Foreign Affairs:The Modi-Erdoğan Parallel


August 15, 2018

Foreign Affairs:The Modi-Erdoğan Parallel

by 

http://www.project-syndicate.org

While Indian Prime Minister Narendra Modi has not achieved the degree of “state capture” that Turkish President Recep Tayyip Erdoğan has, he is also 11 years behind. And the path the two leaders are on is similar enough to invite comparison – and provoke concern.

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NEW DELHI – Comparisons are generally invidious, especially when they involve political leaders from different countries. But, while Turkish President Recep Tayyip Erdoğan rose to power 11 years before Indian Prime Minister Narendra Modi, there is much about their personal and professional trajectories that makes comparison irresistible.

Both Erdoğan and Modi come from humble, small-town backgrounds: Erdoğan sold lemonade and pastries in the streets of Rize; Modi helped his father and brother run a tea stall on a railway platform in Vadnagar. They are self-made men, energetic and physically fit – Erdoğan was a professional soccer player before becoming a politician; Modi has bragged about his 56-inch (142-centimeter) chest – not to mention effective orators.

Both Erdoğan and Modi were raised with religious convictions that ultimately shaped their political careers. Erdoğan’s Justice and Development Party (AKP) and Modi’s Bharatiya Janata Party (BJP) have both promoted a religiously infused, nationalist creed that they argue is more authentic than the Western-inspired secular ideologies that previously guided their countries’ development.

Yet, to win power, Erdoğan and Modi did not count exclusively on religious voters. Both campaigned on modernist platforms, arguing that by implementing business-friendly policies and reducing corruption, they could bring about greater economic prosperity than the establishment they sought to supplant.

Here, Erdoğan and Modi press both the past and the future into service. Erdoğan extols the Ottoman Empire’s legacy, while telling voters that they are not only “choosing a president and deputies,” but also “making a choice for our country’s upcoming century.” Likewise, Modi constantly evokes the achievements of ancient India, which he claims to be reviving in the name of creating a better future.

In short, Erdoğan and Modi have consolidated their power by glorifying the past, while portraying themselves as dynamic, future-oriented agents of change – heroes galloping in on white stallions, swords upraised, to cut the Gordian knots holding their countries’ down.

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“What Turkey has experienced – and India has not – are bouts of military rule. In fact, India’s democracy is deeply entrenched, making it less vulnerable to capture by a single ruler. That partly explains why it is so difficult for many Indians to imagine their country following in Turkey’s footsteps to become a majoritarian illiberal democracy with an autocrat in charge.”–Shashi Tharoor

At the same time, Erdoğan and Modi have painted themselves as political outsiders, who represent the “real” Turks or Indians long marginalized by cosmopolitan secularists. With popular discontent high when they rose to power, such political messaging fell on receptive ears. The narrative of resentment against the established secular elites, peppered with religious-chauvinist discourse and historical revisionism, facilitated their emergence as voices of the middle classes of the hinterlands and second-tier cities and towns.

When Erdoğan first became prime minister in 2003, his position was bolstered by booming global growth, emboldening him to start transforming the Turkish polity. His political formula – a potent compound of religious identity, triumphalist majoritarianism, hyper-nationalism, increasing authoritarianism (including institutional dominance), constraints on the media, strong economic growth, and a compelling personal brand – carried him to re-election as prime minister twice, and from there to the presidency in 2014.

Whether consciously or unconsciously, Modi has adapted Erdoğan’s formula to his own effort to reshape India. He has sought to marginalize Muslims and reinforce Hindu chauvinism. Minorities in general feel beleaguered, as Modi’s nationalism does not merely exclude them, but portrays them as traitors.

Moreover, in Modi’s India, political loyalties are often purchased, and institutions are subverted to serve a narrow sectarian agenda. Dissenters in the media and the universities have faced intimidation. The only area where Modi has been tripped up is GDP growth, owing to his government’s gross economic mismanagement.

On the international stage, too, there are notable parallels between how Erdoğan and Modi conduct themselves. Both pursue activist foreign policies aimed at boosting their domestic image, and have cultivated diaspora support. Erdoğan’s speeches in the Balkans might antagonize the United States and Europe, and even Serbs and Croats, but they raise his stock with Turks. When Modi addresses stadiums full of Indian expatriates on his visits abroad, his speeches are aimed squarely at audiences back home.

Soner Cagaptay, a Turkish analyst and author of a book on Erdoğan, recently remarked, “Half of the country hates him, and thinks he can do nothing right. But at the same time, the other half adores him, and thinks he can do nothing wrong.” The same is true of Modi in India.

Of course, there are important differences between Turkey and India. For starters, Turkey’s population, at 81 million, is less than half that of just one Indian state, Uttar Pradesh, with its population of 210 million. Turkey is 98% Muslim, while India is only 80% Hindu. Islamism, as Hindu chauvinists never tire of pointing out, is a global phenomenon; Hindutva is not. Turkey has no equivalent of Mahatma Gandhi, with his message of non-violence and co-existence drilled into the head of every Indian schoolchild.

Moreover, Turkey is more or less a developed country, while India still has a long way to go to reach that point. And, unlike India, Turkey was never colonized or partitioned on religious grounds, as India was to create Pakistan (though the exchange of populations that accompanied Turkey’s separation from Greece comes close).

What Turkey has experienced – and India has not – are bouts of military rule. In fact, India’s democracy is deeply entrenched, making it less vulnerable to capture by a single ruler. That partly explains why it is so difficult for many Indians to imagine their country following in Turkey’s footsteps to become a majoritarian illiberal democracy with an autocrat in charge.

