-on politician, who leads by example and expects others to do the same. He is beginning to strike chords with the mass of Indians who respect his and the BJP’s nationalism, which was echoed this morning in a annual Dussehra speech (controversially shown live on state television and some other channels for the first time) by Mohan Bhagwat, leader of the RSS, the BJP’s arch Hindu fundamentalist parent organisation. Modi and Bhagwat called on people to follow the simple life style of Mahatma Gandhi, and Bhagwat even asked them to boycott goods from China, apparently because of the two countries’ border confrontations.

Modi also sticks to his beliefs, refusing food at banquets during his successful US visit because he always fasts for nine days of the Navratri festival running up to Dussehra.

India is becoming accustomed to his symbolic gestures that began with South Asian leaders being invited to his swearing in, and continued with him playing drums when he was in Japan, taking China’s president Xi Jinping to his home state of Gujarat for a festive evening, and last weekend addressing huge crowds in New York’s Central Park and (photo below) in Madison Square Gardens.

He has established himself as a tough politician who expects ministers and bureaucrats to turn up for work on time, actually take decisions, and keep files moving, so that policies are turned into action. He has shown the world he can be a friendly politician as well as a capable orator. Clearly a man on a mission to make India work, he also wants to make the world realise it is happening – something he seems to have achieved with President Obama earlier this week in Washington.

Now he needs to spend time in his grand Prime Minister’s Office in Delhi and turn all the symbolism and gestures into action.

But he won’t be doing that yet because tomorrow he is off to Haryana and Maharashtra to campaign for the BJP in state assembly elections due on October 15. The party needs to win those states from the Congress Party, partly to strengthen Modi’s ability to implement policies at state level, and partly because the BJP needs to build up its minority position in the Rajya Sabha, which is elected through state-level electoral colleges. Modi also needs to ensure that the BJP’s embarrassing defeats last month in various state assembly by-elections do not turn into a trend – and he wants to prove that he is still the party’s primary vote winner.

Modi Madison SqWhen he is back in Delhi after the political campaigning, Modi faces mounting problems. The most serious is that too many top ministers are in charge of several ministries, especially Arun Jaitley, the finance, defence, and company affairs minister, who is a diabetic and is in hospital with a chest infection after a stomach operation. Jaitley is the most important, and also the most experienced and probably the most capable, minister in the government. Doctors have said he might be home this weekend, but his load needs to be lightened.

Some commentators have been calling for Modi to introduce economic reforms that would catch headlines, but India does not need reforms so much as implementation of existing policies.

The clean India campaign, which expands on work done by the last Congress-led government, needs to be driven beyond yesterday’s symbolism. The task is huge in a nation that dumps rubbish in the streets, where a third of garbage is never collected, and 70% of rural homes have no access to toilets. Traditionally, cleaning is regarded as something best left to the lowest castes.

A new Make in India manufacturing policy needs political and bureaucratic leadership to reduce blockages that impede investment at all levels. Among many other examples, the highway building programme needs to be actively revived, the railway system needs to be modernised, and care needs to be taken in revising environmental laws and regulations so that infrastructure projects are speeded up without seriously harming India’s natural heritage. Dreadful educational and health facilities also need to be improved in hundreds of thousands of villages and urban areas.

Governments everywhere love to go for high profile and fine sounding projects such as industrial corridors, special economic zones, smart cities, and bullet trains. Such long-term vision is of course necessary, but none of these projects, which Modi has been promoting, will help him to fulfil, by the time of the next general election, his pledges in this year’s election campaign to get India moving again. To do that, he and his ministers and top bureaucrats have to focus on the hard slog of unblocking bureaucratic lethargy and corruption, simplifying laws, and speeding up implementation.

Not a ‘pain in the ass’

Modi attracts a lot of brickbats from observers who find it hard to come to terms with his rise and international success. Pankaj Mishra, an Indian writer who has a following for views aired from his vantage point in the UK, scathingly wrote after Modi’s flamboyant success in the US that “India desperately needs a vision other than that of the vain small man trying to impress the big men with his self-improvised rules of the game”.

