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Showing posts with label defence. Show all posts
Showing posts with label defence. Show all posts

Saturday, 4 May 2024

How to tell good industrial policy from bad

Gillian Tett in The FT

 
Five years ago Reda Cherif and Fuad Hasanov, two economists at the IMF, wrote a paper with the (slightly) sarcastic title: “The Return of the Policy That Shall Not Be Named: Principles of Industrial Policy”. 

This pointed out that while strategic policy intervention was widely viewed as a key reason for the east Asian economic miracle, it had a “bad reputation among policymakers and academics” — so much so that, from the 1970s onwards, the phrase was rarely mentioned in polite company, or by the IMF. 

No longer. Last month the fund reported that it had observed no less than 2,500 industrial policy actions around the world in the last year alone, of which “more than two-thirds were trade-distorting as they likely discriminated against foreign commercial interests”. 

More striking still, industrial policies used to be far “more prevalent in emerging economies” than developed ones; between 2009 and 2022, there were cumulatively 7,000 subsidies tracked in developing countries, and fewer than 6,000 in developed ones. But last year’s surge was “driven by large economies, with China, the EU and the US accounting for almost half of all new [industrial policy] measures”. 

That shift can be seen not just in data, but rhetoric too. Last month, Mario Draghi, former head of the European Central Bank, lamented that Europe “lack[s] a strategy for how to shield our traditional industries from an unlevel global playing field caused by asymmetries in regulations, subsidies and trade policies”. He called for the EU to fight back with industrial policy. 

In the UK, the opposition Labour party is echoing these themes, calling for a “New Deal” and touting what it calls “securonomics”. In the US, Donald Trump wants huge trade tariffs, while Joe Biden has called for tariffs in sectors such as steel. The president’s Inflation Reduction Act is yet more industrial policy. 

But anyone pondering that striking number in the IMF report should remember a crucial point that ought to be obvious but is often overlooked: “industrial policy” can mean many different things. As Cherif and Hasanov told a seminar at Cambridge’s Bennett Institute this week, there is an important difference between policies that try to create growth by shielding domestic companies from foreign competition and those which help those companies compete more effectively on the world stage.  

The former “import substitution” strategy was pursued by many developing countries in recent years, including India. It is also the variant favoured by Trump and the one being considered by some European politicians, for instance in the case of Chinese solar panels. 

But it is this latter approach that has given industrial policy a bad name. On the basis of copious data, Cherif and Hasanov argue that import substitution models undermine growth in the long term since they create excessively coddled, inefficient industries. 

By contrast, the second variant of industrial policy aims instead to make industries more competitive externally in an export-oriented model, while worrying less about imports. This approach is what drove the east Asian miracle, and is what creates sustained growth, the data suggests. 

The difference in approach is embodied by the contrasting fortunes of Malaysian automaker Proton car and South Korea’s Hyundai. The former was developed amid import substitution policies, and never soared; the latter flourished on the back of an export-oriented strategy.  

A cynic might retort that policy is rarely so clear cut as these contrasting car tales might suggest. It is hard for any company to fly on the world stage if its key competitors are excessively subsidised in closed markets — as evidenced by the woes of EU solar-panel makers trying to compete with their Chinese rivals. It is also tough to tell countries to aim for export-driven growth in a world where trade is fragmenting and protectionism rising. 

In any case, while export-oriented strategies work for small or medium-sized countries such as South Korea, they may seem less relevant for a giant such as America. 

Then there is a more fundamental question around economic change. As a thoughtful paper published last year by the economists Réka Juhász, Nathan Lane and Dani Rodrik notes, while “industrial policy has traditionally focused on manufacturing”, it is the service sector that now dominates. Thus “governments are likely to look beyond manufacturing as they consider productivity-enhancing ‘industrial’ policies in the future”. 

Cherif and Hasanov think institutions such as America’s Darpa give one clue to innovation-boosting measures in this space; Juhász, Lane and Rodrik cite worker training and export credit. But this needs holistic policy, which America, say, lacks. 

Either way, the key point is that insofar as western politicians are now increasingly happy to utter the once forbidden words “industrial policy”, they need to define what they mean. Is the goal to exclude competitors from the domestic stage, via tariffs? Or to make domestic producers more competitive and innovative in a global sense and better able to compete? Or is it something else? Investors and markets need clear answers. So, more importantly, do voters.

Saturday, 18 June 2022

Understanding the Agnipath protest




--- Another view

Shekhar Gupta in The Print

The opposition to the Modi government’s ‘Agnipath’ scheme is being led by the articulate community of senior veterans on social and mainstream media, and by India’s dangerously burgeoning population of jobless youth. Especially in the Hindi heartland.

Counterintuitive though it is, we have to also note that these young people understand the nub of the ‘problem’ with Agnipath way better than the senior veterans do.

Most of the veterans are outraged because — among many things that they see as wrong with Agnipath — they think the Modi government is using the armed forces for employment generation.

The young see Agnipath as the opposite. They see it as an armed forces jobs destroyer, not generator. How, we will explain now. And why the very reason they are primarily angry makes a scheme like Agnipath good, we will explain as this argument unfolds.

First, the jobless young. They understand better not only because they know their politics better than venerable, well-meaning seniors with decades in uniform. They do as they come from the hyper-politicised and polarised heartland. They also know the hopelessness of the job market.

They see the absence of opportunity where they live and feel their own lack of skills needed for jobs in distant, booming growth zones. A government appointment whether in the railways, state government, police, anywhere is the only lifetime guarantee of a safe, well-paying job. The armed forces are by some distance the best.

We must not judge them because they “look like lumpen”, burn trains and battle with police. They are every bit as virtuous and deserving of our understanding as the millions of the best-educated who slog year after year paying enormous sums financing the booming ‘competition academy’ industry for those few UPSC jobs.

For the less resourceful or educated, for mere matriculates, an Army recruitment rally means the same thing as the big UPSC for those whose pictures you see in the full front-page advertisements in leading dailies from Unacademy, Byju’s, Vision IAS etc etc. They prepare just as assiduously for Army recruitment. How, ThePrint reporter Jyoti Yadav told us in this report from the rural heartland. 

The less privileged now see Agnipath as their own version of the UPSC being taken away. See it this way. Presume that UPSC exams weren’t held for two years because of Covid while millions prepared in hope. Now you announce that the recruitment for the All India Services will only be for four years and only one-fourth will get the full tenure.

Further, for like-to-like comparison, suppose you also set a new, lower maximum age limit to ensure our civil services remain youthful, and tough luck for those who grew too old in the past two years waiting. By the way, this is precisely why the government has now made its first Agnipath rollback and given this “one-time” maximum age relaxation to 23 years from 21.

Much bigger riots might break out in the same zones of the heartland if UPSC were disrupted like this. And you know what, our middle-/upper middle-class/elite public opinion will be entirely sympathetic to them. Even more than they might have been to the anti-Mandal protests and self-immolations in 1990. The “debates” on prime time and social media (which the Modi government takes much more seriously than people like us) would sound very different from what they do at this point.

