INDIA TRIES A MOONSHOT

NOV. 30, 2016, 7:00 PM BY COMMENTARY 1 COMMENT

https://vtdigger.org/2016/11/30/narain-d-batra-india-tries-moonshot/

Digital India has been called a moonshot project that draws together the best human and private-public capital to achieve a goal that was previously thought to be impossible: Total transformation of society.

Digital India, based on Aadhaar, focuses on three fundamental areas: access to digital infrastructure as a utility, services on demand, and digital empowerment of citizens through access to information. With more than a billion UIDs and growing, Aadhaar is the world’s largest database.

Aadhaar has captured the imagination of the people of India. Besides the government, private enterprises, including some places of worship, have begun to use Aadhaar to prevent fraud and facilitate transactions. For example, a Hindu temple in Almora, Uttarkhand, makes Aadhaar cards mandatory for getting married. Temple priest Hari Vinod Pant told The Times of India, “There have been instances when couples who came to the temple were found to be underage and it turned out they had eloped to get married. There have also been cases of Nepalese underage girls coming here to get married. So the temple committee took the decision of checking Aadhaar cards before agreeing to conduct the wedding.”

Indian Railways, one of the world’s largest railroad networks, a transport system that carries more than 22 million passengers a day, is planning to link subsidized concessional tickets for senior citizens and the underprivileged with Aadhaar to prevent fraud. But Digital India means much more: all railway structures and operations must be totally digitized and automated to eliminate deadly train derailments, such as the one that happened to Indore-Patna Express that killed scores of passengers. 

In a major reshaping of the public health system, Aadhaar numbers will be used as unique patient identifiers in a new electronic health records system. National identification numbers will be generated and assigned to all health facilities, beginning with public health facilities.

To encourage the use of Aadhaar, the Reserve Bank of India has asked banks to ensure that all new transactional cards, effective from Jan. 1, 2017, are also enabled to process payment using Aadhaar-based biometric authentication.

Under the financial inclusion scheme, Jan Dhan, any Indian older than 10 years who does not have a bank account can now open one in their name with an opening deposit of zero in any registered bank. Demonetization has awakened the mostly dormant Jan Dhan. Bill Gates of Microsoft is not the only foreign observer who believes that India will “move away from a shadow economy to an even more transparent economy.” The whole world is watching.

There have been concerns about the misuse of biometric data. Aadhaar uses the highest available public key cryptography with built-in tools to prevent meddling. Just like the U.S. military, Aadhaar uses layers of firewalls for data protection. Besides, Aadhaar databases are segregated. Segregation adds to security.

Entrepreneurs regard India’s digital venture as an extremely bold initiative. Jack Hidary, a senior adviser at Google X Labs, speaking at EmTech 2016: The Digital Future, called India as a moonshot nation that is “going through a radical transformation the like of that we have never seen.” A moonshot, he said, is an initiative that aims to achieve a goal that was previously thought to be impossible because it attracts the best human capital and finance from long-term investors.

Sharad Sharma, co-founder of iSpirit, said at the conference, “India is entering a phase of innovation that is substantially different from what we have seen until now.” Aadhaar, he stated, will create other digital possibilities such as “the presence-less layer, which means I can open a bank account and establish who I am without doing in-person verification.” Aadhaar will enable millions of people to use their e-signs for paperless transactions. Aadhaar has made possible the Unified Payments Interface (UPI), a debit card system that is a less expensive alternative to MasterCard and Visa.

With 650 million smartphone users, it is expected that within a year, mobile cash will become all pervasive in India, especially when the “digital consent” becomes an operational and integral part of the cashless payment system. As reported in LiveMint, Mr. Sharma said, “We are data poor right now, but we are putting in place a new system to managing digital consent, so nobody can aggregate data about you without a digital permission token from you. This is going to be the largest country-scale system in the world — a techno-legal solution… a very modern approach, which is a techno-legal sort of solution to manage privacy.”

While the government uses Aadhaar to ensure the delivery of benefits and services to residents, albeit with a special focus on the underprivileged, business enterprises are developing Aadhaar-based apps for the nation’s burgeoning e-commerce. That is drawing Amazon, Google, Microsoft, Facebook and others to collaborate and compete with Indian enterprises to reach rural India. Consider this: in 2014 Jeff Bezos of Amazon invested $2 billion, and in June 2016 he pledged another $3 billion, to build a logistics network to cover the entire country to have a major stake in the online market expected to grow to $110 billion in the coming decade, according a Wall Street Journal report.

