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Subject: Bilateral Relations

1. Major World Events
2. India’s Interests in neighbourhood
3. Effects of our Policies

  • Bhutan-China Border Agreement

    In a step towards resolving their boundary disputes, Bhutan and China signed an agreement on a three-Step roadmap to help speed up talks to “break the deadlock” in negotiations.

    Bhutan-China Border Issues

    Bhutan shares an over 400-km-long border with China.

    • Doklam: China wants to exchange the valleys to the north of Bhutan with the pasture land to the west (including Doklam), totalling 269 square kilometres.
    • Jakarlung and Pasamlung valleys: located near Tibet to Bhutan’s North, which measure 495 sq. kms.
    • Sakteng Wildlife Sanctuary Project: China claims this area (near to Arunachal Pradesh) in eastern Bhutan as its own.

    What is the recent agreement?

    • The roadmap “for Expediting the Bhutan-China Boundary Negotiations”, is expected to progress on the boundary talks process that has been delayed for five years.
    • It was stalled due to the Doklam standoff in 2017, and then by the Covid Pandemic.
    • Although China and Bhutan do not have official diplomatic relations they have engaged in 24 rounds of ministerial-level talks to resolve their border dispute.

    Implications for India

    The boundary issue between China and Bhutan is special because it not only relates to Bhutan but also has become a negative factor for China-India ties.

    • China control much of the Doklam: Since the 2017 stand-off with India, Beijing has already strengthened its de facto control over much of the Doklam plateau, located strategically along the India-China-Bhutan trijunction.
    • Bhutan supports it: This agreement has been equally endorsed and appreciated by Bhutan and China.
    • Deadlock at LAC talks: Its timing is particularly significant New, given India-China border talks on their 17-month-old standoff at the Line of Actual Control appear to have hit an deadlock.
    • India’s strategic risks: This has big implications for India, since the Doklam swap would have given China access to the strategically sensitive “chicken neck” of the Siliguri corridor.

    India’s interest

    (a) Doklam

    • The Doklam plateau remains hugely critical for India due to the Siliguri Corridor that lies to the south of Doklam.
    • The corridor, also known as the ‘Chicken’s Neck’, is a 22-km wide major arterial road connecting mainland India with its northeastern states and thus it is a highly sensitive area for China.

    (b) Sakteng: the hotspot

    • The Sakteng sanctuary adjoins West Kameng district and Tawang disticts in India’s Arunachal Pradesh state.
    • Its strategic value lies in its proximity to Arunachal Pradesh, where China claims around 90,000 sq km of Indian territory.
    • Tawang, the major bone of contention between India and China in the eastern sector of their border dispute, lies to the northeast of the Sakteng.

    Conclusion

    • Bhutan has to balance its ties with India as well as China.
    • We need to explore channels that India can activate with Bhutan when it comes to the highly sensitive matter of settling the boundary dispute between them and China.

     

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  • India-Central Asia relations

    In his speech at the Shanghai Cooperation Organization (SCO) meet last month, PM Modi stressed on commitment for increasing its connectivity with land-locked Central Asia.

    What is the Central Asia Region?

    • Central Asia is a region in Asia which stretches from the Caspian Sea in the west to China and Mongolia in the east, and from Afghanistan and Iran in the south to Russia in the north.
    • It includes the former Soviet republics of Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan.

    India-Central Asia Ties

    • India has decades-old wish to connect with the resource and fuel-rich Central Asian nations.
    • Since the emergence of the Central Asian Republics as independent countries in the early 1990s, New Delhi has been trying to establish ties with them.

    Trade and collaboration

    • India’s trade with the five Central Asian Republics—Kazakhstan, Uzbekistan, Turkmenistan, Kyrgyzstan and Tajikistan—was below $ 2 billion in 2018.
    • The potential areas for collaboration include construction, sericulture and pharmaceuticals to IT and tourism.
    • Much of this trade was routed through Iran, Russia or the United Arab Emirates (UAE).

    Efforts for connectivity

     

    1. Turkmenistan–Afghanistan–Pakistan–India (TAPI) Gas Pipeline
    2. Development of Iran’s Chabahar Port
    3. Zaranj-Delaram Highway
    4. International North-South (Transit) Corridor (INSTC)

    About INSTC

    • In 2000, India, Iran and Russia agreed on a new route for trade that later came to be known as INSTC.
    • It was aimed at cutting the costs and time in moving cargo between Russia and India.
    • The pact was ratified in 2002 and the original multi-modal route linked Mumbai in India to Bandar Abbas and Bandar-e-Anzali in Iran, then across the Caspian Sea to Astrakhan, Moscow and St. Petersburg in Russia.
    • Over the years, more countries joined the INSTC.
    • In 2003, India and Iran announced the development of the Chabahar port in the Sistan-Balochistan province.