I am not supporting the ongoing Agnipath protests or dismissing concerns over these as mindlessly elitist. These are a distressing, dangerous alarm for India. That our demographic dividend is becoming a wasteful disaster with crores of unemployed young seeing a government job as the holy grail.

No government can produce this many jobs. And certainly not in the armed forces, whose balance sheets and budgets are already an HR disaster. However flawed Agnipath might be, our armed forces need radical reform. But we need to understand these angry young people’s concerns.

Senior veterans erred instinctively into seeing this as a job-creating extravaganza exploiting the armed forces. It’s the opposite. Since India hasn’t held any recruitment rallies for more than two years, a “shortfall backlog” of at least 1.3 lakh has built up. It’s a cut of about 10 per cent from the pre-pandemic strength of the armed forces.

Here’s the math. Since only about 45,000 ‘Agniveers’ will be recruited now per year (compared to the usual 60,000 at full-tenure recruitment rallies), and only one-fourth will be retained after four years, this supposed shortfall will only rise. The most elementary calculation shows that at the current rate of 50,000-60,000 retirements each year, by 2030 the armed forces will field about 25 per cent fewer personnel than they did before the Covid break.

This will be a deliberate, substantive downsizing and a desirable outcome fully in tune with the global trend. The US military heavily cut its manpower and is reducing further, diverting dollars to standoff weapons and artificial intelligence. The Chinese PLA has been similarly downsizing. Agnipath can be fine-tuned, reinvented, renamed and relaunched. But something like it is needed.

Contrary to being a wasteful job-generating extravaganza, a tour of duty approach is to cut jobs, wages and pensions. The same money can go into drones, missiles, long-range artillery and electronics and minimising casualties in battles of the future. Even proper assault rifles in a resource-starved military machine. 

As respected former Army commander Lt. Gen. H.S. Panag pointed out in this article, an idea like Agnipath is well-intended, necessary and could do with improvements. But it is yet another rude reminder to the Modi government that however overwhelming, electoral popularity doesn’t empower them to enforce shock-and-awe change, no matter how virtuous. They’ve seen it with the now repealed farm laws, stalled labour codes and withdrawn land acquisition bill.

A big change has to be reasoned out, public opinion prepared. People respond to abrupt change in their hundreds of millions, have anonymity and safety in numbers unlike the few hundred fawning ruling party MPs, a few score of ministers or a dozen chief ministers.

Whether it’s land acquisition for job-creating industry and infrastructure, labour and farm reform to unleash new forces of entrepreneurship, or modernising the armed forces, you have to evangelise your ideas to people patiently. Allow a robust debate in public and Parliament instead of dismissing anyone disagreeing as anti-national or bought out by some evil force. It’s an ordinary, normal and inevitable exercise in the same democracy that gifts you extraordinary electoral power.

Finally, we need to look at the geography and politics — or shall we be cheeky and say geopolitics — of these protests. Geography first.

If you map the nearly 45 places where rioting has broken out, there will be a hornet’s nest of sorts in Bihar, eastern Uttar Pradesh, Bundelkhand, southern Haryana and Rajasthan.

We can safely classify these as India’s primary low-wage migrant labour exporting zones. Check out, for example, where the mostly poorly paid and security guards doing daily double shifts in your neighbourhood come from.

At least so far, this spark mostly hasn’t travelled South barring Secunderabad-Hyderabad. Let’s hope and pray it stays that way. Unlike the heartland, the south-of-Vindhyas states have their birth rates, education levels, investment and job creation much more sorted. It doesn’t mean that Indians there are any less patriotic.

And now the politics. With the farmers’ protests the epicentre was Punjab, the state least impressed with the Modi phenomenon in all of India as repeated elections from 2014 onwards have shown. This current anger comes almost entirely from BJP/NDA-run states, from the very core of the Modi-BJP base. It’s safe to presume that a vast majority of these angry young people are loyal Modi voters.

The lesson is, there is more to democracy than electoral popularity. You need to keep reasoning with your constituents all the time. Especially on why some drastic change they fear might be good for them. People have an immune system that detests and fears sudden change plonked on their heads.

The Modi government’s biggest flaw over these eight years has been its disinclination to accept the limitations of electoral majorities. This has already ruined land acquisition and farm reform and stalled the labour codes, and it will be tragic if the armed forces’ downsizing and modernisation is derailed too.

Friday, 14 January 2022

Pakistan's Brave Judge

Najam Sethi in The Friday Times

Justice Athar Minallah, Chief Justice of the Islamabad High Court, has made history. He has ordered the Capital Development Authority (CDA) to knock down the Pakistan Navy’s Sailing Club House on the edge of the Rawal Dam in Rawalpindi as well as the Monal Restaurant in Islamabad and seize the Margalla Greens Golf Club in the Capital, because these have been built illegally on land belonging to the Margalla Hills National Park. He has thus outlawed the military’s claim to about 8000 acres of such land. Most significantly, the good judge has expressed the view that the Pakistan Navy does not have the authority to undertake a real estate development venture, nor the right to lend its name to any such enterprise.

Naturally, this judgment has warmed the cockles of millions of Pakistani hearts even as it has raised the hackles of powerful people lording it over unaccountable state institutions which have similar illegal stakes in real estate across the country. For starters, the Auditor General of Pakistan has revealed a list of 79 “encroachments” on the land of the Margalla Hills National Park, noting that several government bodies – CDA, Metropolitan Corporation Islamabad, Islamabad Wildlife Management Board, etc. – claim the right to control and manage the area, making the job of adjudication of rights and permissions difficult.

Justice Minallah’s judgment has also ignited questions of how courts have earlier dealt with such matters relating to the rich and powerful as opposed to the poor or feeble. In recent times, two cases have roused public indignation and in both the courts have been inclined to bend over backwards to appease powerful stakeholders. The first is that of Imran Khan’s sprawling multi-billion rupee estate in Bani Gala which was illegally constructed many years ago and brazenly “regularized” by the CDA on orders of Justice Saqib Nisar. In pursuit of this court order, the wretched chairman of the CDA who sent a questionnaire to Imran Khan regarding the property was swiftly dispatched to the nether lands and the journalist who quoted a news report exposing the PM’s shenanigans was served with a “show cause notice” by PEMRA. The second is a high rise luxury apartment construction at 1 Constitution Avenue Islamabad, a list of whose owners reads like a Who’s Who of the high and mighty (Imran Khan was one such). This building again, was “regularized” by the Saqib Nisar court, in sharp contrast to the demolition orders of lesser structures and lay encroachments in Karachi ordered recently by the Chief Justice of Pakistan, Gulzar Ahmed.