Google and Tata Trusts have trained thousands of female trainers and sent them to rural India on motorbikes to help rural women to learn the use of smartphones and tablets for building their small home-based businesses.

Women in India lag far behind men on social media, e-commerce and mobile connectivity. Parents discourage girls from having smartphones. They fear that young girls might go astray or do something that might shame the family. For their own self-interest, it is important for IT companies, therefore, to educate people and remove their fear of smartphones, especially by women so that they can fully participate in opportunities created by Digital India. Once men see that women are using smartphones for socially useful purposes, their hostility will diminish. That is the hope for Digital India: Give every woman a smartphone and see India transform.

India’s Growth Story Needs a New Actor

From The Diplomat

 India’s Growth Story Needs a New Actor

The country needs to go beyond its current IT sector in developing knowledge workers.

By Narain D. Batra
March 22, 2014

India is facing the challenge of a new industrial age, a software-powered intelligent-machine world that needs highly skilled workers. The nature of work is being transformed because smart machines can do more than repetitive tasks. A dozen highly trained workers, for example, can run an entire garment factory in India, Bangladesh or China. Intelligent machines have very high productivity but they do need intelligent workers, albeit fewer and fewer, who can operate complex hi-tech devices.

A young country like India clearly has plenty of workers, but without high-quality education the so-called demographic dividend could become a demographic nightmare. Indian graduates without information technology skills will be competing with skilled labor in other countries for wages under constant downward pressure. India needs to raise its bar very high. As President Pranab Mukherjee said recently at a Himachal Pradesh university campus, “Our universities have to be the breeding ground for creative pursuits. They have to be the source of cutting edge technological developments.”  These ideas should be implemented not only at the university level; they should be pushed down to the lower rungs of school education.

A decade ago India announced the establishment of the National Knowledge Commission, “on matters relating to institutions of knowledge production, knowledge use and knowledge dissemination.” It was recognition of the fact that – like the United States, Germany, Japan, and other developed countries – India was moving towards an information technology and knowledge-based economy. Much has changed since then.

Today, knowledge means the ability to work with ever increasing computer intelligence and smart software systems that operate and control everything from hospital diagnostics to railroad systems. A knowledge worker today is a highly creative person who feels comfortable working with and manipulating intelligent software and smart machines. As economist Tyler Cowen says, average is over. If you cannot get to the top, there’s plenty of space at the bottom of the pyramid.

The technologically advanced economy of today is a triangulation of cutting-edge technical knowledge, a highly skilled labor force and venture capital. But the driving force is the knowledge software produced by information technology workers who develop innovations that make labor and capital more efficient – the kind of knowledge that is being generated in India’s technology parks. Unfortunately this very knowledge will reduce if not totally eliminate the need for low-skilled workers. The demographic dividend will become an illusion unless India undergoes an education revolution at the grassroots level.

On the bright side, a handful of technology-based knowledge producing cities, including Bangalore, Hyderabad, Kolkata, Mumbai, Pune and Gurgaon, could positively influence the whole country. Technology-based knowledge, unlike capital and labor, is inexhaustible and is “non-rivalrous,” as economists say, and should become the foundation of massively available mass education in India. Let every Indian high school student learn computer programming, a discipline that requires learning mathematics, logical analysis, problem formulation and building step-by-step solutions called algorithms. Programming is a highly creative art form as well as a problem-solving strategy. Catch them young, as they say. The greater the challenge to young people, the greater will be the response.

Teaching computer intelligence, programming languages, as well as the English language, to students from disadvantaged communities in India, to paraphrase Google executive chairman Eric Schmidt’s ideas, will turn them into knowledge workers and lift them out of poverty. It will also supply a steady stream of knowledge workers to the IT sector, without which it would be scrambling to retain workers by offering them stock options and other incentives, which may in the long run prove nonproductive and even disastrous, potentially also increasing inequality in India and adding to social tensions.

The low-hanging fruit of 8-9 percent annual growth is perhaps over. Economic growth in India will come not so much from the stock market but rather from those industries where the knowledge worker, someone who can work with sophisticated machines and complex software, would be as important as the financier or the venture capitalist; for example, the biotechnology and pharmaceutical industry where the gestation period is long and rewards for workers cannot be stock-market driven. Economic growth can be sustainable if workers keep learning how to manage manufacturing systems whose embedded intelligence can be constantly improved.

