Nitish Kumar remains Bihar chief minister of a stronger government

Lalu Prasad Yadav’s nepotism loses his party its government role

Narendra Modi and Amit Shah have won yet another victory in their drive for the pan-India political domination of their Hindu-nationalist Bharatiya Janata Party with a coup in the desperately poor state of Bihar, where Nitish Kumar, the chief minister and head of a regional party, dramatically resigned last night.

In a carefully orchestrated series of events spanning just 15 hours, Kumar was sworn in again this morning as chief minister at the head of a new coalition government in partnership with the BJP instead of a former dynasty-dominated and corrupt partner that lost its government role last night.

Coming four months after the BJP swept to power in Uttar Pradesh and three other states, the coup upsets and probably demolishes the dreams of the Congress and regional parties to mount some form of effective joint opposition against the BJP for the 2019 general election.

This makes it even more likely that Modi will win a second five-year term as prime minister, and it underlines again the political ineffectiveness of Congress’s Gandhi family – Rahul, the hapless heir apparent to the party leadership, and his mother Sonia.

Today Rahul Gandhi has lamely said he had known for three months that Kumar was planning the move.

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Sonia Gandhi, Nitish Kumar (centre) and Lalu Prasad Yadav when they were together

The coup also enables Modi and Shah to bury the ignominy of their crushing defeat in the state’s last assembly election in November 2015, when a mahagathbandhan (grand alliance) headed by Kumar, who had already been chief minister for ten years, won 178 seats in the 243-seat assembly against only 58 for the BJP’s alliance.

Irrespective of the apprehensions that many in India have about the growing clout of Modi and Shah and their often-intolerant Hindu nationalist followers, Bihar has today got the government that it should have had in November 2015.

Kumar now has the BJP to help him drive economic and social development that Bihar desperately needs. He has been unable to do that with his main mahagathbandhan partner, the dynastic nepotism-ridden Rashtriya Janata Dal (RJD) led by Lalu Prasad Yadav, a former chief minister convicted of massive corruption, that won more seats than Kumar’s Janata Dal United (JDU) in 2015.

Kumar first became chief  minister in 2005 in coalition with the BJP, replacing Yadav’s RJD that had been in power for 15 years and had focussed on caste empowerment instead of economic development. Yadav’s uneducated wife Rabri had held the chief minister’s post for nine years after corruption charges led to Yadav being banned from office, as he still is.

Kumar made rapid progress on economic and other policies including law and order. Roads were transformed, as I saw on a visit to the state during the 2015 state assembly election campaign. Electric power came for 12 hours or more a day to over 36,000 of the state’s 40,000 villages, and attendance at schools improved dramatically

But in 2013 Kumar ended the alliance with the BJP because at the time he opposed the emergence of Narendra Modi as the party’s Hindu nationalist prime ministerial candidate and joined up with the Yadav’s JDU for the 2015 election.

By then, the state arguably needed the BJP’s drive for private sector business and entrepreneurship, which Kumar had not pushed alongside his other achievements.

That is why the coming together today of Kumar’s party and the BJP in the new state government could produce what the state needs, providing the focus is on economic and business development and not the BJP’s more socially divisive Hinduisation. The deputy chief minister is Sushil Kumar Modi (no relation to the prime minister), who is strong on development and worked with Kumar in earlier years.

The Kumar-Yadav alliance ran into trouble soon after the 2015 election victory because of the Yadav family’s long running corruption and Lalu Prasad Yadav’s insistence that his totally inexperienced 26-year old younger son, Tejashwi, should became deputy chief minister.

Lalu Prasad with Tejaswi

Tejashwi Yadav (left) with his father Lalu

Investment in education and health infrastructure declined, the law and order situation worsened (as was inevitable with the Yadavs in government), and Kumar’s unexpected introduction of liquor prohibition diverted attention from development.

Tejashwi Yadav is accused of being involved in a land-for-hotels scandal, along with other corruption allegations involving his family, including his father and mother. Earlier this month the Central Bureau of Investigation raided the family’s homes and other properties in Patna, Bihar’s capital, and other cities.

This indicated that the Modi government was using CBI investigations against the Yadavs, as it has been doing elsewhere against other political opponents – in this case to encourage Kumar to split from the family.

Another course would have been for Kumar to sack Tejashwi, but that would have created an uncertain political crisis. Resigning, as he did last night with the BJP primed to step in as his ally, was a much swifter way out of the problem.

The coup however seems to mark the end of Kumar’s ambition to move back into national politics (between 1998 and 2001 he was a railways and agriculture minister in a BJP-led government ) and become prime minister. But the failure of the opposition alliance to come together nationally, and the Gandhi family’s failure to back his ascendancy, made that unlikely.

In Bihar, he might have found himself pushed aside by Tejashwi Yadav and his father before the next assembly polls in 2020.

Falling into the open hands of Narendra Modi and Amit Shah therefore must have seemed to Kumar to be the best option, even though he is being widely criticised for reversing his earlier split from Modi’s BJP.  Significantly, he backed Modi’s controversial demonetisation project last November, and more recently supported the BJP’s candidate for the post of India’s president.

Ultimately, it is all to do with politics, not what is best for the people of Bihar, some 70% of whom are below the poverty line.

The good news is that Bihar now has a better government in place than it had yesterday morning.

Posted by: John Elliott | July 10, 2017

China India standoff raises memories of 1962 war

China wants to build a road at a strategic point in the Himalayas

For the past three weeks it has sometimes seemed, from India media reports and aggressive statements coming out of Beijing, that there has been a distinct possibility of a Himalayan border war breaking out between the two countries high, 55 years after India suffered a humiliating military defeat in the area at the hands of its larger Asian neighbour in 1962.

Modi-Xi HamburgIt is unlikely to happen because neither side wants a war, but the long confrontation has been closer in physical terms and noisier in the media than in the past – at least until China’s president Xi Jinping and India’s prime minister Narendra Modi met, smiled, and chatted (left) while attending a regional meeting at the G20 assembly in Hamburg last Friday (July 7).

That is not to underplay the importance of what has been happening on the 2,500 mile long undemarcated border in a face-off over Chinese road construction that has also for the first time drawn the tiny kingdom of Bhutan into the two nuclear powers’ border disputes.

The Chinese media has played a major role in raising the tempo and yesterday The Global Times, an outspokenly outspoken government-link newspaper even went to the extent of suggesting that India’s role in the border issue with Bhutan would justify another country interfering in its northern region of Kashmir.

China, led by the increasingly powerful and assertive Xi, is in a belligerent mood and is trying to extend its reach and power in areas such as the South and East China Seas as well as in the Himalayas, while also underlining its sovereignty of Hong Kong that it regained from British rule 20 years ago on June 30 1997.

Speaking on the day of the anniversary, a Beijing foreign ministry spokesman said that the UK that had no role in the future of its former territory, even though the 1984 Sino-British Joint Declaration that led to the 1997 handover gave it a monitoring role for 50 years. The spokesman said that, as “a historical document”, the joint declaration “no longer has any practical significance”. It was not at all binding for Beijing’s management over Hong Kong.

1962 “historical lessons”

Similarly slapping down India, a China’s People Liberation Army spokesman on June 29 implicitly alluded to the 1962 defeat when he said that India should learn from “historical lessons”. He was responding to India’s army chief saying his troops were ready for a “two-and-a-half-front war”, referring to China, Pakistan and internal security.

Britain has regularly failed effectively to monitor developments in Hong Kong, and there are doubts about India’s war-readiness, but it was a sign of China’s increased assertiveness that, in the space of two days, the UK should be publicly told it had no role and that India should be reminded so openly about its 1962 defeat.

India has however resisted latest China’s territorial ambitions, despite the aggressive noises from Beijing. Perhaps Modi has heard that Barack Obama, America’s former president, once said of China: “You have to be pretty firm with them, because they will push as hard as they can until they meet resistance”.

Nathu La Pass, in Sikkim, AP file photo

The border at the Nathu La Pass in Sikkim – AP file photo

In the Himalayas, China’s army has been steadily moving into Bhutan territory with tracks and roads for several years, but has met with virtually no resistance. The current crisis has arisen because its road construction has entered the specially sensitive Doklam plateau (below) that Bhutan claims as its territory but which China also claims as part of Donglang region.