    China’s opportunism: Based on proximity

    • China’s trade with Central Asia was $50 billion-$60 billion in the same period.
    • The obvious advantage in China’s favour is geographical proximity.

    Hurdles for India

    • Lack of mutual trust: Unfortunately, many connectivity options are not open to them today due to the lack of mutual trust.
    • Pakistan factor: Tensions with Pakistan mean there is no viable land route towards Central Asia.
    • Iran and the US sanctions: Efforts to look for a circuitous route via Iran (and Afghanistan) have stalled due to US sanctions on Iran.

    Issues in Iran-Afghanistan bypass route

    Recent events acquire broader geopolitical relevance for India in this route:

    • Taliban takeover of Afghanistan: The takeover of Afghanistan by the Pakistan-backed Taliban has severely set back India’s plans in Central Asia.
    • Iran’s bypassing of India: Iran’s overtures has been clearly visible after itself allocating Farzad-B Gas exploration contract to another company bypassing India.

    Central Asia’s importance for India

    • Fossil fuels: While Central Asia is seen as fuel-rich and, hence, important for an energy-starved India.
    • Mineral richness: Central Asian states are also mineral-rich, and Kazakhstan, for one, has been a source of uranium for India’s nuclear power plants.
    • Market for India: A country like India which is seen as a major economy has to have a presence in these markets. INSTC also offers a safe and cost-effective route to the EU (European Union) market.
    • Convergence against Terrorism: India can forge a common position on terrorism and radicalization, which is a matter of concern to the region as much as it is to India.

    India’s recent engagement

    • Defence collaboration: In recent years, New Delhi has engaged with Central Asian Republics in the defence sphere through military exercises (say Ex Kazind).
    • Engagement at UN: Political and economic engagement is also important, given the imperatives of working together at a body such as the United Nations (UN).
    • Technological ties: India has set up universities there—Sharda and Amity are examples.

    Scope for expansion

    • Dairy Sector: There is scope for collaboration in the dairy sector.
    • Pharma: Indian firms have been setting up pharmaceutical units in Russia that can serve these countries as well.
    • Info Technology: IT and IT-enabled services are two other areas.
    • Cultural connect: Bollywood movies are quite famous in these countries.

    Way forward

    • India needs to develop into stronger bonds of trade and commercial bonds which will be possible once the INSTC crystallizes.

    Conclusion

    • The road ahead in the short term is difficult as India doesn’t seem to have any real leverage to get the connectivity projects with Central Asia going.
    • India has been negotiating with individual bilateral partners though.

     

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    Also read:

    [Burning Issue] Ashgabat Agreement

  • Europe as a valuable strategic partner

    Context

    Last week’s in-person summit in Delhi was with the Danish prime minister, Mette Frederiksen.

    Europe as a valuable partner

    • Few Asian countries view Europe with strategic suspicion. Many in Asia see Europe as a valuable partner.
    • As the deepening confrontation between the US and China begins to squeeze South East Asia, Europe is widely seen as widening the strategic options for the region.
    • The perspective is similar in Delhi, which now sees Brussels as a critical element in the construction of a multipolar world.
    • Cultivate Europe: As External Affairs Minister Subrahmanyam Jaishankar puts it, India’s strategy is to “engage America, manage China, cultivate Europe, reassure Russia, bring Japan into play”.
    • EU’s Strategy for India: The EU outlined a strategy for India in 2018 to focus on four themes — sustainable economic modernisation, promotion of a rules-based order, foreign policy coordination, and security cooperation.
    • At the summit in Portugal in May this year, the EU and India agreed to resume free trade talks and develop a new connectivity partnership that would widen options for the world beyond the Belt and Road Initiative.
    • Rebalancing the international system: Above all, there is a recognition in both Delhi and Brussels that the India-EU strategic partnership is crucial for the rebalancing of the international system amidst the current global flux.

    Possibilities with smaller European countries

    • Europe looms so large in the Indian diplomatic agenda today and smaller European states draw unprecedented political attention from Delhi.
    • That Denmark, a country of barely six million people, can establish a significant green partnership with India, is a reminder that smaller countries of Europe have much to offer in India’s economic, technological, and social transformation.
    • Luxembourg brings great financial clout, Norway offers impressive maritime technologies, Estonia is a cyber power, Czechia has deep strengths in optoelectronics, Portugal is a window to the Lusophone world, and Slovenia offers commercial access to the heart of Europe through its Adriatic sea port at Koper.
    • As India begins to realise this untapped potential, there are new openings with the 27-nation EU headquartered in Brussels.