This is just the tip of the iceberg. The highway robbery began at the time of partition in 1947 when tens of billions worth urban and rural evacuee property of Hindus and Sikhs was seized by the new lords of the state and distributed freely over the years to their favoured assets and allies regardless of merit or due process. In time, the parliaments of the state began to make laws for cheap acquisition of lands and properties belonging to Pakistanis for the avowed purpose of building public parks, educational institutions or military security and defense installations. These land were then leased out at throwaway rates to favoured institutions and individuals, only for the latter to quietly transform these into high value, exorbitantly profitable commercial ventures in the private sector (housing societies, clubs, marriage halls, golf courses, etc). And that is how “Military Inc.” irresistibly came to be the leading “businessman” in Pakistan, owning airlines, shipping, hotels, banks, insurance, food, fertiliser, cement, housing, you name it. This is why Justice Minallah’s recent judgment is something to write home about. Earlier, he had put a stop to the practice of the civil bureaucracy allotting valuable residential and commercial plots to themselves and judges at throwaway prices to ensure protection against land-grabbing claims and law-bending practices, thus casting the first few stones at the established disorder. Which other court or judge will follow his laudable example and make these singular milestones in Pakistani history?

The Supreme Court is now faced with another public interest challenge. The Supreme Court Bar Association led by lawyer Ahsan Bhoon has filed a petition challenging the lifetime disqualification of PMLN’s Nawaz Sharif and PTI’s Jehangir Tareen from holding public office for not being “sadiq and ameen”. This petition follows revelations of high level judicial impropriety, misconduct and political bias by ex-CJP Saqib Nisar (that name again!) made by ex-CJ Gilgit-Baltistan, Rana Shamim, aimed at knocking out Nawaz Sharif from politics. To prepare the ground further for appropriate judicial review, the ex-Secretary of the PTI, Ahmed Jawad, has now come out of the closet to level accusations of judicial and military manipulation to oust Nawaz Sharif from office and hoist Imran into it. His allegation that Supreme Court judges disqualified Jehangir Tareen in order to “balance” their unfair ouster of Nawaz Sharif is bound to impact the trial and appeals of Mr Sharif in multiple cases and help pave the way for the judiciary to reclaim its lost credibility. It is significant that Justice Athar Minallah is also seized of adjudicating the allegations of ex-CJ GB Rana Shamim, and he will now be hard pressed to include the testimony of Ahmed Jawad in his deliberations.

Is Justice Athar Minallah the man of the moment? The history man?

Thursday, 10 June 2021

Government Pensions subject to 'Good Behaviour'

Lt. Gen. H.S Panag (retd.) in The Print

On 31 May, the Ministry of Personnel, Public Grievances and Pensions, which is headed by Prime Minister Narendra Modi, issued a gazette notification amending Rule 8 — “Pension subject to future good conduct” — of the Central Civil Services (Pension) Rules 1972. The amendment prohibits retired personnel who have worked in any intelligence or security-related organisation included in the Second Schedule of the Right to Information Act 2005 from publication “of any material relating to and including domain of the organisation, including any reference or information about any personnel and his designation, and expertise or knowledge gained by virtue of working in that organisation”, without prior clearance from the “Head of the Organisation”. An undertaking is also supposed to be signed to the effect that any violation of this rule can lead to withholding of pension in full or in part.

There are 26 organisations included in the Second Schedule of the RTI Act, including the Intelligence Bureau, Research & Analysis Wing, Directorate of Revenue Intelligence, Central Bureau of Investigation, Narcotics Control Bureau, Border Security Force, Central Reserve Police Force, Indo-Tibetan Border Police and Central Industrial Security Force. These organisations are excluded from the RTI Act. Ironically, the armed forces, which are responsible for the external and at times internal security, are covered by the Act.

In 2008, Rule 8 was first amended to make more explicit the existing restrictions under the Official Secrets Act by barring retired officials from publishing without prior permission from Head of the Department any sensitive information, the disclosure of which would “prejudicially affect the sovereignty and integrity of India, the security, strategic, scientific or economic interests of the State or relation with a foreign State or which would lead to incitement of an offence.” An undertaking similar to the present amendment was also required to be signed.

The scope of the 31 May amendment is all-encompassing and its ambiguity leaves it open for vested interpretation and virtually bars retired officers who have served in the above-mentioned organisations from writing or speaking, based on their experience in service or even using the knowledge and expertise acquired after retirement. There is an apprehension that in future, the rules of other government organisations, including the armed forces, may also be amended to incorporate similar provisions. 

The motive behind the amendment

All governments are legitimately concerned with safeguarding national security. Almost all countries have laws for the same. However, political dispensations often use these provisions to stifle criticism of the government, particularly by retired government officials who, based on their domain knowledge and experience, enjoy immense credibility with the public.

Originally, Rule 8 allowed withholding/withdrawal of pension or part thereof, permanently/for a specified period if the pensioner was convicted of a serious crime or was found guilty of grave misconduct. “Serious crime” included crime under Official Secrets Act 1923 and “grave misconduct” also covered communication/disclosure of information mentioned in Section 5 of the Act.

There was no requirement of prior permission before publication of any book or article, and prosecution under Official Secrets Act was necessary before any action could be taken. No undertaking was required to be given by the retiree officials. There is no noteworthy case in which this provision was invoked.

The motive behind the 2008 amendment by the UPA and the present amendment by the NDA, was/is to crack down on dissent by retired officials without the due process of law. This, when despite recommendations of the Law Commission and Second Administrative Reforms Commission, no effort has been made to amend the 98-year-old Official Secrets Act to cater for current requirements of national security. The only difference between the two amendments is that the latter makes the rule more absolute by adding the ambiguous rider regarding publication without permission “of any material relating to and including ‘domain of the organisation’, including any reference or information about any personnel and his designation, and expertise or knowledge gained by virtue of working in that organisation.”

The amendment to Rule 8 is unlikely to withstand the scrutiny of law. The Supreme Court and the high courts have repeatedly upheld the principle that “pension is not a bounty, charity or a gratuitous payment but an indefeasible right of every employee”. The government cannot take away the right merely by giving a show cause notice to a retired official for having used “domain knowledge or expertise” while writing an article/book or speaking at any forum. Any application of this amendment will be thrown out by the courts. No wonder that there has been no known application of the amended rule since 2008. There has been no alarming increase in cases under the Official Secrets Act. Between 2014 and 2019, 50 cases have been filed in the country and none against a government official. And if a government official is actually guilty of violating national security, then is withdrawal of pension an adequate punishment?

What does the government then gain by this amendment? Simple, the new amendment acts as deterrent against criticism by retired officials. Which self-respecting retired government official would like to seek permission from her/his former junior or fight a prolonged legal battle to get his pension restored? The government’s will, thus, prevail not by the wisdom of its decision but by default.
 
Loss to the nation

All major democracies make optimum use of the experience of their retired government officials. While some become part of the government, others contribute by educating the public and throwing up new ideas/suggestions for the consideration of the government. The domain expert keeps a check on a majoritarian government facing a weak opposition by publicly speaking and writing. All governments try to hide failures and scrutiny for inefficiency. With a weak opposition and government-friendly media, the Bharatiya Janata Party dispensation is more worried about the perceived threat from the retired officials with domain expertise than an ill-informed opposition.

