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Israel-Hamas War: HOW THE WORLD REACTS, By Dr D.K. Giri, 20 October 2023 Print E-mail

Round The World

New Delhi, 20 October 2023

Israel-Hamas War

HOW THE WORLD REACTS

By Dr D.K. Giri

(Secretary General, Assn for Democratic Socialism) 

The Israel-Hamas war is escalating every hour causing pathetic loss of lives, property and resources. The bombing of a hospital on Tuesday last, that wiped out 500 or so lives has shaken the conscience of the world. Both sides are blaming each other for this human catastrophe. Hamas claimed that IDF -Israel Defence Forces – has bombed the hospital whereas Israel asserts it is one of Hamas rockets that fell on the hospital by accident.  Palestine sympathisers say the western press supporting Israel is manipulating the news coverage, putting out pro-Israel news and clips. To be sure, the truth will come out sooner than later. 

Be that as it may, there are threats by other countries like Iran to jump into the fray through their mercenaries, Hezbollah’s unless Israel stops bombing. A few calls for ceasefire are also made but not heeded by either of the warring parties. Political debates and protest demonstrations in favour of both Israel and Palestine are staged across the world. Heated arguments in social media are raging on up and down our country. Let us engage with them. 

What is missing in such discussion so far is the impact of Israel-Palestine war on Indian politics mainly the national elections next year, should the war continue in some form or the other until then!Let us pontificate on it. Unlike previous conflicts between Israel and Palestine, or to be precise, Hezbollah and Hamas, there were no fierce moral arguments over who is right or wrong; whether proportionality of retaliation has to be acceptable etc. 

Furthermore, the situation has become complex this time around as both Israel, namely IDF and Hamas (Palestinians) are perceived to be both victims and perpetrators at the same time. Hence the reactions from countries – world powers, allies, friends, and onlookers have to be carefully thought out and assessed. 

In any conflict or war, there have been mainly two kinds of reactions as the world has been divided into two camps since the Second World War. Arguably, the power equation has changed after the disintegration of the Soviet Union in 1992. Some would say it has been a ‘unipolar’ world since. It is America and its allies –Europe and NATO – calling the shots. 

Even if it has been largely the case, China emerging as the second largest economy has begun to flex its muscles, in a quest (mainly of Xi Jinping) for world supremacy. It seeks to provide an alternative to western model of world politics. China calling a conclave at the time of writing (17&18 October) of about 130 countries in the wake of Israel-Hamas war testifies the foregoing assumption. That is, China is strategising to assume the role of a world leader. 

Again, the world seems to be increasingly divided into two blocs; one led by USA and the other by China, Russia tacking on behind the latter. Admittedly, this scenario does not yet exist in its fullness as China has not been able to blow the bugle. Whether it can do so despite Jinping’s irresistible irredentism is a matter of reality-check. 

Yet another group of countries especially of the former Non-Alignment bloc push for a multilateral order with a new strategy of multi-alignment. They bid for reviving the Global South as another axis of world politics. I have argued more often than not that the idea is untenable, not endorsed by history. Reiterating the voice of Global South on the world table is understandable and advisable. But creating a third force in the form of Global South is a far cry when the politics is driven by the measure of security. 

Having put the countries into three blocs although two of them – one China-led another largely India-led – are inchoate formations, let us look at their reactions to the Israel-Hamas war. America and its allies have clearly sided with Israel in the face of the terrorist attacks by Hamas. They support Palestinian civilians on humanitarian grounds. The European Union has not stopped the aid to Palestine. At the same time, the US President has requested a sanction of 100 billion USD from the Congress to support Israel and Ukraine. 

China and Russia refused to condemn Hamas’ terrorism while asking for a peaceful settlement of the two-nation solution. Other countries of Global South have made neutral statements calling against civilian casualties and for ceasefire etc. 

