Iqbal Latif – BRIC Plus News http://www.bricplusnews.com The Full View On The World’s Affairs Tue, 31 May 2016 14:07:40 +0000 en-GB hourly 1 https://wordpress.org/?v=4.4.1 Saudi Arabia’s economic diversification is long overdue http://www.bricplusnews.com/economics/saudis-economic-diversification-long-overdue/ http://www.bricplusnews.com/economics/saudis-economic-diversification-long-overdue/#comments Tue, 26 Apr 2016 15:51:57 +0000 http://www.bricplusnews.com/?p=12026 Today, Prince Mohammad bin Salman announced Saudi Arabia’s plans to end the country’s dependence on oil. The Kingdom will sell a 5% stake in state-run oil company Aramco, boosting their sovereign wealth fund to $2trn, for investment in technology companies. BRIC Plus spoke to Iqbal Latif about the plans, and their likely impact on Saudi [...]

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Today, Prince Mohammad bin Salman announced Saudi Arabia’s plans to end the country’s dependence on oil. The Kingdom will sell a 5% stake in state-run oil company Aramco, boosting their sovereign wealth fund to $2trn, for investment in technology companies. BRIC Plus spoke to Iqbal Latif about the plans, and their likely impact on Saudi Arabia, the Middle East region, and the world.

What was your first reaction to the news?

I am in Kuwait right now, and I am talking with a lot of people about it. It’s a very important decision that should have been taken much earlier. Saudi Arabia’s change of guard, to King Salman and his children, is why this has happened now. I think it is an extremely positive decision.

Why has Saudi Arabia decided to do this?

Quite simply, the era of oil is finished, and the Kingdom is finally waking up to this. Demand for crude oil has not progressed as it was anticipated. It was projected in the 1980’s that by 2016, oil demand would reach 115 million barrels per day – this has not materialised, reaching just 89 million. Investment banks have long bet on the theory that there were not enough hydrocarbons present in earth to satisfy demand, and this would force oil prices to reach $200 a barrel. This was incorrect. No-one anticipated the shale boom, or that deep oil wells would become profitable. No-one thought about increases in the efficiency of oil use and how it lead to a decrease in usage. This has hit Saudi Arabia, and they realised that the oil age is past its peak. Prince Mohammad bin Salman has set a tone that he is thinking of the future.

 What economic issues do they hope to solve?

Saudi Arabia has a $100bn budget deficit. I have my doubts that they will eliminate this by 2020, or even halve it within a year. However, if they cut subsidies, luxury, wasteful projects, and start living within their means this will help the economy. The people need to understand that there are no more freebies.

Is technology a major reason for this shift in focus?

Absolutely. Alternative energies, such as solar power, are increasing rapidly. Solar is the most effective, and solar panels are becoming cheaper. Technology is defeating hydrocarbons the same way the wheel defeated the Stone Age. It is a very good sign that they are thinking 20, 35 years into the future.

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Dammam, Saudi Arabia. (Courtesy: Flickr)

How does defence fit into this?

It certainly has a part of play. Saudi Arabia feels encircled by Iran, and want to develop their own arms. A major problem for Saudi financially is defence spending from the US. King Abdulaziz (Ibn Saud) agreed with the United States that in exchange for pricing oil in dollars, the US would provide the Kingdom with defence. Now, Saudi Arabia is developing new arrangements with cheaper nations to develop regional partnerships to counter Syria, Iran, the Houthis in Bahrain, and Hezbollah in Lebanon. The country is paranoid. As oil prices are down and defence remains a concern, they must increase indigenous defence spending for self-reliance. Their ability to pay for others is diminishing. By partnering with Egypt, Turkey, Pakistan, and local partners, Saudi Arabia is developing a viable strategy for that.

How easy will it be for Saudi Arabia to diversify?

A 75-year addiction and dependency will take some time to overcome. It will be a Herculean effort. However, it is a necessary battle. In 20 years time, we will be in the cheap energy era, and the beneficiaries of cheap oil will be the developing countries. The disinvestment of Aramco is a very intelligent step. Over a period of time, oil will become a redundant commodity, as the technology overtakes it. It is better to sell Aramco now, then to do it in twenty years when oil is $5 a barrel. They have realised that they have lost control over their market structure.

How will Saudi Arabia’s people react?

It will not be easy to wean the top 20% away from luxury living to living within their means. However, these changes will benefit the vast majority of the population. This plan addresses living standards, which are low for many Saudis. It will be a difficult journey for those used to luxury, but it is one that must be done.

How important is Prince Mohammad bin Salman in driving this initiative?

The prince has taken the bull by the horns. There has been an ongoing power struggle between Prince Mohammed, a son of King Salman, and Prince Naif, the official Crown Prince. Prince Mohammad has been a leader in this strategy. The youth are behind him, he is talking in terms that no Saudi royal has ever spoken before.

Is this something other nations will adopt?

Saudi Arabia, for better or worse, is a leader in the Sunni world. The country has changed. They have banned some extremist literature. These economic measures are further proof that the Kingdom is embracing change. It is a leading country of the GCC, and a model to the Sunni world. Pragmatism is much required in the region, and others may well follow their example.