Given the Modi government’s obsession with respect to national security and its lackadaisical performance in its management, it is my view that in the near future, the government will incorporate similar provision in the pension rules of other government departments and the armed forces.

A case in point is the attempt by the Modi government to deny/obfuscate the intelligence failure and the preemptive Chinese intrusions. To date no formal briefing has been given about the actual situation in Eastern Ladakh. Doctored information has been fed to the media through leaks by government/military officials. Three retired defence officers, including the author, brought the real picture before the public through articles and media interviews. All were careful to safeguard operational security. A concerted campaign was launched to discredit these retired officers through government-friendly media and pliant defence analysts until the events overtook their detractors to prove them right. The author extensively used his knowledge of the terrain in Eastern Ladakh to bring the truth before the public. In a similar situation in future, these officers may well be battling in courts to safeguard their pensions.

Imagine a situation that in future when no historical accounts of our wars, counter insurgency/terrorism campaigns and communal riots can be written by retired government and armed forces officers. No retired official will be eligible to head our security related thinks tanks or speak in international forums about our experience. Despite provision of Section 8(3) of the RTI Act to declassify documents after 20 years, the government never does so except to score political points as in the case of Netaji Files.

The amendment to Rule 8 of Central Civil Services (Pension) Rules 1972 is nothing more than a blatant, overarching and draconian gag order against retired officials to manage the public narrative for political interests under the garb of safeguarding national security.

It safeguards the interests of the political dispensation and not the nation. It must be challenged in the courts and in the interim disregarded with contempt.

Friday, 30 November 2018

Imran Khan - The first 100 days

Najam Sethi in The Friday Times






Prime Minister Imran Khan is being hauled over the coals for failing to match words with deeds in his first 100 days in office. Indeed, he has made a laughing stock of himself by justifying 19 controversial decisions and 35 U-Turns so far as tactical policy befitting “great leaders” like Hitler and Napoleon. Since he wittingly proposed the 100-day yardstick to measure his government’s performance, he has only himself to blame for this media onslaught.

The most urgent item on PM Imran Khan’s agenda is related to the crisis in the economy manifested by a yawning gap in the balance of payments, falling forex reserves and a plummeting rupee. As opposition leader, he had thundered endlessly against crawling to the IMF or foreign countries for financial bailouts. Instead, he had pinned his hopes on billions in donations from overseas Pakistanis and tens of billions from unearthing black money stashed abroad. The problem arose when, after assuming office, he persisted in his delusionary approach, and the situation went from bad to worse. When his finance minister, Asad Umar, dared to baulk, he was forced to eat his words. It was only when the army chief, General Qamar Bajwa, “launched” himself purposefully that Imran Khan reluctantly packed his achkan, dragged himself off to Saudi Arabia and China with bowl in hand, and Asad Umar sat down to engage the IMF, both making a bald-faced virtue out of necessity.

But even this belated dawning of “wisdom” has failed to yield the desired results. China is not even ready to reveal the nature of its help. The Saudis have made an insignificant deposit that doesn’t tally with the tall expectations of government. And the IMF delegation has returned to Washington without any commitment, leaving the PM and his FM wringing their hands in despair.

The second item related to the efficient and honest functioning of government. On that score, there is even more confusion and contradiction. Parliament cannot function properly without consensual committees to steer legal reforms and oversee public accounts. But the hounding of the opposition parties at the behest of the interior ministry and civil-military “agencies” directed by Imran Khan himself has log-jammed the core committees. Worse, the PM’s intent to run Punjab from Bani Gala via a weak chief minister in a sea of cunning contenders for power like the Punjab Governor and the Speaker of the Provincial Assembly, has deadlocked the bureaucracy and administration. The rapid postings and transfers of high and low officials at one power broker’s behest or another’s has led to lack of direction and motivation.

The third agenda item is foreign policy. Here, too, the government’s stumbling is embarrassing. When the need of the hour is to keep the American beast at bay so that it doesn’t waylay the IMF on its way to Pakistan or lean on the Saudis to put pressure on us, Imran Khan has tried to win cheap brownie points at home by counter-tweeting President Trump. On the Afghanistan front, the war of words and proxy terrorism continues unabated even as Islamabad vows to be part of the solution rather than the problem.

Now Pakistan’s reopening of the Kartarpur corridor to the Sikh shrine of Baba Guru Nanak is being billed as some sort of “peace breakthrough” in Indo-Pak relations. It is nothing of the sort. Like the IMF, China and Saudi Arabia “openings”, this initiative comes courtesy General Bajwa whose bear hug of Indian cricketer Navjot Singh Sidhu at Imran Khan’s oath taking ceremony in Islamabad put Indian PM Narendra Modi and Punjab state CM Amarinder Singh in a tight corner. Neither politician’s prospects are too bright in the forthcoming elections in Punjab state next year. Therefore, they have reluctantly yielded to the Pakistani proposal only to curry favour with tens of millions of devout Sikhs. It is a tactical and short term concession as the hard, anti-Pakistan statements from Amarinder Singh and the Indian FM Sushma Swaraj, coupled with PM Modi’s refusal to attend the SAARC summit for the third year running, prove. Indeed, even as the Kartarpur protocol was being signed, proxy terrorists were taking a toll at the Chinese Consulate in Karachi, SP Tahir Dawar’s murdered body was being handed over to the Pak authorities at the Afghan border, suicide bombers were striking in the lower Orakzai Agency and India’s brutal repression in Held Kashmir showed no sign of abating.

On the Pakistan side, too, General Bajwa’s initiative is tactical, aimed only at reducing current Indian hostility – in the form of armed conflict along the LoC and proxy terrorism across the country – that destabilizes Pakistan and makes Imran Khan’s job of focusing on government difficult. This is the same Miltablishment that winked at the Labaiq Ya Rasul Allah during Nawaz Sharif’s time and crushed it in Imran Khan’s, the same that kicked Nawaz out for wanting to promote peace with India and is propping up Imran now at Kartarpur.

The Miltablishment has put all its eggs in Imran Khan’s basket. It will take more than 100 days of incompetence to shake its faith in their chosen man.


------

Bombs or Bread?

Najam Sethi in The Friday Times 16 Nov 2018









As we all know, the civil-military relationship in Nawaz Sharif’s time was severely strained. Among the factors often cited are Mr Sharif’s dogged pursuit of ex-army chief, General Pervez Musharraf, for the treasonable coup of 1999; his rush to “befriend” the hawkish Indian PM, Narendra Modi, without clearing the tactics and strategy with the Miltablishment; the “misuse” of the Pakistan-based jihadis in the proxy war with India, that led to the altercation reported in “Dawnleaks”; and Mr Sharif’s refusal to give the Miltablishment a seat at the roundtable determining CPEC projects and contracts.

But in a recent TV interview, Ishaq Dar, the ex-PMLN Finance Minister, has made a startling admission. He alluded to the issue of increasing defense budgets as the most significant area of conflict between the PMLN government and the Miltablishment. It appears that the Miltablishment wanted “more” money for new weapons systems because of the rising security threat from India but the PMLN government was strapped for funds and declined to do the needful.

