The News Editorial Analysis 25 September 2021 | Shikara Academy

The News Editorial Analysis 25 September 2021

India, U.S. ties entering a new chapter: Biden

Indian talent to be a full partner in this relationship: Modi.

Sitting in the Oval Office, Prime Minister Narendra Modi and U.S. President Joe Biden kicked off their bilateral talks, with comments on the promise of the India-U.S. relationship, the areas they would work on like COVID-19 and climate and the importance of the diaspora. Their opening remarks were sprinkled with jokes and laughter, interspersed with a serious outlining of the discussions ahead.Both leaders suggested that the countries were at an inflection point in their relationship. Mr. Modi spoke of a “transformative” decade ahead and Mr. Biden spoke about a “new chapter” in ties.

Mr. Modi said that under Mr. Biden’s leadership the seeds had been sown for India-U.S. relations to expand and that they were entering a “transformative phase”. In this context, he mentioned the growing importance of people-to-people ties, and said Indian talent would be a “full partner” in this relationship.The U.S.-India relationship could help solve an “awful lot” of the world’s challenges, he said. “I think that the relationship between India and the United States, two of the largest democracies in the world, is destined to be stronger, closer and tighter, and I think it can benefit the whole world,” Mr. Biden added.

Mr. Modi’s remarks also made reference to the bilateral relationship having a more global positive impact. While there were overlaps in their remarks, there were some asymmetries as well.  Mr. Modi alone raised the topic of trade, saying it would continue to stay important and that trade between the two countries was complimentary.“There are things that you have and there are things that we have, and then we in fact complement each other. And I find that the area of trade during this decade is also going to be tremendously important,” he said. Mr. Biden did not bring up trade.

The President said the India-U.S.  partnership was rooted in democratic values. “Our partnership is more than just what we do. It’s about who we are. It’s rooted in our shared responsibility to uphold democratic values, our joint commitment to diversity, and it’s about family ties, including four million Indian Americans who make the United States stronger every single day,” he said.


Quad leaders denounce use of ‘terrorist proxies’ in South Asia

The Quad leaders reaffirm that the Afghan territory should not be used to threaten or attack any country or to shelter or train terrorists.

Leaders of the Quad countries — the US, India, Australia and Japan — have denounced the use of “terrorist proxies” in South Asia, in a veiled reference to Pakistan, as they emphasised the importance of denying any support to terrorist groups which could be used to launch or plan terror attacks, including cross-border attacks.

In a joint statement issued after their first in-person Quad summit at the White House on Friday, U.S. President Joe Biden, Indian Prime Minister Narendra Modi, Japanese premier Yoshihide Suga and his Australian counterpart Scott Morrison said they will closely coordinate their diplomatic, economic and human-rights policies towards Afghanistan and will deepen their counter-terrorism and humanitarian cooperation in South Asia.

“We denounce the use of terrorist proxies and emphasised the importance of denying any logistical, financial or military support to terrorist groups which could be used to launch or plan terror attacks, including cross-border attacks,” the joint statement said.

The Quad leaders reaffirm that the Afghan territory should not be used to threaten or attack any country or to shelter or train terrorists, or to plan or to finance terrorist acts. They also reiterate the importance of combating terrorism in Afghanistan.

Coronavirus live updates | India tells Quad will allow export of 8 million Indo-Pacific vaccine doses.

Prime Minister Narendra Modi has arrived in New York where he is scheduled to address the 76th session of the United Nations General Assembly, the theme for this year’s General Debate being ‘Building Resilience through

hope to recover from COVID-19, rebuild sustainably, respond to the needs of the planet, respect the rights of people, and revitalize the United Nations’

Physical classes in schools would resume across Maharashtra from October 4, the State government said on September 24. “All the schools in rural areas will resume physical classes for standards 5th to 12th,” said State education minister Varsha Gaikwad. Physical classes for standards 8th to 12th would resume everywhere in urban areas too, she added.

Naga talks: so far, what now

The Naga Peace talks on the backdrop of R N Ravi’s resignation as interlocutor.

What’s happening?

Recently, Tamil Nadu Governor R N Ravi is resigned as interlocutor for the Naga Peace talks.


  • The govt is unhappy over handling the Naga peace process by Ravi.
  • Many groups like NSCN(IM) have openly criticized Ravi & demanded his removal as interlocutor & Governor.

