China gives currency more freedom with new reform

BEIJING (Reuters) - China took a milestone step in turning the yuan into a global currency on Saturday by doubling the size of its trading band against the dollar, pushing through a crucial reform that further liberalizes its nascent financial markets.
The People's Bank of China said it would allow the yuan to rise or fall 1 percent from a mid-point every day, effective Monday, compared with its previous 0.5 percent limit.
The timing of the move underlines Beijing's belief that the yuan is near its equilibrium level, and that China's economy, although cooling, is sturdy enough to handle important, long-promised, structural reforms, analysts said.
The move would help China deflect criticism of its controversial currency policy ahead of the annual spring meeting of the International Monetary Fund in Washington next week.
A slowing world economy that has pared investor expectations of a steadily rising yuan likely also gave Beijing the confidence to proceed, knowing that a larger band would not necessarily lead to a stronger currency.
"The central bank chose a good time window to enlarge the trading band. The market's expectation for a stronger yuan is weakening," said Dong Xian'an, chief economist at Peking First Advisory in Beijing.
"The move partially clears away doubts on whether China can manage a soft landing in its economy, and makes clear China's reform road map."
Investors have widely expected China to widen the yuan's trading band this year, thanks to repeated hints from Beijing that the change would take China one step closer to its financial goal: a basically convertible yuan by 2015.
Having a currency that trades with fewer restrictions also enhances Shanghai's status as a financial center. China envisions turning the city into a global banking hub by 2020.
"From April 16, 2012, the trading band for the yuan against the dollar in the spot interbank currency market will be widened from 0.5 percent to 1 percent, " the People's Bank of China said in a short statement on its website.
"At present, the development of China's foreign exchange market is maturing, the market's ability to independently price and manage risks is growing by the day," the bank said.
Ultimately, the government wants the yuan to rival the dollar as a global reserve currency, and to this end it has gradually allowed the currency to trade more freely.
After a pilot programe last year was judged successful, in March this year it gave permission for firms across China to pay for imports and exports in yuan, a way of helping to increase the use of the yuan in trade deals.
NO SHARP GAINS
The yuan, also known as the renminbi or "people's money", hit a record high of 6.2884 against the dollar on Feb 10, but is little changed against the U.S. currency for the year, softening 0.14 percent since January.
Analysts say its listless showing is likely to persist through 2012, as expectations of future gains are dulled by China's easing economic growth, and speculation that the yuan is near equilibrium.
As China this year heads into its biggest leadership changeover in a decade, it would be in Beijing's interests to avoid dramatic fluctuations in the yuan that could hurt exporters, many of whom are battling rising costs and tepid demand as it is.
"The yuan is close to an equilibrium. We expect it could only gain 1.4 percent against the dollar this year, so the time is right to widen the band," said Lan Shen, an economist at Standard Chartered Bank in Shanghai.
So muted is the yuan's outlook that investors in the offshore non-deliverable forwards (NDF) market believe there is even room for the currency to fall. The benchmark one-year NDF is pricing for a 0.4 percent depreciation.
Any decline would be a stark contrast to the yuan's steadfast rise in recent years. It jumped about 5 percent in 2011 on top of nearly 4 percent in 2010, giving investors the impression that China was comfortable with a rising currency.
It has gained about 30 percent in nominal terms against the dollar since the landmark move in the summer of 2005 to de-peg the yuan from the greenback.
A WELCOME MOVE
The yuan's value has always been a point of contention between China and its trading partners, notably the United States, which say China suppresses the currency to boost exports. China repeatedly rejects the accusation.
Instead, Chinese leaders say the yuan is near its equilibrium level and that authorities aim to keep its value "basically stable", more flexibility notwithstanding.
Beijing's desire to have the yuan trade more freely was stressed by both Premier Wen Jiabao and Central Bank Governor Zhou Xiaochuan in March when they said conditions were ripe for changes.
Their calls came even as China is set to confront its slowest economic growth in a decade this year, leading many to believe Beijing is ready to foresake heady growth for a restructured economy driven more by domestic than export demand.
Although not a primary intention, a more flexible yuan also works in China's favor in turbulent times by giving it more room to guide the currency lower to aid exports.
"The message of this move is that the renminbi appreciation story is over. Greater two way volatility will be the name of the game going forward," said Qu Hongbin, an economist at HSBC.
Data on Friday showed China's economy suffered its weakest growth since the global financial crisis in the first quarter by expanding just 8.1 percent, below forecasts for 8.3 percent.
The last time China changed its currency policy was in June 2010, after a two-year period when it effectively re-pegged the yuan to the dollar to shield China from the 2008-09 global financial crisis.
"I think the step should be welcomed by foreign countries, especially the United States, who has called for reforms," said Dongming Xie, China economist at OCBC Bank in Singapore. "This is also related to growing domestic calls for economic reforms."

Whose Arms Will Embrace You? The United States and the Beijing Consensus

by Amarnath Amarasingam

The United States is increasingly playing a game of subtle communication in the international arena. I suspect we had a passing glimpse of this at the 19th Session of the Human Rights Council, which gathered in Geneva last month. The question is: who is the United States talking to and what is it trying to say?


There has been much discussion about President Obama’s “Return to Asia” strategy, arising out of a 2009 speech during which he declared that as an Asia Pacific nation, the United States will seek to be more involved in the issues affecting the region.