    EU’s important role in Indo-Pacific

    • The EU’s Indo-Pacific strategy is likely to have a much greater impact on the region more immediately and on a wider range of areas than military security.
    • Area’s of impact range from trade and investment to green partnerships, the construction of quality infrastructure to digital partnerships, and from strengthening ocean governance to promoting research and innovation.
    • Defence and security are important elements of the EU’s Indo-Pacific strategy that “seeks to promote an open and rules-based regional security architecture, including secure sea lines of communication, capacity-building and enhanced naval presence in the Indo-Pacific.
    • Whatever the specific circumstances of the AUKUS deal and its impact on France, the US wants all its partners, especially Europe, to contribute actively to the reconstitution of the Asian balance of power.
    • Working with Quad: The EU strategy, in turn, sees room for working with the Quad in the Indo-Pacific, while stepping up security cooperation with a number of Asian partners, including India, Indonesia, Japan, the Republic of Korea, Singapore and Vietnam.
    • India is conscious that Europe can’t match America’s military heft in the Indo-Pacific.
    • But it could help strengthen the military balance and contribute to regional security in multiple other ways.

    Consider the question “Delhi knows that Europe could significantly boost India’s capacity to influence future outcomes in the Indo-Pacific. It would also be a valuable complement to India’s Quad coalition”. Comment.

    Conclusion

    It was Russia that defined India’s discourse on the multipolar world after the Cold War. Today, it is Europe — with its much greater economic weight, technological strength, and normative power — that promises to boost India’s own quest for a multipolar world and a rebalanced Indo-Pacific.

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  • Explained: Patrolling Points along LAC

    The standoffs between Indian and Chinese troops in Ladakh on the Line of Actual Control (LAC), where initial steps towards disengagement have taken place, are around a number of patrolling points or PPs in Galwan, Hot Springs and Gogra areas.

    What exactly are Patrolling Points?

    • PPs are patrolling points identified and marked on the LAC, which are patrolled with a stipulated frequency by the security forces.
    • They serve as a guide to the location of the LAC for the soldiers, acting as indicators of the extent of ‘actual control’ exercised on the territory by India.
    • By regularly patrolling up to these PPs, the Indian side is able to establish and assert its physical claim about the LAC.

    Are all the Patrolling Points numbered?

    • Some of the PPs are prominent and identifiable geographical features, such as a pass, or a nala junction where no numerals are given.
    • Only those PPs, where there are no prominent features, are numbered as in the case of PP14 in Galwan Valley.

    Are all on the Patrolling Points bang on the LAC?

    • Mostly, yes. Except for the Depsang plains in northern Ladakh, where PP10, PP11, PP11A, PP12 and PP13 – from Raki Nala to Jivan Nala – do not fall on the LAC.
    • These are short of the LAC, on the Indian side.

    Are these Patrolling Points not manned?

    • The PPs are not posts and thus not manned.
    • Unlike on the Line of Control (LoC) with Pakistan, the border with China is not physically held by the Army all along.
    • They are just physical markers on the ground, chosen for their location and have no defensive potential or tactical importance for the Army.

    If the Patrolling Points are not manned, how is the claim actually asserted?

    • The claim is asserted by the Army or joint Army-ITBP patrols as they show more visible presence in these areas.
    • This is done by physically visiting PPs with a higher frequency, as the deployment has moved closer to the LAC and due to improved infrastructure.
    • As the Chinese may not see when the Indian patrols visit these PPs, they will leave come cigarette packets or food tins with Indian markings behind.
    • That lets the Chinese know that Indian soldiers had visited the place, which indicates that India was in control of these areas.

    Who has given these Patrolling Points?

    • These PPs have been identified by the high-powered China Study Group, starting from 1975 when patrolling limits for Indian forces were specified.
    • It is based on the LAC, after the government accepted the concept in 1993, which is also marked on the maps with the Army in the border areas.
    • But the frequency of patrolling to PPs is not specified by the CSG – it is finalised by the Army Headquarters in New Delhi, based on the recommendations made by the Army and ITBP.

    What is this frequency?

    • The frequency of reaching various PPs are given in the annual patrolling programme.
    • Based on the terrain, the ground situation and the location of the LAC, the duration for visiting each PP is specified – it can vary from once a month to twice a year.