The Naga Peace Process & its history:
Naga Peace process refers to the ongoing talks between the Indian govt & Naga insurgent groups such as NSCN (IM) since 1997 intending to sign the Naga Peace Accord.

  • The history:
  • The Naga peace talks refer to talks undertaken between the Indian government and the various stakeholders in Nagaland to resolve decades-old disputes. Some of these issues date back to the colonial era.
  • According to reports, the demand for a Greater Nagaland, or Nagalim— covering Nagaland, its neighboring states, and even parts of Myanmar— has been an important part of Naga nationalism. It’s a demand being made for decades and was first crystallized via the formation of a Naga Club in 1918. The Naga Club had reportedly told the Simon Commission that the Nagas should be left alone “to determine for ourselves as in ancient times”.
  • The Naga Hills became part of British India in 1881. The effort to bring scattered Naga tribes together resulted in the formation of the Naga Club in 1918.
  • The club metamorphosed into the Naga National Council (NNC) in 1946.
  • On August 14, 1947, the Naga National Council (NNC) led by Angami Zapu Phizo declared Nagaland an independent state. Phizo also formed an underground Naga Federal Government (NFG) and a Naga Federal Army (NFA) in 1952, which the Indian government sought to crush by sending in the Army in Nagaland and enacting the Armed Forces (Special) Powers Act, or AFSPA.How did things go wrong?
  • Things went sour after Ravi realized that NSCN (IM) & the Indian govt have different understanding of the agreement.
  • Even though the IM had softened its stance on the demand for a separate flag & constitution.
  • Ravi in 2017 Nov signed an agreement with other 7 naga insurgent groups by leaving behind the main NSCN (IM) from it.
  • IM accused Ravi of attempting to segregate the Naga civil society.
  • After 2019 talks with NSCN (IM), Ravi said that the group had adopted a procrastinating attitude to delay the settlement by raising contentious issues.
  • In response, the IM group hardened its position saying Naga Flag & constitution were non-negotiable.
  • It also accused Ravi of twisting the document by deleting the keywords that suggested Nagaland would co-exist with India as a sovereign.
  • Ravi continued to engage with the other Naga groups & declared that the Accord would be signed with or without NSCN (IM).

The Real Issues:

  • The enthusiasm with which the framework agreement was announced led to unreasonable expectations of an imminent Accord.
  • The NSCN (IM) hardened stand on Greater Nagalim, while the Indian govt cannot accept that demand.
  • At the same time, govt in no way would accept a separate constitution for Nagaland.
  • The move to appoint Ravi as Governor too did not go well with the IM & Ravi’s enthusiasm in matters of governance was taken by the state govt as interference.
  • The Way Forward:
  • It is important to understand there cannot be an accord without the NSCN (IM).
  • Govt needs to work on ideas to slowly bring the IM to accept what govt offers.
  • The new interlocutor’s main task would be to delicately close the gap between the IM & NNPGs which shared the relationship with Ravi.
  • Govt should iron out some of the demands like the bicameral Assembly & absorption of local armed cadres into paramilitary forces.
  • Govt should set up an autonomous council in Naga-dominated areas of neighboring states.Concluding Remarks:
    It is high time for the Indian govt to weed out the differences among all stakeholders & strive to achieve a middle ground to sign Naga Peace Accord.

Why India must strengthen its public sector.

Privatization compromises India’s sovereignty and economic freedom, threatening its energy security and strategic posture.

A spectre haunts the Western world. The spectre of Chinese State-Owned Enterprises (SOEs) and their control over the “commanding heights” of the global economy.

The strategic establishments were startled when the Fortune Global 500 list 2020 revealed that Chinese large firms had overtaken US-based firms. China today has 124 firms in the Fortune list, of which 95 are SOEs, compared to 118 from the US. Many so-called private Chinese firms like ZTE and Lenovo are known to be controlled by SOEs.

The next group of 26 SOEs are from the OECD countries, while emerging market countries like Brazil, India, Mexico add another 17 to make a total of 135 SOEs in the list. This may be compared to a mere 45 SOEs in the 2005 list (figure 1). Today, 28 per cent of the world’s largest and most powerful economic entities are state-owned, dominated largely by the Chinese SOEs.