India should employ its knowledge advantage in the cutting-edge field of intelligent software and robotic machines to create an environment where entrepreneurs and venture capitalists grow and accept the challenge of the unexpected, the road less travelled.

India’s policymakers need to strategize on ways the marketplace, apart from universities and institutes of technology, could be harnessed to create knowledge that generates innovation that can sustainably boost India’s growth. The kind of growth that becomes what economists, such as New York University Stern School of Business Professor Paul Romer and others, call “a virtuous circle.” But at the center of this virtuous circle has to be the highly trained worker who can teach machines and learn from them.

Dr. Narain Batra, professor of communications and diplomacy at Norwich University (U.S), is the author of The First Freedoms and America’s Culture of Innovation. He is currently working on a book on India.

On slippery ground, but India needs both Israel & Iran

Times of India

Narain D Batra |

Feb 19, 2012, 04.54AM IST

Iran is India's biggest diplomatic challenge today. The Chabahar Port in Iran along with a very strategic railway link offers India direct access to Afghanistan and the energy-rich Central Asia. But the allegations made by Israel that a recent bomb attack on one of its diplomats in Delhi was perpetrated by Iran sympathizers, adds to the problems in a already- complicated relationship.

As a responsible Indian Ocean power, India must help resolve an international crisis, particularly in the Middle East where it has heavily invested, especially in human capital. Six million Indians living in the region send home more than $40 billion annually.

That said, India and Israel too have growing relations in several fields crucial for economic development, including defence technology, agriculture, R&D and tourism. India must be a safe place for Israelis to visit and do business.

Trade, investment, and diplomatic influence are highly correlated, and India needs to be innovative and aggressive. Finance minister Pranab Mukherjee's visit to Chicago late January, quickly followed by foreign secretary Ranjan Mathai's Washington trip, the India-European Union summit in Delhi to expedite broad-based trade and investment, and ongoing negotiations with Saudi Arabia and Iran on energy issues highlight the urgency of economic diplomacy to serve India's long-term national interests.

Addressing the Chicago Council on Global Affairs, Mukherjee urged his audience of some top business leaders to "contribute to our collective prosperity," especially when India has embarked on colossal infrastructure building projects that will require one trillion dollar investment during the next five years.

Mukherjee touted India's "calibrated approach" to capital account convertibility; the success of external commercial borrowings policy in maintaining external debt at sustainable levels; the robustness of India's banking sector; diversified export markets; and the robustness of the financial sector due to optimal regulatory mechanism. Financially, India stands like a rock.

With the Delhi-Mumbai Industrial Corridor and other similar projects in mind, Mukherjee explained the government's manufacturing policy to create 100 million jobs in the next decade by establishing special zones with world-class urban centres, to make Indian industry globally competitive. This will be done by instituting a supportive framework to facilitate business, including availability of skills, technology, finance, and "compliance based on self-regulation," with minimal government intervention. Mukherjee came as close as he could to promise that India will be as business-friendly as China.

While courting American investors, Mukherjee did not hesitate to assert India's position on two vital issues - Obama's outsourcing policy and Iran sanctions. Obama's plan to limit outsourcing through tax incentives is counterproductive and will hurt both India and America. Of course, the best way for Indian IT industry to combat the looming outsourcing "protectionism" threat is to offer products and services so compelling that corporate America cannot refuse.

On India-Iran trade relations, Mukherjee was unequivocally frank: "It is not possible for India to take any decision to reduce the imports from Iran drastically, because among the countries which can provide the requirement of the emerging economies, Iran is an important country." Buying Iran oil does not mean that India condones Iran's nuclear ambitions other than for peaceful purposes. Maintaining stability in the Middle East to enable an uninterrupted flow of energy is a global challenge.

Later, on his visit to Washington DC, foreign secretary Ranjan Mathai told his audience at the Center for Strategic and International Studies, that, "while Iran has rights to peaceful uses of nuclear energy, it must also fulfill its international obligations as a non-nuclear weapon state under the NPT." India's voting record on Iran in IAEA is unambiguous.

But Mathai also focused on Iran's geopolitical importance to India. Iran, apart from providing India with 12 % of its oil needs, worth $11 billion annually, also enables access to Central Asia including Afghanistan whose long-term stability and prosperity is vital to India; as it is to the US especially when it plans to withdraw its combat forces in 2014.