The former Mumbai correspondent of The Economist, who is now posted in New York, managed to work “pain in the ass” into his blog report on Modi at Madison Square Garden, which mocked the Indian-origin audience saying the people were “willing themselves into the kind of obedient hysteria they were meant to have left behind generations ago in the badlands of Asia, along with hunger and snakes”.

The magazine responded to complaints by issuing a statement saying: “The Economist does not consider Mr Modi to be a ‘pain in the ass’ ”. The epithet had merely been “how we imagined an uninformed New Yorker might feel about someone who causes a traffic jam” – which Modi had done as the 18,000-strong audience flocked to see him. That was especially embarrassing for the magazine because it had amazingly backed Rahul Gandhi to become prime minister in the general election since it could not bring itself to be identified with Modi.

There are many people waiting for Modi to fail to deliver on the dreams and visions of a successful India that he spun during his presidential-style general election campaign. Obama belted out “Yes we can” from his election platforms and, many would say, failed to deliver. Modi added, “Yes we will do” – now he needs to turn the oratory into practice.

This article appears on Asia Sentinel, a Hong Kong based news website - http://www.asiasentinel.com

India yesterday became the first country in the world successfully to complete a space mission to Mars on the first attempt, beating China, which does not yet have a craft in orbit around the planet. It also beat Russia and the US which did not succeed first time, and its cost was only Rs450 crore spent over three years ($74m) compared with the US spending $679m over six years.

photo 1-2Today Narendra Modi, the prime minister launched his “Make in India” campaign at a televised jamboree in Delhi. This is aimed at persuading both foreign and Indian companies to invest in India and thus boost both its unsuccessful manufacturing industry and its exports. Twenty-five sectors have been identified  for social focus.

Abandoning the usual comparison between India as a lumbering elephant and China as a prowling tiger, Modi has chosen a lion (made of engineering cogs) as the logo of the campaign, presumably because his home state of Gujarat is home to India’s only lions.

With these two events, one might think that all is beginning to come right for a country that has lost its way economically in recent years. The timing is good. Modi is about to leave for what promises to be a spectacular five-day visit to the US where he will try to persuade investors and politicians – and world leaders at the United Nations – that India is bring back on track

Sadly it is not so. Just as Mangalyaan, (Mars-craft in Hindi) was entering the Mars orbit, three judges in India’s supreme court cancelled, with effect from March next year, 214 of the 218 coal mining licences that have been issued without open tendering between 1993 and 2011. This endangers India’s power generation industry, its steelworks and other industries, as well as adding to foreign investors serious worries about the risks and uncertainty of doing business here.

All these events link up to illustrate why India’s fudge and fix-it approach policy making and governance, known as jugaad, coupled with a belief that everything will work out ok (chalta hai) have whittled away at the country’s institutions and economic performance to such an extent that Modi won a landslide general election victory four months ago because voters believed he could restore India to its rightful place in the world.

Even though it fails in many industrial areas, India is a world leader in space and rocket technology, manufacturing, and delivery, mainly because the US and other countries stopped it being able to import high technology after its nuclear weapon tests in 1974 and 1998.

This meant that India was on its own so, capitalising on work initiated shortly after independence in 1947 by prime minister Jawaharlal Nehru, scientists and private sector companies produced a series of successes that culminated in yesterday’s Mars achievement. Two companies that have done pioneering work for decades, the Godrej group and Larsen & Toubro, contributed to the Mars mission, as did many smaller companies that have innovated and developed high technology over the years.

photo 5-1The development speed and the  low cost of the Mars probe illustrates how Indian industry is capable of developing the negative skills of jugaad into frugal engineering where the best is made of limited resources at minimal cost.

Contrast that with India’s defence industry, where there has been no ban on imports and where US and other foreign companies have connived with the defence establishment to such an extent that as much as 70% of India’s defence orders have to be bought from abroad – even night vision goggles, radars and guns as well as helicopters, other aircraft, ships and missiles have not generally been manufactured in India to satisfactory standards.

This bureaucratic throttlehold on the growth of manufacturing industry stretches far beyond the defence industries, and Modi’s hopes of reviving the industry will not succeed unless he stops bureaucrats working with foreign suppliers to boost imports at the cost of local companies.