The rise of Chinese SOEs in the global economy can be traced to the strategic vision and plan articulated in 1998 at the 15th Congress of the Communist Party of China (CPC). The Congress approved a radical restructuring of the state sector with the policy of “grasp the large and let go of the small”. China had more than one lakh SOEs, covering all services, retail, construction, industrial and agricultural sectors. It quickly let go of the small and shut down or privatised 90,000 enterprises, with little impact on the share of SOEs in total output. The reforms launched by the15th Congress were to restructure larger SOEs, “corporatise” them and list several on the stock market, making them profitable and competitive in global markets. Simultaneously, China set up 37 new SOEs in new emerging industries and technologies.

The last two decades have witnessed Chinese SOEs acquiring several American and European technology companies, from IT to oil fields, coal to strategic minerals, telecom to mobile phones and solar wafer to computer chips. By 2010, Chinese SOEs controlled overseas assets worth a whopping $586 billion.

In 1998, under prime minister A B Vajpayee, India too embarked on public sector enterprises (PSEs) reforms with the Navratna Scheme. The large profit-making PSEs were granted autonomy in strategic and operational decisions, including investment, acquisitions, and borrowings. The Vajpayee government also encouraged these PSEs to become “global” and acquire assets and strategic minerals abroad. However, the PSEs were denied any fiscal support, rather the government insisted on taking large dividends. This is in stark contrast to China where SOEs are liberally funded to grow and become global.

The News Editorial Analysis 25 September 2021

The Vajpayee government promoted the private sector in areas that were dominated by the public sector and privatised many PSEs. It undertook a series of sectoral price reforms where PSEs were dominant such as in power, petroleum, fertiliser and chemicals. Low prices of PSE products had made private entry unattractive. The PSEs were encouraged to charge full-market prices or even global prices to facilitate private entry.

The UPA in 2004 deepened the Navratna policy by including several more PSEs, and in an Indian version of “let go the small and weak”, set up the Board for Reconstruction of PSEs (BRPSE) to turn around or shut down loss-making companies.

An unintended consequence of NDA’s price reforms was that the inherent strength and efficiency of PSEs became apparent. They had long attracted the best engineering and management talent in the country. The profits of Central PSEs by 2018 stood at Rs 1,75,000 crore, up from Rs 43,000 crore in 2003-04 (figure 2).

The rising profitability meant that Indian PSEs were investing more and expanded rapidly to become darlings of the stock market. As the Indian economy accelerated under UPA-I, with its total domestic investment rising to almost 40 per cent of GDP by 2010 from 26 per cent in 2002-03, the PSEs played a major role in increasing capital formation and accelerating growth. ONGC even acquired a private Indian refinery. With government encouragement but negligible financial support, PSEs were acquiring assets and resources abroad, often clashing with Chinese SOEs vying for the same assets. Till 2007, the PSEs were the largest outward investors from India. As the private sector has cut back its investment over the last several years, PSEs have become important drivers of industrial investment. Today, as the Indian government readies to privatize India’s most vital and significant PSEs — Bharat Petroleum (a Fortune 500 company) BEML, and the Shipping Corporation — and dismember ONGC, the Chinese may be happy to acquire these firms and their assets, through a chain of firms they would control. Yet, these firms are important strategic assets to confront a rising China, more valuable than Rafale jets or leased Russian submarines. Bharat Petroleum has assets in 17 countries and holds part of India’s strategic oil reserves. Declining support to SCI and Indian shipping has meant that the share of India’s maritime trade carried by Indian ships is today a minuscule 6 per cent, down from 40 per cent in 1989 (figure 3). No prizes for guessing whose ships transport India’s trade.

The government’s refusal to support PSEs at critical moments has left wide gaps in key industrial capabilities. With the collapse of HMT, India is forced to import 80 per cent of its machine tools, the bedrock manufacturing. The undermining of the pharmaceutical PSEs like IDPL and HAL, once India’s pride, makes it dependent on active ingredients from China. The government’s reluctance to support BHEL has flooded the Indian power sector with Chinese equipment. Moreover, India is largely absent in emerging technologies like solar wafers, computer chips or EV batteries. India needs to imitate China in establishing new PSEs in strategic and emerging industries, which require patient capital and greater risk. In the development of a civilian aircraft, India has lost a decade due to the ideological reservation about spending public money for developing anything outside defence.

At this critical juncture, the sale of giants like BPCL, BEML or SCI would undermine India’s “Atmanirbhar” goal. Privatisation compromises India’s sovereignty and economic freedom, threatening its energy security and strategic posture. If India is not to hide behind the tailcoats of western powers as it confronts a rising China, it must strengthen its public sector enterprises.