How has India responded? India’s prompt reactions came from the Prime Minister himself in his tweets as he declared New Delhi’s support for Israel against the Hamas’ terrorism. It was quite different from the neutral postures New Delhi has been taking in Ukrainian war. It is rightly so at least on two counts. First, India is consistently and steadfastly opposed to terrorism as a means to resolution of differences or conflicts. Second, Israel is a reliable friend of India, more than any country at present. It has also been historically proved on two critical occasions, 1962 war with China and Kargil war with Pakistan in 1999. However, New Delhi soon nuanced its response by reiterating its long-standing position on Palestine becoming an independent and sovereign state. 

Normatively, foreign policy of any country is run on consensus. But in democracies, there is room for diverse perspectives. The Opposition parties in India mainly the Communist and Congress seem to have sided with Palestine. That has been the stand of the Congress for long time, the Communist go for any event that is against the US and its allies and supports Chinese position. Congress support for Palestine has been attributed to the so-called vote bank politics, seeking the Muslim votes. That may not be entirely true. 

But the moot point one should raise is who provoked this war? The Hamas attack evokes the horror of the holocaust. The Palestine has a just cause. The whole world should support it. There must be a détente between Israel and Palestine. But can we endorse terrorism as a method? Some would argue that Israeli state (IDF) has equally been a terrorist state. Let us have a conversation on whether Israel has the right to defend itself, or as the argument goes, it has unleashed terrorism on Palestine. How do we define terrorism? Israel is a democratic state, has a government constituted on the basis of elections. 

On the impact on Indian politics, the Congress party seems to have misplaced its reactions. It should have supported Israel when it faced terrorist attacks. Indians would not condone terrorism as they have been its victimfor years on end from across the border. We should be focussing on the cause of the war not just the consequences. In any case, the bloodshed must stop, so should the Hezbollah’s and Hamas and their ilk elsewhere. ---INFA 

(Copyright, India News & Feature Alliance)

TIMELY REMINDER ON POLL REFORMS, By Inder Jit, 19 October 2023 Print E-mail

REWIND

New Delhi, 19 October 2023

TIMELY REMINDER ON POLL REFORMS

By Inder Jit

(Released on 10 November 1987) 

Top Opposition leaders deserve a hand, thanks to a thoughtful initiative by the Chief Minister of Andhra Pradesh, Mr N.T. Rama Rao. They have jointly directed the country’s attention once again to electoral reforms, a matter which merits greater importance today than ever before. The threat to our democracy from money power has greatly multiplied. Something will need to be done before long if our system is not to go under. Successive Governments at the Centre have been promising poll reforms over the past two decades, but with little result. Mr Rajiv Gandhi raised great expectations by his Government’s first major policy pronouncement through the President’s address to Parliament on January 17, 1985. The President then declared: “Government are committed to a clean public life. They intend to initiate wide-ranging discussions on electoral reforms with the Opposition parties.” Not long thereafter, the Government enacted the anti-defection law. However, nothing else has come thereafter. 

Fortunately for the country, others stepped in where the Government failed. The Rajaji Institute of Public Affairs and Administration organised seminars on electoral reforms early in 1986 first at Madras, then at Bombay and finally at Delhi. The seminar at Delhi was presided over by the Speaker of the Lok Sabha, Mr Bal Ram Jakhar, inaugurated by the then Union Law Minister, Mr A.K. Sen, and chaired by Mr C. Subramaniam, former Union Minister who is Vice-President of the Institute. Importantly, the seminar was attended by Mr S.L. Shakdher, former Chief Election Commissioner who was then Director of the Institute, and the present Chief Election Commissioner, Mr R.V.S. Peri Sastri. Also present among the select group were Mr L.P. Singh, former Governor of the North-East Region, leading MPs, constitutional experts, academicians and editors. The BJP President, Mr L.K. Advani, spoke for most of us present as he declared: I hope this seminar on electoral reforms succeeds in goading the Government to fulfil its promise made fifteen months earlier! 