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No, Indian Tolerance Has Not Changed, It Is Still A Multicultural Heaven http://www.bricplusnews.com/opinion/indian-tolerance-not-changed/ http://www.bricplusnews.com/opinion/indian-tolerance-not-changed/#respond Tue, 17 Nov 2015 15:52:46 +0000 http://www.bricplusnews.com/?p=8797 Has hate become the new mantra? No, not at all. The narrative that Indian tolerance has changed is utter nonsense. Step back from this overindulgent narrative of a new, corrosive India. We are facing an existential threat as the overflow of every small incident magnifies hate – and defuses love. India’s practice of cohabitation is [...]

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Has hate become the new mantra? No, not at all. The narrative that Indian tolerance has changed is utter nonsense. Step back from this overindulgent narrative of a new, corrosive India. We are facing an existential threat as the overflow of every small incident magnifies hate – and defuses love.

India’s practice of cohabitation is too deep-rooted for such a scenario. We, as humans, are becoming victims of our own success. Let us step back, and realise the facts. Nothing has changed. The only difference is information. The whole subcontinent has become our neighbourhood. Everything seems to be happening just outside our doorsteps. We think we are the direct victim.

Regrettably, hate and sensationalism sells, whereas ‘1.4 billion slept peacefully’ does not. Honestly, good deeds on an individual level will make our countries heaven. The example of the Pakistan-based Edhi Foundation is but one instance. The Edhi Foundation took care of Geeta, a deaf-mute Indian woman who wandered across the border to Pakistan. This kind act, and reuniting her with her family over a decade later, warmed the hearts of a billion. We need to promote love and tolerance amongst all communities.

malala[via Onedio]

In this age of connectivity, isolated incidents become huge – and create disproportionate outpourings of love or hate. The former is okay, the latter can be devastating. One hate crime or intolerant action becomes the lead story, and poisons the minds of many million. Tragedies happen. We cannot let individual acts consume us collectively.

All good work is lost in a mire of hatred. As social media users, we should try to build bridges, not burn them. We must not forget that with the increasing exchange of global information we face new challenges. A crime that was once limited to a village becomes a story of a billion hates. A small story of love becomes a story of a billion loves. This media glare is how Malala Yousafzai became the universal symbol of courage. The entire world adopted her in her heroism, a beacon standing firm against the ignorant and callous oppression of the Taliban.

The word needs acts of kindness – on an industrial scale. Otherwise we are destined for implosion. Since we live in a global neighbourhood, we are afflicted by the pain of the whole world. It becomes our own. Individual tragedies travel at the speed of light. The propensity to create hate is very high. The time has come for India to have a reckoning with its own identity. India is a paragon of cohabitation, it is time to prove this. Let us have a sensible dialogue about how to handle cow and slaughter issues. Let us not fall victim to the narrative that ‘all hell has broken loose’.

When a Hindu is individually targeted in Pakistan, the news is far more damaging than the positive impact one thousand good efforts. Similarly, when Muslims are murdered in India, the repercussions are grave, and the consequences are tragic. It is not hate that has exponentially increased. The ability to influence minds by propagating hate-filled news has gone up. People think India has lost tolerance.

I don’t buy it. It is the negative information overflow that is killing us. We need to stem the tide. We must build bridges of understanding. We must demote hate-mongers who do not understand that hate kills. If we do not, it threatens to consume us all.

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Forget GDP, the Wealth Of A Nation Is Its People http://www.bricplusnews.com/opinion/wealth-nation-people/ http://www.bricplusnews.com/opinion/wealth-nation-people/#respond Sun, 08 Nov 2015 15:28:04 +0000 http://www.bricplusnews.com/?p=8644 The wealth of nations is not determined by GDP. The real wealth of a country are its people. It is clear that national ignorance is the priciest retribution – and it is self-enacted. One need only to take a look at the poorest and most war-ravaged nations of the world to see that this is [...]

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The wealth of nations is not determined by GDP. The real wealth of a country are its people. It is clear that national ignorance is the priciest retribution – and it is self-enacted. One need only to take a look at the poorest and most war-ravaged nations of the world to see that this is the case. These countries are disappointingly ignorant and doctrinaire. Continuing to follow their doctrines leads only one way: to the bottom of the heap.

There is a reason why these nations are at the bottom. They shunned education, and so they pay a huge price. To these nations I say, your real assets are your people. Educate them and keep them healthy. A healthy and educated nation is the most powerful.

India’s Prime Minister Narendra Modi knows this. In a speech extolling the virtues of the ‘Make In India‘ campaign, Modi championed its real drivers.

“The biggest strength of ‘Make in India’ is human capital. Skill development is very essential for the success of ‘Make in India’ initiative” – Narendra Modi, Prime Minister of India

He was right. Countries that have not caught onto this mantra are doomed to pay the price. On the horizon, within the third world there are now new emerging pockets of the fourth world. Parts of South Asia, South Sudan, Somalia, cursed with the lethal mix of illiteracy, dogma, blind faith, and poor health. This is my two decades-old premise that all internecine wars are a result of low levels of primary education and vocational training for the burgeoning population of youngsters.

One of the most powerful policy instruments for promoting equity lies in education. The HDI 2013 report projects that targeted investments in girls’ education in particular, will have significant impacts on human development.

Stop for a second and ask, do we really belong at the bottom?

