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It’s money that matters in China-UK’s new found love

By Rahul Sharma

Kate Middleton’s snazzy red dress, a hop into a neighbourhood pub for a pint of beer with Prime Minister David Cameron and a jolly ride with Queen Elizabeth in a royal, six-horse carriage would have definitely pleased Chinese President Xi Jinping during his maiden state visit to the United Kingdom.

That the latest round of pomp and show came soon after Xi was feted – U.S. President Barack Obama merely gives additional credence to the fact that the world cannot afford to overlook its second-biggest economy and a fast-growing military power that astutely holds one end of the global power balance.

The Chinese media dubbed Xi’s foray into a country with which the Chinese have had  an oddball relationship for several centuries, a “super state visit”, signifying its importance to Beijing that has been trying hard to redefine its ties with other major powers.

The reality is different. The United Kingdom is no more a major power; it handed over that trophy to a surging United States at the end of World War II. In the past seven decades, since then, the UK has only continued to lose its grip over the world it once ruled.

So while for China its burgeoning ties with the United Kingdom might be the start of a “golden era”, for the latter it is more about a source of cheap funds for infrastructure that it needs to push its economy – some of it like steel manufacturing already battered by cheap Chinese imports. It is almost like a poor man asking a wealthy man for his daily bread.

Beijing, keen to spend its hoard of cash, is not complaining. Not when its president gets to ride with the Queen and sign deals worth a whopping $61.5 billion – most of them in the energy sector.

Cameron has reasons to cheer. He is getting cheap dollars to push nuclear power that will provide electricity to millions of British homes, which he himself can’t raise given Europe’s current economic disability. For China, it is a win-win situation too. With a slowing domestic economy, it is looking for its companies to go out to seek contracts that would buoy their bottom line.

The energy deals are indeed big. Not only will a new nuclear power project built with Chinese help provide electricity to millions of British homes, it will also create thousands of new jobs. More projects using Chinese-built nuclear reactors are in order. For China the projects become a testing site for its technology that it can then take to other developed nations.

But trade and investment is only one part of the story that could go horribly wrong on other sticky grounds. Given the Western world’s penchant for slamming China on human rights and its authoritarian government, and mutual suspicion, Cameron’s overtures to Beijing to invest in Britain’s energy and infrastructure sector will raise red flags in Washington that considers China’s rise a threat to its current influence in East Asia.

While economics works well between China and the United Kingdom, it is a tricky diplomatic route for Cameron and he will have to ensure that his newfound bonhomie with Xi doesn’t make the old ally in Washington too nervous. He will have to carefully walk the fine line between keeping old, historic ties in place and nurturing his new relationship with an ambitious China that would only want more in the long run.

At some point in the near future he may be pressed by the United States to take a stand on ticklish diplomatic issues involving China, such as Beijing’s aggressive postures in the South China Sea where it is building islands to effectively counter the U.S. navy that recently sent one of its ships to take a closer look at what was brewing there. Cameron will then have to take a quick call on what’s best for him. Xi will, of course, be watching.

Rahul Sharma, President, Rediffusion Communications, is a former newspaper editor and a public affairs expert.

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Do you have change?

By Siddarth Gore

Moving from cash to a cashless economy
What is your greatest fear while travelling in an autorickshaw? Besides the fear of getting thrown out during a wild manoeuvre, most people are constantly looking at the meter and hoping that it ends in a round figure. I have known cases where people get down a little before their actual destination just because the meter was showing a nice round number. After all, who would want to haggle over change every time and get in a grumpy mood for it?

Now imagine something like this. You get down from the auto and look at the meter. It is staring back at you with say, a dreadful 37.50 rupees. You prepare to fight for each and every paisa of your hard earned money. But the driver doesn’t seem to care. He whips out his phone and enters the amount on it. He politely asks for your phone at taps his phone on it. Instantly you get a notification on your phone saying that Mr. Autorickshaw-wala is asking for Rs. 37.50. You hit accept by validating with your fingerprint and before you have a chance to look up the rickshaw is off in search of its next client. You have not lost any needless time, money or goodwill in the whole transaction. Is this really possible?

And if yes, then in whose lifetime? The answer will surprise you.

The following two trends will give you an indication of where we are heading and why such a scenario is very likely to be a reality in the next 5 years.

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[Source: RBI]

The above graph shows a clear trend. India is moving from paper clearing to electronic transfer of funds. And that too really fast. Also looking at the volume of transactions that are happening on the electronic medium suggests that people quickly adopt a new and convenient technology for small transactions first. Once they are comfortable with the new system they are more willing to move the high value transactions as well. This is pertinent in case of e-Wallet since almost all of the transactions there will be of low value. If these numbers are anything to go by on then they indicate that the adoption of cashless peer to peer transactions will be much higher and faster than that of the electronic clearing systems.

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[Source: ADC Asia Pacific Quarterly Mobile Phone Tracker, SAP “The Mobile Consumer” Report]

Smartphones are not essential for mobile payments but are much more convenient and safe. The entry of low cost smartphones is leading to a gain of percentage share for them in the market. This is essential for the establishment of payment systems using mobile phones. Latest smartphones are featuring new technologies like NFC (Near Field Communication) and IRIS scan which can be used very effectively for executing payment transactions in a hassle free, secure and fast manner.