    Major friction area: Hot Springs

    • Hot Springs lies in the Chang Chenmo River valley, close to Kongka La, a pass that marks the Line of Actual Control.
    • India’s Patrolling Point 15, it is not a launchpad for any offensive action though the area did see action before and during the 1962 war.
    • China’s unwillingness to pull back its platoon-sized unit from Hot Springs is a sign of the difficulties that lie in normalising the situation.
    • The PLA has traditionally had a major base east of Kongka La.
    • The pass also marks the border between two of China’s most sensitive provinces — Xinjiang to the north and Tibet to the south.

     

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  • A strategy for India in a world that is adrift

    This article discusses new situations prompted by the tectonic shifts in India’s internal and external environment to take another look at India’s path to power in a world between orders.

    New global order: No Order

    • Multipolarity: The world is today adrift. We are neither in a bipolar Cold War nor in a multipolar world, though perhaps tending towards a world of several power centres.
    • Lack of cohesion: The lack of a coherent international response to the COVID-19 pandemic is proof of an absence of international order and of the ineffectiveness of multilateral institutions.
    • Climate ignorance: So is the ineffective international response to climate change and other transnational threats.

    What are the major shifts in global order?

    • Secular stagnation
    • Retreat from globalisation
    • Regionalisation of trade
    • Shifting balance of power
    • Rise of China and others
    • Structural China-United States strategic rivalry

    All above factors have shifted the geopolitical and economic centres of gravity from the Atlantic to Asia.

    Major Concerns

    • Chauvinism: Inequality between and within states has bred a narrow nationalism and parochialism.
    • Existential threats: We are entering a new polarised information age, and face ecological crises of the Anthropocene, making climate change an existential threat.

    Asia as the nucleus: With focus on China

    • Shift of focus by the US: Over the next decade we expect Asia to remain the cockpit of geopolitical rivalries, and that the US remains the most formidable power, though its relative power is declining.
    • China at the centre: China sees a window of opportunity but acts in a hurry, suggesting that she believes that window may close or is already closing due to push back from the West and others.

    China’s expansionism

    • China’s crowded geography constrains her both on land and at sea.
    • Hence it expects her profile and power to continue expanding, particularly in our periphery.
    • The result is likely continued friction, some cooperation, and quasi-adversarial relations between India and China, which others will take advantage of.
    • Overall, we do not expect conventional conflict between the great powers in Asia, though other forms and levels of violence and contention in the international system will rise, with Taiwan a special case.

    Opportunities in disguise for India

    • The uncertainty and changing geopolitical environment clearly pose considerable challenges to Indian policy.
    • However, it also throws up certain opportunities, enhancing our strategic options and diplomatic space, if we adjust policies internally and externally, particularly in the subcontinent.

    How can India reap the benefits?

    • Enhancing ties with the US: Increasing security congruence with the US could enable growing cooperation in fields significant for India’s transformation: energy, trade, investment, education and health.
    • Climate cooperation: Other areas in which India and the U.S. could increase cooperation are: climate change and energy, tech solutions for renewable energy, and on digital cooperation.
    • Neighbourhood first: Several middle powers like Sri Lanka, Bangladesh, Indonesia in the neighbourhood are now India’s natural partners.
    • Digital space: This time of transition between orders is also when new standards and norms are being developed, particularly in the digital space. India can and must be present at the creation.
    • Maritime cooperation: At sea, the balance is today more favourable to us than before, possibly more so than on the continent. India must bat for the creation of a Maritime Commission in IOR.

    Bottlenecks in India’s neighbourhood policy

    • Over securitisation of policy: towards our neighbours has driven trade underground, criminalised our borders.
    • Conducive environment for entry of China: This has enabled the large-scale entry of Chinese goods destroying local industry in the northeast.
    • Lack of self-strengthening: While lessening dependence on China, and seeking external balancing, our primary effort has to concentrate on self-strengthening.
    • Lack of socio-political enterprise: If there is one country which in terms of its size, population, economic potential, scientific and technological capabilities can match or even surpass China, it is India.

    Way forward for India

    (A) Bringing multipolarity in Asia.

    • The way forward should be based on the core strategic principles in Non-Alignment 2.0 which are still relevant: independent judgement, developing our capacities, and creating an equitable and enabling international order for India’s transformation.
    • Today’s situation makes India’s strategic autonomy all the more essential.

    (B) Making an issue-based coalition

    • India must adjust to changing circumstances. We have no choice but to engage with this uncertain and more volatile world.
    • One productive way to do so would be through issue-based coalitions including different actors, depending on who has an interest and capability.

    (C) Reviving SAARC

    • India must craft and reinvigorate regional institutions and processes in the neighbourhood, reviving the South Asian Association for Regional Cooperation (SAARC) for instance.
    • India could be the primary source of both prosperity and security in the neighbourhood — the subcontinent and the Indian Ocean Region.