Secondly, the real battle for any conscientious leadership would to get out of this quagmire. The Foreign Policy survey fails to mention race as a factor in determining the ‘failed state status’ – but the list of nations makes it obvious that it is the emerging world which figures in their calculations. Factors which the survey takes into account include wars, economic failure and decline, the delegitimisation of the state, human rights abuses, and external intervention. It is therefore unsurprising that Iraq and Syria take prime positions on the list. Many countries on the list are situated in Africa. This shows the real consequences of a fast-growing youthful population which are not being encouraged to their true potential. The route to salvation is the activation of human capital. It is high time leaders of the emerging world embraced this.

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Fraud, Deception and Ineptitude: The Story of Volkswagen and the EPA http://www.bricplusnews.com/business/fraud-deception-and-ineptitude-the-story-of-volkswagen-and-the-epa/ http://www.bricplusnews.com/business/fraud-deception-and-ineptitude-the-story-of-volkswagen-and-the-epa/#respond Thu, 24 Sep 2015 10:55:56 +0000 http://www.bricplusnews.com/?p=7880 This week it was revealed that iconic German car manufacturer Volkswagen had been rigging US emissions tests to assist sales of its car as an environmentally friendly product. It is believed that 11million cars were affected. This is the ‘mother of all crimes.’ These extra emissions will mean extra deaths – from cancer or other pollution [...]

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This week it was revealed that iconic German car manufacturer Volkswagen had been rigging US emissions tests to assist sales of its car as an environmentally friendly product. It is believed that 11million cars were affected. This is the ‘mother of all crimes.’ These extra emissions will mean extra deaths – from cancer or other pollution related illnesses. This is not just a scandal, it is corporate fraud at a huge scale. Despite apologies from VW chief Martin Winterkorn and even an admission from boss of Volkswagen’s US business, Michael Horn, that the firm “totally screwed up”, I am livid at the board and its management. You simply cannot do something like this – it is so criminal that they have obscured every criminality.

Volkswagen as a huge corporation deliberately deceived regulators and consumers. This disaster will kill Volkswagen.

The Environmental Protection Agency says US Volkswagen vehicles emitted between 10,392 and 41,571 of NOx each year if they were all being judged against the 2016 model emissions standards. It means far more harmful NOx emissions, including nitrogen dioxide, have been pumped into the air than was first thought – on one analysis, between 250,000 to 1m extra tonnes every year.

The hidden damage from these VW vehicles could equate to all of the UK’s NOx emissions from all power stations, vehicles, industry and agriculture.

US emissions standards were introduced in 2007. It was these tests that forced VW to stop selling its diesel models, introducing new bestselling “clean diesel” models instead, that we now know were not especially clean at all. The treachery was hidden deep in the computer chips that operate modern vehicles, yet the cars had the EPA’s stamp of approval. All by fraud and deception.

How did they do it?

They introduced an intelligent software that was ‘evil ingenuity incarnate.’ It adjusted the engine’s output in order to reduce emissions when a car was hooked up to any testing equipment, then increased the emissions above legal levels when the car was on the road, giving the engine more power to go along with the extra smog.

EPA says the fine for this alleged deception could rise as high as $18-billion.

How were VW found out?

EPA was actually sleeping like any government agency. It was International Council on Clean Transportation (ICCT) that caught them. An NGO, the International Council on Clean Transportation (ICCT), performed independent – and crucially on-road – emissions tests, on the VW Passat, the VW Jetta, and a BMW X5. These tests followed five routes on similar lines to the EPA simulations: highway, urban, suburban and rural up/downhill driving. The emissions performance of the Volkswagen cars, but not the BMW, was so much worse than expectations that the ICCT ran further tests on a dynamometer. In these circumstances, the cars passed with flying colours. It was at this point that the ICCT contacted the EPA.

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This Is Why A Facebook Dislike Button Is A Bad Idea http://www.bricplusnews.com/affairs/facebook-dislike-bad-idea/ http://www.bricplusnews.com/affairs/facebook-dislike-bad-idea/#respond Wed, 16 Sep 2015 15:32:23 +0000 http://www.bricplusnews.com/?p=7683 Since the ‘like’ button was introduced to Facebook in 2009, a ‘dislike’ button has been constantly requested by some users. When Facebook crossed the 1 billion mark, representing a seventh of mankind, the total number of likes was less than 0.4%. Why are some so excited about a dislike button when most of us don’t even [...]

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Since the ‘like’ button was introduced to Facebook in 2009, a ‘dislike’ button has been constantly requested by some users. When Facebook crossed the 1 billion mark, representing a seventh of mankind, the total number of likes was less than 0.4%. Why are some so excited about a dislike button when most of us don’t even ‘like’ the majority of posts anyway?

This is childish and amateurish. A dislike button is unnecessary. If you don’t like a post, you can simply not read it, and scroll down. If you don’t like a person, why not unfriend them, or block them? What this vengeful dislike crowd wants, and what Facebook wants to achieve are two very different things.  For Mark Zuckerberg, it seems to all be about empathy. Some statuses, due to their emotive and distressing content, seem entirely inappropriate for a ‘like’. With a dislike button, empathy can be expressed, when clicking ‘like’ on a sad post may feel insensitive. For the vengeful crowd, the real aim is to bring others down.