The “Defense Budget” remains a sore point with every elected civilian government. At one time, it hovered around 30% of all budgetary expenditures and became grist for critics’ mills. So the Musharraf government cunningly took out military pensions from the Defense Budget and clubbed them with government expenditures, thereby reducing its weight as a percentage of budget expenditures and making it more palatable. When Coalition Fund Support from the US kicked in during the war against terrorism in FATA, it was also toted up outside the ambit of the Defense Budget. It has now become normal practice to post an increase of approximately 10 percent every year over actual expenditures for defense in the preceding year whilst beefing up the defense spending in supplementary budgets during the rest of the year, in effect giving the military much more than a 10% increase. The low levels of budgetary revenue collection and consequent government expenditures have also made defense budgets look overly inflated in percentage terms, especially in relation to India.

The security concerns of the Pak military have increased manifold for three main reasons. First, the aggressive nature of the Modi regime with its constant threat of “strategic strikes” across the LoC and its support of proxy war against Pakistan from non-state actors based in Afghanistan. Second, the perennial threat from its Cold Start Doctrine, now baptized afresh as Pro-Active Operations. Third, India is shopping for advanced weapons systems, the foremost being its proposed purchase of the Russian S-400 Triumf long-range, anti-missile system for over US$5.5 billion which is viewed in Islamabad as a major new threat. Now India has commissioned its first indigenously built nuclear-powered submarine, INS Arihant, armed with a 750km range submarine launched missile fitted with a nuclear warhead. Both these acquisitions are going to compel Pakistan to seek expensive equivalent systems to redress the security imbalance.

In other words, the Pakistan military will want lots more money going forward. The problem is that Pakistan’s economy has been failing and increasingly unable to bear this burden. Therefore, the choice of “bombs or bread” is bound to echo ever more furiously in the corridors of power, leading to renewed strains in civil-military relations and political instability that will in turn hamstring economic development and further strain the budget. When will this vicious circle end to create space for poverty alleviation, education, health, human resource development, etc.?

By definition, a “national security state” like Pakistan with a “permanent” and powerful enemy on its border like India requires a high level of defense preparedness. This is testified by the four wars, countless border skirmishes, and reciprocal proxy-terrorisms between the two in the last 70 years. Ostensibly, the root cause is the unresolved dispute over Kashmir. But we need to ask and answer some pertinent questions here.

How have many countries resolved similar border and territorial disputes in modern times without resorting to wars and proxy-terrorism? Which of the two is the originator of the wars in the subcontinent, regardless of the political provocation by the other? Why has the nuclearisation of the subcontinent spurred the conventional arms race instead of freezing it as originally argued? Who is hurting the most from this arms race, not just in financial terms but also in the cost to representative democracy of an overbearing political-military industrial complex that has created violent non-state actors at home to retain its political hegemony? Why is such a national security state unable to fully exploit Pakistan’s strategic location at the crossroads of three civilisations and markets – South Asia, Central Asia and the Middle-East – instead of replacing the yoke of one declining super power by that of another rising one? Why do we subscribe to the notion of a permanent enemy instead of a permanent peace in the national interest?

The USSR put a man in space and built over 10,000 nuclear bombs but couldn’t put enough bread on its shelves to feed its people. The arms race destroyed it. There are lessons in this for Pakistan.

Thursday, 1 December 2016

Cricket: Why you need to master defence to score runs

Jon Hotten in Cricinfo


Technique is a servant, not a master. Take the example of Jonny Bairstow, and his successful comeback to the England Test side


Dropped from the Test side after a run of low scores, Jonny Bairstow worked out his technical flaws and became a prolific run scorer © Getty Images



Graham Gooch once said, "I don't coach batting, I coach run-scoring." In a sentence he defined the requirements of the game's highest levels: those who arrived there already knew how to bat; what they needed to know was how to prosper on the mean streets, where the pressure was greatest and where any and every weakness would be found and exploited.

It suggested, too, that technique is a servant rather than a master, a means to an end rather than the end itself. Ugly runs count the same as pretty ones; David Gower's and Shivnarine Chanderpaul's look just the same in the scorebook, if not the history book. And as Alastair Cook, Gooch's most famous pupil, has moved inexorably onto the list of the all-time top ten Test match run scorers, and Goochie himself got more than anyone else across all forms of cricket, he's probably on to something.

Like all good buzzwords, technique has been thrumming through Test series between England and India, and Australia and South Africa. There's nothing like a batting collapse to begin the self-evisceration. Speaking to the Guardian for a thoughtful examination of Australian concepts of batting written by Sam Perry, Ed Cowan said: "One of [our] biggest issues is the attitude of 'attack at all costs', which I think is defunct in Test cricket. The message feeds through that we've got to pick attacking cricketers and that you need to be an attacking cricketer to be picked."

In India, Haseeb Hameed is the new poster boy for doing it right, the "baby Boycott", a kid with arms like sticks who hits through the covers with all of the easy power of a natural ball-player. Ben Duckett and Gary Ballance, having got it wrong, well, how must it feel to be them, to keep touring knowing that your tour is over and that stretching ahead is exile, and in that exile there are hard truths to be faced, hard labour to be undertaken.

They will join a list of recent discards, from Alex Hales to Sam Robson, Nick Compton to Adam Lyth, James Vince to Ian Bell, who have various hopes of a recall somehow, someday.

In that, they can look to Jonny Bairstow, who knows the feeling. When he was dropped from the side he averaged 27. He was out for 18 months and went through what he called some "dark spots". In the summer of 2014 he missed six weeks of domestic cricket with a broken finger and afterwards his renaissance began.

Bairstow addressed a point of technique. He felt that he was crouching too low in his stance, which led to a rigid right elbow and back and made him lunge at the ball, a fault compounded by a low backlift that often had him playing shots well in front of his body. He began standing up straighter and holding his hands higher, the bat hovering almost baseball-style as he waited. He still waggled the bat, but it came at the ball from a steeper angle and because of that it arrived later, which meant the interception point was under his eyes, where he was perfectly balanced. He laid waste to county attacks and was recalled for the 2015 Ashes. In 2016 he has made 1355 runs, more than any wicketkeeper in a calendar year, at an average of 64.52.

"You got two options," he says of being dropped. "You either run and hide or you front up."

It wouldn't have happened without a technical change, but then the technical change would not have happened without the desire to improve, to escape that darkness. He had what seems like the right attitude to technique, that it existed to serve him, to help him score runs. If he wasn't scoring runs, then he needed to find out why.

Dean Jones, the former Australia batsman, has published a book called Dean Jones' Cricket Tips (The Things They Don't Teach You At The Academy), about the kind of small improvements players need to make to evolve from being good professional sportsmen to international stars. He analysed a typical Sachin Tendulkar century, which took 180 deliveries, and found that Tendulkar left or defended around 70% of them - about 126 deliveries.