There has been an equally vibrant discussion in policy and scholarly circles about the so-called Beijing Consensus, a term used to describe the Chinese government’s embrace of capitalism, while remaining autocratic. It is to these nations who have “bought into” the Beijing Consensus, that the United States is subtly and guardedly, but increasingly, speaking.

The (B)end of History

With the end of the Cold War, it was widely assumed that capitalism, as well as the Western political system had carried the day. In 1992, Francis Fukuyama published The End of History and the Last Man, which argued that with the Soviet demise, we may be witnessing not only the end of the Cold War, but “the end point of mankind’s ideological evolution and the universalization of Western liberal democracy as the final form of human government.”

As Stefan Halper points out in his excellent 2010 book The Beijing Consensus, Fukuyama’s argument “became the kernel for a broad political consensus in Washington” and was undergirded by the sentiment that it was the American political-economic system “that satisfied mankind’s basic want for both a say in the political process and the opportunity to get rich.”

In other words, politicians and policy makers in the United States argued that history had spoken, and declared a clear winner in the ideological battle of the day: democratic pluralism, free markets, and, most importantly, the necessary link between the two for the creation of a stable and prosperous society. The rise of China complicates the argument in a profound way, by demonstrating that this ‘necessary link’ between capitalism and liberalism is an illusion.

According to many scholars, in addition to everything else that it sells to the world, China is exporting a more corrosive idea that strikes at the heart of Western identity. China functions, says Halper, as “the world’s largest billboard advertisement for the new alternative of ‘going capitalist and staying autocratic’.” Beijing, in other words, has demonstrated that it is possible to “liberalize economically without surrendering to liberal politics.”

What Does China Want?

The true intentions behind China’s rise have been the subject of heated debate in academic and policy circles. Some state that China’s posturing reflects nothing more than its desire for economic progress, while others contend that the Chinese government has regional or global dominance in mind, with still others arguing that both perspectives are true.

Indeed, China’s economic needs are great. It must grow at a minimum of eight percent per year to maintain stability and provide jobs and housing to its diverse population. Failure to achieve this growth rate, Halper writes, “carries the risk of chaos – a nightmare in a country of 1.5 billion.” As such, China seeks to ensure that its economic standing is protected, and has sought to create a set of like minded regimes and strategic facilities across the region – the so-called String of Pearls. Through direct foreign aid, physical investments like the building of ports and highways, and the granting of low-interest infrastructure loans, China wants to ensure that regimes that govern these smaller states – in South Asia, Southeast Asia, and Africa – remain friendly to China.

There is widespread agreement that the first and foremost purpose of China outward involvement is commercial. Similarly, China, as one of the world’s largest importers of oil, wants to ensure that energy lines between the Middle East and China continue to function unimpeded. Military strategists, however, worry that many of these ports could be used by China in the case of a military confrontation.

Before his tragic death last year, I was fortunate enough to have a long conversation with Jalal Alamgir, Associate Professor of Political Science at the University of Massachusetts-Boston, about the geopolitical complexities of China’s relationship with India, Sri Lanka, and the United States. When we spoke, he was, along with many others, not convinced that China’s ultimate goal was military aggression or even ensuring that China can counter India and the United States militarily. As he told me, “One thing that has been consistent in China’s policy is actually to temper its military aggressiveness. If you compare the nature of its military expansiveness or aggressiveness to its economic rise – yes, it’s been pumping a lot of money into its military equipment, hardware, and facilities, but it has maintained consistently a very non-confrontational approach, especially when it came to the bigger powers like the U.S. and India than it could have.”

From the Chinese perspective, according to Alamgir, India is not its primary competitor. Rather, China is more concerned about the United States and its support for countries on its periphery: Japan, South Korea, and Taiwan. Indian military commentators have also been careful to not portray China’s rise as military expansion.

According to Alamgir, Indian civilian commentators, however, have not been so careful. They seem to be convinced, he pointed out, that China will ultimately “ensure not only that it has access to physical facilities that one day it can turn into military bases, but also that it wants to encircle India with friendly regimes that are closer to China than they are to India. So, Pakistan, Nepal, Bhutan, Bangladesh, Burma, Sri Lanka.”

It should be noted that China is one of the leading suppliers of arms to all of these countries. It is, in other words, through both military hardware and economic aid at concessionary rates that China keeps its ties to these countries strong. However, it is widely believed that it is too dependent on peaceful commercial ties to seriously consider military confrontation.

With respect to Sri Lanka, visits between the military brass in China and Sri Lanka have become quite regular. It is a strategic partnership that benefits both parties: Sri Lanka is in the middle of China’s sea lanes, and it makes sense for Sri Lanka to solidify closer ties with China, in case problems arose with India. It is also important to remember that Pakistan, Bangladesh, and Sri Lanka have had connections to terror incidents inside India, and Nepal has had connections to the Maoist insurgency. India, then, has reasons, if similar incidents recurred, to put these states through economic duress. They, in turn, benefit from a lifeline to China.

While China may not be interested in military aggression, it has, however, practiced a hands-off approach when dealing with regimes that have a less than stellar human rights record. Its support for regimes in Uzbekistan, Angola, the Central African Republic, Sudan, Zimbabwe, Myanmar, Sri Lanka, Cambodia, Iran, and others has proved distressing for the United States and other Western powers.