The location on the China-Bhutan-India trijunction is separate from the main areas disputed by India and China, but is it critically important because the Doklam plateau overlooks China’s Chumbi Valley, a strategically important ‘v’ shaped area of Tibet located between the Indian state of Sikkim to the west and Bhutan to the east. The 9,500 ft high valley juts down towards a strip of Indian territory called the Siliguri Corridor (dubbed the “chicken’s neck”), which is the only land route from the main land mass of India to its north-eastern states.

chumbi mapThe closer China gets to the Siliguri Corridor down the Chumbi Valley, the  better equipped it would be in a war to try to cut India off from the north eastern states and invade Arunachal Pradesh, which it claims, while also making land grabs on other states and on Bhutan.

Building the road would give it a distinct strategic advantage, as Shivshankar Menon, India’s former national security adviser, has told theWire.in .

Because of the sensitivity, Bhutan objected and India confronted the Chinese troops and blocked construction work. That brought the opposing army troops face to face and provoked a complaint from local Chinese army commanders early in June that India had invaded its territory.

China chose to publicise the clash and complain to Delhi just as Modi was about to meet President Donald Trump for the first time in Washington on June 26. This led observers to suggest that China had timed the move as a warning to India of what could happen if it continued to grow closer to the US. China is unhappy with a more aggressive stance adopted by Modi in recent months, which has included a boycott of its trans-national One Belt One Road infrastructure and trade initiative.

Bhutan’s objections were unusual because the country, sandwiched between China and India, generally stays quiet. But on June 29 its ambassador in New Delhi delivered a formal demarche to China at its embassy – they are located five minutes drive from each other in Delhi’s Chanakyapuri diplomatic area.

“Recently, the Chinese army started construction of a road towards Bhutanese Army camp at Zomphlri in Doklam area which is in violation of an agreement between the two countries”, Vetsop Namgyel, Bhutan’s ambassador, told India’s main news agency.

“Peace and tranquility”

He was referring to a written agreement with China that that there should be “peace and tranquility” till their disputed border was agreed. That is complicated because it involves reconciling disputes about the relevance of historic documents and agreements going back more than a century to a time when Bhutan had not even decided where it thought its borders lay. An 1890 agreement with Britain gave China sovereignty over Donglang, which was subsequently claimed by Bhutan.

India used to run Bhutan’s foreign affairs, but is now only consulted. The relationship is close however, as was shown by India’s response. Bhutan does not have diplomatic relations with China and has been resisting demands from Beijing to open them, though it does have regular but inconclusive meetings on the 470km border.

From conversations I had on my last visit to Bhutan two years ago, it was clear that there is considerable resentment about India’s sometimes overbearing interference in Bhutan’s affairs, along with a growing demand for formal relations with Beijing, which would weaken India’s role.

Hamburg atmosphere

There was excited media coverage about how Xi and Modi would not meet while they were in Hamburg, and that this would show that relations between the two countries were at a new and dangerously low point.

In fact, neither side was ready for formal talks because no solution was in sight and a formal meeting would have been useless or maybe even counter-productive. As a Chinese spokesman put it, the “atmosphere” was “not right”.

The informal meeting between Xi and Modi does however appear to have gone well with the two leaders apparently praising each others economic and anti-terrorist successes, while avoiding, at least as far as diplomatic briefings have revealed, anything about the standoff in the mountains.

Lobsang-Sangay-CTAThat has softened the mood, at least in the capitals. It is too early to predict how the situation will be solved, though it could be done with all sides agreeing to withdraw pending talks between China and Bhutan. Meanwhile, on the same day that Xi and Modi met, China issued a safety advisory to its citizens living in India to pay close attention to the security, which may have been part of the loud diplomatic onslaught before the leaders met.

Coincidentally, India, Japan and the US begin annual naval exercises in the Indian Ocean today (July 10), bringing together three countries concerned about China’s expansionary ambitions.

India’s relations with China now look like becoming even more fractious because the head of the India-based Tibetan government-in-exile, Lobsang Sangay, on July 5 unfurled the Tibetan national flag on the shores of Pang Gong lake in Ladakh (above). The lake spans the border between India and China’s Tibetan region at a height of over 14,000ft. This is the first time the independent Tibet flag has been unfurled there it is certain to anger China, which tolerates India hosting the government in exile along with the Dalai Lama, providing neither engages in political or diplomatic activity.

Relations between China and India have always been complicated, both before and after the 1962 war, but China’s growing territorial and international ambitions add new dimensions that are likely to lead to more crises.

No shot has been fired on the border for 40 years, though there are frequent confrontations. That is in striking contrast to the regular firing on India’s Pakistan line of control, but it underlines how serious would be if shooting begins.

 

Posted by: John Elliott | June 27, 2017

Trump and Modi bond and boost the US-India partnership

Shared views on Muslims emerge as they boycott Iftar dinners

Donald Trump and Narendra Modi had a remarkably successful afternoon and evening at the White House yesterday, bonding and even hugging in an easy way, and avoiding potential clashes on issues such as visas, climate change and trade that might have disturbed the harmony of the Indian prime minister’s first meeting with the US president. Together they furthered the cause of partnership between the two countries.

Trump, who is notoriously unpredictable did nothing to disturb the harmony of the carefully choreographed visit, which included a pre-dinner reception hosted by Melania Trump, in addition to meetings between Modi and other senior government officials, American businessmen, and Indians living in the US..

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Donald Trump welcoming Narendra Modi, with Melania Trump, at the White House

Modi, who got on well with Barack Obama, thanked the Trumps for the “immense warmth” of his welcome, and invited their daughter Ivanka to lead the US delegation to a Global Entrepreneurship Summit in India later this year.

The two men clearly have a lot in common as extrovert political populists and leaders who have been elected against passionate opposition from their countries’ elites. They are also strong nationalists, who want to protect what they regard as their countries’ heritage and culture.

Shared aversion

This has led them to share an aversion for Muslims, which is significant, even though it was not mentioned yesterday as one of the subjects they formally discussed.

Trump regards Muslims as potential terrorists and yesterday, coincidentally, received the US Supreme Court’s conditional approval for part of his controversial ban on people from six Muslim countries entering America.

Modi leads a committed Hindu nationalist government whose Bharatiya Janata Party is intensely anti-Muslim to a degree that clashes with India’s secular traditions of embracing all religions.

Their common view has been demonstrated in the past week when they both broke US and Indian government traditions by avoiding Iftar dinners on the Muslim days of fasting during the month of Ramadan.

Both men dutifully issued greetings to Muslims to mark the end of the month, but avoided publicly social events. Trump failed to host the traditional White House Iftar dinner that was first held in 1805 and has been an annual event since 1995.

Modi, along with all his cabinet, did not attend the president of India’s annual Iftar reception on June 24, even though dinner places had been prepared for some of them. A cabinet committee on political affairs was arranged at the same time as the dinner, which for decades has been seen as a prestigious event on Delhi’s political calendar embracing all political parties and religions.

Such moves surely alienate Muslim opinion, not only in the US and India but internationally. Along with Pakistan, India has the world’s second largest Muslim population (after Indonesia) of around 190m.

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Modi gave Trump his customary hug

The nearest Trump and Modi came to discussing their shared view yesterday was on terrorism, especially the role of Pakistan. Their joint statement called on Pakistan “to ensure that its territory is not used to launch terrorist attacks on other countries”, and “to expeditiously bring to justice” those responsible for terrorist attacks in India, including one in Mumbai in 2008.

That is a stronger statement on Pakistan than the US has issued in the past. It was accompanied by the State Department yesterday acceding to an Indian request to name Pakistan-based Syed Salahudeen, an extremist Islamic preacher, as a “global terrorist”. Both these moves increase pressure on Pakistan, though the US is careful not to go too far in alienating the country, which is drawing closer to China.

Concerns about China were also discussed, though it was not named. It was however indirectly criticised with the statement reiterating “the importance of respecting freedom of navigation, overflight, and commerce”, which China is not doing in the South China Sea and the region. It also called for territorial and maritime disputes to be resolved “in accordance with international law”.