Truly, the real reason people are so excited by the prospect of a dislike button is because it is far easier to write why something is terrible than why it is good. The human mind finds it far easier to dislike something, as it is hard to describe why we like something. You can be irrational and negative about the things you hate, but positive emotions require reason. The feeling of dislike comes straight from our basest animal instincts.

Some of those who want to make Facebook a place where they can ‘down vote’ other people’s posts should cool their jets. Mark Zuckerberg’s statement gave hope to those of us who don’t want Facebook to descend into a hole of negativity. Zuckerberg said that he did not want it to be a mechanism for down voting others. I hope this is the case. It would be a very sad reflection of the worst traits of humanity, if all of a sudden people began to wantonly dislike pictures of their friends’ babies, pets, and cooking experiments.

We are lucky that we are all connected through the power of social media. There is no need for insults and mudslinging matches. But, regrettably, these things occur anyway. The addition of a dislike option of Facebook will only make such exchanges increasingly likely. There is enough human hate around, we do not need to start flirting with open dislikes. Perhaps, if we were not so busy highlighting people’s shortcomings, we may find their most secret redeeming qualities.

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The Impact of Falling Oil Prices On The Global Economy http://www.bricplusnews.com/economics/impact-falling-oil-prices-global-economy/ http://www.bricplusnews.com/economics/impact-falling-oil-prices-global-economy/#respond Mon, 07 Sep 2015 17:18:06 +0000 http://www.bricplusnews.com/?p=7484 Since the 1970s, great advances in oil extraction have caused oil prices to fall. Not only this, but improvements in automobile design, shifting towards leanness and energy efficiency, have also contributed to this trend. From 2005 to 2011, when the GDP of the US increased by almost $1trn, oil consumption decreased by over 2 million [...]

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Since the 1970s, great advances in oil extraction have caused oil prices to fall. Not only this, but improvements in automobile design, shifting towards leanness and energy efficiency, have also contributed to this trend. From 2005 to 2011, when the GDP of the US increased by almost $1trn, oil consumption decreased by over 2 million barrels per day. Startlingly, though American GDP is now $6trn higher than in 2005, the US consumes less oil than it did a decade ago. But what can explain this?

Globally, 34 billion barrels of oil are consumed each year. When the barrel price of oil falls by a mere $10, this can result in a price shift of $340bn from producers to consumers. Following this, last August’s $60 price decline redistributed a staggering $2trn in savings back to oil consumers. Clearly, falling oil prices benefit net importers of oil. Any country that consumes more than it produces will gain from these changes.

The major global recessions of the past 50 years have been preceded by a sharp increase in oil prices. In 2007, in the year before the Global Financial Crisis, the price of oil almost tripled, from $50 to $140. When prices collapse, however, the story is different. Even the prices of other commodities and industrial metals increase after an oil price collapse. In 1986, after oil prices fell by 50%, the prices of metals doubled.

The income disparity between importers and exporters goes some way towards explaining these trends. Oil consuming countries spend extra income quickly, whereas oil exporters maintain public spending, and add significant funds to their sovereign reserves. One such example is Saudi Arabia. The effect of lower oil prices is positive for global growth. The IMF has projected that the recent fall in oil prices should boost 2016’s global GDP by 0.5-1%.

Many recent developments have helped to accelerate the decline in oil prices. The shale boom in the United States and its innovative extraction methods have made oil easier to obtain. Known as ‘octopus wells’, as many as 18 horizontal shafts can tap multiple separate pools from a single vertical hole. It is undeniable that the shale revolution has changed the oil industry irrevocably. As advances continue, more oil wells will become accessible, and production is set to increase further.

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Ask the Experts: Is This The Next Global Financial Crisis? http://www.bricplusnews.com/business/ask-the-experts-is-this-the-next-global-financial-crisis/ http://www.bricplusnews.com/business/ask-the-experts-is-this-the-next-global-financial-crisis/#respond Tue, 25 Aug 2015 17:46:05 +0000 http://www.bricplusnews.com/?p=7012 This week, the financial situation in China has been making headlines across the world. From the devaluation of the Yuan, to the trillions lost on the Chinese stock exchange, many are wondering how the world’s largest economy will recover, and what it means for the rest of the world. Today, China lowered interest rates causing [...]

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This week, the financial situation in China has been making headlines across the world. From the devaluation of the Yuan, to the trillions lost on the Chinese stock exchange, many are wondering how the world’s largest economy will recover, and what it means for the rest of the world. Today, China lowered interest rates causing some to draw comparison to 2008’s credit crunch. We asked the experts, is this the next global financial crisis?

Iqbal Latif, Managing Director, Gulf Real Asset Management

“The Yuan weakening was actually long overdue and the lower interest rates will help the anaemic liquidity”

China is not going to go bust any time soon. We need to look at the fear factor at play here. This week the Shanghai Composite (SSEC) dropped 8.5%, trading down -300 points and was pressing 3200. Back in July Howard Gold’s (Marketwatch) opinion was “China’s stock-market crash is just beginning” writing that “Morgan Stanley which made a good “sell” call on China weeks ago, now expects Shanghai to fall as low as 3,250 by mid-2016.” Now here we are.
The sell off is compounded by the fears that the Chinese economy may be slowing down far more drastically. China’s astonishing move to devalue its Yuan two weeks ago to make its exports competitive, and now its interest rate cuts amid intense measures to boost lending, are adding to the worries.