For many of these countries, China exists as what Halper has called a “path around the West” or as an “exit option” for states that have fallen out with the West. As Halper tells me, these states “accept the Beijing Consensus, which is that ‘we’ll invest in your country, we’ll extract your minerals, we’ll pay you very well. All you need to do is support us at the UN and the trade discussions on Taiwan, Tibet, and any question related to sovereignty.’ Those are the issues they require support on. If you do that, the Chinese are your friends.”


Human Rights

China’s hands-off approach to human rights violations in other countries largely stems from its very different conception of human rights itself. As Sinologists like Lucian Pye and others have noted, China’s concept of human rights emphasizes the culturally specific aspects of a country as well as the paternalistic nature of the state. As Sonny Lo, a political science professor at the University of Waterloo, told me, “China is willing to deal with countries whose human rights record is questioned by the West. The reason is, first, that China has its own conception of human rights and, second, China adopts the foreign policy of non-interference with the domestic affairs of other countries.”

Conceptions of human rights in the West, for example, emphasize individual rights as being supreme. In China, by stark contrast, it is believed that individual human rights have to be in accord with state rights. In other words, collective rights or the collective interests of the state are equally as important as individual rights. Individual rights in China, by most accounts, do not supersede the rights of the state. “In the West, we always emphasize individualism,” Lo pointed out, “China emphasizes a harmony of interests between individual rights and state interests. So the role of the state is very important in deciding the scope of rights of the individual. In Chinese tradition, the state confers the rights upon individuals whereas in the West, individuals themselves are endowed with their own rights. I think there are quite different assumptions.”

In Chinese tradition, Lo and others argue, the state has been traditionally paternalistic. It is the state that carves out the boundaries and the content of individual rights. The question arises, however, as to why China, even with its differing conception of human rights, does not seek to export it or apply it in the countries over which it has influence. Most authorities agree that China is trying to move away from its Maoist legacy, during which it was regarded as spreading communism throughout Southeast Asia. China today in no way wants to be seen as an expansionist state, or one forcibly spreading communism around the region.

Since the 1980s, China has been very careful to position itself as holding on to a principle of non-interference. “With the rise of China,” Lo argues, “the Chinese leadership is very concerned about a so-called ‘Chinese threat’ – a perception maintained by the United States and other countries – so the Chinese leadership is very keen to project an image of a peaceful rising China, rather than a threatening rising China.”

The Problem for America

The combination of these two elements in China – a different conception of human rights and a policy of non-interference – has many consequences. One consequence, Halper writes, is that “China does business with the good, the bad, and the ugly – as long as they pay.” The other, more significant, consequence is, as mentioned above, a not-so-subtle blow to Western Enlightenment identity itself. Chinese positioning on the geopolitical landscape, according to some scholars, calls into question the inevitable and necessary relationship between free market capitalism and liberal democracy.

Once the fissure is made plain, it takes a lot of effort to convince states that the two shattered pieces actually belong together. Many states would rather not be harangued by the West about human rights abuses if they can help it. If at the same time they can achieve economic prosperity by building alliances with countries that are indifferent, or at least do not interfere, in the realm of human rights, then that is indeed a bonus.

It does not help matters that the American “brand” has taken quite a beating around the world. The controversial ventures into Afghanistan and Iraq have stained the moral credibility of the United States, has weakened the country economically and, perhaps most importantly, made it clear that democratic pluralism cannot be applied universally without understanding cultural and historical particularities.

Accusations of American hypocrisy on the international stage have also caused a decline in its brand around the world. In the 1990s, for example, both Congress and the State Department expressed a commitment to ensure that American funds did not trickle into the coffers of autocratic regimes with poor human rights records. This changed, however, with the events of September 11, 2001. Almost overnight, countries, even autocratic ones, were eligible for U.S. aid and support if they offered to help in the global war on terror. Uzbekistan, Pakistan, Saudi Arabia, and Equatorial Guinea are cases often brought up by critics of Washington. As the American image – one dedicated to both economic progress and international human rights – weakened, it quickly found that pressuring states about their human rights records resulted in resentment and not-so-veiled snickers.

A case in point was Sri Lanka. Protests erupted in the capital city of Colombo as discussions and negotiations began regarding the U.S.-led resolution at last month’s session of the UNHRC. A key theme evident throughout the protests was that the United States did not have the moral authority to lecture Sri Lanka about its human rights record. A memorable photograph that circulated on the internet showed a young man holding a sign that read, “Dear US, UN, et al. Please wipe your own arse first.”

Such perceived interference in the domestic affairs of a country like Sri Lanka has no doubt helped to solidify the relationship between Colombo and Beijing. Indeed, according to sources at the UNHRC sessions, the Sri Lankan lobbying effort included the Chinese government, and Chinese officials often accompanied Sri Lankan officials when seeking the support of specific countries leading up to the vote. Of course, countries working with and supporting each other in the international arena isn’t news. However, China’s willingness to work with the “good, the bad, and the ugly” creates a kind of bifurcation of international relations where economic incentives and threats lose significance.

These are not abstract fears, but ones with mounting evidentiary support. According to Richard Gowan and Franziska Brantner, authors of a report on European power at the United Nations, the West is indeed suffering on the international playing field. Support for Chinese positions on human rights, which have significantly hindered UN intervention into humanitarian catastrophes (like Darfur and Kosovo), has increased from less than 50 percent at the beginning of the decade to over 80 percent in recent years. “The European Union is suffering a slow-motion crisis at the United Nations,” write Gowan and Brantner, “The problem is fading power to set the rules of the game. The EU’s members insist that the UN is central to their vision of international order and universal human rights – but the UN is increasingly being shaped by China, Russia and their allies.”