But while it is true that Modi and the BJP have not achieved the degree of “state capture” that Erdoğan and the AKP have, they are also 11 years behind. And the path they are on is similar enough to invite comparison – and provoke concern. The warning bells are ringing: like the Turkish lira, the India rupee has lost over 5% of its value in the last month. With upcoming elections in both countries – Turkey this month, and India in Spring 2019 – will voters heed the alarm?

India :Rajiv Gandhi’s Foreign Policy


August 11, 2018

India :Rajiv Gandhi’s Foreign Policy– Diplomacy in Tough Times

By Antony Clement

https://moderndiplomacy.eu/2018/08/09/rajiv-gandhis-foreign-policy-diplomacy-in-tough-times/

 “Though he was advised about the threat for his life but never shied away from facing the challenges. He was involved in ‘making India ‘strong, independent and self-reliant’. Further, he never yielded to any sentiments. He knew that there was no room for sentiments while making foreign policy. He was ready to sacrifice anything in the interest of the country. Thus ‘moral and physical courage’ were the central part of his foreign policy making. He carefully chose his foreign visits as well as his policy had brought positive implications on India’s diplomacy.

His breakthroughs have been standing today as good examples and as a guiding pillar for us to formulate policies with respect to many countries. It would be sure the present day diplomatic circle cannot articulate policy without pronouncing the name ‘Rajiv Gandhi.”

…his achievements in the area of India’s foreign policy would not be wiped out or to be erased. The imprint of his legacy in the making of Indian foreign policy will stay longer in shaping of India’s diplomacy and ever lingers in our memory. –Antony Clement

 

The Late Air India Pilot who left his footprints in the Indian Sands as Prime Minister

 

The end of the World War II in 1945 gave the birth to Cold War among the two superpowers. The U.S. and the USSR had respectively been spreading their ideologies (Capitalism and Socialism) across the globe. This was continued till the disintegration of the Soviet in 1991. International relations scholars described 1980s as the peak period of bipolar competition which had already expanded to the Indian Sub-continent. Shri Rajiv Gandhi was the Prime Minister of our country during that time (1984-89).

Throughout the Cold War many developing countries were on the hinge, had stuck without moving either side but wedged with Non-allied Movement (NAM). Moreover, at that time India was leading the NAM, a trustful head for the Third World countries. Further, throughout the Cold War playoffs, building relations with other countries were not only a hard task but getting a new partner would be seen as suspicious in our old friend’s camp. Hence, in the Cold War era reaching out to new friends while keeping the old friends close to us was one of the difficult jobs and challenging. In general, articulating strategy and diplomacy would be really a tough choice but necessary. If a single word is spelt out wrongly would have greater consequences in the international stage. However, the neo-realist thinker Kenneth Waltz “believes that bipolar systems are more stable and thus provide a better guarantee of peace and security” (Jackson & Sorensen, 2003).

In this article let us discuss his important visits and how Rajiv Gandhi’s state visits were received by the major-powers at the time of the Cold War and what India has gained from his diplomacy.

Since the end of the World War II (apart from the five established ‘major powers’ – the U.S., Soviet Russia, France, UK and China) India was the only country that has been expected, and has the required potential, to become a major power. Surely, this would not be a sweet tune to neither the U.S. nor China. So both the countries worked against India with the strategy of containment policy supporting Pakistan in South Asia. As we said, the various U.S administrations have their strategy to contain to keep India within the Sub-continent, have been well working with the help of puppet regimes in Pakistan.

On the other hand, China was blindly helping India’s adversary Pakistan to build nuclear arsenals and was then waiting to consider if Islamabad would lose the support of Washington at any point of time in a situation when the Soviet Union withdraws its forces from Afghanistan. Presuming the “U.S. inaction in the face of the Pakistani acquisition of nuclear weapons with the assistance of China, Rajiv Gandhi took the plunge and secretly authorized going nuclear, notwithstanding his personal sentiments to the contrary. The Agni was successfully test-fired in May 1989” (Baldev Raj Nayar & T.V.Paul, 2003).

During the Cold War period the international politics was tough but Rajiv Gandhi’s visits brought new friends and breakthrough in India’s diplomacy. Under his leadership it was a proud moment for India in the international system. The young Prime Minister Rajiv Gandhi’s new approaches were received by the world leaders. He never goes for the state visits without having solutions for the long outstanding issues. Some of the divergent issues were converted into convergent because of fresh thoughts pouring in the Indian foreign policy making.

It has strengthened India’s authority in the Indian Ocean and particularly gave a turning point in India’s relations with the U.S. and China. His diplomatic visits to Sri Lanka or Australia – there were new lessons to be learned. Therefore, the international relations scholars described, “Indeed, his period in office saw India become more assertive in power terms in the region. At the same time Rajiv Gandhi’s government “walking on two legs: Economic reform and nuclear weaponisation” (Baldev Raj Nayar & T.V.Paul, 2003).

In May 1988, under the leadership of Atal Bihari Vajpayee, India detonated her second nuclear test. But it was built, a decade ago under the able administration of Rajiv Gandhi. He was the architect of pro-poor liberal economy. Moreover, modernization in telecommunication sector, reforms in education, science & technology took place under his leadership. He introduced computer in consultation with Shri Sam Pitroda, the communication wizard and Rajiv is the builder of the 21st century India.

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Rajiv and Sanjay with their mother Prime Minister Indira Gandhi

Rajiv Gandhi always looks at our neighbors in two dimensions. First, when they are in need of our help he immediately reaches out to them. Through this approach he always makes them feel comfortable but at the same time keeps India’s interest alive. Second, his policies are formulated to make the neighbors to stay close to New Delhi. Also he never keeps quiet  in Delhi by sending a statement through the diplomatic channel while our neighbors were facing troubles.