It is expected that there will be further easing moves and that the central bank is preparing to flood the system with liquidity to increase lending. However China’s economy is still growing at a fast clip compared with Western nations, and China has a vast $3.7 trillion in foreign-exchange reserves to help it weather shocks.

China needs a dose of quantitative easing to cope up with non-performing loans of the banks. The bursting of the property bubble and leveraged punters to the hilt have taken a heavy toll; but luckily the world demand is not slackening. China will continue to be a big exporter. The Yuan weakening was actually long overdue and the lower interest rates will help the anaemic liquidity, although it wouldn’t hurt to consult Bernanke. I see similarities to 2007/8, but the caveat is China is not hugely indebted like the Western countries were when they faced the meltdown.

 

David Powell, Chief Euro-area Economist, Bloomberg Intelligence    

“Growth in the Asian nation would have to slow much more precipitously before it would pose a big threat to the euro-area recovery.”

The biggest hit to the euro-area recovery from the slowdown in the global economy may have come already — from the downturn in Russia. The deceleration in China, by contrast, looks to be a much smaller problem for the monetary union. Growth in the Asian nation would have to slow much more precipitously before it would pose a big threat to the euro-area recovery. Russia has contributed most to the slowdown in foreign GDP growth (weighted by exports from the monetary union), which is the most important determinant of export growth, over the last year knocking 0.23 percentage point off the headline figure. China has chipped away only 0.03 percentage point.

 

Vasily Koledov, Director at Bluestone Capital Partners and BRIC+ Editor

“Whether there is going to be a major spillover into the world markets depends a lot on market perception.”

Two weeks ago China unexpectedly devalued its currency. This highlighted fears about the state of the Chinese economy and its real estate market, which many believe to be propped up by the government in order to give an appearance of stability. As a result, last week saw an 11.5% fall in the Shanghai Composite Index.

Market participants expected the government might announce a fresh loosening of monetary policy, including reductions in the proportion of deposits that banks need to hold in reserve.

However Beijing did not respond accordingly, as over the last seven weeks they have spent $200bn buying up equities to support prices and nearly $200bn of China’s FX reserves to keep the yuan from falling further since devaluation – likely deeming the operation too expensive.

What followed was yesterday’s crash which saw Shanghai Composite falling 8.5 %, its worst day since February 2007. The losses are continuing today as the market continues to lose faith in Beijing’s ability to prop up the economy.

In order to answer the question fully we must understand the roots of the crisis. Now, whether there is going to be a major spillover into the world markets depends a lot on market perception.

As it stands the majority of economic growth was really the result of governments injecting a lot of cash into the markets. This has led to government debt piling up all across the Western world so cash today has to be paid by debt tomorrow. Now, when you’re full of debt it’s harder to borrow more (or rather print more money thereby devaluing your currency as everyone has been doing) so policy responses to market shocks are now very weak.

So is this the end of the debt supercycle? Potentially. Spillover can be very bad for the wider economy however it is important to understand that the problems here are China specific and panic selling can easily be reversed if sentiment is re-established.

 

Ian Ivory, Partner at Goltsblat BLP:

“It is difficult to see which countries might gain from this situation – at the moment it is looking like a “lose, lose” outcome”

The slow-down in China will bear difficult consequences for everyone. It will heavily impact the global economy and we can expect to see a sharp fall of demand of goods and services and a significant reduction in global economic growth. The hardest hit will be its direct trading partners and in particular, the emerging economies who are providing raw materials for the One Belt One Road initiative. Russia is another classic example who will feel the pain and China will be a further negative drag on the Russian economy. It also puts into question the economic viability of the proposed energy pipelines between Russia and China. With the reduction in demand and the drop of oil prices, the upfront cost of building these pipelines is a significant burden and must surely put the projects under threat.

However, the reactions from both the mainland and internationally, point to the wider, fundamental concerns around our globalised world and how we function. What is happening in the China cannot be called a blip and is part of a wider, global problem.

Combined with the situation in Greece, the weakness of the Euro, military tensions in the Ukraine and the Middle East, the collapse of oil prices and the asset bubbles forming in a zero interest rate environment, there are some fundamental structural issues that world leaders need to urgently address. It is difficult to see which countries might gain from this situation – at the moment it is looking like a “lose, lose” outcome and the only questions are how long it will last and how deep the effects will be.

Recent events have been a major bump in the road for the global economy and represents a continuation of the volatility we have experienced since 2009. Whether it will lead to a full-blown crisis remains to be seen and it is too early to call at this stage.

 

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India Does Not Deserve Reparations For Colonial Rule – And Here’s Why http://www.bricplusnews.com/opinion-pieces/india-does-not-deserve-reparations-and-heres-why/ http://www.bricplusnews.com/opinion-pieces/india-does-not-deserve-reparations-and-heres-why/#respond Fri, 14 Aug 2015 17:01:40 +0000 http://www.bricplusnews.com/?p=6025 In a speech to the Oxford Union, Dr Shashi Tharoor made the case for the United Kingdom to pay reparations to India, its former colony. Dr Tharoor’s speech was widely appreciated in India, and even Prime Minister Narendra Modi gave it his stamp of approval. “Tharoor’s speech reflected the feelings of patriotic Indians on the issue, [...]