These trends have resulted in what Halper, quite distressingly, calls the neo-Westphalian bargain. “According to this bargain,” he writes, “sovereign states are empowered to settle the terms of existence inside their borders between the government and the governed. Internationally, they deal with each other in a strict market setting and recognize no real rights or obligations other than to fulfill agreed contracts.” Such a bargain, of course, creates problems for the continued functioning and respect of international law, human rights norms, and principles such as the Responsibility to Protect.

How is the United States responding? From their study of China, officials in the United States seem to have rightly gathered that while China adheres to a principle of non-interference, it is deeply anxious about its own reputation in the international arena. According to Halper, China is concerned because it seeks a seat at the top table in global affairs. “It wants to be a world leader,” he says, “It thinks it’s time that it is recognized as a world leader. And it believes that its contest with the United States is a zero-sum contest”

According to Halper, the Chinese government thinks that the United States is in decline and believes that it will inherit American leadership globally. To this end, it has invested much in building its own “brand” abroad. In January 2009, Beijing unveiled an ambitious global media drive, with an allotted budget of $6.8 billion, to better compete in what President Hu Jintao described as a “fierce struggle in the domain of news and opinion.” Chinese officials believe that if the world could look at China in a positive way, and admire China’s progress, they will increase their prospects for global leadership.

The American response has been interesting. The strong interdependence of the Chinese and American economies of course means that neither country can afford military hostilities. As James Mayall has succinctly put it, “The Chinese and American economies are like two drunk old men shuffling along together; if one takes a serious fall, they both go tumbling over.” Such interdependence also means that the United States is blunted in forcefully pushing for the issues integral to the international liberal order, such as human rights, the rule of law, and free speech.

While success is certainly not guaranteed, a proper understanding of these broad geopolitical dynamics reveals much about U.S. activity in recent years, especially in the international arena. Spaces like the Human Rights Council have increasingly been used by the United States to not only counter China’s presentation of itself to the world, but also to send a subtle message to smaller states under its influence (like Sri Lanka) with the hope of slowly nudging them back to the liberal democratic fold.

As events like the Arab Spring continue to transform the region, and as some African populations begin to evince anti-Chinese sentiment, the United States will seek to once again make the argument in the international arena that the Western model still has legs, that autocracies breed resentment, and that there is indeed a necessary link between liberal democracy, a respect for human rights, and economic development. Whether anyone cares to pay attention is another matter.

Amarnath Amarasingam is a Doctoral Candidate and Lecturer at Wilfrid Laurier University and the University of Waterloo in Ontario, Canada. His research interests are in social movements, diaspora studies, nationalism, media studies, and the sociology of religion. He is the editor of The Stewart/Colbert Effect: Essays on the Real Impacts of Fake News and Religion and the New Atheism: A Critical Appraisal, as well as many academic articles and book chapters. He has also contributed to The Huffington Post, The Daily Beast, The Toronto Star, and The Washington Post’s On Faith blog. He is currently writing his dissertation entitled, Pain, Pride, and Politics: Sri Lankan Tamil Activism in Canada. He can be reached through Facebook and Twitter

'Chance to build a nation with respect for HR' - Hillary

US Secretary of State Hillary Clinton in a message greeting all SriLankans around the world for the Sinhala and Tamil New Year said thatit gives an opportunity to help build a democratic nation defined bytolerance and respect for human rights. 


The message says:


"On behalf of President Obama and the people of the United States, Iam delighted to send best wishes to Sri Lankans around the world asyou celebrate Sinhala and Tamil New Year.This celebration brings people together to renew bonds of friendshipand family. 


It also gives Sri Lankans of all backgrounds, livinginside and outside the country, an opportunity to help build aprosperous, democratic nation defined by tolerance and respect forhuman rights. As a partner and friend of Sri Lanka for more than 150years, the United States looks forward to supporting your efforts tofoster national reconciliation and development, and to build evenstronger ties between our people.


Congratulations and best wishes for a safe and happy holiday and aprosperous New Year."

Kumar Sangakkara chosen by Wisden as Leading Cricketer in the World plus One of Five Cricketers of the Year for 2011

Sri Lanka’s Kumar Sangakkara has been chosen as both one of the Five Cricketers of the Year and the Leading Cricketer in the World for 2011 in the 2012 edition of Wisden Cricketers’ Almanack, it was announced on Wednesday.


The 34-year-old Sangakkara, one of the outstanding batsmen of his generation and for much of his career a top-class wicketkeeper as well, became the first man to receive both awards since Wisden, ‘cricket’s bible’, started naming a leading cricketer of the year in 2004, Times of India reported.


In 2011, no-one else came close to the 2,267 runs Sangakkara scored in all international cricket, and he is now the only man to have topped 1,000 runs in Tests and one-day internationals in a single year on three separate occasions.


The left-hander also captained Sri Lanka to the World Cup final, where they were beaten by co-hosts India in Mumbai.


Off the field, he also received worldwide praise for giving a deeply heartfelt MCC Cowdrey Lecture at Lord’s which caused shockwaves in his homeland when he called for the end of political interference in Sri Lankan cricket.