Chinese troops were yesterday accused by India of crossing the border in the north-eastern Indian state of Sikkim and stopping Indian pilgrims crossing the border to a shrine. This may, or may not, be a coincidence at the time of  Modi’s visit, which has been criticised in the Chinese media today.

The mood of the talks was summed up by S. Jaishankar, India’s foreign secretary, as “very warm, very open, very cordial”, with a “great deal of ease” between the two men who were “comfortable with each other”. Previously India’s ambassador in Washington, Jaishankar said it was “one of the most productive visits I have seen to the US”

He used the word partners at least four times in an on-the-record media briefing, and the joint statement was titled “Prosperity through Partnership”. India had sent the message that it was a “reliable dependable partner” on counter-terrorism initiatives, and the two countries saw each other as “major defence partners”.

Modi Trump delegation meeting

the delegation meeting which followed a meeting between Trump and Modi

On economic and business matters, there was a “high level of comfort” between the two countries, which meant that they were “natural partners” for each in several areas including civil aviation and natural gas. They should, Jaishankar said, be seen as “preferred partners when it comes to economic issues”.

This showed that Trump is following and extending the policy of Barack Obama, which he is not doing in other areas of American policy. Obama talked during a visit to Delhi in 2015 about the many ways in which the two countries could move on from being “natural partners” to “best partners”.

It is now nearly 20 years since President Bill Clinton started moves to draw closer to India after its nuclear tests in 1998. The relationship has changed dramatically since then, but there are many in New Delhi who do not trust Washington, and there are many US policy experts who regard India as a tiresome non-performer.

It took 14 years for India to agree to a logistic deal that was signed last year to enable the two countries to use each other’s defence bases for servicing and repairs on a case by case basis. Negotiations on other agreements are still pending, but India is increasingly accepting the US as a defence equipment supplier, most recently for a surveillance drones contract mentioned during yesterday’s talks.

It remains to be seen how far yesterday’s bonhomie turns into action, and how the two countries tackle their differences over issues like US visas for Indian high technology workers (which were discussed, but not in detail), US demands for more open trade (which could become a problem when Trump’s current policy view is completed), and India’s support for the Paris accord on climate change (which Trump has abandoned, criticising benefits that India receives).

The main outcome of the visit however is that the leaders of two of the world’s largest countries, both democracies, have found they can get on with each other and have commons bonds. That should help them navigate through the future unknowns of  policy differences, Chinese aggression and other inevitable international crises – and Trump tweets.

Posted by: John Elliott | June 25, 2017

Modi on a roll as he meets Donald Trump for the first time

Lines up economic and political successes at home

Trump tweets Modi is “a true friend”

Narendra Modi is on a roll. The Indian prime minister arrived in Washington last night (below) for his first meeting with Donald Trump that takes place tomorrow (June 26), after lining up two politically significant and headline catching political and economic successes in India.

Modi arrives Washington 2

The country’s long overdue national sales tax, which is a major economic reform, is coming into force on July 1, and Modi has also stitched up the job of India’s next president for a veteran but little known senior low-caste politician in his Bharatiya Janata Party.

These three events cover Modi’s primary aims of burnishing his and India’s images on the world stage and demonstrating a primary concern for economic development, while strengthening the BJP low caste appeal ahead of the next general election in 2019.

Modi has spoken three times by phone with Trump but has not met him, so tomorrow’s encounter will set the tone for the relationship between two charismatic politicians, both of whom are strong public performers and nationalists and who also both like to spring surprises with their actions and decisions.

Given Trump’s extreme unpredictability and the sensitivity of some major issues, the Indian government has been careful not to publicise either an agenda or a wish list for the talks. Reports from Washington however show that the White House has not been so reticent in a long and positive briefing for journalists about the programme, which includes Trump’s first working dinner in the White House with a visiting prime minister or president.

The two leaders have both tweeted on the visit, with Trump fulsomely saying he had “Important strategic issues to discuss with a true friend!”.

Look forward to welcoming India’s PM Modi to on Monday. Important strategic issues to discuss with a true friend!

This is an excellent start for Modi who will be hoping to repeat the strong personal bond that he quickly developed with Barack Obama after becoming prime minister three years ago – he addressed a joint meeting of the US Congress last June.

There will be agreement on the need to curb terrorism, and that will lead Modi to want Trump to be tougher with Pakistan, which fuels the unrest in Kashmir. But the two men will differ on globalisation and action needed to stem climate change, which Trump spurns and Modi favours.

Visas and drones

It remains to be seen how opposed Trump is to India’s wish for visas to be available for the 100,000 Indian IT specialists working in the US. Curbing what are known as H-1B visas would seriously hit Indian high tech companies as well as their staff.

Defence sales will be a special focus – the Washington briefing mentioned that India had “supported thousands of American jobs” since 2008 by signing over $15bn defence contracts with the US.

An announcement is expected that the US has cleared the $2-3bn sale to India of 22 unarmed surveillance drones, manufactured by General Atomics Aeronautical Systems, for patrolling over the Indian Ocean, despite objections from Pakistan. But it seems that Lockheed Martin’s ambition to shift its F-16 single-engine fighter jet technology and production line from Texas to India, in a partnership announced a few days ago with the Tata group, will not be mentioned publicly, even if it is discussed between the two leaders.

A positive indicator for future relations between the two countries was the announcement a  few days ago that the new US ambassador to India will be Kenneth Juster, a former Warburg Pincus partner who is currently a senior Trump advisor and director of his National Economic Council.

The new GST

India’s new Goods & Services Tax (GST) will be launched with maximum fanfare in the parliament hall at midnight on June 30-July 1 at an event designed by Modi to echo the dawn of India’s independence 70 years ago when Jawaharlal Nehru, India’s first prime minister made his famous “Tryst with Destiny speech”

The GST will be presented as a unique unifying measure that binds India together because it replaces a complex mass of national and state level taxes that impede economic activity, most visibly by forcing trucks to stop to pay levies every time they cross state boundaries.

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Reuters photo at a state boundary tax collection point

It has been under discussion since 2000 and was in the then finance minister’s budget speech in 2010. Since then it has been opposed for short-term political reasons by whichever parliamentary parties have been in opposition, until the current government managed to break the log-jam and push through the legislation.

As might be expected in India, the new tax is however far from simple and will cause widespread confusion, even though industry is being given two months to adapt. Companies will have to file a mass of returns in the states where they operate and, instead of having just one tax rate or narrow band as happens in many countries, there will be six ranging from zero to 28%.

As The Economist reports in its current edition: “Officialdom decrees, for example, that shampoo, wallpaper and fizzy water are luxuries to be taxed at 28%; eyeliner, curry paste and plain water will attract an 18% levy. Restaurants will pay 12%, unless they are small (5%) or air-conditioned (18%)”.

Dalit president

India’s next president is set to be Ram Nath Kovind, a 71-year old lawyer and former member of the Rajya Sabha (upper house of parliament), who was the governor of Bihar till he became the BJP candidate for the post on June 19.

He has been an activist in the Rashtriya Swayamsevak Sangh (RSS), the BJP’s extreme right wing umbrella organisation, which fitted what Modi and Amit Shah, the BJP president, wanted.

Ram Nath Govind + ModiShah

Ram Nath Kovind (left) is greeted after his selection by Narendra Modi and (right) Amit Shah

The key factor behind his selection however was that he is a Dalit (formerly known as “untouchables” at the bottom of the caste system), which would almost automatically win him support from parties outside the BJP’s  National Democratic Alliance (NDA).

The Congress Party, headed by Sonia Gandhi, and its allies were slow in selecting a candidate and were out-manoeuvred by Modi and Shah. Eventually, on June 23, they also picked a Dalit politician, Meira Kumar, a Gandhi family loyalist and a former speaker of the Lok Sabha, knowing that she seems to have no chance of winning.

The president is chosen for a five-year term through an indirect electoral college system that comprises members of both parliament and state assemblies. Kovind looks set to win, when the contest takes place on July 17, because the BJP and its NDA allies make up 48.6% of the vote and have enough support from other regional parties to get over 60%.