India's forthcoming trade negotiations with Iran should have twofold aims - first, to negotiate the oil deal at best prices entirely in rupee terms. Rupee oil trade agreement will boost Indian exports to Iran. Besides, it will open up opportunities for other countries to do trade in rupee, further stimulating Indian exports. Although Indian economy is based on domestic consumption, international trade generates tremendous diplomatic leverage and influence - see what China is doing with its massive trade surplus and foreign currency reserves.

Second, India should use the opportunity to persuade Iran to resume negotiations regarding its nuclear programme since it claims its programme to be peaceful. In fact, during the recently concluded India-EU free trade talks, European Council President Herman Van Rompuy and European Commission President Jose Manuel Barroso pressed India to use its leverage with Iran to return to the negotiating table.

India needs to make a large and meaningful diplomatic gesture for international cooperation without compromising its economic interests.

The writer is professor of communications and diplomacy at Norwich University

Offensive-Defensive National Security

COMMENT
The Devil Is In The Detail
May 28, 2011

TOI Crest Edition

Narain D Batra

America keeps a constant hawk-eye on potential terrorists. Less than two weeks after the Abbottabad commando operation, six people, including two imams of Florida mosques, were arrested for providing material and financial support to the Pakistani Taliban. For about two years, 2008 through 2010, according to the indictment, the accused provided money, financial services, and other kinds of support to the Tehrik-e Taliban of Pakistan.

It is the daily nitty-gritty intelligence work that has been keeping the United States safe since 9/11 rather than the shock-and-awe SEALs operation that killed and clawed Osama bin Laden out of his Abbottabad lair and sent him to his watery grave. This is not to diminish President Barack Obama's courageous decision;nor is it to take away from the valour of the Navy SEAL commandos trained for do-or-die missions and the hitherto unknown radarevading stealth helicopters that sneaked past Pakistani vigilance. But these are not foolproof measures.

Such daring missions do go bust. With one helicopter down, the Abbottabad mission got lucky. A similar audacious mission on April 24, 1980, authorised by President Jimmy Carter to rescue 52 American hostages held at the American Embassy in Tehran, ended in humiliating debacle. There have been other disasters too, for example, in Mogadishu, Somalia, in 1993, where the Navy SEALs' two Black Hawks were shot down, requiring a rescue operation.

Just as we admire the US Navy SEAL operators, it will be a mistake to underestimate the Pakistanis;they have created the indestructible Taliban, the progeny of a most ruthless secret service, the ISI, which through selfmultiplying lethal cells and self-sustaining charities dominates Pakistan and casts its deadly shadow beyond its borders. The former British prime minister, Gordon Brown, on a visit to Pakistan, called it "the chain of terror that links the mountains of Afghanistan and Pakistan to the streets of the UK and other countries around the world."

Ponder over the well-organised Pakistani sea-borne commando attacks in Mumbai in 2008. Not only did the Pakistanis do a tremendous job of training do-and-die commando-style terrorists but they also used some of the most modern means of communication including GPS, Google Earth, satellite cell phones, Skype, and Vonage. Somewhere in Pakistan, every movement of the terrorists must have been monitored in real time. President Obama and his team were doing the same in the White House situation room when the commando operation was in progress.

India should not think of fighting terrorism with USstyle commando attacks into Pakistan territory even if it is capable of doing so. And it should ask its military commanders to keep their cool and remain taciturn when provoked by the news media. Terrorism has to be fought with anticipation, intelligence, and persistence.

Every so often, the US Homeland Security authorities revisit and update their plans to meet new contingencies. In 2006, for example, authorities discovered a plot to blast and cripple the underground tunnel system that connects New Jersey with New York City. The discovery was not serendipitous. The security forces were on the lookout for terrorists in order to pre-empt any attack. Besides the Homeland Security, every state has contingency plans. Federal and state governments work meticulously, and closely, to fight terrorism.

In the United States as well as in Europe, there has been a paradigm shift in thinking about terrorism. The strategy is to eliminate terrorism at the neonatal stage by establishing an early awareness system, which is different from an early warning system. The guiding principle is: what can be anticipated can also be prevented. Preventing terrorism at the inspirational and "aspirational" stages is the goal. For example, the plot to bomb Sears Tower in Chicago was at a stage "more aspirational than operational, " according to the FBI, when the terrorists were nailed down in June 2007.