India dithered over projecting naval power. Now it’s been pushed to the sidelines of the Indo-Pacific.

Raja Menon writes: With nuclear submarine technology, Australia has now been catapulted into a frontline state against Chinese aggression, something that India can only dream of, despite its massive army.

The announcement from Washington that the US, UK and Australia are to form an alliance against China comes as a resounding slap to the Indian foreign policy establishment trying to ride two horses simultaneously. The information that Australia is to be provided nuclear submarine technology further humiliated the external affairs ministry and rubs salt into the wounds of the Indian Navy. Stunted by the neglect of being allotted just 14 per cent of the defence budget, the Navy has been hit hard by the news that US nuclear submarine technology — the finest in the world — will only be made available to Australia. Canberra has reaped the rewards of steadfast friendship with the US and accepting the punishing tariffs imposed by Beijing on Australian agricultural exports to China. These tariffs were imposed by a vengeful Xi Jinping for Australia’s refusal to abandon its American ally.

Supreme Court move to set up a panel to probe Pegasus is a vital and welcome step

A probe under an SC-appointed committee has more credibility than one by a government panel. At stake are vital issues involving civil liberties, including the right to privacy of citizens, the integrity of institutions and due process.

The Supreme Court said Thursday that it would set up a committee of experts to study the allegations of illegal surveillance using Pegasus spyware and issue orders next week. Expert panels appointed by the court always test the separation of powers but in this case, the move is vital and welcome. When the executive cites national security, a probe under an SC-appointed committee has more credibility than one by a government panel. At stake are vital issues involving civil liberties, including the right to privacy of citizens, the integrity of institutions and due process. The public is entitled to know, as the court said, “whether this spyware has been used by the government by any other method other than permissible under the law”.

Since the Pegasus Project, a collaborative journalism enterprise, reported by The Wire in India, revealed that a spyware developed by Israeli firm NSO Group is being surreptitiously used to snoop on politicians, journalists, civil liberties activists —Though the Minister of State for Defence told Parliament that his ministry “had not carried out any transaction with NSO Group Technologies” — the NSO has clarified that it trades only with sovereign governments — Solicitor General Tushar Mehta told the Supreme Court that the government cannot be made to answer whether or not it uses Pegasus spyware. Mehta reasoned that a clarification on this matter by the government would alert terrorists and compromise national security. While the government filed a short affidavit in the Supreme Court, when proceedings began on a clutch of petitions filed by journalists and the Editors Guild of India, it backtracked from filing a detailed affidavit that it had promised the court, earlier this month. However, the government offered to set up a panel of experts to look into the allegations and submit a report to the court. At every step, the government has cited national security to avoid a discussion on Pegasus — its refusal to allow a debate on the matter in Parliament resulted in the Opposition disrupting the Monsoon Session. The government’s defence of its intransigence — that terrorists would be alerted if it speaks — is weak since no one has asked for the names of terrorists under surveillance. What is being asked is whether state agencies used the spyware to snoop on journalists, Opposition politicians, human rights activists, bureaucrats etc., and if so under whose authorization. If it has not, it is as much a task of the government to probe if any outside agency has used the spyware on Indian citizens since the petitioners have claimed that forensic analysis revealed tampering of their gadgets.

The Supreme Court has been the custodian of personal freedoms and has been an alert watchdog whenever the executive and legislature have transgressed the red lines that separate the state’s authority from the domain of individual rights, including the right to privacy. India’s stance on Pegasus has been in sharp contrast to other governments, which have taken serious note of the revelations and set up probes. The court has rightly recognised that the likes of Pegasus pose a threat to core values of democracy as well as the autonomy and credibility of institutions and processes. Its panel and its work are keenly awaited.

Indian tech unicorns are gaining at China’s expense. Is this a blessing or a bubble waiting to burst?

The last thing India can afford is a bubble that bursts and for capital, talent and technology to take flight and seek refuge elsewhere.

Tiger Global Management, a New York-based investment firm, has a reputation for tracking and hunting unicorns — startups with billion dollar-plus valuations. This year, if we were to track the Tiger’s shifting gaze, we would catch sight of an interesting migratory phenomenon: Fewer unicorn sightings in China — ordinarily the biggest unicorn habitat outside the US — and the beginnings of a unicorn stampede in India. While the shifting of the Tiger’s gaze cannot be good for China, I worry it may not be good for India either.


The News Editorial Analysis 24 September 2021

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