It suggested that the ability to stay in remains a great batsman's primary quality. His array of of scoring strokes, however wide and thrilling, are restricted to one ball in three. What all players looking to score runs must be able to do is defend forward and back and leave the ball well. To score runs, you begin by knowing how to not score them too.

It's interesting that the most discussed technical flaws always apply to defensive technique. England's most improved players, Bairstow and Ben Stokes, have improved most in that area. The problems of Duckett and Ballance lie there. For all of modern batting's pyrotechnics, finding a way to stay in remains the key to it all, as Cook and Gooch continue to show.

Friday, 30 September 2016

In his victory speech Jeremy Corbyn spelled out exactly why the establishment hates him so much

Youssef El Gingihy in The Independent

Jeremy Corbyn's conference speech yesterday underlined exactly why he has been subjected to a ferocious smear campaign. We have heard an endless catalogue of critiques: That Corbyn lacks leadership; that he is not electable; that Labour has become a protest party infiltrated by the far left. Yet the real reason behind these attacks is that Corbyn is a clear and present danger to powerful, vested interests.

For the first time in a generation, a Labour leader is truly challenging the cosy political consensus extending through the Thatcher-Blair-Cameron axis. The policies taking shape represent a clean break from several decades of deregulated free market economics.

Corbyn has positioned Labour as an anti-austerity party. He emphasised that the financial sector caused the 2008 crisis not public spending. This is important as Miliband and Balls mystifyingly failed to make this argument. One can only surmise that they were eager not to offend the City of London.

Corbyn promised to reverse privatisation of public services. This would mean renationalisation of the railways. It would mean restoring a public NHS reversing its privatisation and conversion into a private health insurance system.

It would mean an end to the outsourcing of council services. It would mean returning public services into public hands. And none of this is radical. Polling shows the majority of the public, including Conservative voters, is in favour.

It is no surprise that Richard Branson and Virgin seemingly used Traingate in an attempt to discredit Corbyn. Virgin would stand to lose billions in contracts if such policies went ahead. As would many other corporate interests - the likes of Serco, G4S, Capita and Unitedhealth to name a few.

Corbyn promised Labour will build enough social housing and regulate the housing market. Again, property developers, investors and construction firms would stand to lose from the restoration of housing as a social good rather than a financial instrument.

Corbyn vowed that bankers and financial speculators cannot be allowed to wreak havoc again. Regulation of the financial sector will have the City running scared - the party may well be truly over for them. Deregulated finance has resulted in industrial scale corruption profiting a tiny elite at the expense of ordinary people. This was evident not only during the crash but in the raft of scandals since, including LIBOR and PPI.


Corbyn added that the wealthy must pay their fair share of taxes. Labour would take effective steps to end tax avoidance and evasion. This would need to start with winding down the offshore empire much of which comes under the influence of the UK and the City of London.

Corbyn highlighted the grotesque inequalities driven by neoliberalism. The result has seen millions of ordinary people abandoned by a system that does not work for them. Here, Corbyn again broke with the consensus pointing out that immigration is not to blame. Scapegoating of migrants is convenient for elites keen to distract from the damage that they are causing. Corbyn emphasised that it is exploitative corporations, which are to blame for low wages not migrants. Over-stretched public services are down to Conservative cuts not immigration. However, after years of xenophobic anti-migrant rhetoric, winning this argument will require plenty of hard work.

On the economy, Corbyn promised investment with £500bn of public spending and a national investment bank. He also promised investment in research and development, education and skilling up of the workforce.

Yet none of this is especially controversial. Much of it is increasingly accepted as common sense amongst economists.

It is Corbyn's reset on foreign policy, which is truly intolerable for the establishment.

Corbyn spoke of a peaceful and just foreign policy. There would be no more imperial wars destroying the lives of millions; generating terrorism and migration crises. Arms sales to countries committing war crimes would be banned starting with Saudi Arabia. This will have set alarm bells ringing amongst the nexus of intelligence agencies, defence contractors and corporates. Corbyn is directly challenging the Atlanticist relationship paramount to the US-UK establishment and its global hegemony, particularly in the Middle East.

It is no surprise that the Conservatives and their mainstream media cheerleaders have therefore attacked Corbyn. The most damaging attacks, though, have come from his parliamentary party. The process of disentangling from the New Labour machine captured by corporate interests may still generate more damage.

As Corbyn and McDonnell have both made abundantly clear, socialism is no longer a dirty word. Corbyn's Labour - the largest party in Western Europe - is powering forward with a vision of forward-looking 21st century socialism.

Monday, 17 August 2015

Rahul Dravid and Sanjay Manjrekar on Batting

S Dinakar in The Hindu


Rahul Dravid.
Rahul Dravid.


Batting legend Rahul Dravid shared his thoughts on India’s troubles with spin and the dynamics of technique in an exclusive conversation with The Hindu.

Here is the first part of excerpts from the interview.



Q. Indian batting has become increasingly vulnerable to spinners over the last few years.

Playing spin was one of our big strengths. What can happen is that when you are with an international team you are not getting to play a lot of spin bowling in matches. Perhaps the pitches in India have changed.



Q. Does it boil down to the use of feet?

Good footwork certainly helps, but different players can play spin differently. Even in the team that I played, Laxman for example, would use his feet, but not that much. He had great reach and used the depth of the crease well. He didn’t have a sweep shot, but had a great on-drive.

Sehwag used his feet against spin a lot more than some of us.

Ganguly stepped down to the left-arm spinner whenever he could.

It always helps to have a sweep shot.



Q. The present day batsmen are playing too many shots too early against spin?

You need to be a bit more patient against spin. People now want to dominate the spinner from the beginning.

Sometimes we need to give the ball the respect it deserves.



Q. Batsmen rarely come across worthy spinners in domestic cricket these days.

You still have the odd good spinner in domestic cricket, but the numbers have dipped. The top four spinners are good but we had a lot more spinners in the domestic scene then.

Maybe, domestically, our batsmen are not getting exposed to quality spin bowling. Wickets have improved in India too. I have played on some absolute turners.



Q. International line-ups have become increasingly vulnerable on pitches doing a bit.

You are seeing a lot of results in Tests. People are playing more aggressively.

The flip side of that is, sometimes, on tricky wickets where there is seam and swing or turn, you get found out.

Generally, very rarely do you get seaming or turning wickets in international cricket these days. Most wickets are flat.

If you see a difficult wicket, you should have a certain level of personal pride to perform. If you have that you will practice for it.

To succeed in any form of the game, your game has to be built around your defence. It then expands from there.



Q. Do you believe the cash-rich T20 format has taken the cricketers’ focus away from Tests?

To be a successful Test cricketer was our primary focus then. Now you can easily make a living without being a Test cricketer. Maybe the incentive is not there anymore.

Then it boils down to personal pride, getting satisfaction in succeeding in all and the most difficult of conditions.



Q. What, in your mind, is good footwork?

Good footwork is being able to pick the length of the ball early, get to it as quickly as possible and get yourself into a good position. Good footwork is really about using the depth of the crease when you need to go back, and getting a good stride forward when you need to go forward.

You need to ensure that you are not stuck in the crease.