Understandably, the seminar largely covered familiar ground. There is hardly an aspect of electoral reforms which has not been considered or advocated during the past decade and more. Nonetheless, the seminar served a useful purpose on at least two counts. First, a consensus was reached on some minimum electoral reforms which need to be put through immediately. The Law Minister, Mr Sen, himself agreed to some of the suggestions. What is more, he informed the seminar that he had submitted “a long memorandum” on the subject to the Prime Minister. Second, the seminar spotlighted a new threat to the independence of the Election Commission and the future of our young democracy --- a threat which regrettably had thus far not been taken up by our Parliamentarians. On February 25 last year, the former Chief Election Commissioner, Mr R.K. Trivedi, was appointed the Governor of Gujarat. Mr Trivedi had reason to rejoice as the first CEC to be awarded gubernatorial honours. But appointment flew in the face of vital democratic conventions. 

The Law Minister had unfortunately to leave the seminar by the time it agreed that the independence of the Election Commission should be ensured. It would have been interesting to get his response to Mr Trivedi’s appointment as Governor. (Circles close to Mr Sen indicated at the time that the appointment came to him as a surprise!) However, Mr Sen was one with the rest of the seminar in introducing two reforms straightaway. He expressed himself strongly in favour of giving every voter an identity card with a photograph to fight the evil of impersonation. The indelible ink was not any great help as it could “be rubbed off in no time”. Importantly, he also expressed himself in favour of electronic voting machines in the interest both of economy and of fighting the growing menace of booth capturing. The cost, he said, would not be too high. The chances of error were minimal. He also felt that electoral officers needed to be given magisterial powers to deal with increasing poll violence even though this evil was prevalent only in a few States such as Bihar and Haryana. 

The seminar also agreed on the need for Government funding of elections, as in West Germany and many other countries. Opinion was, however, divided on the extent of funding -- part or whole. Mr Sen ruled out total funding in an informal talk with me later but he was one with the present Chief Election Commissioner, Mr Peri Sastri, in funding political parties in kind. Some participants favoured a reform of the political parties and adoption of some device through which the nexus between black money and elections could be broken. Many felt that this could be achieved by getting parties to maintain proper accounts and providing for compulsory audit. But I took the opportunity to press for a law for political parties, as in West Germany. This law proceeds on the basis that political parties must function democratically if they are to operate the democratic system properly. The law provides for the registration of parties and also financial accountability to the people. The suggestion was welcomed. However, some MPs felt it needed to be given greater thought. 

NTR has now picked up the thread where it was left by the seminar. Last month, he convened a meeting of political parties, intellectuals, experts and editors at the State and national levels and helped evolve a consensus on comprehensive electoral reforms. (The Congress-I was represented at the State level). However, it stayed away at the national level.) Most of the recommendations are along familiar lines. But the principal thrust is now on State funding of elections to eliminate what NTR rightly described as “the great plague of money power”. Prominent among the other proposals are: (a) Appointment of the Election Commission by the President in consultation with the Chief Justice of India, the Prime Minister and the Leader of the Opposition and not only by the Government of day; (b) reduction of voting age from 21 years to 18 years; (c) equal treatment of all recognised political parties for the allocation of time on AIR and Doordarshan; (d) strict enforcement of the code of conduct for electioneering; (e) access of all recognised parties to the use of official planes etc. on payment of prescribed charges; and (f) simultaneous elections to Parliament and the State Assemblies. 

Not only that. NTR went one stage further to leave the two conclaves in no doubt that he means business. He announced his decision to go ahead with state funding of polls in elections to a11 local bodies and to bring forward suitable legislation without waiting for the Union Government's initiative. The Legislation would provide inter alia exclusive State funding of elections to local bodies like Mandala Praja Parishads, Zila Parishads, Municipal Corporations and Municipalities etc. and would be in the nature of a model bill. The Chief Minister clarified his ideas to State funding of civic elections in an informative booklet entitled: Electoral Reforms Relating to State Funding of Local Body Elections in Andhra Pradesh. Exclusive state funding of elections is proposed only in respect of candidates who secure at least 1/6th of the total valid votes polled at an election in a given constituency. Others in the elections fray will have to meet their own expenses. Advances are also proposed to be given to political parties. But these would require to be refunded in constituencies where a party failed to secure the minimum prescribed votes. 