    Conclusion

    • Economic policy must match political and strategic engagement.
    • Globalisation has been central to India’s growth.
    • A more active regional and international role for India is incompatible with a position on the margins of the global economy.
    • Self-reliance in today’s world and technologies can only be realised as part of the global economy.
    • We should not imitate China’s claims to being a civilisational state and its adoption of victimhood.
    • Instead, we should affirm our own strength and historic national identity.

     

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  • Outer space

    In opening new pathways for outer space cooperation in the recent US visit, PM Modi has positioned India to engage more productively with a rapidly evolving domain that is seeing more commerce and contestation.

    Outer Space Cooperation: A backgrounder

    • International cooperation is the new normal in space exploration, but it’s not a new concept.
    • One example of this cooperation is the International Space Station (ISS).
    • Another advance in international cooperation in the peaceful exploration of outer space came with the Artemis Accords.
    • Introduced in October 2020, the Artemis Accords establish a set of principles to guide space cooperation among countries participating in NASA’s Artemis program.

    There are five treaties that deal with issues related to outer space

    1. Moon Treaty: Non-appropriation of outer space by any one country, arms control, the freedom of exploration
    2. Liability Convention: Liability for damage caused by space objects
    3. Rescue Agreement: Safety and rescue of spacecraft and astronauts
    4. Outer Space Treaty: Prevention of harmful interference with space activities and the environment
    5. Registration Convention: Notification and registration of space activities, scientific investigation and exploitation of natural resources in outer space and the settlement of disputes

    Why does Outer Spaces matter?

    • Space situational awareness (SSA) involves monitoring the movement of all objects — natural (meteors) and man-made (satellites) — and tracking space weather.
    • Today, space is integral to our lives and disruption of space-based communications and earth observation will have serious consequences.

    India’s strategic interest in Outer Space

    Delhi’s new strategic interest in outer space is based on a recognition of two important trends.

    1. Centrality of emerging technologies in shaping the 21st-century global order
    2. Urgency of writing new rules for the road to peace and stability in outer space

    Why need US for this?

    • Technology cooperation has always been an important part of India-US relations.
    • But it has been a boutique discourse between the relevant agencies of the two governments.
    • The US has traditionally dominated outer space in the commercial domain.
    • As emerging technologies overhaul global economic and security structures, Delhi and Washington now have to widen the interface of technology.

    Why need a comprehensive outer space treaty?

    • Although human forays into space began in the middle of the 20th century, the intensity of that activity as well as its commercial and security implications have dramatically increased in recent decades.
    • Outer space has become a location for lucrative business as well as a site of military competition between states.
    • Until recently, outer space has been the sole preserve of states. But private entities are now major players in space commerce.
    • At the same time, as space becomes a critical factor in shaping the military balance of power on the earth, there is growing competition among states.

    Expanding QUAD in this term

    • Until now, the maritime domain has dominated the strategic cooperation bilaterally between Delhi and Washington as well as within the Quad.
    • The annual Malabar naval exercise, for example, began nearly three decades ago as a bilateral venture in 1992 and became a quadrilateral one in 2020 with the participation of Australia.

    Why does US need India in OST?

    • India, which has developed significant space capabilities over the decades, is a deeply invested party.
    • The US recognises that it can’t unilaterally define the space order anymore and is looking for partners.
    • International cooperation on space situational awareness is similar to the agreements on maritime domain awareness — that facilitate sharing of information on a range of ocean metrics.
    • India has been strengthening its maritime domain awareness through bilateral agreements as well as the Information Fusion Centre for the Indian Ocean Region (IFC-IOR) at Gurugram.
    • India has also taken tentative steps to cope with the unfolding military challenges in outer space.
    • It has also initiated space security dialogue with close partners like the US, Japan, and France.

    Making a first global move

    • When signed, the agreement with the US on SSA will be the first of its kind for India.
    • Washington has agreements with more than two dozen countries on SSA.
    • The US and Indian delegations have also discussed a US initiative called the Artemis Accords — that seek to develop norms for activity in the Moon and other planetary objects.

    Way forward

    • As commercial and military activity in outer space grows, the 20th-century agreements like Outer Space Treaty and the Moon Treaty (1979) need reinforcement and renewal.
    • The growing strategic salience of outer space demands substantive national policy action in India.
    • That can only be mandated by the highest political level. Back in 2015, PM Modi’s speech on the Indian Ocean focused national attention on maritime affairs.
    • India could do with a similar intervention on outer space today.

     

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  • India, Australia to conclude free trade pact by end 2022

    India and Australia have agreed to conclude a Free Trade Agreement (FTA) by the end of 2022.