India’s president has similar but more extensive powers than Britain’s Queen. The president can ask the government to reassess legislation and can make decisions about intervening in state assemblies, in addition to inviting a potential prime minister to form a government after an election. Modi and Shah will have a loyalist in this key post, as well as a Dalit which they hope will help them win elections, especially in the northern states of Uttar Pradesh and Bihar.

The choice of Kovind and Kumar means that neither the BJP nor Congress has picked an eminent person to fill the top post. Neither candidate has the experience or authority of Pranab Mukherjee, the retiring president, an independent-minded veteran Congress politician who had been minister for finance, foreign affairs and defence over several decades and has brought stature to the position.

These high profile Modi successes help to boost his image as a strong prime minister, but there are also serious problems. Economic growth is slowing, there are widespread farmers’ protests over prices for their produce, and civil unrest in Kashmir has reached alarming proportions alongside a long period of soured relations with Pakistan. Unless Modi can tackle these and other issues, his record will not look so good when the 2019 election arrives.

Posted by: John Elliott | June 9, 2017

Britain has a hung parliament caused by Theresa May hubris

Small Northern Irish party to support weakened Conservatives 

Theresa May’s colleagues attack her style of functioning

LONDON: Yesterday’s British general election was supposed to be a coronation for Theresa May, the strict and autocratic Conservative prime minister who grabbed the party leadership last year after the Brexit referendum result and immediately turned herself from being a Remainer in the European Union debate to a hard-line Brexiteer leaver.

Instead the election has enabled Jeremy Corbyn, the leader of the Labour Party, to emerge as a serious national politician and not the leftist rabble-rouser that has been his image for decades. He is being metaphorically crowned by his party and its MPs, many of whom had tried to dump him.

May on the other hand is fighting to remain prime minister , initially by forming a new government with the support of Northern Ireland’s small Democratic Unionists which has proved to be highly controversial.

UPDATE: June 10 – In order help May fight off criticism from senior cabinet colleagues about her secretive decision-making style, her two main Downing Street aides have quit. She has depended on their advice throughout her political career and is weakened and isolated by their departure.

TMay in DSt

Theresa May announcing she is forming a government, having visited the Queen in Buckingham Palace

“If I lose just six seats I will lose this election and Jeremy Corbyn will be sitting down to negotiate with Europe,” May tweeted on May 20, trying to scare voters with a reference to the Brexit negotiations that are due to begin in Brussels in ten days’ time.

The “I” in that remark graphically illustrates how hubris led her to stage the election as an endorsement of her personal leadership, with ministers and MPs tagging along behind.

She has in fact lost 13 seats from the Conservative Party score in the 2015 general election, winning 318 yesterday, whereas Labour has won 262, up an astonishing 30 on the last election. A party needs 326 to have a working majority, which is why May is talking to the Democratic Unionists who have ten seats, though even then she will only have a tiny majority of six.

The irony is that May has beaten voting records with a country-wide total of 13.7m votes, which is the best result for any party leader in Britain since 1992. That amounts to a vote share of 42.4%, which is the highest since Margaret Thatcher won a Conservative landslide in 1983. Yet, under Britain’s first-past-the-post system, May lost seats and is now being pilloried for her ineffective electioneering.

She need not have called an election because she had a working majority in the House of Commons with 331 seats compared with Labour’s 232 and the third major party, the Scottish Nationalists (which did badly yesterday) with 56.

The shock result means that May’s unbending approach for what is known as a hard Brexit in negotiations with the European Union may have to be softened – possibly, some commentators believe, even including a bid to stay in the EU’s single market that she had rejected. The government will also be under pressure to give parliament a bigger say in the EU negotiations and to ease its approach both on economic austerity and on immigration barriers (that will be good news for India in particular).

May will have to soften her style and consult her ministers and others instead of relying on just two advisors huddled in her 10 Downing Street office, and also adopt a less confrontational approach with EU leaders. She called the election to strengthen her standing in European capitals, but she has been dramatically weakened by the result.

Corbyn happy

Jeremy Corbyn celebrating last night

She should have learned from one of her predecessors, Sir Edward Heath, who picked a fight with coal miners in 1974 and called a snap election on the theme of “who governs Britain?”. Such sudden elections are not popular and he lost, just as May did yesterday, with a similar question linked to Brexit, that squandered a 20 point lead in opinion polls.

Corbyn this morning declared: “Politics has changed. Politics isn’t going back into the box where it was before. What’s happened is people have said they’ve had quite enough of austerity politics.”

It was widely assumed that when people came to vote they would shy away from his  Labour Party and vote Conservative for safety, but many didn’t, just as they didn’t shy away from voting for Brexit last year and for Donald Trump in America. The swing in the vote came from a desire for change and a rejection of May.

The youth vote was specially important, wooed partly by Corbyn’s promise to eliminate university student fees. The first evidence of turnout levels among younger voters is that it rose 12 points to 56% of 18 to 34-year-olds above 2015 figures according to an “exit poll” reported by The Guardian – 60% of under-35s and 66% of 18 to 24-year olds said they had voted Labour, 36% of them being first-time voters.

I have been amazed in the six weeks that I have been in the UK, away from my base in India, how increasingly unpopular May became, even among traditional Conservative voters, and how respect grew for Corbyn, even among people who detest his politics.

‘Strong and stable’

She was tense and unbending from the start of the campaign, repeatedly claiming that she, and she alone, would provide Britain with the “strong and stable government” that it needed in the Brexit negotiations, without ever saying how she would do it. She rarely acknowledged the role of her fellow ministers and even seemed to forget that Conservative MPs also played a role. She was aloof and evaded questions, speaking mostly to careful selected audiences and avoiding television confrontations with other party leaders.

May loses

Theresa May last night as the election result emerged

There were two deadly terror attacks in Manchester and London during the campaign but she and her ministers refused to acknowledge that cuts in police forces that had removed 20,000 police from the streets might have reduced the chances of detecting attacks before they happened.

“Her scarce TV performances have been wooden and repetitive. Journalists following her on the campaign trail have become frustrated by her stonewalling tactics,” said The Guardian, quoting a tv journalist who accused her “of responding to questions with “clichés and platitudes”.

“It’s almost as if Theresa May looked at Hilary’s campaign and said let’s do that,” wrote Robert Shrimsley of the Financial Times, referring to Hilary Clinton’s defeat by Trump.

Corbyn relaxed

Corbyn on the other hand was friendly to questioners and was discursive, sometimes entertaining, and always serious and appealing. A tv commentator put it well when he said two nights ago that Corbyn had “relaxed into the election campaign” as it progressed, which enabled him to come across as a genuine person and even a trustworthy national politician. He and his colleagues also paraded a range of social and other policies that appealed to voters.

May’s main political – and personal – problem seem to stem from her childhood with a father who was a stern Church of England vicar and told her to decide what was right and stick to it. “My father encouraged me to, whatever job I did, just go get on with it and do my best,” she said in one interview. “I think you have to believe in what you’re doing”.

In another interview, she discussed her strong faith and politics. “That’s key. If you do believe you’re doing the right thing, that gives you resilience.” Asked if that was a “moral” approach, Ms May added: “I suppose there is something in terms of faith. “I am a practising member of the Church of England and so forth, that lies behind what I do. It’s not like I’ve decided to do what I’m going to do and I’m stubborn. I’ll think it through, have a gut instinct, look at the evidence, work through the arguments, because you have to think through the unintended consequences.”

Yet when it comes to the crunch she has abandoned that approach, dumping her strongly held views and doing U turns, thus revealing herself as a politician who is so focussed on sticking to her line that she is incapable of doing the political footwork needed to steer herself out of problems.

The Financial Times has listed ten of her reversals, most importantly that she said repeatedly she would not call a general election, and suddenly changed her mind.

Earlier, in March, she allowed her chancellor of the exchequer, Philip Hammond to reverse, after a week of criticism, a budget announcement that self-employed workers would pay higher national insurance contributions, breaching a promise in the 2015 Conservative manifesto not to increase the tax.

May fumbled

Then she fumbled over the Conservative manifesto that said aged rich people requiring care in their homes would be obliged to pay for it, unless they had less than £100,000 in assets including the family home. Quickly dubbed a “dementia tax” she announced after just four days that care payments would be capped, and then repeatedly refused to admit she had changed anything,.