In 1988, ‘The Operation Cactus’ in Maldives to thwart the coup against President Abdul Gayoom’s government would be seen as the best example for his realist approach. However, he always gave room for ‘mutual cooperation.’ Thus his foreign policy had the mixture of realism and liberalism, maintains India’s power balance in the Indian Ocean Region. Particularly in the Male crisis before the superpowers turn their focus on Gayoom’s invitation, Rajiv Gandhi “responded with an overwhelming speed and efficiency. With less than 16 hours since President Gayoom’s call – Indian troops were deployed in one swift motion” and saved the Maldives government (Vishnu Gopinath, The Quint, Feb 06, 2018). At the same time since Feb 2018, 16 weeks had gone; the new political crisis in Maldives is seeking India’s help. The department of external affairs has sent few statements regarding the Male issue and then kept mum.

These approaches indicate that Modi’s government is not in a position to enhance India’s power projection in the Indian Ocean Region, but extending an olive branch to cool down China. These are the policy differences of the then Prime Minister Rajiv Gandhi and the present Prime Minister Narendera Modi.

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It would be understandable that the relations between India and Pakistan were never in comfortable course. During his visit to the SARC Summit in Islamabad the ‘mutual effort’ of Rajiv Gandhi and Benazir Bhutto brought a new twist in ‘normalization of bilateral relations’ between India and Pakistan. “Both prime ministers pledged not to attack or assist foreign powers to attack either country’s nuclear installations and facilities. This summit was described as the dawn of a new era in Pak-India ties” (Shaikh Aziz, The Dawn, August 2016). Further, both the leaders applied step by step approach and “widened their official contacts initiating unprecedented military – to military talks to ace tensions on their northern border, where Indian and Pakistani troops have skirmished for years” (Steve Coll, The Washington Post, July 17, 1989). These developments suggest us that the visits of the state heads are not only mandatory but it should demonstrate some valuable output.

Rajiv Gandhi’s intervention in the Island-nation of Sri Lanka was the striking example for bringing peace and unity in Sri Lanka, and India’s articulation of power. This was also with the aim of keeping the U.S. out of the Indian Ocean especially not to get a foothold in Colombo in the time of Cold War. For the same cause, he lost his life at the very young age but he never folded his hands nor sat quiet when our neighbor was in need.

R. Hariharan a military intelligence specialist wonderfully writes, “The Rajiv Gandhi – Jayewardene Accord, signed in the Cold War era in 1987 was undoubtedly strategic – collectively address all the three contentious issues between India and Sri Lanka: strategic interests, people of Indian origin in Sri Lanka and Tamil minority rights in Sri Lanka. The Accord was unique with respect to India’s beginning with respect to India’s articulation of power, set a strong message to its neighbors, global powers and delineated India’s strategic zone of influence in the Indian Ocean region” (R. Hariharan, July 28, 2010, The Hindu)..

These are indications of his presumption on the importance of the Indian Ocean Region (IOR) for our security and our responsibility in maintaining the freedom of navigation. Rajiv Gandhi was well presumed of China’s interest in the Sub-continent. Hence, he had formulated India’s policies toward in keeping our neighborhood closer to us. The whole of his tenure as the prime minister he thwarted the Chinese entry from the Indian Ocean.

The war with China in 1962 had completely stalled the ties between New Delhi and Beijing. Accepting the then Chinese Premier Li Pang invitation in 1988 he landed in Beijing. Prof. Harsh Pant from the Department of War Studies, Kings College, London says “A new leaf in Sino-Indian ties” (Harsh V. Pant, 2016). “This visit was followed by a flurry of high-level diplomatic exchanges” (David M. Malone, 2011).  Further, Baldev Raj Nayar commenting about this visit a ‘turning point’, “When the two countries agreed to set up a joint working group to resolve the border dispute. A key element in the forward movement was the Indian concession not to insist on prior resolution of the border dispute, though without shelving it, but to move on to improve relations in other areas” (Baldev Raj Nayar & T.V.Paul, 2003).

Further, both the countries come to an understanding of in realizing to initiate the trust building and set up a border management mechanism. Today, the Doklum crisis or Chinese troops crossing into India in the Himalayan border has been managed under this institutional framework. Thus changes were made in the Indo-China relations. However, Rajiv Gandhi never promised to the Indian voters that he would do miracles if he voted for power. But Modi has promised to the Indian public if voted to power he would do wonders in six months. Does he bring breakthrough in India’s border talks with China? Or does he raise the Doklum issue with China’s president often meeting him in various bilateral and multilateral forums?

Further, in recent times Modi had to snub Dalai Lama to pacify China was not a policy mistake, but deliberately performed. He knows since the general elections are just ten months away from now if “China-triggered flashpoint would be more harmful for his political future” (Rajeev Sharma, dailyo.in). Hence, for his short-term political gains he decided to turning his back on Dalai Lama. Further, his ‘strategic restraint’ exposed in the case of crisis in Maldives also.