    What is a Free Trade Agreement (FTA)?

    • A FTA is a pact between two or more nations to reduce barriers to imports and exports among them.
    • Under a free trade policy, goods and services can be bought and sold across international borders with little or no government tariffs, quotas, subsidies, or prohibitions to inhibit their exchange.
    • The concept of free trade is the opposite of trade protectionism or economic isolationism.

    Key benefits offered by FTA

    • Reduction or elimination of tariffs on qualified: For example, a country that normally charges a tariff of 12% of the value of the incoming product will rationalize or eliminate that tariff.
    • Intellectual Property Protection: Protection and enforcement of intellectual property rights in the FTA partner country is upheld.
    • Product Standards: FTA enhances the ability for domestic exporters to participate in the development of product standards in the FTA partner country.
    • Fair treatment for investors: FTA provides treatment as favourably as the FTA partner country gives equal treatment for investments from the partner country.
    • Elimination of monopolies: With FTAs, global monopolies are eliminated due to increased competition.

    How many FTAs does India have?

    • India has signed it’s first Free Trade Agreement (FTA) with Sri Lanka in 1998.
    • Likewise, India had FTAs with: Nepal, Bhutan, Thailand, Singapore, ASEAN, Japan and Malaysia.
    • India has signed Preferential Trade Agreements such as:
    1. Asia Pacific Trade Agreement (APTA) with Bangladesh, China, India, Lao PDR, Republic of Korea, and Sri Lanka
    2. Global System of Trade Preferences (GSTP)
    3. India – MERCOSUR PTA etc. with South American countries

    Back2Basics: Types of Trade Agreements

    (1) Free Trade Agreement – discussed above

    (2) Preferential Trade Agreement

    • In this type of agreement, two or more partners give preferential right of entry to certain products.
    • This is done by reducing duties on an agreed number of tariff lines.
    • Here a positive list is maintained i.e. the list of the products on which the two partners have agreed to provide preferential access.
    • Tariff may even be reduced to zero for some products even in a PTA.
    • India signed a PTA with Afghanistan.

    (3) Comprehensive Economic Partnership Agreement

    • Partnership agreement or cooperation agreement are more comprehensive than an FTA.
    • CECA/CEPA also looks into the regulatory aspect of trade and encompasses and agreement covering the regulatory issues.
    • CECA has the widest coverage. CEPA covers negotiation on the trade in services and investment, and other areas of economic partnership.
    • It may even consider negotiation on areas such as trade facilitation and customs cooperation, competition, and IPR.
    • India has signed CEPAs with South Korea and Japan.

    (4) Comprehensive Economic Cooperation Agreement

    • CECA generally cover negotiation on trade tariff and Tariff rate quotas (TRQs) rates only.
    • It is not as comprehensive as CEPA.
    • India has signed CECA with Malaysia.

    (5) Framework Agreement

    • Framework agreement primarily defines the scope and provisions of orientation of the potential agreement between the trading partners.
    • It provides for some new area of discussions and set the period for future liberalisation.
    • India has previously signed framework agreements with the ASEAN, Japan etc.

    (6) Early Harvest Scheme

    • An Early Harvest Scheme (EHS) is a precursor to an FTA/CECA/CEPA between two trading partners. For example, early harvest scheme of RCEP has been rolled out.
    • At this stage, the negotiating countries identify certain products for tariff liberalization pending the conclusion of actual FTA negotiations.
    • An Early Harvest Scheme is thus a step towards enhanced engagement and confidence building.

     

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  • Four geopolitical developments and a window of opportunity for India

    A number of important developments has taken place over the past several weeks. They may appear disconnected but in fact add up to a significant shift in regional and global geopolitics.

    Four major recent developments

    1. Withdrawal of US and NATO forces from Afghanistan: The complete takeover of the country by the Taliban
    2. Significant domestic political changes in China: The ideological and regulatory assault against its dynamic private high-tech companies and now its real estate companies
    3. Announcement of the Australia-UK and US (AUKUS): It represents a major departure in US strategy by its commitment to enable Australia to join a handful of countries with nuclear submarines
    4. Convening of the Quad physical summit in Washington: A major step towards its formalisation as an influential grouping in the Indo-Pacific going beyond security

    Risks and opportunity for India

    These four developments, taken together, present India with both risks but also with opportunities.  In affirmation, one can conclude that the opportunities outweigh the risks.

    [A] Risks in Afghanistan

    • The Afghan situation is a setback for India in the short run.
    • The political capital and economic presence it had built up in the country over the past two decades has been substantially eroded.
    • The Taliban government is dominated by more hard-line and pro-Pakistani elements.
    • They will help deliver on the Pakistani agenda of preventing a revival of Indian diplomatic presence and developmental activity in Afghanistan.