Along with the technology where needs to be a mindset change in the population for it to be widely adopted. On that count too India is in a favorable position. In a recent survey conducted by SAP Indians were found to be the most enthusiastic about new and innovative payment methods in the entire Asia Pacific region. This goes further to show that the India economy is ripe for this pivotal change.

But financial services are a tightly regulated sector and things will not change unless the regulators adapt to the changing needs of the sector. In this respect we are lucky to have a very proactive financial regulator like the RBI. It has not only created the required regulatory framework but also by establishing the National Payments Corporation of India (NPCI), has endeavored to create the IT infrastructure that would be required to make such services accessible, secure and inter-operable between all the players involved.

If you think about the above scenario of the auto rickshaw it is not all that different from doing an electronic funds transfer using NEFT. There are however some key differences which make this kind of a transaction possible. Let us peak under the hood and look at what is involved in pulling off our transaction.

First of all you will need a wallet with some money in it. Only in this case it will not be a physical wallet weighing down your pocket but an e-Wallet which will just be an App on your smartphone. The RBI calls it a Pre-Paid Instrument or PPI but we can continue to call it an e-Wallet for ease of understanding. You have already linked your bank account to this wallet and transferred some money into it for your spending today.

You must have noted that you didn’t need to provide your account details anytime during the transaction. And this is a major difference between an NEFT transfer and it is made possible by the Unified Payment Interface developed by the NPCI. When you tap your phone what you send to the other person can be a “virtual address” along with the name of your w-Wallet provider (also called Payment System Player or PSP). The PSP on the receiver’s phone will send this information to the NCPI using the Unified Payment Interface. The NCPI will map this virtual address to a bank account itself (if the virtual address happens to be an Aadhaar Number) or it will send it to the Payee PSP for mapping to a bank account. After NCPI has both the bank accounts it will do a regular electronic funds transfer (much like the IMPS, or perhaps exactly like IMPS) and notify both parties upon completion of the transaction.

The security aspect is taken care by the fact that the information you share with the other person is not sensitive. It can be a number which is valid only for one transaction so it cannot be misused in the future. The transaction also requires you to validate with a password, a pin or a biometric like fingerprint or iris scan. This information is never stored anywhere and is transferred in encrypted form only.

Screen Shot 2015-10-15 at 2.19.58 am[Source: “The Cost of Cash in India” Fletcher]

The economic impact of this transition is huge. India is predominantly a cash based economy. The above estimates suggest more than 85 percent transactions happen in cash. Besides the obvious transaction costs when it comes to cash dealings like carrying of change, risk of theft, fake notes, etc. there is a huge cost of printing and maintaining the paper currency in circulation. RBI estimates put the figure at Rs. 21,000 crore. All these costs will be reduced by moving to a more cashless economy.

Though the regulations are well thought out keeping the safely and security of users in mind, I would like to point out two areas in which they can hinder the large scale adoption of this technology.

First is the requirement for adding a Payee before you make a transaction. This is a tedious process and completely unnecessary for one time transactions like with an auto rickshaw or a vegetable vendor. Perhaps the PSPs can design some clever user experience in their Apps which will circumvent this issue but making this a part of the regulation might make that option unavailable.

Second is the possibility of offline payments. Currently the system is real-time and both the peers need to have data connectivity for the transaction to be successful. Data connectivity is still ramping up in most parts of the country, especially in rural areas, and cannot be relied upon just yet. For e-cash payments to become truly ubiquitous it has to work without network connection. It is unclear if this is indeed feasible with the currently available technology but recent advances in block-chain algorithms and success of currencies like bitcoin are encouraging signs. Let us hope the RBI takes this into consideration and improves upon its policies and infrastructure.

The success of this mission depends largely on the solution providers for the PSPs and their ability to come up with products which are easy to use and interoperable. RBI has shown great understanding of the market while awarding the licenses of payment banks and small banks to players with diverse backgrounds and expertise. It will bring much needed innovation and funds to this critically important aspect of the Indian growth story.

(Siddarth Gore has over 13 years of experience in the computer industry with expertise in networking and embedded systems. He has a Bachelor’s degree in Electronics and Telecommunication from PICT, Pune and a Master’s degree in Computer Engineering from Boston University, US. He is currently pursuing his Master of Arts in Economics from the University of Pune.)

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Bolstering military abilities in Indian Ocean Region

By Sambit Dash

What happens in the high seas in its backyard, concerning India’s national aspirations, is India’s business.  

With 70 percent of the world’s petroleum shipment, 50 percent of world’s container traffic, dependence of world’s two most populous nations for their huge satiety for growth and with an Asian world order establishing, Indian Ocean Region has emerged to be the centre of geopolitical fluxes. This important Sea Lane of Communication (SLOC) however is being used by China to make strategic manoeuvres to encircle India and to assert its hegemony in the region. India, with a geographical advantage, needs to be proactive in order to establish its position as a responsible global power, right signals of which has been shown by the Narendra Modi government.