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Rajiv’s first foreign state visit was to the longtime friend, the former Soviet Union. Commentators viewed the first destination was deliberately chosen. Apart from the usual bilateral ties between India and Soviet Union, various areas from military procurement to civil nuclear technology, and mutual agreements in other sectors, Rajiv had always maintained India’s ‘Special Relations’ with the Soviet Union. Because “Soviet Union consistently gave India valuable political, diplomatic and strategic support bilaterally as well as in international forums on Kashmir and other vital issues affecting India’s national interests” (Rajiv Sikri, 2009). However, in every meeting he raised the universal concern of the danger of nuclear weapons with President Mikhail Gorbachev. He stood against the illusion of ‘limited nuclear war.’ His presumption was at any moment nuclear weapons would not and should not be as a guarantor of global peace. At that time since India was the leader of the NAM obviously criticisms were poured out against India’s ‘Friendship Treaty’ with the Soviet. However, Rajiv Gandhi bravely raises the global concern on nuclear arsenals equally with the U.S. and the USSR. At this point the young prime minister’s articulation of foreign policy toward the West was sometimes concern for the Soviet leaders, but Rajiv comfortably expressed India’s view. Meanwhile, the USSR understood India’s rise through the prism of Rajiv Gandhi. Hence, the Soviet Union gave Rajiv Gandhi the ‘status of a world leader.’

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In the Cold War climate Rajiv Gandhi and his predecessors were compelled to manage the U.S.’s regional containment strategy. For the U.S., they well know India’s leadership and major power aspirations. So they don’t want to give a path for the Soviet’s best friend India to rise out of the Sub-continent. At this juncture Rajiv decided to bring down the hostility nature of India-U.S. relations. He visited the U.S. in June 1985. “That trip has been hailed by many as likely to contribute to a new era of cooperation between New Delhi and Washington (Steven R. Weisman, The New York Times, 1985).

He gave a wonderful speech which was sweet and short by carrying a hint in his hand which had the strategy for both the countries to have greater understanding. At the Joint session of the US Congress he said, “I am young and I too have a dream. I have no doubt this visit will help to bring about greater understanding between our countries” (Youtube).

In his reply President Ronald Reagan said, “Today we opened up personal channels of communication.” Further, signing a “memorandum of understanding” with the U.S., he promotes technological cooperation between both the countries (Baldev Raj Nayar & T.V.Paul, 2003). Hence, we should understand our present relations with the U.S. or China are the continuation of Rajiv’s breakthrough made during his visits to those countries in his premiership.

Modi went to the U.S. several times in the last four years. What happened to the India-U.S. seriously negotiated nuclear deal? Are there any changes in the position of India and U.S. in the liability issue to implement the nuclear deal?

Conclusion

The 1980s has registered the crucial period in the history of Cold War. But each of Rajiv Gandhi’s visits was well planned in advance; policies were made with sufficient consultations, and had definite trajectories to strengthen India’s interest globally. His visits to Pakistan, China and the U.S., further, the way he was handling the crisis in the Indian Ocean islands would tell us how much is he committed in keeping not only India’s ambition in the international system but also have delivered India’s moral responsibility to help our neighbors while they required our support. Under Modi’s leadership our capabilities are not properly demonstrated.

Modi even evaded in visiting Maldives in his Indian Ocean Islands tour in 2015, the reason for his evasion was stated by his office as ‘the time was not favorable for the prime minister to visit’. Rajiv Gandhi visited Pakistan in a crucial time of the Cold War. His office does not say that Pakistan’ situation was not conducive to the prime minister to visit that country.

Though he was advised about the thereat for his life but never shied away from facing the challenges. He involved in ‘making India ‘strong, independent and self-reliant’. Further, he never yields to any sentiments. He knew that there was no room for sentiments while making foreign policy. He was ready to sacrifice anything in the interest of the country. Thus ‘moral and physical courage’ were the central part of his foreign policy making. He carefully chooses his foreign visits as well as his policy had brought positive implications on India’s diplomacy. His breakthroughs have been standing today as good examples and as a guiding pillar for us to formulate policies with respect to many countries. It would be sure the present day diplomatic circle cannot articulate policy without pronouncing the name ‘Rajiv Gandhi.’

Hence, his achievements in the area of India’s foreign policy would not be wiped out or to be erased. The imprint of his legacy in the making of Indian foreign policy will stay longer in shaping of India’s diplomacy and ever lingers in our memory.

Malaysia: Embracing Abe-san and Bro Modi


August 1, 2018

Dr. Mahathir’s Look East (Japan) and West (India) Geo-Economics–Embracing Abe San and Bro Modi

by Dr. Shankaran Nambiar, MIER

http://www.eastasiaforum.org/2018/07/13/mahathirs-foreign-policy-reset/

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Malaysian Prime Minister Dr.Mahathir greets Bro Modi

Prime Minister Mahathir Mohamad appears to be setting the tone for a revision of Malaysia’s geo-economic policy, if the bilateral meetings with his Indian and Japanese counterparts in the early days of his administration are anything to go by. 

 

Indian Prime Minister Narendra Modi called on Mahathir not too long after the latter assumed office. The meeting was significant in so far as Modi is keen on ‘Acting East’ and forging stronger ties with ASEAN. With Mahathir at the helm, Modi may well have an active and influential partner in the region.

India is likely to be an economic powerhouse in the coming decade or two, and any long-term economic architecture in the region will have to take this reality into account.

Does Mahathir run the risk of disrupting Malaysia’s economic relations with China by engaging with other partners? Not quite, but he does want to tilt the balance.

Mahathir is not questioning China’s intention to build friendly, harmonious and prosperous relations with the region or with Malaysia. But he is adding a dose of reality to some of the more questionable investment agreements that Malaysia has entered into with China and wants these deals to be reviewed. Mahathir has said that ‘we will be friendly to China but we don’t want to be indebted to China’.

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With Ali Baba’s Jack Ma of China

The Prime Minister is keen to do business with anyone who means business, provided there are no hidden caveats and Malaysia is not compromised. If there was any question of wanting to cut off China, Mahathir would not have met with Chinese entrepreneur Jack Ma.