Following the preemptive policy of dealing with terrorists, former US Attorney (for the Northern District of Georgia) David E Nahmias said, "We no longer wait until a bomb is built and ready to explode. " That's what India should do.

Europeans have been following similar antiterrorism strategies. In December 2008, for example, the Belgian police arrested 14 people on mere suspicion of suspected terrorist links. Six of them were charged with being members of a Belgian branch of al-Qaida. What prompted the pre-emptive measure was a concern to secure the European Union leaders' two-day summit meeting, which might have become the terrorists' target. The federal prosecutor in Brussels, Johan Delmulle, was quoted as saying, "We don't know where the suicide attack was to take place. It could have been an operation in Pakistan or Afghanistan, but it can't be ruled out that Belgium or Europe could have been the target. " Instead of sending commandos into Afghanistan or Pakistan, they combed their own backyards and got them.

US security laws allow intelligence and law enforcement authorities to trawl through places of worship, activities of charities, communications of suspected militants, and even their shopping patterns. The strategy "provides a common framework" through which not only the federal, state and local governments work but also "the private and non-profit sectors, communities, and individual citizens" are actively included in Homeland Security's efforts.

Outstanding intelligence gathering, pre-emptive and preventive measures, and anticipatory disaster plans will go a long way in eliminating the scourge of terrorism in India. India needs to create a culture of preparedness and alacrity that pervades all levels of society instead of planning commando attacks against a country with which, in the long run, we have to develop working relations.

The writer is a professor of communications and diplomacy at Norwich University

THE ECLIPSED SUN

THE ECLIPSED SUN


By Rajat Das Gupta

“The book comprises translation by the author of some Poems / Songs and other works by Rabindranath Tagore (Nobel Laureate of 1913) in Bengali language.”

Read more….

http://www.indoindians.com/index.php?option=com_content&view=section&id=39&Itemid=120

Corruption in India

COMMENT

It's a matter of trust

Narain D Batra | January 8, 2011

Times of India The Crest edition

The challenge for India, a growing economy, a rising nation that wants to play a global role, is how to go beyond the trust based on family ties, old boys' networks, caste and religion - especially in a diversified and multicultural world - so that investors can repose their faith in the system.

The system must be so open and transparent that it creates verifiable trust and trustworthiness. There lies the future of India. 

Erosion of trust is a global phenomenon.

President Barack Obama sees the rebuilding of public trust as one of his major challenges and, therefore, the subject of transparency reverberates in his public communication. What is good for the government is equally good for corporate governance. 

Doing business is essentially building social trust, which is imperative for foreign direct investment (FDI), especially if a company is dependent upon global customers as many Indian companies are increasingly becoming. When enterprising families join hands with government, business growth can be rapid in the initial stages, because regulatory constraints and market accountability can be waived to access credit and investment.

The rapid growths of companies like Satyam, for example, was not due to the miracle of unique Indian entrepreneurial spirit but because of the government-family nexus of economic interests, contemptuously though rightfully called crony capitalism. 

Although crony capitalism is present in every society, it flourishes best where the flow of information, both economic and political, is limited.

This has been the pattern in most Asian countries and India fits into this pattern. India is a double-book nation and those in the accountingauditing profession do understand how big India's shadow economy is. The protected family-based business system reaches its limits of growth when it needs infusion of technology and capital for expansion, which can come from sources outside the family. Investors, especially now when they have many competitive opportunities available all over the world and can electronically transfer their investments instantly, demand sunshine, transparency, openness and accountability. You cannot separate business from politics, global corporate from global politics. 



It is possible to create trust beyond the family-based business system but it can be done only under the supervision of an independent watchdog authority that creates a level-playing field for all. In the United States, the Security and Exchange Commission (SEC) monitors business corporations and stock markets. Markets are complex but fragile systems, which do not thrive on family ties but on honest and open communication with investors. But even the best system is open to abuse, as we have been painfully observing what has been happening to some legendary banks and financial institutions. Trust is in deficit now. Rebuilding global trust is the biggest challenge for corporate and political leaderships in the age of uncertainty. And India is no exception. 



Economic growth of more than 8 per cent during the last several years had made us temporarily forget about corruption until the slew of scams that were outed last year. Ordinary Indians pay a bribe of about $5 billion (Rs 21, 068 crores) a year for "availing one or more of the eleven public services in a year" according to a 2005 Centre for Media Studies/Transparency India Report. Can you imagine how much people of the super class - those who breakfast in New York, lunch in London and have dinner in Mumbai - must be paying to speed up their business deals? 