Indian Ocean Region extends from Australia in the east to South Africa in the west and leading economies of the world China, India, Japan and Australia depend on it. Of late, the docking of Chinese submarines in Sri Lanka and Pakistan, forcing an Indian submarine to surface, building of islands in the South China Sea, forging friendships with smaller Indian Ocean countries, an ambitious Maritime Silk Road (MSR) touted as ‘String of Pearls’ and the massive expansion of PLA-Navy of late has created a buzz of discomfort in India. Strengthening military capabilities should be a prominent feature of the “reverse string of pearl” strategy.

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(Image: thetimes.co.uk)

Military Capabilities
India has been fundamentally against militarisation of Indian Ocean. However of late, the massive spurt in growing its military presence in the region, pretty much exponentially, by the Chinese only mean that India needs to build an effective deterrence. Chinese economy and PLA-Navy’s massive fleet are far from India’s reach but backing on better security relationships it has and a regime that has set its priorities in the region, an effort is underway to catch up.

Andaman & Nicobar Command (ANC): This facility overseeing the crucial Malacca Strait through which about 60,000 ships pass each year, is India’s easternmost bastion and has not seen much capacity building since its establishment in 2001. However Indian Navy chief Admiral Robin Dhowan has reiterated that the defence ministry has set ANC as a priority and probably will have a division-level force with 15,000 troops, fighter squadron, more airstrips and major warships. There is a need to equip it with Anti Submarine Warfare (ASW), keeping in view the increase in Chinese submarine excursions. A bold ‘geo-economic vision’, as analyst C Raja Mohan calls it, needs to be realised in this 572 group of island. Additionally for India, ANC can prove to be an example for functioning of an otherwise mired in squabble unified command. India needs to take advantage of China’s ‘Malacca dilemma’ through this strategic point.

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(Image: atimes.com)

Shipbuilding: India has 28 shipyards, which thanks to public sector work culture and being stuck in pre-modern era have failed the aspirations of a Navy in need. China has over 800 shipyards and even countries like Vietnam and Phillipines produce quality ships at competitive price. Privatisation of shipbuilding industry needs to be undertaken if India is to make great strides in sea. There are about 2600 ships capable of ocean transport in China which surpasses all others by more than a mile. The new ship acquisition policy announced by Arun jaitley in July 2014, in order to raise India’s home fleet by four times its current capacity, has been a welcome move. Perhaps a policy like China to build new ships fitting specifications by Navy so as to ne ready for ocean transport could be explored.

Dredge: Incessant dredging activity by China and its ‘creation’ of ‘Spratly Island Chain’ and ‘Fiery Cross Reef’, which is against the UNCLOS, and has all machinations for military use, has concerned the international community. India’s dredging industry has been plagued by slow pace of project award and implementation. The Maritime Agenda 2010-2020 pegs an investment of Rs 200 billion by 2020 for dredging and with opportunities which cannot be met by Dredging Coporation of India, forming a policy on dredging and opening that sector to private players could help explore posibilities of extending it to meet military needs.

Aircraft carriers: India currently possesses an ageing and limited capacity INS Viraat which is set to be decommissioned in 2016. INS Vikramaditya is India’s primary aircraft carrier and serves as a statement in the Indian Ocean backyard. India home-grown aircraft carrier INS Vikraant, made by Cochin Shipyard could be inducted in 2017 and the other nuclear powered carrier INS Vishal is in the design phase. While China has two aircraft carriers, one which it built on its own, the building of world’s longest dock at Sanya captured the world’s attention. With the aid of its partner US, which has its 6th fleet in the Indian Ocean, with whom it is set to carry out its 19th war exercise in October, and who sees India as a ‘lynchpin’ in the ‘pivot’ strategy of strenghening its position in the Asia-Pacific, India should speed up the process of technology transfer in building indigenous aircraft carriers.

Submarines: China has 68 submarines and India has 14 and that speaks volumes, if not all, about China’s under sea capabilities. They might be a generation behind the West but suffices to counters India’s posse. India has however attempted to catch up by adding 15 submarines to its fleet, including three nuclear ballistic-missile (SSBN) ones but the key feature is that most of them are built in India itself. This should boost India’s abilities to build more and at home. But an effective strategy to counter China’s huge submarine fleet is to develop anti-submarine warfare (ASW). The current fleet of about 6 ASW aircrafts might pale in front of the Chinese.

Mission Sea-Base: China is keen on sea-basing, a concept where overseas missions can be undertaken without land based command, control and support. It acquired a Mobile Landing Platform in July this year, rolled out its fifth replenishment ship and has made laws for commercial ships to meet naval standards. India’s sea-basing capabilities are negligent however its long-standing naval partner US could help India develop capacity in that regard and that is what India should look for from its strategic partner.

Indian Ocean – the hotbed of activities
A conventional full-scale war may be a thing of past and thus India’s long standing policy of not having overseas military bases may hold good but in a scenario where isolated conflicts and posturing might demand show of power, ‘Places not bases’ strategy would help. In that regard India’s healthy relation with Indian Ocean countries is very important.