Sangakkara’s career Test record of over 9,000 runs in 108 matches with 28 hundreds at an average of nearly 55 stands comparison with all but a handful of cricket’s greatest batsmen.


Wisden, published every year since 1864, is widely regarded as cricket’s leading reference work.


The Five Cricketers of the Year, chosen solely by the editor of Wisden — the 2012 edition is English cricket journalist’s Lawrence Booth’s first as editor — is an award that dates back to 1889.


Among the other four recipients for their performances in 2011 were the England Test duo of run-hungry opener Alastair Cook, who made 294 against India at Edgbaston, and pace bowling all-rounder Tim Bresnan, yet to be on the losing side in a Test match.


Lancashire captain Glen Chapple was also honoured after leading the Old Trafford-based club to their first outright County Championship title in 77 years, as was fellow seamer Alan Richardson, who took 73 First Division wickets to help Worcestershire avoid relegation.


No one can be chosen as one of the Cricketers of the Year, based primarily on a player’s influence upon the previous English season, more than once

Distancing from Congress and BJP

THE communists in India have preferred strategy to ideology. The occasions have been few, but they have regretted them. At the time of independence, they supported the demand of partition. Subsequently they admitted that they wrongly backed the Muslim League which represented Muslims alone. Marxism, they woefully recalled, demanded a secular approach.


At a congress in Kerala this week, the communists have departed from their vehement opposition to the BJP and instead support the party if the Congress faces the prospect of defeat. The communists have put the BJP and the Congress at par. They have even said that they would not side with the Congress to swell its strength to defeat the BJP which till yesterday represented the communal forces inimical to national interest.


The communists are justified in attacking the Congress for the scams which have cost the public exchequer billions of rupees. The communists are also correct in averring that the Congress has done little to improve the lot of minorities. But where they go wrong is when they put the two parties on the same footing. The Congress, with all its faults, has never propagated against secularism, nor has it accepted the guidance of a body like the RSS which stands for Hindu Rashtriya.


The Congress can be apportioned blame for diluting the principles of pluralism and liberalism. But the BJP has never claimed to be pursuing them. Its credentials have never been liberal from its very birth, when it was called the Jana Sangh. However, it is heartening to know that the communists will not have anything to do with the Congress.


Yet, they must admit that they have been guilty of giving the Congress the veneer of being progressive, whether it was the government of Mrs Indira Gandhi or that of Prime Minister Manmohan Singh. The Communists were partners in the first UPA (United Progressive Alliance) government. The Marxists saved it from defeat in parliament several times.


What will the communists do now when the Special Investigation Team (SIT), appointed by the Supreme Court, has exonerated Gujarat chief minister Narendra Modi from the charge of planned killings of Muslims in the state? True, though one member of SIT Ramachandran has not absolved Modi, the majority has given the clean chit. The state elections are due this year. Surely, the communists are not going to pull their punches because their criticism may help the Congress.


The entire strategy of communists is faulty. It cannot afford to stay silent on matters like communalism even if the beneficiary is the Congress. And how can a responsible party like that of the communists allow the Congress to get away with the murders of Sikhs in Delhi? The state machinery was used to connive at the murders as the Modi government did in Gujarat. The communists have to stand by the victims and the minorities without caring whether the Congress is defeated or the BJP wins.


The communists are on a strong ground when they talk about a democratic alternative. But the problem with them is that they always want to dominate the formation. And seldom do they see beyond the existing regional parties which are parochial, casteist and even communal.  These parties have failed to deliver justice in their own state as they have neither the cadres nor convictions to meet all-India challenges. How can they become an alternative?


The communists have to shed their pride and prejudice to work with the grassroots activists who are spread all over the country. Their ideology is also pro-left but they are not dogmatic or rigid. They find a common denominator among themselves to work together. But they do not compromise with communal casteist elements at any cost. The communists’ willingness to shake hands with the BJP may come in the way of joint action which the activists are proposing to initiate.


Postmortems by the Congress and the BJP of reverses in UP election have not made them any wiser. They are stuck to their old thinking that some rebels cut into the official candidates’ votes or that the party wrangling were responsible for defeat. There are at best rationalizations by the two parties to sustain hope among their followers. The fact is that both parties have lost their way and do not know the direction.


Neither the Congress nor the BJP realizes that they are increasingly becoming irrelevant and look like the once-upon parties. Their statements and activities suggest that they have nothing new to offer. They go on indulging endlessly in the same slogans, the same exhortations and the same promises. The UP election, and the one held earlier in Bihar, have proved that the voters find regional parties closer to their heart and more familiar with their aspirations.


The biggest thing which has hit the two is the voters’ doubt about their integrity. They find them mixed up with the mafias and underhand deals. Manmohan Singh’s regime has been full of scams. A new one appears even before the old one recedes into the background. The BJP’s corruption in Karnataka, both economic and moral, is a continuing saga. One party blames the other but both of them, more so the Congress, are mired deep in corruption and black money. The 2G spectrum scam has reached the countryside as the Bofors gun scandal did.  