Judicial activism

Governments till now have failed to tackle these and many other failing in the way India works, which has led to an escalation of “judicial activism” that began over 30 years ago, where courts take it on themselves to order governments and other authorities what to do. Initiatives have ranged from protecting bonded labour and enforcing environmental regulations, to ordering Delhi’s buses to be powered by compressed natural gas, and even recently challenging the government’s tardiness in appointing an official leader of the opposition in parliament

This has progressively upset the balance between the executive and the judiciary as the machinery of government has begun to implode, but yesterday’s mining judgment is probably the most damaging and irrational of edicts. It follows a similar but less economically damaging ruling two years ago that cancelled mostly corrupt telecommunications licenses. It stems from a coal scandal during the time of the last government when coal licenses were handed out without proper controls to a wide range of companies in order to speed up coal-fired power generation. But many companies simply sat on the assets and did not start mining, which led to the Supreme Court action.

It would have been understandable if the judges had cancelled licenses where coal mining had not been started, but it has acted retrospectively on 21 years of licenses and is also fining companies Rs 295 per tonne of coal mined. That money will go to the government which now has six months to reorganize the industry and the inefficient Coal India to try to fill the gaps.

The judges no doubt felt they were doing their legal duty, and it is of course the failings of successive governments that have led the supreme court to intervene to such a degree. And it will no doubt continue to do so until the government gets a grip on affairs that it should be running.

This article appears on Asia Sentinel, a Hong Kong based news website - http://www.asiasentinel.com

Posted by: John Elliott | September 18, 2014

India and China agree deals despite border face-off

modi-xi-swing1 - IndianExpressIndia and China’s leaders have today successfully agreed in Delhi on plans for economic and other co-operation despite over 1,000 troops from each side facing off against each other in Ladakh on the two countries’ disputed border, known as the Line of Actual Control (LAC), 15,000ft up in the Himalayan mountains,

China is to invest $20bn in Indian infrastructure projects over five years, and eight agreements and memorandums of understanding were signed on subjects ranging from China modernising Indian railways and building industrial parks to twinning the commercial capitals of Mumbai and Shanghai and Ahmedabad in Gujarat with Guangzhou in the Chinese province of Guangdong. A five-year economic and trade development plan was also agreed.

The visit was supposed to have been full of friendliness and co-operation. The day that China’s president Xi Jinping arrived was prime minister Narendra Modi’s 64th birthday, and Modi celebrated it by proudly hosting Xi to a carefully choreographed afternoon and evening of serenading and dining (with 150 vegetarian dishes) on the waterfront of the Sabarmati River in Ahmedabad, the biggest city in Gujarat where he was chief minister.

The chemistry between the two leaders, who had previously bonded at a BRICS summit July, was good and Modi’s eyes twinkled when he spoke to Peng Liyuan, Xi’s wife, who is a famous folk singer and former soldier. Later in the visit, Peng got widespread media coverage for relaxed informal meetings with school children

Modi-Xi2 -Peng - PTI - Indian Express

But Modi’s birthday was spoiled not only by Chinese troops massing on the border, which threatened to upset the mood, but also by bad by-election results announced the day before when the Bharatiya Janata Party lost significant regional assembly seats.

Confrontations happen frequently on the LAC, mainly stemming from the fact that the line of the current border is not demarcated. A similar confrontation built up just before China’s prime minister visited India last year, but that was solved before he arrived. This time, there have been at least two confrontations and they increased even after Xi had arrived, without Chinese troops withdrawing. While it seems unlikely that Xi personally ordered the Chinese troops to cross what India regards as the border, there is speculation that the People’s Liberation Army decided to flex its muscles and test India’s reaction – and Xi may not have been in a position to stop it. If that is correct, it underlines the PLA’s growing independence.

modi-xi umbrella - Indian ExpressModi had promised before he became prime minister to take a tougher line over border incidents with China and Pakistan, and it seems that India has reacted more aggressively than it has done in the past by moving troops rapidly to the LAC to match and even exceed the number of Chinese troops. He also, inevitably, complained about the Chinese troop activity during talks with Xi both in Ahmedabad and Delhi.