India’s maritime focus should be to go beyond A2/AD (Anti Access/ Area Denial). New Delhi has mandated a three pronged strategy for the high seas which involves bolstering submarine capacity, augmenting carrier battle groups and stregthening air power and thorugh its humanitarian and peace-keeping objectives. By the way of anti-piracy operations in Gulf of Aden (incidentally with China) and Operation Rahat in Yemen it has demostrated its intent of a responsible sea power.

India’s naval policy plagued by structural and institutional issues riding on a deep disconnect between Navy and bureaucracy has not espoused great faith in building its capabilities. It will take much more, than the state of affairs presently to put forth a sea-based deterrent vis-à-vis China. A beginning step could be to have a single government agency with the expertise and mandate which would replace the current 14 odd agencies that work in an uncoordinated manner in ocean related matters.

It might be true what the Chinese say, Indian Ocean may not be India’s ocean, but what happens in the high seas in its backyard, concerning India’s national aspirations, is definitely India’s business.

Sambit Dash is a faculty member in Melaka Manipal Medical College at Manipal University, is an alumnus of Takshashila’s public policy course, the Graduate Certificate in Public Policy and writes on public policy, social issues and geopolitics. The views are personal. 

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India’s security relationships in Indian Ocean region

By Sambit Dash

A growing India cannot afford to lose out to proactive Chinese maritime policies.

With 70 percent of the world’s petroleum shipment, 50 percent of world’s container traffic and dependence on energy routes of world’s two most populous nations, the Indian Ocean Region has emerged to be the centre of geopolitical fluxes. In this important Sea Lane of Communication (SLOC) China has been pursuing strategic manoeuvres encircling India and building its ambitious Maritime Silk Route or more fancifully called “String of Pearls”. India with a geographical advantage in the region needs a foreign policy that would thwart China’s perilous designs, a “reverse string of pearls“, signs of which the current dispensation has shown. India’s security relationships in Indian Ocean Region will play a crucial role in stability of the region.

Bolstering economic and political ties with countries on shared objectives even with countries that otherwise receive huge Chinese aid should be in India’s immediate foreign policy focus. The key players in this foreign policy dynamics with stake in IOR are:

Africa: Africa, on a path of colonisation by China, is crucial in India’s policy in the Indian Ocean Region. Set in the western end of IOR, Africa’s allegiance to China, riding on about 222 billlion dollar investment in 2014 by latter (which is three times that of China-US trade) should be a matter of concern for India. Setting up the India Africa Forum Summit (IAFS) in 2008, ushering summit level relationship, has enhanced relation between both regions. However in terms of trade, economic and energy cooperation India needs to catch up with China. The forthcoming India-Africa Summit in October which has seen invitation to all 54 heads of state of Africa, is an apt opportunity for strengthening ties banking on the presence of a huge Indian diaspora and a mutual worldview.

Pakistan: In May of 2015, China docked a Yuan 335 class submarine, having capability of staying under water for a longer time, in Karachi. China is incidentally also selling eight such submarines to Pakistan, while talks for four frigates, six missile boats are on. This development, particularly the docking, which caught India unaware should prompt Indian Navy to bolster its capacity in the western seafront. The strategic location of Gwadar port should also prompt succesful seeing through the Chabahar Port development in Iran which would open India to Central Asia bypassing Pakistan and act as a deterrent to Chinese presence in the neighborhood.

United States of America: India is poised to play a key role in US designs of rebalancing of Asia Pacific. In lieu of Indian Ocean strategy pursuing aircraft carrier technology under India-US Defence Technology and Trade Initiative (DTTI) is a welcome step. India has carried anti-piracy operations in Indian Ocean under Combined Task Force–151 led by the US and has proved its mettle in thwarting pirate attacks. US sees India as a ‘lynchpin’ in the ‘pivot’ strategy of strenghening its position in the Asia-Pacific.

The 19th edition of Indo-US joint naval exercise off India’s eastern seaboard is to be held in October this year which involved Japan in the previous edition. Such exercises in the Indian Ocean, where the 6th fleet of US is stationed, which involves other like-minded nations like Australia and Japan should be carried out regularly to send appropriate signals to the People’s Liberation Army – Navy.

Sri Lanka: Recently being touted as a country that has the potential to become Cuba of India, Sri Lanka is being seen being closer to China than its immediate neighbour India. There has suddenly been a spurt of interest shown by the West in Sri Lanka too given the fact that the post Cold-war lull is getting over and in the small power-big power equations, it is poised to play a strategic role.

The docking of nuclear powered attack submarine in Colombo ruffled feathers of the Indian establishment. This however has not been an isolated incident. The Chinese have been building infrastructure, considered to be of “dual use”, both military and civilian. A change in the overtly pro-Chinese Rajapaksa regime, which had ensured loans of 2.1 billion USD in 2012-14, in the recently concluded elections, should be leveraged by India to gain stronger foothold in this island nation.

Indian Ocean countries: India and Mauritius inked a deal during Prime Minister Modi’s visit to develop Agalega Island north-east of Madagascar for use by Indian military. India’s agreement with Seychelles to build capacity on Assumption Island at northern end of Mozambique Channel will also give Indian Navy much needed strategic advantage. The couple of summits of Forum for India-Pacific Island Countries (FIPIC), with its members India and 14 Pacific island countries held in Fiji in November last year and in Jaipur in August this are welcome especially in the backdrop of huge Chinese aid and presence in these countries.