Both  parties need to have something like the Kamaraj Plan. In 1963, when Prime Minister Jawaharlal Nehru wanted to get rid of his critics in the wake of the debacle at the hands of China, he used Congress president K. Kamaraj’s proposal to force the ministers leave their cabinet berths and work in the organization. It was like Mao’s cultural revolution to let ministers and top bureaucrats soil their hands by working in the countryside. Both parties have mostly the same faces for many years. A Kamaraj plan may cleanse the stables of the parties and throw up new faces as well as ideas.


Yet an overhauling alone will not do. The parties have to change their support to the governments’ lassie fare policies. The BJP openly favours economic reforms which have been detrimental to the people of country. The communists have also extended their support to a few. The result is that the rich have become richer and the poor poorer. The criticism by the BJP on price rise or anti-poor has no meaning when the party arrays its support behind the Congress to have disastrous bills passed. What comes out is that the BJP and the Congress are the two sides of the same coin.

J’LALITHAA WITHDRAWS MP FROM PARLIAMENTARY DELEGATION’S VISIT TO SL

Criticising the joint parliamentary delegation’s proposed visit to Sri Lanka as a tourist visit conducted by the Sri Lankan government to help form a favourable opinion for itself, AIADMK general secretary and Chief Minister J Jayalalithaa announced on Wednesday that her party would not be represented in the team as initially agreed.

A 15-member all-party delegation of MPs from both Houses of Parliament led by Opposition Leader Sushma Swaraj are to visit the island nation from April 16-21 to see for itself the condition of the Sri Lankan Tamils. The AIADMK had initially agreed to send Rajya Sabha member A William Rabi Bernard as its representative.

When it was first proposed, Jayalalithaa said in a statement on Wednesday, the party was under the impression that the MPs will be able to interact with the Lankan Tamils now held within the camps for IDPs (internally displaced persons) and learn about their situation directly.

“However, the communication from the Ministry of External Affairs said there was no opportunity to speak to the affected Tamils to learn the problems faced by them. From the itinerary, it seems importance was given only to the meetings with Lankan government representatives and official feasts,” she said. “This tourist visit...seems to be tailored to form an opinion in favour of the Lankan government,” she charged.

Also, she added, there were no journalists, human rights activists or independent monitors in the team, which added to the suspicions. (IndianExpress)

Strategic reasons behind India supporting the Resolution on Sri Lanka at the UNHRC

by P.S.Suryanarayana


Abstract:


A comprehensive calculus of ethnic, political, and strategic factors has shaped India’s firm vote against Sri Lanka at the United Nations Human Rights Council on 22 March 2012. In a broad sense, India has cast a Diaspora Vote, which is compatible with the so-called ‘Indira Doctrine’ of the 1980s.


However, New Delhi, by casting its lot with the United States and by being the lone Asian voice against Sri Lanka on this occasion, has charted a newly interesting and uncharted course in foreign policy.


Introduction: ‘Indira Doctrine’


By the logic of the long-forgotten ‘Indira Doctrine’, India’s latest decisive vote against Sri Lanka at the United Nations Human Rights Council (UNHRC) makes a lot of sense.


In the early 1980s, the then Indian Prime Minister, Indira Gandhi, frequently expressed proactive concern over developments in the country’s neighbourhood. She was concerned that those developments might hurt the interests of India or the sensitivities of its ethnic groups.


No definitive foreign policy pronouncement on those lines was made, although her first comments were directed at Pakistan which was facing a gathering storm of political protest by the Movement for Restoration of Democracy (MRD). Led by Benazir Bhutto, the MRD was at the time campaigning against the then Pakistani military dictator Zia ul Haq.


Regardless of whether or not Indira Gandhi’s comments catalysed the MRD’s campaign, her statements came to be categorised as ‘Indira Doctrine’ in some quarters (and not in her political circles). The so-called ‘Indira Doctrine’ was not the Indian equivalent or version of Washington’s old Monroe Doctrine of hegemony. In today’s political idiom, the ‘Indira Doctrine’ or at least some aspects of it can perhaps be described as a ‘Diaspora Doctrine’.


Surely, New Delhi’s latest vote against Colombo in the UNHCR has not been portrayed by the present Indian Government as a revival or reaffirmation of the ‘Indira Doctrine’. But India’s championing of the “rights” of the minority group of Sri Lankan Tamils in the current situation in that island-republic can be characterised as a Diaspora Vote. It is too early to judge whether a Diaspora Vote in general and, more specifically, this particular one will enhance India’s enlightened national self-interest.


Viewed from another angle, New Delhi’s latest vote, which tilted the political scales (not the voting trend) against Colombo on 22 March 2012, smacks of a double standard in India’s own human-rights diplomacy. The vote against Sri Lanka was adopted by a majority of 24-15, with eight countries abstaining. With a total of 23 countries not having placed Colombo in the dock, as it were, there was a difference of just one extra vote against Sri Lanka in purely political (not numerical) terms. In this situation, the anti-Colombo vote by India, Sri Lanka’s closest neighbour in terms of both civilisation and geography, acquires unusual political importance.


‘Double-Standard Diplomacy’


Contrary to the calibrated enthusiasm with which New Delhi has now voted against Sri Lanka in the UNHRC, India had in the past successfully opposed being pushed into the UN dock on a human rights issue at home. Surely, the current Sri Lankan case and a past Pakistani move against India on the human rights front are not comparable in humanitarian and political terms.