Importantly, State funding of elections was specifically recommended by the Election Commission’s Report on the General Elections to the Lok Sabha, 1980, and the Legislative Assemblies, 1979-80. Mr Shakdher, who was then the Chief Election Commissioner, said in the report: “The Commission is of the view that there should be an election fund from which amounts could be drawn as and when required under orders of the Election Commission for the following purposes: (1) Revision of electoral rolls; (2) Conduct of elections; (3) Shortage of election materials and records; (4) Payment of subvention to political parties; and (5) Issue of photographed identity cards.” The Commission also went into the size of the fund and proposed that “the fund should initially be of the order of Rs 100 crores for a period of five years. The share of the Central Government on the one hand and various State Governments and Union Territory Administrations on the other may be on 50:50 basis. The Central Government and State Governments each may contribute Rs 10 crores every year so that over a period of five years the proposed fund of Rs 100 crores may be made up.” 

True, prices have shot up since 1980. But it should not be difficult to implement Mr Shakdher’s idea by doubling the figure of Rs 100 crores to Rs 200 crores. True also, the amount seems big when you look at the resources crunch against the backdrop of the unprecedented drought. But it should not be impossible to find this money if one realises that Doordarshan is reported to have been given Rs 200 crores for providing live telecast of the World Cup Cricket series. (Not many remember that Mr C.M. Stephens as a top Congress-I leader eloquently pressed for State funding of the polls during the Janata rule!) Personally, I am clear that eliminating the evil of money power from the polls is tackling only half the malady. The other half is elimination of the evil of money power from the functioning of political parties, which are today more in the nature of private limited companies. However, the important thing is to make a beginning. Mr Rajiv Gandhi should respond positively to the timely reminder by NTR and other Opposition leaders and start the long-promised dialogue for poll reforms. --- INFA

(Copyright, India News and Feature Alliance)

Numbers That Don’t Add Up, By Rajiv Gupta, 18 October 2023 Print E-mail

Spotlight

New Delhi, 18 October 2023

Numbers That Don’t Add Up

By Rajiv Gupta 

The number system is one of the moreremarkable inventions of humans. I find numbers very fascinating as the basic rules of the number system are simple and yet robust. If we have a group of numbers, say 2, 3 and 4, it doesn’t matter in what order we add them, i.e., 2 and 3 first and then 4, or in any other order, the result is still the same. Today this seems trivial to mention this, but it would have taken tremendous intellect to come up with such a system. Although the number system is wonderful and useful, we sometimes use numbers in a manner that was probably not intended by those that created the number system.In doing so we get ambiguous and unclear outcomes. Let me explain. 

The simplest type of numbers is those that are used for counting. For example, how many apples in a basket. We can perform simple mathematical operations on these numbers. But we also use numbers to rate and rank people and objects. A gymnast gets rated by a panel of judges on a scale of 1 to 10. How do we interpret the ratings? If one gymnast is rated an 8, while another is rated a 4, is the first gymnast twice as good as the second? The numbers used in rating cannot be used in the same way as simple numbers. The rating value is an opinion of the judge converted into a numerical scale to which normal number system rules do not apply. 

Moreover, the same gymnast may get rated differently by different judges. The numbers may mean different things to different judges. A particular judge may be more conservative in assigning scores, while another judge may be more liberal. Adding or averaging these numbers from two different judges makes as much sense as adding four apples to five oranges to get nine bananas. But that is precisely what is done in competitions. 

We are obsessed with rating everything. We witness a proliferation of reality shows with competitions comparing abilities such as singing versus dancing which cannot have a common basis for comparison. We use arbitrary scoring scales to determine who is number one, number two, etc. in any, and every, field. In fact, the most recent addition is the acronym GOAT, which stands for the “Greatest Of All Time.” And how do we determine who the GOAT is? We poll people. Unfortunately, we poll people from the present population who have had no direct exposure of the past experts in the same field. But that does not deter us. We still go ahead and rate people and anoint one person as the GOAT. Well, so much for that. 