This brings us to Mahathir’s meeting with a second foreign leader, Japanese Prime Minister Shinzo Abe. Why did Mahathir choose to go to Japan on his first official overseas trip soon after he came to power?

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Teaming with Abe-San on Look East Partnership with No.7 Jersey

Mahathir probably sees value in reviving his ‘Look East’ policy, which he pursued while prime minister in the 1980s, perhaps in a different form and for slightly different reasons. There is an element of nostalgia, to be sure. But Mahathir is not is not a sentimentalist.

The previous Najib administration did not treat the notion of equidistance from global superpowers with the sensitivity it deserved. There was a tumbling over to China coupled with a reticence to engage with Japan, at least with nothing of the enthusiasm that Tokyo enjoyed during the Mahathir 1.0 era.

Mahathir has always believed in maintaining equidistance from other powers, preferring to work with the larger economies as equals. Mahathir would, by logical extension, be willing to cooperate with China’s Belt and Road Initiative as long as the partnership is fair and without Beijing using Malaysia as its playground. In that respect, reaffirming Malaysia’s long friendship with Japan is a reassertion of Mahathir’s pragmatic approach to geo-economic policy.

But equidistance is not possible without the existence of something like the Non-Aligned Movement. In lieu of that, Mahathir will likely pursue equidistance through a more integrated ASEAN in partnership with other countries such as the United States, China, Japan, South Korea, India and the Central Asian states. This would be a revival of his East Asian Economic Caucus (EAEC) concept.

A close-knit ASEAN, through the EAEC, would be able to give countries such as Malaysia more access to foreign markets without having to pay an onerous price for doing so. It would allow countries like India to trade and invest in Southeast Asia or other places while being able to show their home constituencies that they can make gains without paying for them with tough commitments.

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Strengthening ASEAN’s economic cohesion and including other powers through the EAEC would mean that neither the United States nor China could dominate Malaysia’s foreign policy. Malaysia would not have to choose between aligning with either power.

Mahathir’s discussion with Jack Ma after his India and Japan meetings shows the Prime Minister’s pragmatism — more than being caught up in great power politics, Mahathir wants to push ahead with attracting no-strings-attached investment, be it from China, India or any other part of the world.

Mahathir understands that trade and investment are Malaysia’s lifeblood. Improving Malaysia’s networks with the rest of the world’s markets must take top priority to foster better trade and investment connections.

Mahathir’s meetings with Modi and Abe will set in motion a couple of initiatives. Malaysia will return to its default position of maintaining equidistance between superpowers. Japan will not feel it is being edged out of Malaysia’s investment landscape.

Malaysia will stand for a free and unaligned ASEAN, with Mahathir leading a campaign for a new trade architecture that might be more palatable to Southeast Asian countries  and which will minimise the conflicting demands of China, the United States and India by embracing Japan.

Of course, the EAEC idea will have its share of detractors and non-adherents. Much as Mahathir has a tough job setting domestic affairs right now, he has the no less difficult task of realigning the country’s geo-economic policy.

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Shankaran Nambiar is a senior research fellow at the Malaysian Institute of Economic Research.

A version of this article originally appeared here in The Sun Daily.

The Domestic Political Impact of Rapid Economic Change in the Indo-Pacific Region


July 25, 2018

The Domestic Political Impact of Rapid Economic Change in the Indo-Pacific Region

by Ellen Frost

Asia Pacific Bulletin, No. 426

Publisher: Washington, DC: East-West Center
Available From: July 11, 2018
Publication Date: July 11, 2018
Binding: Electronic
Pages: 2
Free Download: PDF

 

Ellen L. Frost, Senior Advisor and Fellow at the East-West Center in Washington, explains that “A key question is whether the strategies employed by current Indo-Pacific governments are working well enough to be both competitive in the new regional economic environment and responsive to legitimate grievances at home.”

 Structural changes in the external economic environment have a profound and complex impact on the distribution of power and wealth among and within national societies. They mobilize new actors, influence the content of domestic and foreign economic policies, and ultimately contribute to–or erode—the legitimacy of national governments.

Nowhere in the world are these impacts more visible and more dynamic than in the nations of the Indo-Pacific, many of which will hold elections within the next year. These challenges are not new, but they have intensified. Beginning in the 1980s, the revolution in communications technology and the advent of large-scale container shipping swept across East and Southeast Asia, connecting people and markets as never before. In the 1990s, burgeoning production networks linked the more competitive and investment-friendly developing economies—such as Singapore, Thailand, Malaysia, South Korea, and Taiwan—with world markets, leaving more closed economies such as Laos, Myanmar, and India lagging behind. Market-opening in China fueled spectacular rates of growth, lifted millions out of poverty, and enabled the country to become not only an assembly nexus and production hub but also an assertive regional power.

Regional economic integration has become a dominant feature of today’s Indo-Pacific. All governments are committed to promoting closer economic ties with each other, whether half-heartedly or not. Integration is inching along, gingerly encouraged by governments but driven more powerfully by pressure from the private sector and from ocean-facing local governments. Trade-liberalizing agreements, though imperfect and limited, are the new norm. Negotiations spearheaded by the Association of South East Asian Nations (ASEAN) have made some progress. Despite the Asian financial crisis of 1997-98 and the U.S.-origin global recession of 2008-09, no government in the Indo-Pacific region has rejected the rules embodied in the World Trade Organization (WTO) or retreated from its slow and uneven march toward more open markets.