So the strong leader was no longer so strong and, steadily, Corbyn won hearts and minds.

The British media generally backed May and did everything it could to rubbish Corbyn, reminding readers of his ultra leftist rebellious past on issues like the Northern Irish IRA battles and Britain armed incursions into foreign countries, notably most recently Syria.

The Economist was so appalled by both him and May that it recommended its readers a week ago to vote for the small and fading Liberal Democrats “as a down-payment for the future” because “the leaders of both main parties have turned away from a decades-old vision of an open, liberal country”. (That was as useless a piece of advice as a suggestion The Economist made in 2014 that India’s last general election should be won by the fading Congress Party, headed by the hapless Rahul Gandhi and his mother, because of the appalling reputation gained by Narendra Modi, now the prime minister, during riots in his home state of Gujarat).

But The Economist political columnist excelled himself this week with an article headed “The country will soon go into bat against Brussels with one of its weakest teams in decades”, adding:

“The best performer in the campaign, Jeremy Corbyn, the Labour leader, is a 68-year-old crypto-communist who has never run anything except his own mouth. Theresa May, the Tory leader, tried to make the election all about herself and then demonstrated that there wasn’t much of a self to make it about. As for Tim Farron, the Liberal Democrats’ leader, he looked more like a schoolboy playing the part of a politician in an end-of-term play than a potential prime minister”.

The Farron remark ignored the fact that the magazine had recommended voting for his party, but the anonymous columnist did have a point. Corbyn has no administrative experience and May is an egotist who does not understand the basics of political leadership.

.Authoritarianism and intolerance cloud the record

The third anniversary of Narendra Modi being sworn in as prime minister was celebrated on May 26 with all the bombast that has come to characterise a nationalist administration built around the image of one man, backed by his chief henchman, Amit Shah, the arch Hindu-nationalist president of Modi’s Bharatiya Janata Party.

Modi went to Assam in the north east of the country to open India’s longest bridge and, along with statements from Shah and various ministers, paraded a series of extravagant claims about what has been achieved in the three years. Many of the assertions are difficult to verify, whereas critics produced an array of more easily accessible points on which the government has failed, not least on the growth of authoritarianism and intolerance that does not fit with the traditions of a country which prides itself on being the world’s largest democracy.

PM Modi Dhola-Sadiya Bridge Assam

Narendra Modi at the Dohla-Sadiya Bridge in Assam

The most telling event of the day demonstrated how priorities focus on Hindu nationalism, even if that runs counter to the country’s economic interests. This was an announcement of a ban that had been gazetted earlier in the week severely restricting the sale of cattle for slaughter at livestock markets and animal fairs.

Billed as a protection of animals measure, it in effect supported opposition to beef eating, which the BJP’s more Hindu fundamentalist and sometimes violent activists have been spreading across the country with bans on the slaughter of India’s sacred cows.

The measure included buffaloes, which are widely eaten as beef, as well as other cattle. This will hit Muslim meat and leather traders, as well as many farmers who raise money by selling cows for slaughter after they have ceased producing milk. Experts have warned this could upset the economics of milk production and undermine India’s $5bn a year buffalo meat export market.

Kerala’s Left Democratic Front government condemned it as a “fascist and anti-federal move” adding, in a reference to people even being killed by beef-ban vigilantes, “Cattle slaughter becomes illegal at a time when manslaughter happens in the name of cow”.

That political jibe illustrates how the government’s critics believe its primary aims are slewed towards the Hinduisation of India, even though Modi’s top priority is building an economically strong India that earns respect and influence internationally.

Foreign policy lapses

Today (May 29) Modi flies to Germany for two days of talks with Angela Merkel, the  German chancellor, and her ministers, and will then go on to Spain and Russia. His foreign trips and overall policy have not yielded the gains that had been hoped when he made high profile visits around the world in his first year in office. Many multi-billion dollar promised deals and investments have failed to materialise.

Good rapport with President Obama did however help to strengthen relations with the US, while growing ties with countries to the east, notably Japan and Australia, could form the basis of a bulwark against China’s aggression.

Modi has tried to counter China’s wooing of India’s immediate neighbours, and has achieved some success with Bangladesh and Sri Lanka, but he has been inconsistent in dealings with Pakistan and relations have worsened. This has exacerbated instability in India’s northern state of Kashmir, which is mired in the worst social aunrest for many years with the government doing little to ease tensions.

At the same time, Modi seems to have abandoned attempts to develop co-operative relations with China, which holds virtually all the cards in the bilateral relationship and can use its closeness with Pakistan to destabilise both that country’s relations with India and life in Kashmir.

On May 26, Modi tweeted that his three years in power had seen concrete steps that had “transformed” people’s lives. “Sath hai, vishwas hai, ho raha vikas hai”  – “There is cooperation, there is confidence and progress is being made”.

Insufficient energy

The economy is strong with around 7% growth and various measures are in train such as the introduction of a long-delayed goods and services tax, but the contrasting view to what Modi said has been summed up well by Martin Wolf, who has been studying IndiA for over 30 years and is widely regarded as one of journalism’s best economic commentators.

Writing in the Financial Times, he says that the government “has shown insufficient energy in tackling both the immediate problems of inadequate private investment, excessive debt and feeble banks, and the longer-term problems of dreadful education, lousy healthcare, weak infrastructure, corruption, regulatory incompetence, excessive interference and government waste”.

Modi has posted graphics on various sectors such as agriculture, mobile banking, tele-density, women empowerment, electrification, and solar energy and included some of his favourite branded schemes such as Make in India and Digital India.

Make in India is said to have generated a “giant boost” to investments in electronic manufacturing that has multiplied ten times. There is however little evidence that the campaign has had much success in its primary aim of boosting manufacturing industry jobs, even in the defence manufacturing where there is most potential.

LocalCircles surveyA survey (left) of 40,000 people in 200 cities by LocalCircles, a social media organisation, found that only 8% thought Make in India had been the most effective campaign, whereas 47% voted for a direct benefit transfer scheme that pays subsidies via bank accounts.\

On Digital India, Modi’s tweets claimed that the country’s optical fibre broadband network had increased to 205,404 kms from just 358 kms in 2014, but a recent study by the Centre for Equity Studies shows that much of what was promised three years ago has not materialised. Only 37% of the optical fibre needed to reach 250,000 gram panchayats (village and small town councils) has been laid.

One of the biggest failures has been cashing in on what is called India’s “demographic dividend” with two-thirds of the population under 35 and providing jobs for new entrants in India’s labour market.

Writing on thewire.in news and analysis website, M.K. Venu, a leading economic columnist, says that there has been a “sheer decline” in the creation of new jobs in the organised sector which includes textiles, metals, leather, gems and jewellery, information technology, call centres and automobiles from an average of 950,000 a year between 2009 and 2011 to 155,000 in 2015 and 231,000 last year. Venu reckons that unorganised small business new jobs will have followed a similar trend.

Corruption 

Modi repeatedly says he has “zero tolerance on corruption”. That seems to have had an impact on central government ministers and the top grades of bureaucrats, but not on the lower levels of government employees, nor in most state governments. A new bankruptcy code could have some impact, but the government has made no attempt to introduce a Lok Pal anti-corruption ombudsman that was planned by the last Congress government.

There is also scant evidence that its dramatic demonetisation project last November, when the validity of 86% of bank notes was cancelled overnight, has had a permanent effect on corrupt deals, money laundering and general graft, though there are some reports of, for example, real estate companies being more cautious about taking large payments in cash.

Piyush Goyal, minister for power, coal, and mines, reports that the number of villages without reliable access to electricity has been reduced from just over 18,000 in 2014 to around 4,000, and says he is aiming for the whole country to have round-the-clock access to electricity by 2019, three years ahead of an official government timetable. There is however no way that power will be in widespread use throughout the villages, even though it if it reaches them.

Overall, the LocalCircles survey showed that the 44% of the people said the government had met their expectations with 17% saying the expectations had been exceeded and 39% being dissatisfied.