A walk down the memory lane is, therefore, necessary to understand the argument about India’s current ‘double-standard diplomacy’. In 1994, Benazir Bhutto, by then Pakistan’s Prime Minister, moved heaven and earth (metaphorically) to try and get a vote passed against India in the UN Human Rights Commission (the current UNHRC’s predecessor). Her government’s campaign was rooted in the allegations that India was violating the human rights of Muslim “freedom fighters” in the Kashmir valley.


Opposing the Pakistani move, India launched a diplomatic counter-offensive. During that battle of wits, Pakistani and Western diplomats told this writer, then in Islamabad as an Indian journalist, that China and Iran were still keeping Pakistan guessing whether they would at all vote against India.


In the end, China and Iran influenced Pakistan into abandoning its quest for an anti-India vote. Benazir Bhutto was stopped in her tracks. Significantly, the Pakistani move against India had coincided with the efforts by Beijing and New Delhi to think out of the box and think of peace and tranquillity along their disputed border.


Unsurprisingly, therefore, China’s willingness to give India the benefit of the doubt was partially traceable to a new spring in their relationship at that time. As for Iran, India found it necessary to try hard before succeeding.


A Strategic Calculus and a Risk


Human rights diplomacy and strategic diplomacy may not always go together. However, it is evident that India has now jockeyed for possible but not guaranteed ‘strategic gains’ from the United States (US) in the regional and global arenas. This explains, at least partially, India’s agonised but firm choice of joining the beeline behind the US in its single-minded targeting of Sri Lanka on this occasion.


Washington’s current calculations against Colombo are a different story altogether. In sailing along with the US, New Delhi has, therefore, reckoned with or simply discounted the hazards of isolating itself in the South Asian Association for Regional Cooperation (SAARC) and also in India’s extended neighbourhood.


In the light of such a range of insightful standards, the domestic compulsion of coalition politics, which is generally believed to have influenced India’s Prime Minister Manmohan Singh, cannot fully explain its latest vote at the UNHRC.


Widespread is the perception that Singh has had to dance to the tunes of a crescendo of pro-Sri Lankan Tamil sentiment in the southern Indian state of Tamil Nadu. Conspicuous in this context is the parliamentary support that Singh’s coalition government at the pan-India level receives from the Dravida Munnetra Kazhagam (DMK) party of Tamil Nadu. Moreover, the ruling party in Tamil Nadu, led by J Jayalalithaa of the All India Anna DMK, did urge the Singh coalition, which does not include her party, to support the US-sponsored resolution against Sri Lanka. Such political peer-pressure on Singh can partially explain India’s voting choice – but only partially so.


More significantly, the other India-relevant factors rooted in the politics of this resolution are too weighty to be missed. It will, therefore, be a superficial exercise to see the Indian vote entirely under the prism of Singh’s domestic political compulsion.


The relevant UNHRC Resolution is believed to be aimed at promoting reconciliation between Sri Lanka’s majority Sinhala population and the island-country’s minorities, including the Sri Lankan Tamils. South Indians – the people of Tamil Nadu in particular but also those of Andhra Pradesh, Kerala, and Karnataka – share the Dravidian ethnic identity with the Sri Lankan Tamils. While Sri Lanka’s Sinhala majority, too, has deep links of history and civilisation with India, this aspect has not had commensurate salience in the contemporary narrative of the relations between the two countries.


It is noteworthy in this sub-context that the relevant UNHRC Resolution makes no direct mention at all of the minority rights of Sri Lankan Tamils by name. Nor is the resolution explicit about another key issue: the alleged extra-judicial killings of the Liberation Tigers of Tamil Eelam (LTTE) activists during Sri Lanka’s recent military triumph in an anti-terror war.


This particular micro-aspect can be explained by the fact that the wider international community saw, and continues to see, the LTTE as a notorious terrorist outfit. The LTTE’s colours are no different in Official India’s view. Interestingly, the now-slain LTTE leader, Velupillai Prabakaran, had told me in the 1980s that he would not become a slave of India in any situation (quoted in The Peace Trap authored by this writer at that time).


UNHRC’s Concerns and Call


The three essential elements of the relevant UNHRC Resolution are:


(1) the Council’s “concern that the report of the Lessons Learnt and Reconciliation Commission of Sri Lanka [LLRC] does not adequately address serious allegations of violations of international law” by the victor, Colombo;


(2) the Council’s “call” that the Sri Lankan Government “implement the constructive recommendations made in the report of the [LLRC] and … take all necessary additional steps to fulfil [Colombo’s] relevant legal obligations and commitment to initiate credible and independent actions to ensure justice, equity, accountability and reconciliation for all Sri Lankans; and


(3) the move by the UNHRC to “encourage the Office of the United Nations High Commissioner for Human Rights and relevant special procedures mandate holders to provide, in consultation with and with the concurrence of the Government of Sri Lanka, advice and technical assistance on implementing the above-mentioned steps”.


Inherent in this long-winded language of the UNHRC are two defining interpretations of this resolution.


First, the Sri Lankan Government, often seen outside as an overwhelmingly Sinhala-dominant executive, has been censured for not having moved towards ensuring post-conflict reconciliation among all communities in that country.


The second and no less important interpretation flows from India’s strategic calculations in having succeeded in amending the original draft to make it more balanced with reference to Colombo’s sovereign rights.


It is true that India’s intervention has not diluted the originally intended censure of the Sri Lankan Government. The absence of a direct reference to the Sri Lankan Tamils as the group in dire need of a healing touch from Colombo can only be seen by the Sri Lankan authorities as a matter of cold comfort.