In a prepared media statement after the talks, Modi voiced India’s “serious concern over repeated incidents along the border”, and said peace on the border was essential for “mutual trust and confidence and for realizing the full potential” of the relationship.

“This is an important understanding, which should be strictly observed,” said Modi, using tougher language than is usual. He also suggested reducing the risk of confrontations by demarcating where the existing border runs, while leaving (though Modi did not spell this out) the dispute over a permanent settlement till later.

Xi was the first Chinese president to visit India since 2006 and he sounded constructive in his remarks, though he used the words always deployed by China that the border dispute is something “left over by history”.

Modi saw Xi’s visit as an opportunity to attract China’s capital and technology to help modernise India’s infrastructure and industry. It follows a similar exercise when he visited Japan three weeks ago and obtained investment pledges, and then met the Australian prime minister in Delhi. This is in line with Modi’s pro-active approach to diplomacy, which he will continue in the US at the end of this month. He wants to develop foreign policy far more pro-actively than has done in the past in order to harness other countries’ help in accelerating India’s under-performing economy and industry.

The $20bn figure is much lower than rumours of an unrealistically high figure of $100bn, but it is a massive increase on the $400m that China has invested in the past ten years. The figure offered by Japan was $35bn and the challenge for Modi now is to speed up India’s slow-moving bureaucracy and project approval system to absorb such big investments. There is also serious concern in India about the poor quality of some Chinese power project equipment which, it appears, was not mentioned in the talks.

umb--621x414 - Mint

Xi arrived in India from Sri Lanka and the Maldives where he had been increasing China’s involvement in what used to be seen as a region of India-influence. He unveiled new infrastructure projects in both countries, and talked about them having a role in reviving an “ancient maritime silk road” of trading posts that led to China. In Sri Lanka he inaugurated a China-funded $1.5bn port development in the capital, Colombo, which is billed as the island’s biggest ever foreign investment project. Xi was also to have gone to Pakistan, a long-term China ally, but cancelled to visit because of he political unrest in the capital, Islamabad.

The BJP losses came in by-elections for state assemblies in eight states and followed other less significant defeats in recent weeks. This week’s results were significant because they involved the key northern state of Uttar Pradesh, where the BJP did spectacularly well in the general election but lost eight out of 11 seats to the regional Samajwadi Party. In Modi’s home state of Gujarat, it was defeated by the Congress Party in three out of nine seats.

These results may show some disenchantment with Modi’s national government for not tackling basic problems such as prices. But more importantly they seem to show voters in UP turning against divisive Hindu nationalist anti-Muslim rhetoric orchestrated by Amit Shah, a Modi confidante who has been controversially installed as the party’s national president. It is also significant that Modi was not personally active in the by-election campaigns, which underlines the point that the general election result was more a vote for him personally than for the BJP.

This article appears on Asia Sentinel, a Hong Kong based news website - http://www.asiasentinel.com

It hasn’t taken much to lift the gloom of Delhi’s elite. Three good months of economic growth plus a booming stock market were capped last night when India’s modern art market came alive with sales totalling Rs38.27 crore ($6.38m) at an auction mounted by Saffronart of Mumbai. Only four of ninety works on offer had to be withdrawn after failing to meet their reserve prices, which is far less than usual in Indian art auctions.

SHRaza SfrnArt Sept '14The Rs38.27 price was just above the total higher estimates for the works, and nearly 50% above the Rs25.74 lower estimates.

The top sale was La Terre (left), a 50in x 29in acrylic on canvas by S.H.Raza, one of India’s leading elderly masters. It sold at a hammer price that matched the top estimate of Rs7 crore hammer price – Rs8.17 crore ($1.31m) including buyer’s premium. A rather dark and gloomy oil on canvas by Jehangir Sabavala titled Flight in Egypt 1 tripled its estimates to sell (including premium) for the artist’s world record price of Rs3 crore ($500,000).

The power elite, as they are known in this city, are supposed to be in the depths of despair now that Narendra Modi has burst into Delhi as prime minister of the new Bharatiya Janata Party, shattering the self-confidence, power and patronage of political and social circles who have swirled around the Nehru-Gandhi led Congress Party for years if not decades.