The real question however is whether Modi will be able to say in two years time that he has delivered on what he was elected to do, namely change the way that India is run by making the machinery of government cleaner, more effective, and less bureaucratic, and whether he has created jobs and opportunities for the young.

“My prime minister is focused on speed and scale, he doesn’t like small targets,” Goyal told the Financial Times.

That must also mean that he does not like slow small results, which inevitably leads to extravagant claims of success, but there is no other national leader, or potential leader, to challenge Modi. The political opposition is weak, despite a current attempt to unite on the choice of India’s next president, so he is on strong ground.

Currently it looks therefore as if the BJP has a good chance of being re-elected in 2019. No-one knows however whether the growth of often intolerant Hindu nationalism, which horrifies India’s liberals and strikes fear among Muslims and some other minorities, will affect people’;s judgement on how well Modi has done..

Sotheby’s New York and Pundole in Mumbai scored in recent sales 

Christie’s yesterday scored at its annual early summer auction in London of South Asian modern art with sales totalling £5.9m ($7.66m) and over 90% of the 69 lots finding buyers. This helped to rebuild its regional reputation after a poor auction result in Mumbai last December and a subsequent cost-cutting decision to stop holding the high profile annual event in the city.

tyeb_mehta_untitled woman on rickshawThe top work yesterday was by Tyeb Mehta, one of India’s most famous and successful artists of the 20th century, whose 59in x 39in untitled oil on canvas (right) depicting a woman on a rickshaw was bought by a leading collector from India with a hammer price of £2.3m. Mehta often focused on social issues, saying “the rickshaw is not a simple means of transport, but a sign of bondage”.

That £2.3m comfortably exceeded the top £2m estimate and, with a total (pre tax) price of £2.74m ($3.56m, Rs19 crore) including buyers’ premium, set a new world auction record for the artist, beating his previous high of £1.97m ($3.24m) set in 2011.  

A total of 14 lots sold above $100,000, but there was nothing apart from the Tyeb Mehta above £300,000. This illustrated the problem that auction houses face finding works that are fresh to the market. Some auctions did badly two or three years ago because they were recycling works from trade sources, and that led to the current focus on new collections. Christie’s and other auction houses are also tempting bidders by trimming over-ambitious pricing and are accepting bids that are lower then low estimates.

“The auction saw one of the highest rates of participation from new clients in the past years, which is likely related to the fact that the majority of works offered were  hitherto unseen on the auction market and consigned from important private collectors,” said Sonal Singh, Mumbai-based director, Christie’s India.

Souza the-herald Saffrnt

Painted in 1994, the Tyeb Mehta had been in an Indian collection and was being auctioned for the first time. Another of his works, Thrown Bull, that sold for £245,000 had been hidden away for many years in Oxford University’s Nuffield College, being passed from room to room by those studying there.

A rare work (left) by F.N.Souza, another leading artist from Mehta’s generation, has been sourced from South America for an on-line auction being staged between June 6 and 7 by Mumbai based Saffronart.

Titled The Herald, this 48in x 23in oil on canvas dates from the early 1960s when the artist often focused on Roman Catholic subjects. Having been owned by a South American collector for decades, it will be facing its first auction and has been given a broad $300,000-$500,000 estimate to test the market.

Christie’s decision to abandon its annual Mumbai auction after only three years and focus instead of two South Asian auctions a year in New York and one in London was part of a slimming down of its international operations, which are increasingly focused on the Chinese market. It is closing one of its London locations (in Old Brompton Road) and reducing its activities in Amsterdam. A market rumour suggests that François Pinault, the French luxury goods magnate who owns the auction house, is readying it for sale to a Chinese buyer.

It is also increasing its on-line sales for lower-priced works. This week its annual Arts of India antiquities auction, which yielded £1.7m, was accompanied by on line auction called Painting the Maharaja of 32 mostly 19th century portraits that sold for a total of nearly £128,000.

Part of the pressure on Christie’s and others to find new works stems from an increasing number of auctions run by Indian businesses.

That is in addition to Sotheby’s, which had a highly successful South Asian New York sale two months ago totalling $6.56m with only four of the 59 lots not being sold.

Pundole Buddha April '17Most of Sotheby’s works were sourced privately from European and American collections, and works by M.F.Husain, another of the Mehta and Souza generation, did specially well. “The freshness, high quality, provenance and condition really are reflected in the both presale interest and in the final sale results which exceeded our expectations” said Yamini Mehta, who heads Sotheby’s for South Asia.

The Indian auction businesses include Pundole, Delhi Art Gallery and Osian’s, which all held sales in Mumbai last month. Osian’s was making a rare  reappearance after years of financial problems.

Pundole’s had a specially successful auction, producing a total hammer price of Rs33.8 crore ($5.3m) for 82 lots with only three not sold. That included Rs6 crore ($930,000) for a Tibetan gilt bronze Buddha statue (above), which was a record for any antiquity in an Indian auction.

Collectors also go for the unusual, as was shown yesterday at the end of Christie’s auction, a set of 54 playing cards depicting work by South Asian artists conceived for the British Council in Delhi, took the bidding in three minutes from £60,000 to a hammer price of £230,000.

maqbool_fida_husain_untitled_d6072678g

The Christie’s auction included three collections of smallish pencil and gouache on paper works by M.F.Husain – this collection fetched £22,000

Could Narendra Modi do the same in 2019 with acche din?

LONDON: Any political leader must envy Theresa May, Britain’s prime minister, who looks as though she has already virtually won the UK’s general election, even though it doesn’t take place for another month, without promising anything more than “strong and stable government”.

She has avoided being questioned by the media and by critical voters, and has not explained how she is going to deliver stability as Britain approaches its Brexit destiny – apart from showing that she will be as tit-for-tat tough and horrible as she deems necessary with European Union negotiators. The Conservative Party manifesto, due out in a day or two, will provide some clues on policies, but victory has been virtually assured by big victories that the party won in regional and local elections last week.

May ought to be challenged by a coherent opposition that would attack her hard negotiating line and argue that astute and flexible political footwork could work better in Brussels, but there is no such challenge. Instead, county council and mayoral elections results declared on May 5 showed the decimation of both the leftist Labour Party and rightist UK Independence Party. Support for the strongly pro-European Scottish National Party declined and was insignificant for the middle-of-the road Liberal Democrats.

REUTERS_Britain27s-Prime-Minister-Theresa-May-speaks-outside-10-Downing-Street-May 3 '17

Theresa May attacking European leaks and leaders outside 10 Downing Street after seeing the Queen on May 3 – Reuters photo

Flip forward exactly 24 months to 2019 when Narendra Modi, India’s prime minister, will be coming to the end of India’s next general election campaign, five years after he and his Bharatiya Janata Party won a landslide victory on May 16, 2014 promising acche din (good days).

Imagine that the BJP has set the stage, as has happened for May in Britain, by winning most if not all of the important assembly elections that are due to take place between now and then in Gujarat, Karnataka, Rajasthan, Madhya Pradesh and Chhattisgarh.

The Congress Party will probably still be fumbling its way to ignominy as it procrastinates about how to side-line or even dump the ineffectual Gandhi dynasty. It would therefore be unable to muster voter support, while non-BJP regional party leaders in Bihar, West Bengal and elsewhere could well be failing to unite with a serious challenge, despite various current attempts to get together. The Aam Aadmi Party run by Arvind Kejriwal, chief minister of Delhi, which has been seen as a challenger to established patties is already on the skids.

This weak opposition is a parallel factor in the UK and India, with the Labour Party being unable to garner votes under the ineffectual leadership of arch left-winger Jeremy Corbyn. Just as India’s Congress Party has failed to grapple with the Gandhi dynasty issue, Labour has procrastinated for too long about dumping Corbyn. Some Labour MPs have deserted him and are not standing in the general election.

Modi will certainly be offering “strong” government in 2019, but it will be an open question whether the country will be “stable”, given the BJP’s Hindu nationalist base and apparent determination to turn India into a Hindu-dominant and more authoritarian country.

May is offering to implement “strong” delivery of Britain’s exit from Europe, but it is highly questionable whether it will be “stable” because she has shown no ability in her political career to compromise. Indeed, she could well be leading Britain into two years (the official time for negotiating Brexit) or more of turmoil.