Apart from the issue of adding and averaging numbers which cannot be added or averaged, there is a bigger problem with such an endeavour. We completely ignore the negative psychological impact such ratings have on individuals. We rate students in schools and colleges. We rate people at work. These ratings and rankings do more harm than good. Let us consider a young toddler in school. She is curious and is a sponge for learning. There is so much new and exciting for her. Now we introduce a grading system. From this point on, the focus of the child shifts from curiosity and learning to conformance to what is expected of her. Can we expect this child to contribute creatively to society? 

What does the grade or mark earned by the child represent? In the words of the famous quality and management guru, Dr W.E. Deming, “A grade is only somebody’s (e.g., teacher’s) assessment of a pupil’s achievement on some arbitrary scale.” I had an interesting experience when I had volunteered to talk to a group of 5–8-year-olds in a school in Flint, Michigan about engineering as a career option. I told them about the interesting things engineers can do. I could see the bright gleam in the eyes of the children when I spoke. The same afternoon I was teaching a class in my college. It was depressing to see the apathy and lack of interest in the students. Somewhere between the ages of 5-8 and 18, the system had effectively managed to kill any interest that the child had. The focus had shifted from learning to finding ways to get a better grade by any means, including unfair ones. The grading system played an important role in making this happen. 

We continue the ill-conceived practice of rating and ranking in the workplace. The practice of annual appraisals is meant to distinguish and reward the exceptional performers. Noted psychologist Edward Deci has shown that even positive reinforcement in the form of rewards can have the effect of killing intrinsic motivation in an individual. The focus changes from the joy of learning and enjoying a task to the reward. Moreover, the entire process of assessment, including the more recent developments such as the 360 degree review, is subjective. There are more losers than winners, which does not bode well for the company morale. 

In his book “The New Economics,” Dr Deming states that “It is wrong to suppose that if you can’t measure it, you can’t manage it – a costly myth.” This is contrary to the popular belief that one can manage only with the help of measurement. The obsession with measurement has led managers to resort to the process of numerical rating of people where it does not justifiably apply. While physical measurement uses specific objective methods and tools to accomplish the task, the job of assessing people is subjective, based on what the manager remembers, what the manager’s mood is at the time of the assessment, etc. You get the idea. 

The problem is not that we need a more accurate method of measurement. Rather, we need to understand that the system of measurement itself is flawed. What is the purpose of assessment,whether in school, college, or at the workplace? If the purpose is to improve learning and performance, then how does rating and ranking help achieve this objective. If our aim is to get students and workers to do better, would it not be more effective to provide more explanatory feedback which would give them specific corrective actions to take? In most of the rating and ranking systems we find such feedback woefully missing. Instead, what we see is a cookie cutter system of measurement and assessment which does not provide any benefit either to the person assessed nor to the institution. 

We have created assessment systems which work contrary to the basic aim of the organisations. In educational institutes, the focus should be on improving the learning experience, not rating and ranking. Instead of the emphasis that is placed on evaluation, there needs to be a stronger focus on how well the student is able to think and apply the concepts covered in class. In companies, we need to move away from creating internal competition among employees. The need of the hour is teamwork, not competition. There is enough competition in the outside world. Apart from the human cost of rating and ranking people these numbers just do not add up.----INFA 

(Copyright, India News & Feature Alliance)

State Polls Calculations: IS BJP LOSING GROUND,? By Dhurjati Mukherjee, 17 October 2023 Print E-mail

Open Forum

New Delhi, 17 October 2023

State Polls Calculations

IS BJP LOSING GROUND?

By Dhurjati Mukherjee 

Assembly elections in Rajasthan, MadhyaPradesh and Chhattisgarh are expected to have a wide effect on the national scenario as they form a core area of the Hindi belt. In these statesthe BJP and Congress may clash directly. Opinion surveys so far have given a clear edge to the Congress in Chhattisgarh, while in Rajasthan and Madhya Pradesh the contest is expected to be tough. And while the BJP is banking on Modi’s image, the Congress is putting a host of social and economic issues to attract the lower segments of society. 