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In a speech to the Oxford Union, Dr Shashi Tharoor made the case for the United Kingdom to pay reparations to India, its former colony. Dr Tharoor’s speech was widely appreciated in India, and even Prime Minister Narendra Modi gave it his stamp of approval.

“Tharoor’s speech reflected the feelings of patriotic Indians on the issue, and showed what an impression one can leave with effective arguments, by saying the right things, at the right place” – Narendra Modi, Indian prime minister

India’s colonial era began in 1502, when in Kollam, the Portugeuse Empire established the first European trading centre. Through the marriage of Charles II of England to Princess Catherine of Portugal, the English crown gained possession of some Indian territories. This was the beginning of the English presence in India.

The spice trade would become the frontline of the colonial advance. In 1617, the Mughal emporer Jahangir gave the British East India Company permission to trade in India. As they increased their influence, the British East India Company was granted duty-free trade status in Bengal in 1717. The opposition of the local leader, Siraj ud Daulah, led to military confrontation with the British, in which the East India Company’s forces, named the Bengal Army defeated Nawab’s forces, which had been backed by the French. The key argument in Dr Tharoor’s speech concerned the economic toll that British rule took on India.

Quite simply, Dr Tharoor is wrong. I present a full rebuttal of his arguments – and explain how British rule actually had a positive effect on India.

We let ourselves be conquered

Dr Tharoor stated that the so-called ‘Clive of India’ treated the country as though Robert Clive himself was from the country, “when all he really did was to ensure that much of the country belonged to him”. Tharoor’s mistake is tantamount to severe historical whitewashing, forgetting about the deceit and treason of the native. How else could a nation of 100 million be conquered by so few? ‘Clive of India’ only succeeded because of the betrayal of our people, who are imbued with an intrinsic sense of treason. We were rotten, we who sold the allegiance of our Motherland for a trifle.

Before the British, India was a disunited mess

Tharoor claimed that by the fall of the 1800’s, “India was already Britain’s biggest cash cow”. Until 1947, the subcontinent was deeply separated. The British gave the subcontinent contiguity, and extending it beyond the Indus to the Durand Line, they left it an almost communicable subcontinent. Without the Raj, no-one would be able to unite the subcontinent; it was never ‘one’ the way it was once it became a federation after 1947. It was made up of about 680 ‘native states’, under hereditary rulers, the population kept subjugated into draconian systems and caste divisions. The empire lasted 200 years, and the Government of India acquired de facto and de jure control over the entirety of India. Thank the Raj. We were never ‘one’ before that.

The British liberated us from Nawabs

In 1857, there was no northern region, simply Indus and all of the lands owned by the hereditary Nawabs, in whose hands lay nearly all the wealth of the state. Without a central army that the Raj bequeathed to us, these Nawabs would have wreaked hell on the ordinary people of a balkanised subcontinent. The best thing to happen to the subcontinent was the disappearance of these 600-plus blood-sucking Nawabs.

Tharoor’s GDP argument is flawed

Dr. Tharoor made much of the fact that India’s share of the world economy seemed to fall under British rule. He claims that it was 23% at the start, and by the time the British left, it had been driven down below 4%. Tharoor claims that this is due to India being governed for the sole benefit of Britain. He completely missed the fact that India was (and remains) among the world’s most populated nations. Naturally, the GDP would consequently be high – but as the economy and productivity were very inefficient, the wealth was mostly concentrated in a few ruling hands. Furthermore, the share of world output was 23% when the world was an utterly agriculturally-based economy. India’s population was 120 million, and together with China, constituted 45% of the population of the known world, and 50.5% of its GDP. Without the Raj, we would be struggling with internecine wars, no language skills, and hugely divided land under the control of the Nawabs, with no railways making the continent one.

Without the Raj, India would have been pre-industrial

The subcontinent was lucky that as a result of the Raj we had an early rendezvous with the Industrial Revolution, fuelled by steam power. Otherwise, sans steam power, there would be no agricultural revolution, or scientific revolution. In the long run, the manual skill of the Indian artisan could be no substitute for technical progress.

India would be nowhere without the English language

If the Mughals had continued their unremitting rule of India without a proper education system introduced by the British, the overreliance on madrasas would ensure that downtown Bangalore would be a picture of day-after-day beheading, rather than India’s most important tech hub. The English language was brought by the Raj, and taught in schools and institutions as an official language in the country. They gave us the language that connected us to the world, and the long term benefits can still be seen today.

The Raj boosted India’s healthcare

An important point ignored by Dr Tharoor in the heat of the moment is overlooking the Raj’s contribution to healthcare. The control of campant diseases helped to reduce mortality rates. According to Angus Maddison, the British ensured that the death rate fell, allowing India’s population by 1947 to be more than two-and-a-half times that in 1757.

India’s agriculture was revolutionised

Tharoor made another huge omission in his speech by making no reference to the irrigation systems made by the Raj and the British that made the Punjab the granary of the subcontinent. This was the biggest gift of the Raj, with the others being the early introduction of the age of steam and industrialisation, and language. It’s no coincidence that Iran, Afghanistan and others have not seen their sons running Microsoft and top Fortune 500 countries. The Indus irrigation system is the world’s largest, and it consists of three major reservoirs, 18 barrages, 12 link canals, 25 irrigation canals, and over 107,000 water courses, with millions of farm channels and field ditches. The total length of the watercourses and field channels exceeds 1 million miles.