Geopolitics of the Seas
Other countries that are major players in the game of energy, security and seas are Myanmar, Nepal, Vietnam and Bangladesh. India’s growing dependence on import of energy will require India to play game with various regimes, of different hues, in these countries. A buzz of activities like diplomatic visits and courtesy calls have occurred under the Modi regime and these should be carried forward to meaningful conclusion. Incidences like cancellation of Iran-Pakistan-India pipeline and instead China replacing India in that axis must be avoided.

To counter China’s uneasy experiments in South China Sea India should create a buzz in international forums for China to adhere to UNCLOS, as Indian minister V K Singh did at East Asia Summit Foreign Ministers’ Meeting in Kuala Lumpur. India should also take leadership position in drawing up a CoC (Code of Conduct) which would include risk reduction and conflict resolution in Indian Ocean Region.

Economic growth shall address many of the security relationships issues and it should be relentlessly pursued. Ties with countries having a stake in Indian Ocean Region need to be bolstered keeping Indian national interest paramount. A growing India cannot afford to lose out to proactive Chinese maritime policies.

Sambit Dash is a faculty member in Melaka Manipal Medical College at Manipal University, is an alumnus of Takshashila’s public policy course, the Graduate Certificate in Public Policy and writes on public policy, social issues and geopolitics.

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IITs should be role models in university politics

By Saurabh Chandra

The last thing we need in this country is for politics to become a ‘dirty’ word and people pleading to keep elite institutions away from it.

The recent controversy sparked by the suspension of a little known student group called the Ambedkar Periyar Study Circle at IIT-Madras has again brought to fore the question of allowing politics in universities. The worst fears of the detractors seem to be in revisiting the horrors of the 80s when student politics often led to violence between factions, even leading to murders. Many a times students were used as muscle men by mainstream parties and the local university politics became a proxy for a larger game play.

The concerns are not unfounded but the solution that got employed has been most stifling – complete ban on all political activities on campus. In many cases, the student unions have been dissolved too. My alma mater BHU is a good example where University politics had simply overwhelmed the campus culture. Student politicians would decide not to pass their courses so that they could continue to stand for elections or continue to enroll in masters and then PhD courses in departments where faculty members were also more inclined towards politics than academics. Things went to a boil in the 90s and two students died, post which the student union was dissolved and politics banished from the campus. In the following years, the university got back its academic mojo with multiple faculties climbing various nationwide rankings. In parallel, we created a sterile atmosphere in the university when it came to political engagement and the number of politician alumni from the university is on a fast decline.

This is typical of the blunt knife approach often seen in India. To prevent crimes at night, the recommended approach is to close all shops and advise people to stay indoors. Taken to its logical conclusion: if there were no people then we would have no problems in life. The challenges of university politics need to be solved rather than throwing the baby with the bath water. Violence was an issue in the past and the solution is to impose the rule of law. If academic excellence is the goal of a particular institution then there are many ways to impose that too – mandatory attendance, minimum marks to be a candidate and so on. There is no one size fits all and each university should evolve rules and norms that fit with its culture. Mostly, politics should be like an extra-curricular activity in college that should compete with cultural, sports, literary and other activities in capturing a student’s attention. A bold faculty could even craft its instructional design around political activities.

University politics also provides an easy ramp for new talent to come into the system. For a country so young, it is tragic that the average age of the political class is more than twice the average age of the country. The young politicians are mainly family members of older politicians since genuine challengers from below are in short supply.

The last few years have seen a huge engagement from the student community in the India Against Corruption campaign and then as volunteers for various political parties in the general elections. Both of these events demonstrated the potential that youngsters have in India to contribute to the national political agenda. However, in the absence of politics in the iniversities, we will only see this community in support roles and being utilised by the larger parties or activist groups as ‘man-power’. Genuine leadership will emerge only through the competition and tussle of student politics leading to fresh ideas that provide relief from the same-old of current Indian politics.

The last thing we need in this country is for politics to become a ‘dirty’ word and people pleading to keep elite institutions away from it. If anything, elite institutions should be role models on how politics should be done.

Saurabh Chandra is a tech entrepreneur with an interest in policy.

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What is your most controversial view?

by V Vinay

The next time you meet someone you care about, engage them on this question.

A question I frequently ask students is to share a view which they believe is controversial. The puzzled look on their face is a sight to behold. Many openly admit that nobody has asked them this question. Despite being from the best institutions, many have not even thought of anything remotely interesting and controversial.

One of the primary roles of a university (beyond supplying manpower to industry) is to teach students to think for themselves. This involves another important aspect – that of questioning authority. Universities provide an ideal playground (in the sense of an isolated environment) to learn these skills without fear of
repraisals.

A key necessity for this is diversity. In the absence of conflicting thoughts, there is really nothing to mould. In fact, I would go as far as to say the greatest gift a university can impart to a student is the ability to hold two contradictory ideas without short circuiting their brain.