Campaigning expectedly has picked up momentum. The BJP is counting on the success of G-20 and putting India’s strength in global order, whereas the Opposition is harping on issues of unemployment, inflation and social fabric being destroyed. Freebies such as reducing LPG prices, subsistence allowance to women etc are being announced. While the Centre  has reduced the price of an LPG by Rs 200 -- in trying to counter Rajasthan which sells these at just Rs 500 -- global oil prices are rising, which obviously will strain the economy, but votes instead are being eyed.    

The Congress has importantly promised a nation-wide caste survey which has sent a clear signal that it wants to give more opportunities in education and job quotas to the EBCs, who are deprived and oppressed. This is expected to have an enormous effect on the lower castes in the Hindi heartland. Moreover, the old pension scheme that has been implemented in Rajasthan, Chhattisgarh and Himachal Pradesh appears to have tilted the scales in favour of the Congress. Though experts believe that such measures benefit the middle class more than the poor and deprived sections, wooing the huge middle class can go a long way in winning elections. 

As for the BJP, though it had constituted the Rohini Commission to look intoSub-Categorisation of OBCs, it has been hesitant on this issue. There is no doubt that the demands for a nation-wide caste census and sub-categorisation of reservation benefits may have a deep impact on OBCs. While the BJP has maintained a studied silence, Congress is on the offensive. Only time will tell how much of the OBC votes will come to it. The backward castes are up in arms and current trends reveal that they would possibly back whichever party assures them better facilities. 

In fact, welfarism has emerged as a common theme across parties and states. Economic growth has not been creating jobs and there is massive unemployment and underemployment in the states, more so because governments are not fillings up vacancies in critical areas like health and education. There are other issues which go against the ruling parties in power that is, inflation in essential commodities and dwindling sources of income.   

In Rajasthan, the BJP by sidelining its former Chief Minister Vasundhara Raje and promoting lesser-known leaders may impact its fortunes. Similarly, in curbing the importance of Shivraj Singh Chouhan in Madhya Pradesh, the party may be making a tactical mistake with a formidable Kamal Nath of the Congress firmly entrenched. The incumbency factor weighs very much in both the States. However, a redeeming feature for the Congress is that its Rajasthan Chief Minister Ashok Gehlotis firmly entrenched in the state and differences about leadership issues have been resolved. At the same time, he has ordered a caste survey in his state and in promised a survey if it comes to power. 

In Telangana, the Congress, which bifurcated the state from Andhra Pradesh, there are expectations that the party would make its presence felt. Having won Karnataka elections, it is expected that the Dalits and OBCs would be attracted to it, more so because of Party President Mallikarjun Kharge. The party has created a welfare strategy based on guarantees that may benefit the poor and help the electoral prospects of the Congress. 

Meanwhile, Sonia Gandhi’s call in Parliament for a sub-quota for backward classes within the 33% quota for women is expected to catch the voters’ attention. The party realised that combining class with caste, the Hindi heartland’s reality would make for a potent political package to influence the electorate. The OBC leaders are at the top of the leadership, to mention the names of Siddaramaiah, Ashok Gehlot and Bhupesh Bhagel. In fact, the Opposition combine is taking the OBCs seriously as these constitute half the country’s population. It expects the demand for adequate representation and distribution of wealth and opportunities to generate hope among the OBCs, segments of which have been enticed by the call of Hindutva despite it giving them no real empowerment. 

Congress leader Rahul Gandhi has been asking this segment to demand real empowerment instead of settling for religious dominance. Addressing a public meeting in Chhattisgarh recently, andpushing the button to transfer an instalment of money to beneficiaries of a housing scheme, he said: “Modi too pushes the button and PSUs get privatised, Adani gets airports, mines, railways and other infrastructure contracts”. But he indicated that his party has been working for the poor and the backward sections and in most Congress ruled states, special schemes have been started to help them. 