Q. As we saw with the Aussies in England recently, batsmen are increasingly vulnerable on or outside the off-stump.

The key is being balanced and knowing your head position. You need to be going towards the ball than across the wicket. The body weight is going down the wicket than across the wicket.

Once your head starts falling over and goes across the wicket, you lose [sense of] where your off-stump is. Your head has to be in the right position to know where your off-stump is.



Q. Sunil Gavaskar recently spoke about the alignment of right eye with the off-stump.

I thought that was a brilliant technical suggestion. If you are balanced, with your right eye guiding where your off-stump is, then there is a good chance that you go down the wicket, the weight is going towards the ball, and your head is still and in a good position. Anything outside the right eye-line you could leave.

But if you are going across the stumps, your right eye actually loses where your off-stump is. And you end up playing balls that are wide outside the off-stump.



Q. Do you believe the wide and excessive back-lifts are an issue too?

Typically, you want the bat to come from second slip, swing around and come down straight.

Hashim Amla picks up his bat, almost towards gully, but when it comes down it does so really straight. That’s what really matters.

The ideal way to pick it up will be between first and second slip. But there are cases of people who pick it up slightly wider but are able to align it straight.

I used to pick it up a lot wider than first or second slip, but generally I was able to get into good positions to bring the willow straighter.

When I was not playing well, that was an area that bothered me. If I wasn’t able to get the timing right of bringing the bat down, then balls, especially those coming back in, got me bowled or lbw, which happened towards the end of my career.

------

Sanjay Manjrekar on Playing Spin (from Cricinfo)



I think batsmen around the world are not playing spin too well these days.

We have seen it in the Ashes, seen Sri Lankan batsmen struggle against the legspin of Yasir Shah, and now India disintegrate against Rangana Herath to lose a Test match that was firmly in their grasp. All this is suggestive of the fact that international batsmen are not playing spin too well at the moment.

The focus is so much on playing pace and seam well that it seems there is no headspace left for them to try to be adept at spin too. Before India went to England last summer, how many of their batsmen tried to hone their skills against offspin? I am sure James Anderson and Stuart Broad would have been on their minds, not Moeen Ali. No wonder Moeen ended up getting 19 wickets in that series.

Historically, Indian batsmen have tended to take spin lightly. You just have to watch them bat in the nets - they bat with caution and respect against fast bowlers, but when they see a spinner come in to bowl they dance down the pitch to hit the ball for a six. They are not fussed if they miss a few; they basically look to have fun against the spinners before they put their heads down and get serious against the fast bowlers.

Then, in a tense match situation, when the ball is turning square and the batsman sees four fielders around the bat, dancing down the pitch and hitting the ball into the stands is not an option any more, but they do not know what to do instead. Now the batsman has to do something he has never done before: try and defend the spinner from the crease and make sure the ball rolls safely along the ground off the defensive bat, away from the close-in catchers.

This is a highly specialised skill, to defend confidently against the spinning ball, using only the bat, with catchers hovering four feet away. (With the DRS and umpires willing to give batsmen out lbw on the front foot, thrusting the pad at the ball is not an option any more, as it used to be in my time.)

It is a skill no one practises enough these days, and that is why you see a Rohit Sharma in defence planting his front foot on leg stump, to a turning ball from Herath that has pitched on middle and off stump.

The other critical defensive technique that has practically vanished from the game is a batsman trying to play a good-length ball and then letting it go at the very last minute, when he realises it has changed direction and is not going to hit the stumps any more. It's amazing to see how many batsmen get out - to seamers and spinners alike - while playing defensive shots to balls that are going to miss the stumps.

Mind you, in my time too, spinners were treated no differently in the nets. The advantage we had, though, was that we still played a decent amount of domestic first-class cricket as international players, so our skills against spin had not become dormant. But I remember, every time I came home to domestic cricket after travelling the world playing international cricket, it took some time getting used to playing spin well again.

In the first innings in Galle it was evident that the Indian batsmen were treating the Sri Lankan spinners with respect - they did not want to make the same mistakes they made against Moeen. But their defensive game against spinners is far from perfect.



VVS Laxman set a worthy example of how to play on a pitch that takes turn: by scoring more off the back foot than off the front © Getty Images

Every time an Indian batsman decides to get on to the front foot to defend against spin, I cringe. They leave far too much distance between the bat and the spot where the ball has pitched. This is a recipe for disaster on a turning pitch. By leaving this space between the bat and the spot where the ball has pitched, you are allowing the ball to spin and bounce or straighten. You are giving the ball the space to behave mischievously. This is how Ajinkya Rahane got out in the first innings and Virat Kohli in the second - two big wickets.

The golden rule of playing spin is judging the length early, and then, when choosing to play on the front foot, getting right on top of the ball to smother its spin and whatever venom it carries.

If you think you can't reach the pitch of the ball with the front foot, go right back in the crease and watch the ball closely off the pitch. In fact, on turning pitches you should look to score more off the back foot than off the front, just as VVS Laxman used to do. When you are on the back foot, because the ball is turning so much, you get the width to play the cut and the pull or play it away for a single safely. Catchers around the bat are placed there mostly for errors arising out of front-foot defensive shots.

With all good intentions, domestic pitches have changed in India. There is more grass on the pitches now, and spinners don't rule the roost any more. The flip side is, this means less good practice against spin for Indian domestic batsmen. KL Rahul, very much a recent product of Indian domestic cricket, looked far more assured against pace than he did against spin in Galle. That is telling.

The fact is quite simple: your chances of surviving against spin increase if you practise for hours in the nets what you need to do in the match.