Tyeb Mehta SfrnArt Sept '14

But last night, many of them were at the Saffronart evening auction in Delhi’s smart Oberoi Hotel as buyers as well as spectators. Unlike such events in the UK and US, drink and snacks were served during the sale in a large room alongside the auction ballroom, and refreshments were brought into the hall for select high-rollers.

The party mood continued after the auction, which was the most successful since Christie’s of London held its first ever auction in India last December in Mumbai with sales totalling Rs96.5 crore ($15.45m).

The next big events on the India art scene are the annual auctions in New York later this month, and then there is an India Week with three auctions being staged in London by Sotheby’s at the beginning of next month. Sotheby’s will span five centuries from Mughal miniatures and the art and rare photographs of imperial India (some lost or hidden for many years) to modern and contemporary works.

Tyeb BluePainting Sotheby's London Oct '14The ‘modern’ highlight will be Blue Painting, (left) a 45in x 35in oil on canvas painted by Tyeb Mehta in 1982, which is being sold by Masanori Fukuoka, a leading Japanese collector, and was unveiled in Delhi two days ago.

A much earlier and unusual small 13in x 7.5in Tyeb Mehta gouache on paper (above), dating from 1954, went last night for a hammer price of Rs82 lakhs, which was more than five times the estimates ($165,000 including buyers’ premium).

The event was the first live auction held in Delhi by Saffronart that has been pioneering on-line auctions for twelve years. It was also the first big auction staged in the city by professional specialists for several years. Only works by moderns such as Raza, M.F.Husain, F.N.Souza and others were included, and there were none in the contemporary category where prices remain low after a slump a few years ago.

ManjitBawa SfrnArt Sept '14All this helped to draw a far wider selection of Delhi’s collectors than many smaller auctions, most of which fail to create a buzz, and then finish with a considerable number of unsold works. Last week less than half the works on offer were sold at an auction (partly to raise funds for a charity) by the Delhi Art Gallery, which has a vast collections and is an active buyer and seller.

A measure of the buzz last night was shown when a small rather evocative 11in x 15in Manjit Bawa pencil and pastel on paper (above) fetched a hammer price of Rs25 lakhs ($41,000), triple the estimates, and also triple the price paid for a very similar work at the Delhi Art Gallery sale.

“People were excited and old collectors came out, with people wanting to feel the market and buy,” says Dinesh Vazarani, Saffronart’s co-founder, and the auctioneer. The question now is how long that will last – the auctions in New York and then at Sotheby’s in London will provide some of the answer.

This article appears on Asia Sentinel, a Hong Kong based news website - http://www.asiasentinel.com

Posted by: John Elliott | August 31, 2014

Narendra Modi kick starts government in his first 100 days 

Modi Japan rtr44dh7Narendra Modi’s Bharatiya Janata government is now celebrating its first 100 days in power. Modi is now in Japan on his first big international visit as the guest of prime minister Shinzo Abe, who has given him an effusively warm personal welcome reflecting their rapport (left).

Two days ago it was announced that economic growth reached 5.7% for the three months to June, the highest for two years, and a big financial inclusion scheme to open bank accounts for millions of the poor has just been launched. A raft of defence contracts and tenders have been decided, with more Indian private sector involvement than has been allowed before.

This shows that the government is now moving into an action phase, though the economic growth of course was generated before the general election.

There is widely reported gossip about rifts among BJP leaders, and there are also concerns about the BJP’s right wing and its ideological partners pushing a nationalist agenda. This has surfaced most damagingly with suggestions that all Indians are Hindus, which marginalises the identity of minorities, notably Muslims but also others including Christians. Such suggestions do not fit with Modi’s current economic-oriented agenda, though he probably has to allow the right some slack to keep them content.

photo 2-2

There will be a price to pay for the newly energised growth-oriented government that Modi is running. “Dirty growth is inevitable,” a leading Delhi columnist adamantly said to me the other day. Rules restricting coal mining in forest areas are expected to be watered down soon, along with the powers of a National Green Tribunal. The government has also avoided appointing the authorised number of independent members to the National Wildlife Board, though that is being questioned by the Supreme Court. Such developments will gradually unpick environmental protection moves started by the Congress government.