Meanwhile, global reports of exploitation and harassment of Muslims has put the BJP in a somewhat difficult position.  The half-yearly report of Hindutva Watch, a US-based research project, ‘Anti-Muslim Hate Speech Events in India’ referred to “255 documented incidents of hate speech gatherings targeting Muslims in the first half of 2023…Overwhelmingly, 205 incidents, 80% of these hate speech events occurred in BJP-ruled states and Union Territories”. The report added: “Overall, 42% of all hate speech gatherings in 17 states, which include two centrally controlled territories, were organized with the RSS…A concerning 33% of all the gatherings explicitly called for violence against Muslims”. Hindutva Watch pointed out that states like Maharashtra, Karnataka, Madhya Pradesh, Rajasthan and Gujarat witnessed the highest number of hate speech gatherings. 

Remember, one of the big news recently has been the AIADMK, the biggest ally of the BJP in South India quitting the NDA. The BJP’s perceived attempts to swallow the political space of its partners after earning a toehold and a latent partiality to the Brahmanical order that reared its head during the Sanatan Dharma controversy are being seen as the reasons behind the rupture in the run-up to the general election. It may be mentioned here that the AIADMK has become the fourth major ally since 2019 to dump the BJP, following in the footsteps of the Janata Dal (United), Shiromani Akali Dal and the Shiv Sena (Uddhav Thackeray). 

The BJP has been perceived to be harassing the Muslim community in the hope that it would be recognised as a party dedicated only to the interests of strengthening and propagating Hindu religion and philosophy.  The Ram Temple is possibly opening to the public in January, again demonstrating that the RSS-BJP combine is wedded to preach and practice Hindu religion. But all this may not garner the expected votes to the party as larger social and economic issues are there and the lower castes are struggling for a better existence. 

While this is no doubt a political strategy and the ruling party understands this well, the question remains if the BJP may win the next elections due to Modi’s image and somewhat good governance? The voters will need to weigh their options carefully. ---INFA 

(Copyright, India News & Feature Alliance)

India GDP Rises, Arms Sale Up: ISRAEL WAR MAY HURT: IMF By Shivaji Sarkar, 16 October 2023 Print E-mail

Economic Highlights

New Delhi, 16 October 2023

India GDP Rises, Arms Sale Up

ISRAEL WAR MAY HURT: IMF

By Shivaji Sarkar 

Indian economic parameters are improving. But would thesebe able to retain the 14-month high Index of Industrial Production growth (IIP) and keep inflation under check amidst the fires of the Gaza-Israel war? 

The global economy is under stress as it was just about getting used to the Russia-Ukraine war and had even stabilised the oil prices. In a week, oil prices surged by 4 percent. If the oil prices increase by 10 percent, the International Monetary Fund (IMF) says, the global economic growth is estimated to come down by 0.15 percent and global inflation will increase by 0.4 percent. The disruptions led by war will spike geopolitical tensions and create turbulence for financial stability. 

This week the IMF raised India’s GDP growth forecast for to 6.3 percent from 6.1 percent amid prediction of world growth to slow down to 2.9 percent in 2024. It can also be slower. Higher oil prices would also add about 0.2 percentage points to global inflation -- holding it near 6 percent. It could force the Reserve Bank of India (RBI) to firm up interest rates as growth slows. 

As a relief, in September, the Consumer Price Index (CPI) data fell to 5.2 percent from 6.83 percent in August and 7.44 percent in July. The IIP reached a record 10.3 percent as manufacturing rises, capital goods rise by 12.6 percent and infra construction by 14.9 percent in August.If global slowdown accentuates as it is now being reassessed, Indian growth may slump. Higher oil and other prices will impact price index. 