Indo-Pacific governments that signed on to the high-standard Trans-Pacific Partnership (TPP) agreement—Brunei, Singapore, Malaysia, Vietnam, Australia, and New Zealand—remain committed  to improving the protection of intellectual property and tackling other behind-the-border measures that impede trade and investment, with or without the United States. Promoting the transition to a digital economy is likely to gain more prominence next year, when Thailand takes over the chairmanship of ASEAN. Meanwhile, negotiations on a less demanding, ASEAN-sponsored Regional Comprehensive Economic Partnership (RCEP), which includes India as well as Australia, and New Zealand, continue to inch along.

Even India has embraced closer integration, as emphasized most recently by Prime Minister Modi at the June 2018 Shangri-La Dialogue. India’s economic reform is lagging, but its high growth rate, relatively low level of public debt, and youthful population have attracted an upsurge in foreign investment. The Modi government’s outward-looking strategic awakening is gradually improving relations with nations bordering the Bay of Bengal and the Indian Ocean littoral, thus facilitating closer integration. But the combination of India’s federal system, local politics, corruption, and remnants of the “license raj” has thus far thwarted wide-ranging economic liberalization.

Domestic Aspects of Regional Integration

The upsurge in Indo-Pacific economic integration has spawned a rising middle class whose members have embraced the choices available in the regional (and global) marketplace. Urban dwellers in particular have become used to higher standards of living, more consumer choice, and a wide spectrum of social media. Thousands of Asians have found employment in foreign firms or joint ventures, while others have lost their jobs. What Karl Marx and others called the “comprador bourgeoisie”—local agents or managers working for foreign entities—has emerged as an educated political class with a major stake in regional integration.

Many provincial and urban authorities have developed close ties to their nearby counterparts across borders, particularly in mainland Southeast Asian countries bordering on or close to China (Myanmar, Laos, Vietnam, and Thailand). Small- and medium-size companies and local enterprises account for a growing share of China’s overseas investment. All of these groups have acquired a stronger political voice.

China    

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Overshadowing all this activity is the sheer weight of China. China’s economic growth and central role in production networks have made it the number-one or number-two trading partner of virtually all countries in the East and Southeast Asia regions. Some smaller nations have found a niche in China-centered manufacturing networks, while others have boosted their sale of commodities and raw materials. China’s Belt and Road Initiative and the China-sponsored Asian Infrastructure Investment Bank will spur badly needed development of Indo-Pacific infrastructure and connectivity. Local interest groups have sprung up accordingly. For all of these reasons, most Indo-Pacific governments feel compelled to maintain friendly relations with China.

Dependence on China comes at a price, however. Huge loans for infrastructure projects can feed large-scale corruption and saddle poorer countries with unsustainable debt. To enforce its geopolitical agenda, Beijing is increasingly resorting to coercive economic statecraft (“sharp power”), including surprise “inspections” and delayed approvals, selective boycotts, and limits on tourism. Chinese companies investing in Indo-Pacific countries typically import large groups of Chinese workers to perform jobs that might otherwise go to local laborers. The militarization of islands claimed or created in the South China Sea has gone unchecked, spurring criticism in rival claimants.

Challenges Facing Indo-Pacific Governments

“Governments that fail to reform the structure of their economies risk falling even further behind in the regional marketplace, but those who neglect their most vulnerable citizens may be voted out of office—or overthrown.” –Ellen Frost

A number of major threats to integration, growth, and political stability in the Indo-Pacific region are beyond national governments’ control. They include financial volatility, cyber crime, terrorist attacks, refugee flows, fluctuating commodity prices, rising sea levels, severe storms, and other natural disasters. Grievances and conspiracy theories proliferate via social media. Manufacturing breakthroughs such as 3-D printing may localize or otherwise shrink the regional supply chains in which many Asians have found a profitable niche. Growing income inequality is also a threat; when those left behind come from a neglected or persecuted ethnic or religious group, the result can be highly destabilizing.

The latest threat to Indo-Pacific prosperity—and indirectly to regional integration—is the outbreak of protectionism and populist nationalism in the United States. The Trump administration’s “America First” campaign may well divert investment away from the Indo-Pacific and into the United States. Indeed, that is an explicit U.S. policy goal. As regional integration stalls, domestic interest groups with a stake in the expanding regional economy and others with previously high expectations may turn against established governments.

Electoral Prospects: Finding a Balance

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Upcoming elections in Bangladesh, Bhutan, Cambodia, the Philippines, Indonesia, Thailand and India (including Indian states), scheduled for 2018 or 2019, will put the leaders of these countries to the test. Governments not facing challenges from the ballot box will feel pressure from their citizens as well. Some of the likely issues will be linked to or exacerbated by the evolving external economic environment, such as large-scale corruption in the infrastructure sector, widening income gaps, unwelcome Chinese activities, and worker layoffs in non-competitive sectors.

A key question is whether the strategies employed by existing Indo-Pacific governments are working well enough to be both competitive in the new regional economic environment and responsive to legitimate grievances at home. Governments that fail to reform the structure of their economies risk falling even further behind in the regional marketplace, but those who neglect their most vulnerable citizens may be voted out of office—or overthrown.

https://www.eastwestcenter.org/publications/the-domestic-political-impact-rapid-economic-change-in-the-indo-pacific-region

Pakatan Harapan: What is so special about this Naik Fella from India?


July 12, 2018

Pakatan Harapan: What is so special about this Naik Fella from India?

By Dennis Ignatius

http://www.freemalaysiatoday.com

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Dr. Mahathir Mohamad protects an Indian Cobra

What’s so special about Zakir Naik? Why is he so uniquely deserving of Putrajaya’s support and attention?