Modi‘s approach is to solve problems and implement decisions, unlike the Nehru-Gandhi dynasty’s leadership of the Congress Party that not only let growth drop by half from its peak of 9-10% in the last five years, but also failed to reduce the official poverty level below 30% in the 67 years since independence when it was mostly in power. The dynasty believed in modulating the impact of social issues rather than solving them, and Rahul Gandhi, the fading heir to the party leadership, even said to friends that, to stay in power, Congress should focus on aid schemes not economic reforms. Modi will continue with schemes, but he will also go for growth and for cleaning up the way that the government functions, including reducing corruption.

De Gaulle or Putin?

Commentators have likened him to Charles de Gaulle, Margaret Thatcher and Vladimir Putin – all autocrats who wreaked change in democracies (albeit a managed one in Russia), plus Jawaharlal Nehru who set India on its independent path in 1947. He has also been compared by one writer to Deng Xiaoping and Lee Kuan Yew, who managed development and social cohesion in China and Singapore.

Such a range of impressive comparisons illustrates the burden that Modi heaped on himself with his presidential style general election campaign, when he made himself the reason to vote BJP, not the party itself. He is an autocrat and is showing not only that he is in charge, but that his ministers and top bureaucrats – who have started working a full day from 9am till into the evening for the first time in years – are watched and monitored.

There have been often-repeated stories in the media about a minister, who was dining in a hotel with a top industrialist, receiving a phone call from Modi who showed he knew the name of the industrialist. Another minister on his way to an international airport in jeans was called and told to go home and smarten up. The names of the cities, hotel, and people change with the repeated-telling, but one story that has caused rifts is Modi allegedly cautioning the son of Rajnath Singh, the former BJP president and now home minister, for talking a bribe. I’ve also heard a story about intelligence officers manning corridors in at least one ministry, watching who visits ministers and officials.

The image of absolute authority was also shown by the way that plans for India’s and Pakistan’s foreign secretaries to meet were suddenly cancelled two weeks ago, and by the sudden cancelling of India’s pledged support (given by the last government) for a World Trade Organisation agreement on trade facilitation. In neither case did Modi seem to care who he was upsetting – including the US and other parties to the WTO agreement.

photo 5

The India-Pakistan move has potentially re-set the terms for talks between the two countries because India is saying that they are strictly bilateral matter and should exclude Kashmir-based separatist organisations that Pakistan has talked to in the past. The message here is that Modi is in favour of improving economic and other links with India’s destabilised neighbour, but not having talks that get nowhere.

Modi’s visit to Japan – which follows his earlier regional trips to Bhutan and Nepal – is focussed on establishing a new bilateral relationship that will lead to deals covering nuclear power equipment, infrastructure investment, education, modern city planning, and defence and other manufacturing. A strategic bond is also being developed to offset the regional ambitions of China. Later in September, Modi will develop his approach to foreign policy when he meets China’s president in Delhi and the Barack Obama in Washington.

It is now clear that Modi will have a significant impact on the way that the central government works, indeed he has already started doing so. His ability to introduce new legislation however is restricted because the BJP and its allies do not have a majority in the Rajya Sabha upper house of parliament. They are unlikely to do so till 2018, according to a forecast by the Washington-based Center for Strategic and International Studies. Rajya Sabha seats are indirectly elected via the states, and the BJP and it allies would have to win six state elections between now and 2018 to achieve a majority, according to the analysis

That does not however stop Modi implementing policies that the last government failed to do and taking wide-ranging initiatives ranging from boosting the manufacturing industry to building highways and establishing effective schemes for the poor like the bank accounts.

This should continue to expand the growth that began under the last government, and bring back foreign investors who, though they are piling record amounts of money into the stock market, have been reluctant to bring in direct industrial and other investments.

It’s a new style of government and Modi is on a roll, though not everyone will like it!

This article appears on Asia Sentinel, a Hong Kong based news website - http://www.asiasentinel.com

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