May Juncker-798885

Theresa May welcomes Jean-Claude Juncker before their disastrous dinner

Insults have been flying between Downing Street and Brussels, especially since European officials leaked details of a private dinner party in 10 Downing Street, the office and home of Britain’s prime minister. The chief guest was Jean-Claude Juncker, the outspoken former prime minister of small state of Luxembourg who revels in the limelight of his current job as president of the European Commission, and who the British media portray as an excessively jolly and mischievous heavy drinker.

Juncker said he was “10 times more sceptical” about a successful negotiated settlement after the dinner, and was reported to have told Angela Merkel, the German chancellor, that May was existing in a “parallel reality” and a “different galaxy”. That prompted Merkel to say that Britain harboured “illusions” about what could be achieved through Brexit. Relations worsened when The Financial Times revealed Britain could be asked to settle a €100bn bill to cover outstanding EU liabilities before Brexit. Juncker then unnecessarily stirred the pot by provocatively telling a conference in Florence that he would speak in French because “slowly but surely English is losing importance in Europe”.

May responded by accusing Brussels officials of interfering in the British election, adding that “there are some in Brussels who do not want these talks to succeed, who do not want Britain to prosper.” Her remarks carried special weight because she made them standing in Downing Street just after she had been to Buckingham Palace to tell the Queen formally that parliament had been dissolved for the election. She was of course capitalising on the Juncker attack and Merkel comments to win votes by strengthening anti-Europe views among the British electorate. Her remarks will however not be forgotten by Juncker and his anti-UK comrades.

Europe’s leaders will however probably feel slightly more relaxed after Emmanuel Macron’s victory in France’s presidential election that has emerged today. His opponent, Marine Le Pen, the far-right candidate, would have wanted to take France out of the European Union, seriously undermining the future of Europe’s unity.

No challenge to Brexit

Viewed from India before I travelled to London ten days ago, it seemed odd that no political party was challenging Brexit and arguing that Britain should stay in Europe and that, if elected, it would recant on last year’s narrow pro-Brexit referendum result and on May’s recent triggering of Article 50 that launched the exit negotiating process.

I now realise that, though a majority of Conservative MPs in the outgoing Parliament are pro-Europe “Remainers”, many of them have constituents who are pro-Brexit, so have been unable to mount a Remain campaign. The Labour Party is similarly in no position to do so, nor it seems is the worthy but minority pro-European Liberal Democrats. These Remainers are now merely calling for a referendum when the negotiations are completed, vainly hoping it seems that this would keep Britain in Europe.

It is therefore clear that the UK does not face a stable future, at least for the next few years. May’s government will almost certainly be stable because it looks like having a substantial parliamentary majority, but there will be little stability about the country’s economy as foreign companies turn to the European mainland for investment locations, and countries like France and German launch bids to steal London’s role as a prime financial centre. There will also be little stability about its relations with Europe if May interprets her promise of “strong” government to mean being a belligerent negotiator.

Modi is more politically agile and is a far better orator and image builder than May. He was elected because the country was tired of the Gandhi clan’s failings. Aspirational youth in particular wanted a prime minister who would produce jobs and the possibility of a successful life. They were not however voting for Modi’s Hindu ideology, which means that he has two years to produce the economic advances and the acche din the electorate wants.

Similarly, voters who propel May to her landslide victory on June do not want what they are likely to get – strong government but little stability.

Place names and Dalai Lama visit are China-India’s latest weapons 

Usually outclassed by China, India scores a few points

While international attention has been preoccupied with Donald Trump and his reactions to North Korea’s nuclear capability and the war in Syria, India and China have been provocatively needling each other over their long-running and potentially explosive border dispute in the Himalayan mountains.

The world need not worry however because, instead of nuclear strikes or even, as often happens, troops crossing the undefined border, China last week issued new names for places in India’s north-eastern state of Arunachal Pradesh, which it claims as its territory. This was in response to India allowing the Dalai Lama, the Tibetan Buddhist spiritual leader who lives in India in exile, to go to the state earlier this month for a high profile eight-day pastoral tour.

Dalai-Lama_reuters.jpgIndia is not strong internationally and does not often score against China, its larger and more powerful neighbour. China usually has the upper hand – for example by blocking India’s membership of the little-known but significant Nuclear Suppliers’ Group in Geneva, and encircling India by developing close relationships and investing in countries that India regards as its bailiwick. China is also planning a massive One Belt One Road economic trading and transport corridor between Asia and Europe that has exposed India’s diplomatic weakness because the government does not know how to react.

India has however scored three times this month, firstly by allowing the Dalai Lama to go to Arunachal which China calls Southern Tibet, and then by laying out the red carpet in quick succession for state visits by Sheikh Hasina, the prime minister of Bangladesh, and by the president of Nepal. China is constantly trying to wean away these two Indian neighbours.

Last year, China undermined India’s regional role by striking $25bn agreements with Bangladesh, including the supply of two submarines. India struck back during Sheikh Hasina’s visit with a $9bn bundle of agreements including $4.5bn line of concessional credit. India also scored a point with Nepal by persuading it to scale back a ten-day military exercise with China that was taking place during the president’s visit.

China invests $2bn in Bangladesh gas

Today however it has been announced that two Chinese corporations are buying Bangladesh gas fields that account for more than half the country’s total gas output, with a price tag of $2bn, from Chevron. This is specially significant because it is China’s first energy investment in South Asia.

China showed unusual irritation, even anger, over the Dalai Lama, who has led a largely uncontroversial life in northern India since he fled from China in 1959. It always objects when he receives high profile welcomes abroad, which sometimes leads to countries such as the US and UK toning down the reception he receives.

Dalai Lama in Arunachal Pradesh

He has previously visited Arunachal six times since 1959, the last being in 2009, and Beijing always issues strong and ineffective complaints. This time it stepped up its (again ineffective) protests by summoning India’s ambassador in Beijing to warn, as the foreign ministry spokesperson put it, that it would “take necessary means to defend its territorial sovereignty and legitimate rights and interests”. India should “immediately stop its erroneous move of using the Dalai Lama to undermine China’s interests” because, by permitting the visit, it had “escalated the boundary dispute” between the two countries.

China claimed that Narendra Modi had allowed the Dalai Lama to go to the area or the first time in nine years in order to provoke Beijing (at a time when relationships have been worsening), which of course India denied. The visit was specially sensitive because the Dalai Lama was boosting his role as the people’s spiritual leader with a long road journey through towns and villages to a monastery at Tawang that is the focus of Beijing’s territorial claims.  A day before he reached Tawang, where he had stayed when he fled from China, the official China Daily warned that Beijing “would not hesitate to answer blows with blows” if he was allowed to continue, which of course he was and did.

China retaliates

The more controversially outspoken Global Times suggested that China could retaliate by supporting the anti-Indian militancy in Kashmir – which, Delhi would say, it already does by condoning Pakistan’s role in the area’s currently escalating unrest. “With a GDP several times higher than that of India, military capabilities that can reach the Indian Ocean, and having good relations with India’s peripheral nations, coupled with the fact that India’s turbulent northern state borders China, will Beijing lose to New Delhi?”, the newspaper taunted.

Eventually however, China did no more , at least overtly, than re-naming the places – about which, of course, India complained.

The Dalai Lama tending to his Buddhist flock, and China’s response, are however just a by-play in a much larger story of India’s dwindling regional clout, which contrasts with the apparent strength of Narendra Modi’s government that aims to make the country internally and regionally strong and internationally important.

OBOR map - The Economist

India has for years aspired to be a player on the world stage and specially covets a seat on the United Nations Security Council, which China opposes. But, as its leaders recognise, it will not become such a player until it overcomes its economic and social problems at home, especially its hundreds of millions of undernourished and under-educated poor.

I was specially struck by this weakness after attending a series of recent conferences and seminars in Delhi. Many of the points are not new, indeed I covered them in detail in my book IMPLOSION: India’s Tryst with Destiny, a couple of years ago. But they strike home three years into the Modi government, which should be making a better job of making India achieve its potential.