The railways, the postal service, every possible system that we enjoy today are the remnants of the Raj. The difference between India and North Waziristan in Pakistan for example, is the language and the versatility of connection. The largest man-made irrigation system is a gift of Raj engineering. Yes, excesses were committed, but the alternatives were not democratically elected leaders of India. A leap forward in science requires foresight, reason, and rationalism – these were the gifts that the Raj gave India.

Closing

We overlook the fact that we kept fighting over religion for hundreds of years, and kept our populace in chains and shackles as a result of an evil caste system. We ignore this, and find xenophobic slogans to detract from life in the slums, where men are denied the dignity of the living. What economy can prosper ‘when waging holy wars is the name of the game’? Some of the old fiefdoms and princely states used to spend up to 50% of their region’s GDP. Can you imagine how many times Delhi was looted and raped before the Raj? How could a nation come out of it? Had it not been for the systems that the Raj established, there would be no nation to speak of.

The post India Does Not Deserve Reparations For Colonial Rule – And Here’s Why appeared first on BRIC Plus News.

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India Needs A Stable and Strong Nation in the North http://www.bricplusnews.com/affairs/india-needs-a-stable-and-strong-nation-in-the-north/ http://www.bricplusnews.com/affairs/india-needs-a-stable-and-strong-nation-in-the-north/#respond Mon, 03 Aug 2015 11:51:44 +0000 http://www.bricplusnews.com/?p=5563 War is not an option anymore, but an understanding of history is. The military option between India and Pakistan has lost all credibility, especially with the successes of radical Islam in the face of dismantled armies. A stable Pakistan and north of the subcontinent is a must for India. It has a possible resolution: a [...]

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War is not an option anymore, but an understanding of history is. The military option between India and Pakistan has lost all credibility, especially with the successes of radical Islam in the face of dismantled armies. A stable Pakistan and north of the subcontinent is a must for India.

It has a possible resolution: a settlement. The ‘greatest democracy’ in the world cringes when it comes to promises of a plebiscite – that seemingly is out of the question – yet all hell has broken loose in the name of holy Jihad to free the valley; it has taken a huge toll on the new state and has taken all its development hostage to this single point. They call it their jugular. As wasteful as it is economically for Pakistan, it leads to nowhere, only vain glory. The present face-saver is to make the Line of Control (LOC) permanent and work around it. This is possible to achieve.

But first, a bit of history: Mohammed Ali Jinnah did not make Pakistan. BJP leader Jaswant Singh said on record that ‘he did not win Pakistan but Congress leaders Jawaharlal Nehru and Sardar Vallabhbhai Patel “conceded” Pakistan to the Quaid-e-Azam with the British acting as an ever helpful midwife.’ Partition, luckily for India, bequeathed the most troublesome ‘northern region’ (which remained the cause of several invasions even by the British) in the hands of the new nascent nation: no greater tragedy could have been asked. It was a design of the ‘two most intelligent and shrewd politicians [to]cut the umbilical chord and bequeath the most troublesome blue baby, the ‘northern region’, to Mr Jinnah.’

What we call ‘Pakistan’ is the land that contained the invasion routes to the subcontinent. The Khyber Pass and Bolan Pass are not the creation of the ISI or Pakistani state, neither was Bin Qasim nor Mongol Tamerlane or Nadir Shah, Ghauri or Ghaznavi. North of the subcontinent was the lawless land for millennia, where most of these invasions fermented and the hate remains.

The cradle of all invasions to the Indian subcontinent was left to a nation newly formed. That is the true background of the lawlessness and warlordism in the region called Pakistan; it is part of the curse of its history. By sheer coincidence the entire region was cut off from the subcontinent and a buffer placed in between.  People have forgotten the thousands of years of history and squarely place the blame on the region, not on its history.

A war leading to military defeat will lead to a power vacuum. A strategic power vacuum in the region where Pakistan is situated will lead to similar consequences like Peninsular Arabia post de-ba’athification of Iraq and Syria. (Pakistan red line – the breach of which will signal ‘the existential threat.’) In the absence of a strong credible arbiter in the region, too many vested extremists like ISIS shall crop up, and that will be extremely difficult to handle. ‘What next?’ is the question for the morning after. Military tacticians worry more about consequences and outcomes than the war itself. What will happen next after a military victory, occupation? And what next? Perpetual Jihad, once the ‘thorn of Pakistan’ is removed the entire subcontinent’s Muslims will once again unite against a common ‘Hindu enemy.’ Today a secular India is the best bet against any such happening.

Pakistan borders on India in the north.

Can’t you see that coming? You need a strong nation in the North, the last thing you need is de-ba’athification of Pakistan where there is no one to talk to but Baghdadi-like men dangling nukes. When Pakistan fights a full scale war in North Waziristan, it is a war for the stability of the subcontinent. Why Indian strategists cannot even think of that as a plus, is baffling.

The curse of history has weakened Pakistan from its inception. We need to understand that Pakistan is at a crossroads of history. It is a product of sensitive geography and a tragic history of confrontation and violence. Some lands are more quarrelsome than others; whereas some are cursed with the violence of history. The tribal North, the hotbed of global fundamentalism, is one such troubled zone, cut off from the world for centuries – even the British never bothered to rule it and granted it a status of autonomous tribal area where writ of Pakistani government rarely functions; people grow hashish and run guns and now with the ‘distance collapsing,’ such areas are breeding grounds for jihadis.