Additionally, India’s stock market is taking the hit daily. This means investment is falling. India’s defence expenses are likely to grow as it is the second largest importer of arms in the world, ahead of Egypt, Australia and China. The government says it has no other option but to arm itself against China, which continues to grow in military and economic power. Israeli exports to India are growing. The Indians are authorised by Israel to manufacture and export Israeli-designed drones and ammunition across South-East Asia. It is believed that the laser systems currently being developed in Israel will eventually also reach India. 

The figures portray an interesting picture. As Israel needs more arms, including drones, would it be able to continue its supplies to India? Its multiple security system, Iron Dome, itself has collapsed. The war in Ukraine helped it rake in high profits through the sale of Israelis arms. Israel, the 10th largest arms exporter, sold $9 billion last year, up from $8.3bn in 2020, amounting to three per cent of global military spending. Now these exports, if hit for domestic Israel needs, could possibly change the dimensions of Ukraine war.Germany, France, and the US will now have to maintain supplies to Ukraine. They may earn tonnes of cash. 

This is not soothing for India. It calls for India to upgrade its systems and to earmark more expenses, calling for higher tax revenue. India may have to review its own Rs 16000 crore defence exports, including Pinak and other missile systems. In FY2022-23, Indian merchandise exports to Israel amounted to $7.89 billion, while Israeli exports to India were $2.13 billion. 

Besides, India also has substantial investments, including at Haifa port in Israel. According to data, the cumulative overseas direct investment from India during April 2000 to May 2023 was $383 million. Many Indian firms such as Tata Consultancy Services (TCS), State Bank of India, Jain Irrigation, Sun Pharma, Infosys, Tech Mahindra, Adani, and Wipro have either acquisitions or investments in Israel. 

Recently, India chalked out a clever trade route plan to Middle East-Europe via Haifa, where the Adani group has large funding, through ship, rail, road involving UAE, Saudi Arabia, Israel, Greece. Would it succeed in the present melee?  

The Middle East Monitor says the arms industry in Israel is harmed if there are no large-scale military operations against the Palestinians. The Israeli assaults on Palestinian civilians in the Gaza Strip in May 2021 got Israeli aviation industry conclude a deal with a country in Asia for military drones worth $200 million. In 2020, of all global investments on the internet, a third was directed to Israeli electronic companies. The Israeli arms industry works with the support of the US and the EU and establishes near-normal relations with repressive and far-right regimes from Eastern Europe and Africa to Brazil. The war benefits it. 

That is not so with India. But Indians need to ponder over what the Nuvama Institutional Equities says, “The private sector accounts for 60–70 per cent of India’s total defence exports. The Israel-Hamas conflict, though a sad reality for the people of the region, presents lucrative growth opportunity for India’s defence exports.The escalation of this war may create opportunities for India’s defence companies in the near-to-medium term as Israel is likely to reach out to its allies (India, US, etc) to ensure ample stockpiles to fight the war”. 

So, if India is becoming a tough arms exporter, the people need to rethink and reassess the situation whether it is heading for a jingoist country. Should a country head towards becoming so just for the benefit of some arms dealer and impose tougher preventive laws? Is that a profit or a loss in social terms and is it adhering to the Gandhian non-violent philosophy? 

The insight by Nuvama is revealing. India may harm itself more if it gets into an arms-led economy. It warns, “While some companies exporting equipment to Israel may benefit, other players (both PSUs and private) which procure raw materials or have tie-ups with Israel Aerospace Industries, Elbit Systems or Rafael Advanced Systems, may go through a hard time,” because Israeli priorities may lead to supply chain bottlenecks, execution delay and possible breach of agreements for Indian companies. 

Bloomberg estimates that if the war is not stopped in a few days, in phases it can escalate to Lebanon-Syria, having Iranian militias, and then to Iran verging into a larger global conflagration nearer India. Columbia Broadcasting expert Peter Armstrong says the dust may not settle in a year! 

For India, in all these cases the direction could be the same, more expensive oil, higher inflation, and slower growth, with the magnitude being different. The wider the conflict, the more it becomes global, rather than being regional, which is tougher for India.---INFA 

(Copyright, India News & Feature Alliance)

 

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