Political parties (whether in power or not) want followers but not people who question. Discipline and conformity is what parties seek. We are told the Janata experiment failed as there were too many ‘thinkers.’ Even a new entrant with claims of being different, the AAP, cannot support multiple points of view. The Congress enjoys discipline and conformity as a direct consequence of dynastic rule. Add to this a poor country where a degree is a way to get a better salaried life. In this scenerio, conformity is so much more easy on everyone.

The real world is messy. Universities cannot and should not isolate themselves from what is happening around them. However, the cost to being a contrarain voice is high. We may want to pretend the universities are playground but you never know when a bottle is thrown at a player. In a more heated moment, even a pitch invasion cannot be ruled out.

Let us take the recent IIT Madras episode. An anoymous letter is sent. The undersecretary could have ignored it, but didn’t. Instead she decided to ask for comments. The IIT could have ignored the letter or said something along the lines of “we will look into it.” Instead, they decided to act. They could have initiated a conversation with the forum under scrutiny. Instead they unilaterally suspended them. The reaction was immediate: a pitch invasion was imminient. One voice spoke of “touching a nerve” and another of “a civil war”. The ministry smartly washed its hands. Media and political parties jump in to complete the polarisation.

But really, where are the players in the playground? Empty playgrounds is an apt metaphor to much of our elite institutions. They just don’t seem to be engaged enough. Outside, we have a different problem. How can we have an informed debate when all sides give us ready made conclusions? And who is to participate in this debate when we are compartmentalised into one dimension as left or right.

What we need are political conversations in our society and in our elite institutions. Currently this environment does not exist (without grave costs). It needs to be created. As a first step, the directors of elite institues have to isolate the rest of the institute from their political masters. Second, they need to encourage students to open up and state their views, have an opinion, take a stand, construct arguments around it. One possilbe way to do this is to offer a credit and have students discuss current events in the class. (If you already dismissed off the idea, you now know where the problem lies!)

When dissent is no longer a novelty, you are unlikely to have anonymous letters being sent to the ministry.

But what I do not want in elite institutions are political parties creating camps that cannot and will not talk to each other. This may seem like political activity but is really conformity without logic or reason playing a role. It at best makes a dysfunctional campus. This may be how the real world is, but it is not for an institution to mirror reality, but seek to change it.

Let us get back to the need to hold some controversial views. You don’t have to defend 3 times 4 as 12. (Maybe Russell has to, but hopefully not you.) For anything else, you have to articulate a cogent argument to defend your views. Unfortunately most students have no idea how to because they have never been challenged. Let us make a small beginning. The next time you meet someone you care about, engage them on this question.

Indeed I should be asking you: what is the most controversial view you hold which you believe to be true?

V Vinay is a curious academic entrepreneur.

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Geopolitics, economic reforms and the citizen

By Nitin Pai for Loksatta Whistle.

Let us be clear: the world is interested in India because our economy is growing. If the growth process stalls, the world will stop seeing India as a potential solution to its problems. It is important that the world sees us positively this way because that, in turn, creates an environment conducive for our own growth and development.

So, getting back onto a high growth path is as much a foreign policy imperative as it is a development policy goal. Economic power can be converted into military power, knowledge power, cultural power and other forms of power.

India in 2015 has a short window of opportunity to avail of a virtuous cycle of positive demographics, shifting global balance of power and the economics of development. If we miss the bus, it might be several decades before we get another chance.

This is why the goal of completing the process of economic liberalisation is important. It is also why the task of reforming the government to make the Indian state more competent is important. It is wishful to believe that either of these goals can be achieved by a citizenry that is narrowminded, parochial, illiberal and chauvinistic.

If economic and governance reforms are in the domain of political leaders, personal reforms are very much in our own hands. Can the politically awakened Indian citizen hold fast to the enlightened values enshrined in our Constitution? Let’s use the opportunity to reflect on this.

Author is co – founder and director of the Takshashila Institution, an independent think tank and school of public policy.

This piece was first published in Loksatta Whistle.

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Why don’t the Chapel Hill attacks count as terrorism?

By Saurabh Chandra

By conflating hate crimes with actual terrorism, we end up doing disservice to both.

Many people on social media asked this question: Why don’t the Chapel Hill attacks count as terrorism? Terrorism is violence inflicted to create a general environment of terror towards a political objective. So, the Church Street IED in Bangalore counts as a terror attack as do the 9/11 twin tower attacks and the 26/11 Mumbai shootings. The Chapel Hill killings are in all likelihood hate killings where the victims suffered due to their religion. Any murder is despicable but by trying to label all hate crime as terrorism, we lose sight of what terrorism is and how to counter it.

In the 9/11 attacks Al-Qaeda had a political motive for murdering innocent civilians. The message being sent to the United States was that if they do not withdraw from the Middle East, Al-Qaeda’s sceptre of terror would haunt all American citizens and hurt the US financial system by adding risk. Lashkar-e-Taiba, the terror outfit behind the Mumbai attacks has a stated objective of waging a holy war to establish a medieval Khilafat (or caliphate in anglicised form) over the Indian subcontinent. LeT’s mentors, the ISI and the Pakistani Army are the only professional army in the world to have a stated objective of “striking terror in the hearts of the enemy” (from the Quranic Concept of War by SK Malik, a mandatory reading in the Pakistan war college since late-70s). By conflating hate crimes with actual terrorism, we end up doing disservice to both.