However, such an explicit omission by the UNHRC does not lend decisive credence to the commonplace theory that Singh has pursued a purely domestic political agenda. The reasoning on these lines helps open up the window on New Delhi’s strategic calculations, which override the political irony of India being the lone Asian voice against Colombo in the UNHRC at this time.


New Delhi has in fact sought to stamp its strategic authority on India’s perceived sphere of influence – South Asia. In the process, New Delhi may have to pay a diplomatic price for being the solitary opponent of Colombo among the eight South Asian and East Asian members of the UNHRC. Of course, this scenario will become a reality only if India comes to be seen as an uncritical camp-follower of the US over the long term.


Defining India’s Diaspora Vote


However, New Delhi cannot also afford to discount the line-up of the UNHRC members from South Asia and East Asia who chose to differ with India on the current human rights situation in Sri Lanka. Significantly, Bangladesh and Maldives – both SAARC members like India and Sri Lanka – voted against the US-sponsored resolution and, therefore, in favour of Colombo.


Moreover, Indonesia, Philippines (quite often a supporter of the US), and Thailand – all three from the Association of Southeast Asian Nations (ASEAN) – favoured Sri Lanka. No less significantly, Malaysia, an ASEAN member with an ethnic-Indian minority, abstained from voting on this anti-Colombo resolution. Abstention was indeed an option which was open to India too.


China from East Asia and Russia from Eurasia – both veto-empowered permanent members of the UN Security Council – turned their faces against the US, another unique power at the United Nations. In a sense, there is nothing very unusual about such an adversarial line-up of the US on one side and China as also Russia on the other, especially on the issue of state-sovereignty over human rights. Nevertheless, what is noticeable is that India stands isolated from, or stands alone among, the UNHRC members from the South Asia-East Asia-Eurasia arc.


A logical question, therefore, is: Why has India chosen to vote against Sri Lanka, a fellow-democracy with some ethnic diversity?


Two of India’s strategic objectives, which define its latest Diaspora Vote, can be discerned behind the diplomatic scenes.


The first strategic objective, which India has achieved in this context, is to set a precedent of an explicit norm for any future international vote on the human rights situation in any country. The US, in its original draft against Sri Lanka at this time, wanted the UNHRC to “encourage the Office of the United Nations High Commissioner for Human Rights [UNHCHR] … to provide, and [encourage] the Government of Sri Lanka to accept advice and technical assistance”.


An uncontested version in the public domain is that it was at India’s intervention that the substantive wording of this operative passage was altered to give Sri Lanka the elbow room to refuse to play ball with the UNHCHR. The relevant passage, as finally passed, reads as: … to “encourage the [UNHCHR] to provide, in consultation with and with the concurrence of the Government of Sri Lanka, advice and technical assistance”.


Now, the UN High Commissioner for Human Rights cannot at all hope to ‘set right’ the situation in Sri Lanka without its government’s explicit concurrence. By ‘engineering’ this, India has clearly sought to stamp its strategic authority as a norm-formulator in South Asia, at least in respect of some issues.


However, a related question is: Why has the US winked at India’s sleight of hand in enshrining this ‘non-intrusive’ provision? At one level, the elbow room, which Sri Lanka has been given now, is in any case available to all sovereign states under international law and the UN Charter. At another level, it is also evident that the US will, therefore, continue to “impose pressure” (China’s words) on Sri Lanka for strategic purposes.


Closely related to this aspect is India’s second strategic objective in voting with the US now. For a variety of reasons outside the scope of this analysis, India has in recent times ceded considerable space to China, in terms of diplomatic and strategic influence, in Sri Lanka. And, in a recent ISAS Interview, India’s External Affairs Minister S M Krishna steered clear of saying whether New Delhi would or would not seek commercial and naval access to the Sri Lankan coastline to match China’s presence at Hambantota.


In these circumstances, India’s new closeness to the US on Sri Lankan affairs will be fully explored by both New Delhi and Washington for mutual gain, especially if the need arises.


Conclusion: A Critical Moment


Viewed differently, India’s latest decision to vote against Sri Lanka, despite Colombo’s closeness to China, is seen by some observers as a sign of New Delhi growing out of its Beijing-fixation in South Asia. Regardless of any such perspective, India cannot afford to discount the current and potential roles of both China and the US as major players in South Asia.


Overall, it will be interesting to watch whether Sri Lankan President Mahinda Rajapaksa would make any new strategic move to contain the fallout of Colombo’s latest setback at the UNHRC. What he needs most is to retain optimism as a politician. During his recent visit to Singapore, Rajapaksa did indicate that he saw himself as an optimist-politician who would be willing to weather political storms without getting disheartened.


While in Singapore, Rajapaksa made no secret of his belief that his administration’s overtures to the Sri Lankan Tamils had not received a matching appreciation from the wider international community. He also appeared keen to let the world take a dispassionate look at his administration’s ongoing efforts to reach out to the Sri Lankan Tamils, Muslims, and other minorities. It is now up to him to face this new challenge (or crisis, as some would say) as he deems fit.


Mr P S Suryanarayana is Editor (Current Affairs) at the Institute of South Asian Studies (ISAS), an autonomous research institute at the National University of Singapore. The views expressed are those of the author and do not necessarily reflect those of the institute.