    Future of Taliban

    • In the longer run, it seems unlikely that the Taliban will give up its obscurantist and extremist agenda.
    • This may lead to domestic inter-ethnic and sectarian conflict.
    • The unwillingness of the Taliban to cut its links with various jihadi groups, including those targeting Afghanistan’s neighbours, may revive regional and international fears over cross-border terrorism.

    How should India defer the Taliban?

    • India’s response should be to bide its time, strengthen its defences against an uptick in cross-border terrorism.
    • India can keep its faith with the ordinary people of Afghanistan, provide shelter to those who have sought refuge.
    • It can join in any international effort to deliver humanitarian assistance to the people of Afghanistan.

    [B] Domestic political change in China

    • This is taking an ideological and populist direction.
    • The country’s vibrant private sector is being reined in while the State-Owned Enterprises (SOE) are back in a central role.
    • After the tech sector, it is the large real estate sector that is facing regulatory assault.

    Concerns for investors

    • This is leading to deepening concern among foreign investors, including those who have long been champions of long-term engagement with China.

    Opportunities for India

    • It is not coincidental that while in NYC, our PM had meetings with the CEOs of Blackstone and Qualcomm, both of which are heavily invested in China but are reconsidering their exposure there.
    • If India plays its cards well, this time round there could be significant capital and technology flows from the US, Japan and Europe diverted towards India because it offers scale comparable to China.
    • Since India has benign partnerships with the US, Japan and Europe, there are no political constraints on such flows.

    [C] AUKUS and QUAD

    • The AUKUS and progress made by the Quad serve to raise the level of deterrence against China.
    • It is useful since it has now become the core of the US’s Indo-Pacific strategy. China will be more focused on its activities.
    • The Quad now represents, from the Chinese perspective, a second order threat.

    Underlying opportunities

    • This offensive against China suits us since we are not ready to embrace a full-fledged military alliance which will constrain our room for manoeuvre.

    Why should India gauge these opportunities?

    • China has given up the expectation that it could unify Taiwan through peaceful and political means, including through closer economic integration.
    • It has lost its credibility after the recent crackdown on civil liberties in Hong Kong.
    • China may advance its forcible takeover of Taiwan before the AUKUS gets consolidated.
    • The nuclear submarines for Australia may not be built and deployed for several years.
    • We may, therefore, be entering a period of enhanced uncertainty and danger in the Indo-Pacific.

    India’s area for introspection

    • The constraints are policy unpredictability, regulatory rigidities and bureaucratic red tape in India.
    • Some of these issues are being addressed, such as dropping of retrospective taxation.
    • But there is still a long way to go.

    Way forward

    All these developments has heightened risk perception among international business and industry who have hitherto seen China as a huge commercial opportunity.

    • For India, some bold initiatives are required to take advantage of the window of opportunity that has opened.
    • It is a narrow window with a very short shelf life.
    • If grasped with both hands, then it could deliver double-digit growth for India for the next two or three decades.
    • This will shrink the asymmetry of power with China and expand India’s diplomatic options.

    Conclusion

    • India should not be caught off guard. Failure of deterrence in the Indo-Pacific will have consequences beyond the region and change the geopolitical context for India.
    • For now, let us focus on what we can do to advance India’s economic prospects, for which the times are unexpectedly more propitious.

     

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  • Flood management that cannot be watered down

    Over the years, many of Bihar’s districts have been facing serious challenges with recurrent and massive flooding.  It is the right time to look at some of the key aspects of India-Nepal flood management.

    Simultaneous floods in Bihar and Nepal

    • Some of Nepal’s biggest river systems originate in the Himalayan glaciers which then flow into India through Bihar.
    • During the monsoons, these river systems flood causing many problems for Bihar.
    • It is a necessity that there is process-driven coordination between the Centre and the Government of Bihar to handle the flooding in Nepal’s Terai and North Bihar (largely the Mithilanchal region).

    Which are those flooding rivers?

    • Nepal’s three biggest river systems—Kosi, Gandaki and Karnali—originate in the high mountain glaciers, flow through the country and then enter India through the state of Bihar.
    • During the monsoon season, these river systems often get flooded due to heavy rains/landslides in Nepal which create floods in India’s most flood prone state—Bihar.

    Bihar’s vulnerability

    • The history of floods in Bihar from 1998 to 2012 reveals how strong discharges of water due to heavy rains in the catchment areas of Nepal have created a strong pressure on the river embankments in India.
    • About 76 per cent of the population living in northern Bihar live under threat of floods due to these river systems and a total of 73.06 per cent of the total geographical area of Bihar is flood affected (mostly during the monsoon).