Is this specific to a religion?
Terrorism is a political tool used when conventional confrontation is not an option and members of all religions have used it. The Irish Republican Army fighting for Northern Ireland was Catholic. The LTTE (pioneers of suicide bombers and using children as suicide bombers) was largely Hindu (but had members of other faith also). The perpetrators of terrorism are political organisations or at times individual claiming to act under inspiration from such organisation.

The term Islamic or Muslim terrorism is an unfortunate outcome of the fact that we don’t distinguish between political Islam or Islamism and the religion Islam. This is perhaps a legacy of the fact that the religious and political leaders since Mohammed were the same person in the form of the Khalifa (or Caliph). The terror organisations also are more interested in making it appear that there is indeed no difference – IS or the Islamic State being a case in point. It serves their cause to appear as if they speak on behalf of all Muslims. In contrast, IRA or LTTE did not seek identification with a religion and had nationalistic causes.

What about the killings of Shia Muslims in Pakistan?
That is not terrorism either. An act of killing a group of people on account of race, religion or some other attribute is a genocide. Instances of this would be the Nazi Germany against the Jews or what happened in Rwanda, against the Tutsi. There is no other way to label an attempt to kill Shias by certain organisations in Pakistan.

If we need to pick an act of terrorism within Pakistan, the recent killing of school children in Peshawar by Taliban was a clear act of terrorism. Taliban wants the Pakistani Army to stop its operation against them and allow them to run its own government in parts of Pakistan. The killing was not a mindless act. Taliban had clear political demands and a message it wanted to send to the Pakistan Army through that massacre.

How do we fix this?
We need to move away from lazy journalism where terror attacks are often explained away having been done by Islamic terrorists.  It is important to cite the organisation responsible for the attack together with its political objective.  Most organisations that commit such attacks want people to know their identity, which is never a mystery.  Often, shoddy journalism leads to reporting that blames Islamic terrorists, without sufficient explanation or granular detail. This creates the false correlation of Muslims with terrorists, especially for western populations, that live in homogenous societies. This also creates an atmosphere where a killings such as those which happened at Chapel Hill, without a political objective also gets tagged by many people as a terrorist attack.

The other part is public education – people need to know that all Muslims don’t subscribe to Islam as a political ideology and faith is a personal matter. Highlighting the distinction between political Islamism and Islam the religion will weaken the cause of Islamists and increase safety of Muslims.

Finally, we as readers should ask why. If the why does not lead to a political answer, it is not terrorism.

Saurabh Chandra is a Bangalore based technology entrepreneur with an interest in public policy.

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Stand-up’s tryst with destiny

By Devika Kher

The history of stand-up comedy has shown that, like all the other fields, the relevance of stand-up will grow along with its demand in society.

It was the decade after the Second World War. There was still anxiety within the western communities just out of a war. The rules that existed before the war no longer applied. It was during this time that the pubs around America started appreciating a new breeze of entertainers. This new stream of talent wasn’t restricted to the rules of entertainment followed before. They, unlike their predecessors, were pushing the envelope as far as they could. It was the turning point in the field now known as, stand-up comedy.

In America, stand-up comedy started as a part of the Vaudeville theatres in the late 18th and early 19th century. Vaudeville theatre was a theatrical performance with a series of different type of acts presented in a sequence. It was like watching a play, a song and a dance performance on just one ticket. Quite a famous genre, vaudeville theatre art was distinguished for having liquor free and mixed-gender crowd. It was this form of art that increased the number and the size of theatres across cities.Amongst the various routines presented, one of the genres sprouting was a set of burlesque shows. These shows used a new art form in which the artists presented a set of fast one liner jokes. At the time, the jokes were mostly ‘clean’ and kept a safe distance from politically incorrect topics.

Meanwhile, the United Kingdom saw the rise of stand-up comedy within the music hall performances.  One of the famous names of the time was Max Miller, who use to chip in jokes in between a song and dance set. However, the taste for such shows developed post World War II as the Armed forces started appreciating the art form they discovered while attending wartime concert parties.

The space for stand-up comedy developed further after the war in both the countries. While America saw a rise of rebellious stand-up comedy, the workmen clubs in the UK provided space for comics who used racial and sexual stereotypes to entertain the audience. A series of comics like, the famous Lenny Bruce and Mort Sahl were the products of this era, where comics like Bruce were being imprisoned on the ground of obscenity. The negative sentiment within the society after the World War became a fodder for these artists and the outcome was the stand-up comedy as we know of it today.

The modern stand-up comedy was no more bound by fear of censorship, and the comics slowly started delving into the topics which were once a taboo. The night clubs in the cities became the new breeding grounds for this genre of artist. A casual dress-code was brought into the act, and, various new forms of stand-up comedy were also initiated. Along with a rising number of followers, the post War period also saw the advent of communication technology. As the communication gap was filled by radios, televisions etc., the reach of these comics became global. Consequently, rebellious American stand-up comedians started influencing their British counterparts and stand-up comedy started spreading across boundaries.