These are among the many questions that Malaysians are asking in the wake of the government’s decision to allow him to stay; so far no satisfactory answers have been forthcoming.

Well-deserved reputation

Any which way you look at it, Naik is a highly polarising demagogue. Considered one of the most influential Wahhabi ideologues in the world, he aggressively propagates a version of Islam that even Saudi Crown Prince Mohammed Salman says is in need of reform, and which, incidentally, the National Fatwa Council (NFC) of Malaysia declared “has no place in Malaysia”.

Countries as diverse as Canada, India, the UK and Bangladesh consider him an extremist who seems to endorse terrorism. Some countries have denied him entry as well. Bangladesh alleges that he inspired a terrorist attack in Dhaka in 2016 which left 22 dead. India’s National Investigation Agency is also investigating his foundation for alleged money laundering.

While he consistently denies these allegations and claims that he has been misunderstood or taken out of context, it’s hard not to conclude from even a cursory viewing of his many YouTube offerings that his reputation for extremism is well-deserved.

Dishonest and deceitful

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Now that he is in the dock of public opinion, and desperate for refuge in Malaysia, he is attempting an image makeover, claiming that his “primary concern” has always been “to foster social harmony”. He is, of course, being utterly dishonest given that he has a long history of being extremely intolerant, insulting and demeaning of other faiths.

And when cornered by his own remarks, he immediately cries that he is but a victim of some vague conspiracy against Islam, part of a “broader objective of demonising Islam and Muslims”, never mind that it is his own hate-filled invective that does more to demonise Islam that anything else.

Skillfully exploiting our divisions

While many of us might shudder at the thought of someone like Naik being turned loose in a country like ours which is struggling to contain religious and racial extremism, he has apparently no shortage of supporters. With the Wahhabi narrative already well-established in the corridors of power, the NFC’s opinion notwithstanding, he is of course a perfect fit. His choice of abode – in Putrajaya – is itself very telling.

He also seems to have adroitly exploited Malaysia’s political, racial and religious divisions to his advantage, endearing himself to many in UMNO and PAS by his endorsement of both Islamic and Malay supremacism. And they, in turn, have showered him with a level of praise, privilege and protection that he never found anywhere else. No surprise then that he loves it here.

Legal obligations

The Indian government is now apparently seeking to extradite Naik (who remains an Indian citizen) to face money laundering and terrorism-related charges.

Ultimately, extradition is a legal matter subject to treaty obligations which the courts must decide upon. The government must take a principled stand and affirm that it will respect its legal obligations. To do otherwise, to insist that Naik be treated differently from others in similar situations, would undermine the government’s own oft-repeated commitment to the rule of law.

Does Naik deserve to be here?

Beyond the issue of extradition, however, is the larger question of whether or not he deserves to be a Malaysian permanent resident. A strong argument can be made that extremists like Naik do not deserve residency status in our country.

His values, his actions and his worldview stand in sharp contrast to the kind of tolerant, respectful and inclusive nation we are trying to build. He has nothing to contribute to making our nation a strong, united and prosperous one. He is but an intolerant religious bully who does not deserve our respect let alone our protection.

And don’t forget that this is also the same opportunist who, convinced that UMNO would rule forever, insisted at a seminar last year that Muslims ought to vote for a Muslim leader who might be corrupt (read Najib) rather than a Muslim leader who depends on non-Muslim support (read Mahathir).

Of course, once Najib lost power, he immediately ingratiated himself with Putrajaya’s new leaders and now sings their praises. And this is the man that some in Pakatan Harapan are now defending.

Naik doesn’t belong here. If he doesn’t have the courage to return home to India to answer the charges against him, let him find sanctuary in Saudi Arabia; after all, he is a great admirer of the Wahhabi clerics who hold sway there.

Government owes us an explanation

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In the interest of transparency, the government has an obligation to explain why it refuses to extradite him and why he deserves to remain in Malaysia.

As well, the government needs to clarify whether it is paying for Naik’s ever-present security detail, whether he is receiving financial support of any kind from the public purse, and whether he is being considered for Malaysian citizenship now that India has withdrawn his passport.

Whatever it is, the government should not underestimate how deeply offended many Malaysians are with Naik and how deeply disappointed they are by the inexplicable and shocking decision to continue offering him sanctuary here.

Dennis Ignatius is a former ambassador.

The views expressed are those of the author and do not necessarily reflect those of FMT.

Foreign Affairs: Time for East Asia


July 9, 2018

Time for East Asia

By Bunn Nagara@www,thestar.com.my

READ : https://asia.nikkei.com/Spotlight/The-Future-of-Asia-2018/Mahathir-revives-Look-East-policy-to-join-ranks-of-economic-giants

AS an indication of how out of touch some international pundits of Asia are, they still call North-East Asia (China, Japan and Korea) “East Asia.”

East Asia as a region comprises the sub-regions of North-East Asia and South-East Asia, the latter being the countries of ASEAN and Timor-Leste.

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The ASEAN region developed steadily with peace and prosperity as its watchwords. It became known as a region consistently posting some of the highest growth rates in the world.

Yet ASEAN and its member countries were severely constrained by a lack of economic weight and global reach.

ASEAN’s diplomatic clout is fine, but South-East Asia as a region falls short of economic heft in a rapidly globalising world. Nonetheless, the forces of globalisation themselves would take care of that with growing economic integration within East Asia.

North-East Asia included two of the world’s three largest economies, so as a region it had no problems of limited reach or heft. Despite global constraints, China on the whole continued to grow.