    Measures: Joint flood management program

    • As part of the long-term measures to address the problem of massive and recurrent floods in Bihar, the Joint Project Office (JPO), Biratnagar, was established in Nepal in August 2004.
    • It aimed to prepare a detailed project report to construct a high dam on the Nepal side (on the Kosi, Kamla and Bagmati rivers).

    Flaws: Yet to get effect

    • Despite the best efforts made by the Government of Bihar, the task remains unaccomplished even after 17 years.
    • The Government of Bihar has raised the matter at regular intervals for this.

    Who is the obstructionist? : Fault lies with Nepal

    • The Central Water Commission (CWC) has convened several meetings with Nepali Authorities.
    • However, what is evident is Nepal’s lack of prompt reciprocation.
    • India has long-standing water sharing issues with Nepal.

    What has been done so far?

    • As in the figures shared by Bihar, a total of four new flood protection works in the Gandak basin area were proposed before the floods of 2020.
    • There were proposed Barrage structures located in the border districts.

    Nepal’s reluctance

    • However, Nepal argues that many of the bund area falls into no man’s land along the open international border.
    • This is notwithstanding the fact that the embankment was built by India 30 years ago and there has not been any dispute regarding its maintenance all these years.

    What does this signify?

    • There is a need for India-Nepal collaboration for an efficiently operated barrage.
    • It is evident that Nepal’s attitude towards mutual issues (water sharing, flood control, etc.) has been short of collaboration, unlike in the past.

    Way forward

    • In the best spirit of friendship, Nepal and India should restart the water dialogue and come up with policies to safeguard the interests of all those who have been affected on both sides of the border.
    • It is time the two friendly countries come together and assess the factors that are causing unimaginable losses through flooding every year.
    • Optimisation of the infrastructure will be decisive in finding an alternative paradigm of flood management.
    • By controlling the flooding and using the water resources for common developmental uses such as hydroelectricity, irrigation and waterways, India-Nepal relations can be strengthened even further.
    • Moreover, it is also linked to how the Himalayan glaciers and the green cover are managed.

    Conclusion

    • Water resources are priceless assets.
    • Water cooperation should drive the next big India-Nepal dialogue, and despite the challenges, wisdom should prevail to turn the crisis into an opportunity, for the sake of development and environmental protection.

     

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  • What is Havana Syndrome?

    A US intelligence officer traveling with CIA director William Burns has reported symptoms of Havana Syndrome.

    What is Havana Syndrome?

    • Havana Syndrome refers to a set of mental health symptoms that are said to be experienced by US intelligence and embassy officials in various countries.
    • It typically involves symptoms such as hearing certain sounds without any outside noise being present, nausea, vertigo and headaches, memory loss and issues with balance.
    • As the name suggests, it traces its roots to Cuba.
    • In late 2016, US officials in embassy began experiencing sudden bursts of pressure in their brain followed by persistent headaches, feeling of disorientation and insomnia.

    How severe is it?

    • In 2018, at least three CIA officers working under diplomatic cover in Cuba had reported troubling sensations that seemed to leave serious injuries.
    • Some officers are being compulsorily retired for their inability to coherently discharge his duty and another needing a hearing aid.

    Has Havana Syndrome been reported anywhere else?

    • Since the Cuban incident, American intelligence and foreign affairs officials posted in various countries have reported symptoms of the syndrome.
    • In early 2018, similar accusations began to be made by US diplomats in China.
    • The US media has reported around 130 such attacks across the world including at Moscow in Russia, Poland, Georgia, Taiwan, Colombia, Kyrgyzstan, Uzbekistan, and Austria, among others.

    What are the causes of Havana Syndrome?

    • No one is entirely sure. But it is speculated to be a “sonic attack”.
    • Medical examination of the victims began to suggest that the victims may have been subjected to high-powered microwaves that either damaged or interfered with the nervous system.
    • It was said to have built a pressure inside the brain that generated the feeling of a sound being heard.
    • Greater exposure to high-powered microwaves is said not only to interfere with the body’s sense of balance but also impact memory and cause permanent brain damage.
    • It is suspected that beams of high-powered microwaves are sent through a special gadget that Americans have begun calling “microwave weapon”.

    Who is doing this in India?

    • Sources in the Indian security establishment say they are not aware of any such weapon being in the possession of an Indian agency.
    • Even if there was one, it is unlikely the government would admit to having acquired such counter-espionage technology given the sensitive nature of intelligence work.

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