As the reach of this profession continues to grow within new countries and cultures, it is important to remember where all of this came from. Not because it makes for an inspiring story, but to understand the nuances that are involved behind making it a culture within society. For instance, support for comedy as an art form is majorly dependent on the temperament of society. Making comedy a rebellious art form would not have been possible had the dominant temperament not been of insecurity and anxiety.

Another important observation to take away is the relation between political correctness and comedy content. As mentioned, comedy in its nascent stage was heavily censored: so much so that the content had to be passed through a censor board which would then mark the unacceptable content in blue. Later the comedy which focused on these unacceptable topics came to be known as “blue comedy”. After the war, the friction increased much more as various artists were sent to prison for obscenity. The fight between the two ends continued for a long time with famous comics like George Carlin and Richard Pryor facing the brunt.

Hence, it should not be seen as unusual for comics starting the genre within a community to start getting into trouble with the authorities. Stand-up content has had to fight through moral consciousness in all societies before the mindset evolved in its favour. One of the things which helped the most in this was the rising fame and demand for stand-up comedy, which made it an economically viable occupation. For some of the stand-up comedians it also brought fame and stardom which solidified the base for the upcoming talents and brought a legitimacy that the occupation needed. In other words, the budding comics from the countries with a comparatively new stand-up scene should look at early troubles as a rite of passage before they make it to a more accepting environment.

The history of stand-up comedy has shown that, like all the other fields, the relevance of stand-up will grow along with its demand in society. However, unlike most other services, stand-up does not only depend upon the choices and preferences of the people, but also their culture, norms and beliefs. The good news here is that even if it takes a long time, stand-up comedy as a profession will evolve as the society evolves.

Devika Kher is a Research Associate at the Takshashila Institution.

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The appropriate umpire

By Devika kher

The Spicejet case allows the Directorate General of Civil Aviationto emerge as an appropriate umpire.

The Government regulators got it right this time. Based on the remarks of the hassled civil aviation minister Ashok Gajapathi Raju, the Directorate General of Civil Aviation (DGCA) Chief Prabhat Kumar took the much needed steps to monitor Spicejet, a heavily indebted domestic airline in a timely manner. The airline was put on the cash-and-carry mode after the Civil Aviation Minister expressed his concern regarding the flight. All these measures were taken by the DGCA as a step for “heightened surveillance”.

Spicejet is a low-cost Indian airline owned by the Chennai based Sun Group, a conglomerate of Kalanithi Maran who also own the Sun TV Network, the largest media network in the country. It commenced services in 2005 and has Sanjeev Kapoor as the current CEO who took the position in April 2014 as the airline made a substantial loss of Rs.1,186 crore in 2013-14 and was in a dire need of investments. In the turbulent times faced by the airline last year, the owner Kalanithi Maran invested Rs. 54.27 crore into the airline as it made a loss of Rs 559 crore for Q2FY14.

Not keeping with the financial condition of the airline, Spicejet managed to be the second largest passenger carrier till August 2014 with a 20.9 percent share of the domestic market. A major attribute for the high number of passengers was the low fares maintained below the cost price, which eventually led to the increase in the losses made by the airline. As the financial health of the airline became grim, the Civil Aviation Minister pointed it out as “giving (them) a heart attack”.

On December 4th, the DGCA Chief issued a warning against Spicejet airline asking it to provide a schedule for payment of a Rs.1,500 crore loan to various vendors. The DGCA Chief also took other steps, such as withdrawal of the credit facility for airport user fees, in response to the Rs. 200 crore debt owed by the airline to the Airport Authority of India (AAI). However, an interesting aspect of the decisions was, the caution taken to leave the market untouched. Instead the DGCA went a step ahead and asked the airline to stop advance bookings of flights for over a month as well as to refund the customers of the cancelled flights. The airline was asked to withdraw slots to minimise the impact in the aviation industry. Besides the market factors, the safety measure have also been kept in mind when the DGCA ensured that pilots would not be made to do overtime, as 115 commanders and 17 co-pilots resigned on Saturday, December 6.

Another intriguing aspect was the government’s ability to avoid taking extreme steps. For instance, on one hand the authorities refused to provide financial support to the private airline, on the other, they extended the deadline for the debt payment to AAI by almost a week. Hence, the government took the stand of not being authoritative enough, so as to ban the airline, but were cautious to not misuse the fiscal resources at hand.

This case can be seen as an example of the government playing the role of a fair umpire. As an umpire the government should set the rules of the game. It should ensure that all players adhere to it. If this is done right, it helps the government in asserting legitimacy over the players in the market. In this case, the government has shown timeliness by taking steps before it was too late. This not only helped improve the government’s ability to overlook the scenario but also saved the employees, investors, customers and agents from another massive loss after the Kingfisher Airline fiasco.

Fortunately, unlike the Uber case, this scenario gives hope for a government body with the ability to realise its role in accordance to the objective required to be attained. Hence, instead of impairing the market by banning a firm from operating in the national capital, the DGCA concentrated on reducing the impact of the losses of one firm from adversely affecting the entire industry. The government authority in the case of Spicejet used its power to sustain the market, instead of using it as a punching bag for the political economy.

Devika Kher is a Research Asoociate at the Takshashila Institution.

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