The heavy weight of the violent North West Frontier Province of India by the 1947 partition was bequeathed to a state which was young and created on the concept of homeland of Islam. It was, and is, tainted with blood. What changed in 1977, under Carter, was that these landlocked warriors whose forays never extended beyond the north of India were put in bed with the most radical elements of Wahhabism.

India should help make Pakistan stable; a peaceful, economically stable Pakistan is the best course for India.

Let’s go back to history – to the north of Pakistan is a disintegrated land under pressure from neighbouring nations and a historical battlefield where rival nations could wage their proxy wars. Indeed it is doubtful whether even many Western nations would have been able to cope with the strain faced by Pakistan. An Indian army of nearly a million face off Pakistan at the border, and in the highlands of the Khyber Pass, Pakistan is pitted against the fanatical Islamic terrorist. Instead of helping them, to kick them is foolhardy. Who else is going to do the job if Pakistan as a federation is condemned?

pakistan

Had there been no partition in a united India, India would have had to contend with a 550 million strong Muslim minority with a keen awareness of their ‘ruled’ past, united from North to South against dominant Hindu rule. Partition diluted the political folklore of a heavenly Muslim nation, and rather the failure of Pakistan to present itself as a functional democratic state has helped cool down the Islamic fervor amongst Indian Muslims.

Today, 200 million Indian Muslims scattered in India are happy with 20+ seats in the Lok Sabah. A concentrated 550 million united Indian Muslim population would have had 150+ seats in the Lok Sabah. No Union government could have worked without Muslim concessions and no secularism would be possible. Who knows how Deoband would have weighed in such circumstances? After all Mr. Gandhi and Congress were very close to Khilafat and Reshmi Rumal heroes.

The rise of secularism within Indian society is across the sectarian divide, though in radically charged Kashmir today it requires 700,000 troops to subdue and pacify the regional population, which has not reconciled itself with an imposed Indian identity. Can one truly imagine the consequences of a 550-million strong disaffected minority? Partition separated the most vocal and radicalised segment of the subcontinent’s populace in one area and created a huge buffer between secular India and the Islamic Republic. It also created a bigger distance from the warlords from the North once and for all. It is a blessing in disguise for India that they could phenomenally progress in peace without any intervention from religious warlords from the North or the disgruntled radicalised majority of the Islamic provinces.

Time, forbearance, academia and informed decisions based on our ‘dark history’ can help our future generations, otherwise, we face a bleak future of war. We need to grow up and face our demons and let’s talk aloud. We are nuclear tipped nations; we should talk sense and balance, not foolish jingoism putting total blame on each other. People who ignore history are the worst offenders and fools.

If you like this article you may be interested in “Can China, India and Pakistan Work Together for Afghanistan?”.

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Is Aung San Suu Kyi the Pro-Democracy Laureate We Think She Is? http://www.bricplusnews.com/iqbal-latif/the-real-aung-san-suu-kyi/ http://www.bricplusnews.com/iqbal-latif/the-real-aung-san-suu-kyi/#respond Wed, 10 Jun 2015 16:20:38 +0000 http://www.bricplusnews.com/?p=3362 What does Aung San Suu Kyi stand for?

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Aung San Suu Kyi: China Visit

Aung San Suu Kyi’s is making her first trip to Beijing. As part of her preparations, she has avoided anti-Chinese rhetoric in a clear break from other fellow Nobel Prize laureates. Notably, she has sidestepped criticising Chinese human rights abuses. Meanwhile, the Chinese have major investments in Myanmar with an eye to have control of the Indian Ocean. Has Ms Suu Kyi recognised the potential for Myanmar to be that bridge?

Aung San Suu Kyi was first recognised for her non-violent campaign for democracy and human rights development with the Nobel Peace Prize in 1991. Suu Kyi had won 59% of the national vote in the 1990 General Election whilst living under house arrest.

Perhaps the most sensitive aspect of Ms Suu Kyi’s visit is that her fellow Nobel peace laureate, Liu Xiaobo, the only Chinese winner of the honour is languishing in jail, on an 11-year sentence for “inciting subversion”.

Does this put into question her status in the West as a pro-democracy peace loving Nobel laureate? Ms Suu Kyi’s is also poignantly reluctant to speak for Myanmar’s persecuted Rohingya people. Those who recognise Suu Kyi feels no responsibility to the Rohingya may infer she has no obligation towards anyone’s human rights and, that like everyone else, doesn’t actually mind the Chinese expansion and encirclement of their strategic interests in the Indian Ocean.

Bangladesh too has been courted by the Chinese to create a trade corridor, as well as by India’s Prime Minister Narendra Modi. India strategically want Myanmar and Bangladesh to be in their sphere of influence as Indian interests face isolation in the South East of it’s flanks –but for Ms. Hasina and Ms. Suu Kyi, money could speak much louder than all other voices. Suu Kyi may have learned at the heart of politics is not human rights but raw interest, with friendship and humanism a sacrificial lamb.

If you like this article you may be interested in “Social Media Watch: Internet Reacts To Castro’s Million Dollar Demands”.

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