As the economies of North-East Asia and South-East Asia grew more integrated, growth in East Asia as a whole would soon reach an altogether different plane.

Studies generally find intra-regional trade surpassing foreign direct investment (FDI). A 2009 study found that tariff reductions as well as closer monetary cooperation among East Asian countries made sense.

A report by the Asian Development Bank Institute last year acknowledged the impressive growth of East Asia’s intra-regional trade ratio over the past 55 years.

It noted how trade had become “more functionally linked to international production networks and supply chains” as well as FDI in the region. This is indicative of East Asia’s deepening regionalisation. Typically, after Japan’s export of capital to South-East Asia in the 1970s and 1980s, China took up the slack as Japan’s economy leveled off from the early 1990s.

In 1990, ISIS Malaysia and Prime Minister Tun (then Datuk Seri) Dr. Mahathir Mohamad worked on a proposal for an East Asia Economic Grouping (EAEG). It was time for East Asia to come into its own.

When Chinese Premier Li Peng visited Kuala Lumpur in December 1990, Dr Mahathir proposed the EAEG to him. Li Peng accepted and supported it.

The idea had not been discussed within ASEAN before. Indonesia, the biggest country and economy regarding itself the region’s “big brother,” felt miffed that it had not been consulted about the plan.

Singapore’s position, traditionally more aligned to a US that was not “included” in the East Asia proposal, was slightly more nuanced. Lee Kuan Yew, upon becoming Senior Minister just the month before – and on the cusp of the Cold War’s demise – still preferred an economic universe defined by the West.

At the time this was the European community and the Uruguay Round as an outgrowth of the General Agreement on Tariffs and Trade (GATT).

It was still three years before the European Union (EU), and four years before the North American Free Trade Agreement (NAFTA).

Generally the world was still beholden to Western economic paradigms and game plans. The EAEG was thus seen as the work of some upstart Asians, in turns brash and occasionally recalcitrant.

Most of the six ASEAN countries, like South Korea, accepted the EAEG even as they tried to learn more about it. But it was still at best tentative.

The EAEG’s critics, however, proved more vocal. US President G.H.W Bush and Secretary of State James Baker wanted to crash the regional party by becoming a member also, or else would see the idea crash.

The Uruguay Round was then seen to be quite rudderless, and APEC, itself formed just one year before, appeared fumbling in the doldrums.

The EAEG, misperceived as an “alternative”, would be thinking and acting outside the box. An energised Asia owing nothing to Western patronage was far too much for an Occidental-conceived world order to contemplate, much less accept.

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Prime Minister Hun Sen and China’s President Xi Jinping

Malaysia tried to soothe anxieties about the EAEG by emphasising its soft regionalism. It was to be only “a loose, consultative” grouping and no more.

Why should a booming, rapidly integrating East Asia be deprived of a regional economic identity, when Europe and North America could develop their own?

Unfortunately the EAEG’s public relations campaign proved too little too late. The idea, albeit now conceived as an ASEAN project, lacked traction and ground to a halt.

Singapore saw its merits and tried a different tack. Prime Minister Goh Chok Tong proposed an East Asia Economic Caucus (EAEC) within APEC, allaying fears of an insecure US that this would remain within the ambit of a US-dominated APEC.

Several political speeches and conference papers later, the EAEC idea also failed to germinate. A Bill Clinton Presidency was lukewarm-to-cool to the idea, still without the encouragement Japan needed for a nod.

A flourishing East Asia would be left without a regional organisation of its own, again.

In 1997 the devastating Asian economic and financial crisis struck, hitting South Korea, Thailand and Indonesia particularly badly. If the EAEG had been in place by then, greater regional cooperation and coordination would have helped cushion the shocks.

Suddenly, South Korea took the initiative to push East Asia into forming a regional identity: ASEAN Plus Three (APT). This grouping would consist of the same EAEG countries.

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Indo- Pacific Partnership –An Alternative to China’s One Belt One Road Initiative (BRI)

Japan this time was more accommodating, and the APT was born.

For decades, “the West” led by the US was identified with open markets and free trade. But now a Trump Presidency deemed protectionist, even isolationist, is hauling up the drawbridge and raising the barricades with tariffs and other restrictive measures.

These are aimed at allies and rivals alike, whether in Europe or Asia. Equivalent countermeasures have been launched, and the trade-restraining spiral winds on.

China, by now identified globally as a champion of open markets and free trade, has called on Europe to form a common front. Strategic competitors are making for strange trade bedfellows and vice-versa.

Dr Mahathir was on his annual visit to Tokyo last month for the Nikkei International Conference on the Future of Asia. He duly revisited the idea of an East Asian economic identity and community.

For emphasis, he added that he preferred this to a revised Trans-Pacific Partnership that the US has now rejected. How would an EAEG now play in today’s Japan and East Asia? More to the point, how would it play in Washington? The answer may still determine its prospects in Tokyo and East Asia as a whole.

It is possible that the US has become too tied to the idea of battling trade skirmishes, if not outright trade wars, with any presumed adversary to have time to frown on an EAEG.

Dr Mahathir has noted how this is the time for such a regional grouping, since we still need it and particularly when the US is helping to justify it. It is also conceivable that Japan today is more open to the EAEG, just like with the APT post-1997.

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America First Fallacy– In fact it is US retreat from global engagement

 

The more the rhetoric of a US-China trade war rages, the more likely East Asia can finally develop a regional economic identity of its own.

Even a US-EU trade conflict will do. East Asia should not be too choosy about its benefactors.

Bunn Nagara is a Senior Fellow at the Institute of Strategic and International Studies (ISIS) Malaysia.

Bunn Nagara