It started at a London School of Economic conference in Delhi where a discussion on India moving from being a “third world to regional power” showed that it wasn’t moving very far, even though it has the world’s fastest growing economy at around 7%. Ashley Tellis, a leading US academic who was reported earlier this year to be on Washington’s list for America’s next ambassador to India, said that the country was not “moving at a pace” that would enable it to take on China or enjoy the international clout of other world powers.

Vikram Sood, a former senior Indian diplomat, said it was inevitable that India’s neighbours would not like it because they were so much smaller. He might have added that India’s diplomats have not learned how to woo their smaller neighbours and are outclassed by China’s money-led diplomacy, though Sri Lanka has recently found China infrastructure investment terms too onerous.

A few days later, it was India’s failure to cope with One Belt One Road – the Belt Road Initiative (BRI) as it is also known – for highways, railways, sea links and pipelines to Europe that emerged strongly at the Observer Research Foundation, a leading Delhi think tank. China’s ambitious aim (map above) for 2049 is to utilise its surplus industrial and financial capacity, to develop trade and financial markets, and to extend its sea power and diplomatic reach by linking as many as 65 countries and 4.4bn people in Asia, East Africa, the Middle East and Europe. It builds on the ancient Silk Road and Trans-Siberian railway and other existing projects, as well as including China’s contentious claims to control the South China Sea.

Kashgar-Gwadhar-Road-and-Railway-LinksThis is a challenge for India because the project brings all its neighbours closer into China orbit. The plan also includes a basically separate project to built a China Pakistan Economic Corridor (CPEC) linking the ancient city of Kashgar in western China with Pakistan’s Gwadar port (built by China) on the Arabian sea close to the border with Iran (shown above in a Pakistani map).

India has objected to this because it goes through the northern region of Pakistan which India claims as part of Jammu and Kashmir. India does not of course seriously expect ever gain this territory, but it lodges the claim in response to Pakistan wanting India’s part of Kashmir. It objected without any success over 40 years ago when China built the Karakoram Highway, which forms part of the corridor, in Pakistan’s Northern Areas.

“For India, blocking the BRI is not feasible, ignoring it would be self-defeating,” said Manoj Joshi, a leading journalist and senior ORF fellow at the seminar. “New Delhi needs to work with like-minded states on a strategy that can use BRI to its own ends and minimise its downsides to its own economic and geopolitical standing”

The next day, at a Carnegie India seminar, there was anxiety about whether US-India ties, which have been developed over the past decade, would not be so important to Donald Trump. That could significantly weaken India in its dealings with China. And the day after that, at the Vivekananda International Foundation which is close to the BJP government, there was concern about how badly India sells itself to the world – and no real answers about how that could be improved.

Those few days, together with the Dalai Lama spat and the neighbourly visits, put the India story in context as it approaches its 70th anniversary of independence.

Despite all that has been achieved developing a poverty-stricken country to an increasingly modern economy, India has yet to develop the confidence or the ability to be significant in its own region and on the world stage. It is increasingly losing out to China and there is no sign of that changing.

Shashi Tharoor’s attack on British rule got more attention in the UK

Governor of the Bank of England came too, but who noticed?

Three British cabinet ministers plus the governor of the Bank of England and two other government ministers trooped through India just before Easter in a seemingly desperate bid to drum up support from their largest former colony as Brexit looms – and before, following today’s announcement, they start campaigning for the UK’s June 8 general election.

They were well received by the Indian government, but the UK no longer rates as one of India’s leading foreign relationships and they made little impression outside their formal meetings. This revived memories of visit splurges staged to little effect by former prime minister David Cameron.

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Philip Hammond and Arun Jaitley, India’s finance minister

Two prominent investment bankers in Mumbai said “zero” and “none” when I asked about the impact of the visit by Philip Hammond, Chancellor of the Exchequer, who brought Mark Carney, the Bank of England governor with him. “I didn’t know they were here,” said the head of a large business group.

Shashi Tharoor, a provocative Indian MP and author, and a former top United Nations official, seems by contrast with the ministers to have made much more impact in the UK, where last month he was publicising his best-selling book, Inglorious Empire, that castigates the British for what he sees as its cruel and economically debilitating rule in India. Some 8,000 copies were sold in the first month after publication.

The comparison may appear unfair, but Tharoor has kicked off a debate about Britain’s failure to acknowledge its mis-deeds. His book, titled An Era of Darkness in its original Indian edition, has sold over 40,000 copies since it was published last November, making it the top title for Aleph, its publisher. Tharoor has suggested that Britain should apologise for plundering the Indian economy and for horrors such as the Amritsar massacre in 1919 of hundreds of non-violent protesters and pilgrims.

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There is a Brexit link with Tharoor’s lucid and sometime passionate arguments because he is stirring up anti-colonial memories just as Britain is hoping that the 52 Commonwealth former colonies will give it a special welcome when it comes to negotiate bi-lateral trade deals. There is even talk of a surely improbable multi-lateral deal with the Commonwealth, an international association that achieves little but is seeking new roles for its biennial CHOGM assembly in London early next year.

The risk is that Tharoor is stirring up post-colonial angst that could generate tougher trade deal negotiations and even opposition to Britain. That seems unlikely to happen in India, which is much more concerned with UK visa problems faced by Indian businessmen and students.

The British civil service has not helped by dubbing its Commonwealth ambitions as Empire 2.0 (initially for an Africa free trade zone). The Times has reported that the title was coined by sceptical officials worried about the high priority being given by ministers to trade deals with Commonwealth nations, but it is now being seen as misplaced old imperial ambition.

The British ministers’ visits to India were mostly focussed on meetings of annual “dialogues” on specific subjects. They were also reported in the UK to be part of a drive called by Theresa May for ministers to spend the Easter break selling Britain abroad. Liam Fox the trade minister, toured South East Asia, and May went to the Middle East (West Asia).

Stock expressions

Arun Jaitley, India’s finance minister, gave Hammond and his colleagues a good reception, saying that the UK was “looking at a different kind of relationship with India” and there was “a huge aspiration in India itself also to add to and improve upon that relationship”. The talks would take the relationship to “an entirely different level” said Jaitley, using a stock Indian expression that usually means little if anything.

Two-way merchandise trade between India and the UK has fallen in recent years to around $14bn, though both countries are among the top three investors in each other’s economy. Part of Hammond’s focus was on expanding services trade, especially financial services, building on rupee-dominated “masala bonds” that were launched in London last year to raise funds for India’s infrastructure. He offered financing for India’s Make in India campaign though that project’s problem is less to do with finance than finding foreign companies that will generate manufacturing jobs.

These were good workman-like talks but scarcely justified the sudden mass of ministerial visits, nor the strange attachment of the Bank of England governor, who is supposedly independent of government and could have made a splash on his own.

Also with Hammond was commercial secretary Baroness Neville-Rolfe and international trade minister Mark Garnier plus, on a separate energy mission, secretary of state for business, energy and industrial strategy, Greg Clark.

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Sir Michael Fallon arrives for his meeting with Arun Jaitley, who is also defence minister (photo Pritam Bandyopadhyay)

The final minister was probably the most focused, though his main aims were long term. Sir Michael Fallon, the defence secretary, brought a posse of army and air force officers and set his sights on developing design and manufacturing relationships, with the prospect of the sort of high technology transfer that India wants.

He offered to advise India on how to improve and reform its massive defence establishment, explaining in great detail how Britain had transformed its over-large and inefficient operations. He also talked about a possible new order for 20 Hawk trainer jets, more than 100 of which have already been assembled in India, and also about a more advanced version. The UK has however been less successful than the US, Russia and France in gaining major orders in the past few years. A recent $737m contract for 145 howitzer artillery guns placed with Britain’s BAE Systems went to the group’s American company.

Vijay Mallya’s extradition

From Delhi, it is difficult to see what has been achieved with the special pleading by these ministers. Indeed, the arrest (and bailing) in London today of Vijay Mallya, the absconding liquor and airline tycoon, as the first step towards his extradition to India will make far bigger headlines than the ministers’ visits.

The extradition, providing it goes through before or after the general election, will be seen as a significant gesture by the UK, which has never agreed to extradite anyone to India since the 1970s. That’s real action and beats a flood of visiting ministers.

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