Sunday, 26 October 2014

From Siachen’s heights, NaMo made a cracker of a point on Diwali

Shoba De in the Times of India
As of now, the man can do no wrong. He is here, he is there, he is everywhere! After 10 years of putting up with a prime minister who was in permanent mute mode, and hardly moved out of the confines of his daftar, perhaps it is a good thing that we now have a guy who is garrulous and voluble, hyperactive and on the go. Critics are saying Narendra Modi is blindly aping American presidents who always made it a point to spend time with their troops over Thanksgiving and X’mas breaks. If that is the case, and our NaMo is indeed doing a `me too’, so be it.
There he was pumping hands with our soldiers stationed at Siachen, sharing homilies, bonhomie and mithai with lonely men stuck in an icy , hostile post, miles away from their loved ones. It was a gracious gesture, even if the idea was to create extra goodwill, milk the photo ops and generate more votes. That’s what smart politicians do! It is an inseparable part of their job description. As strategies go, this one was superbly timed, as was his visit (and a hefty Rs 750-crore relief package) to Srinagar. Leaders are picked for these very qualities. And even at the risk of sounding cynical, it must be said, a Modi-on-the-move is better than a Modi-sitting-tight. A while ago, I happened to be sitting next to a fauji wife on a plane. Here was a young, modern woman, bright as a button, well-informed, articulate, outspoken and feisty. She spoke about her life as an Army wife with incredible fervour and pride. The mehendi on her hands told me she had observed Karva Chauth. So had her dashing husband, she informed me! It was that kind of a marriage, she said with a twinkle in her eye. They did everything together — they always had. From the time they’d married 20-odd years ago, after a whirlwind romance. I asked about long separations, anxieties and uncertainties. How did she cope when he was away?
As it turns out, he had served in Siachen. And in J&K during the worst skirmishes. Being a Military Intelligence man, she never knew where he had been sent or for how long. By then, they had a young child, and any form of direct communication was out of the question when her husband was on a special mission. She had trained herself to wait… to pray… to never give up hope. Like thousands of young fauji wives who believe the Army is their extended family, no matter what happens.
Late one night, her husband came back from a secret assignment and knocked lightly on the bedroom window so as not to wake up the sleeping infant. He was wounded on his right arm and face.
He had taken a bad hit and could barely move or speak. For the next few weeks, he stayed home to recuperate — even though he was injured, she was just glad for their time together as she nursed him back to health. She talked about another incident when militants in the Valley attacked the home of another Army officer, who returned the fire but was grievously injured. As the militants closed in, two young daughters pleaded with their mother to kill them first, before the militants could get them.
Listening to her deeply stirring stories of valour and faith, I thought about our safe, protected city lives. This gutsy, proud woman’s narrative is just one of many. Today, she said emphatically, she has confidence in the new Prime Minister’s ability to motivate a tired and demoralized Army. For far too long, she insisted, our soldiers were made to heedlessly sacrifice their lives, because of political interference and an appalling level of corruption that had left the country vulnerable and weakened. She was glad Modi was taking a tough, aggressive stand.
She felt reassured and confident that a zero-tolerance position was being established against those using force against India. And then she told me something pretty chilling. “They were told to DUCK bullets and not fire back! Can you imagine any trained, self-respecting soldier ducking enemy bullets?” she said, her eyes were burning with outrage.
Was that the reason her own husband had finally quit the Army…in disgust? She denied it. But it left me wondering…. We treat our armed forces with scant respect. We have consistently ignored the demand for introducing the overdue OROP scheme (One Rank, One Pension). Fauji veterans have waited in vain for its implementation by the newly minted BJP-led government at the Centre, after previous administrations consistently ignored their appeals. It was a black Diwali for them this year. Hapless, frustrated veterans went so far as to return gallantry awards and medals to register their protest.Despite these setbacks, our men in uniform are stoically carrying on. Narendra Modi thanked our brave jawans on behalf of 125 crore Indian citizens, telling them we could sleep well at night only because it was they who were keeping us safe. It is true. It needed to be said.
Strange and sad nobody thought of saying it earlier.

Friday, 1 August 2014

To fight Britain’s privatisation dogma, Labour should look to the US military, Singapore, Taiwan...


State-owned enterprises can be successful, as some unlikely global examples prove
VARIOUS
A Honeywell computer under the control of Michael Caine In the 1967 film Billion Dollar Brain. It was used to connect to the Arpanet – developed by the US military as a precursor of the internet.. Photograph: Snap/Rex Features

Since Margaret Thatcher came to power in 1979 the UK has led the world in privatisation. The Conservative government sold off state-owned enterprises throughout the 1980s and the 1990s – electricity, oil, gas, rail, airline, airports, telecommunications, water, steel, coal, you name it. In the worldwide fever for selling off state assets that gripped those decades, the rest of the world looked up to Britain as the guiding example.
Privatisation was halted under Labour. However, the belief in the superiority of the private sector was such that, when it brought the rail infrastructure back under state control in 2002 following a series of rail disasters, Labour made sure it did not take the form of re-nationalisation – at least in legal terms. Network Rail, the owner and operator of the rail infrastructure, was set up as a private company, although on a not-for-profit basis and without shareholders.
When the coalition came to power in 2010, it resumed the privatisation drive with gusto. It privatised Royal Mail – the “crown jewels” that even Thatcher balked at selling. However, in recent months the tide has started to turn, albeit slowly.
Even while planning to sell off almost every remaining state-owned enterprise, from plasma supply to helicopter search and rescue, the coalition has had to make an embarrassing climbdown over its plan to privatise student loans. More importantly, in the past few months the Royal Mail sell-off has been fiercely criticised. Moya Greene, its chief executive, has questioned the viability of its universal service obligation. Abandoning this would mean that customers who live in less accessible or sparsely populated – and thus less profitable – areas wouldn’t get their letters delivered, or would have to pay more for them: the end of the postal service as we know it.
In the meantime, the Labour party has made the lack of competition and the suspected collusion in the privatised energy industry a key issue in its promise to “fix broken markets”, and has caught voters’ attention by announcing its intention to partially reverse rail privatisation. Although its fear of being branded anti-business has prevented it from proposing outright renationalisation of the railways – despite the support for such a move from most of the electorate – it has declared that if it wins the 2015 general election it will “reverse the presumption against the public sector”, and let state operators bid for rail franchises.
However, if it is really to overturn the privatisation dogma, Labour should do more than reverse the presumption against the public sector: it should tell people that the public sector is often more efficient than the private sector.
Even while there are many examples of inefficient state enterprises from all over the world, including the UK, there have been many successful such businesses throughout the history of capitalism. In the early days of their industrialisation, 19th-century Germany and Japan set up state-run “model factories” in order to kickstart new industries such as steel and shipbuilding, which the private sector considered too risky to invest in. For half a century after the second world war, several European countries used state businesses to develop technologically advanced industries: France is the best-known example, with household names like Thomson (now Thales), Alcatel, Renault and Saint-Gobain. Austria, Finland and Norway also had technologically dynamic state-run enterprises.
The most dramatic example, however, is Singapore. The country is usually known for its free trade policy and welcoming attitude towards foreign investments, but it has the most heavily state-owned economy, except for some oil states. State-owned enterprises produce 22% of Singapore’s national output, operating in a whole range of industries – not just the “usual suspects” of airline, telecommunications and electricity, but also semiconductors, engineering and shipping; and its housing and development board supplies 85% of the country’s homes. Taiwan, another east Asian “miracle” economy, also has a very large state-run sector, accounting for 16% of national output.
Posco, the state-owned steel company in my native South Korea, was initially set up against World Bank advice but is now one of the biggest steel companies in the world. (It was privatised in 2001, but for political reasons rather than poor performance.) In Brazil, Embraer – the third largest civilian aircraft manufacturer in the world – was initially developed under state control; and the country’s state-owned oil company, Petrobras, is the world leader in deep-sea drilling.
Arguably the most successful state enterprise in human history, however, is the United States military, which has almost single-handedly established the modern information economy. The development of the computer was initially funded by the US army; the country’s navy financed the research that created the semiconductor; and the US Defense Advanced Research Projects Agency developed the Arpanet, the precursor of the internet.
When people realise that the history of capitalism is full of highly successful state enterprises, the rush for ever more privatisation can be halted. If the Labour party puts forward this case, it will not only gain popularity in the run-up to next year’s general election – it would also be doing something of lasting benefit for Britain.