Initially, as the legend goes, the foreign exchange crisis of the early 1990s forced India to open up its doors to market economy. But India was pushed into globalisation by the information revolution.

The other India, its diaspora, especially in the IT field, began to show ingenuity for developing new products and services as well as for solving complicated problems, including the killing of the millennium bug. Bangalore was able to liftoff in spite of its poor infrastructure and in the process transformed itself into a cyberspace module that expertly docked with the emerging digital universe, partly thanks to Indian satellite technology, which was paradoxically seeded during the era of self-reliance. 

While the spectacular success of Bangalore and India's IT industry showed how much the Indian entrepreneur could do for the world, it also exposed India's vulnerabilities, its sluggish rural economy, massive shortfalls in investment for infrastructure development, high illiteracy levels, and a high rate of underemployed and unemployed people. The world began to look at India's underside. Indian policymakers and intellectuals began to grapple with the problem of economic growth, but they did not pay attention to the culture of corruption, a yoke on the poor. 

Sadly, the news media in India has not been playing its watchdog role robustly enough. Public accountability through news media exposês and relentless investigative reporting, especially through internet blogging and television shows, as the American experience shows, is a strong antidote to corruption.



What would make politicians and bureaucrats more accountable and responsive to public needs? Individuals who exercise political power should be made answerable for not only how they use the power vested in them but also whether they achieve goals with clean hands. Some problems facing India are systemic and call for structural changes. The system as a whole has to be geared up for growth, which means the development of a Grand National Strategy that covers every region.

Booming Gujarat and a depressed North-East cannot be part of the same country. 

If India were to build global trust and take its rightful place in the world order, it must fight corruption as seriously as it is fighting terrorism and insurgency. 



The writer is professor of communication and diplomacy at Norwich University

Open up India

Printed from
TOP ARTICLE
Open Markets, Open Minds

N D Batra
Aug 10, 2010, 12.00am IST
Times of India

Every year, India waits for a bountiful monsoon not only to cool people from the sweltering heat but, more importantly, to chill food prices so that the common man can feed his children healthy meals. A good monsoon can make a difference of 7 to 10 per cent in food prices and that means a lot to a middle-class Indian family with school-going children or a day labourer working on a construction site. Last year's bad monsoon spiked food inflation by double digits this year.

But since India cannot always depend upon the generosity of the rain gods, it can certainly use the efficiencies of organised retailers like Carrefour, Tesco, Walmart and others to bring down the prices of daily essentials including groceries. A few years ago, West Bengal chief minister Buddhadeb Bhattacharjee asked at a meeting of business leaders in Kolkata, "Why do we need Walmart to come?" The answer is simple: bringing down prices of daily essentials is good for every politician, regardless of ideology.

Food subsidies through rationing create a feeling of dependence and hurt the poor's self-respect. Moreover, as a recent discussion paper by the ministry of commerce and industry emphasised, "The bill on food subsidies is rising. In spite of such heavy subsidies, overall food-based inflation has been a matter of great concern. The absence of a 'farm-to-fork' retail supply system has led to the ultimate customers paying a premium for shortages and a charge for wastages."

Eliminating wastage through a modern cold storage and supply chain system that an organised retailer like Walmart can provide will bring down prices by 5 to 7 per cent. But the question is: will Walmart eat up the lunch of millions of entrepreneurs, middlemen and small shopkeepers? Very unlikely, for the simple reason that the retail space in India is growing at a very fast rate. According to the BMI India Retail Report for the third-quarter 2010, retail sales are likely to increase at the annual rate of 11.4 per cent for the retail industry to grow from $353 billion in 2010 to $543.2 billion by 2014. India is not a dog-eat-dog world. In a growing India, everyone can grow.

The world's biggest retail and grocery giant, Walmart, sells almost everything and at the lowest prices, providing low-income and middle-class people affordable access to goods which would be otherwise beyond their tight budgets. Small entrepreneurs are, of course, the backbone of the Indian economy but instead of being overly protected, they should be gradually exposed to the challenges of marketing innovations of Walmart, Carrefour and others. Entrepreneurs thrive best in an environment of challenge-and-response. In the process, some creative destruction as economist Joseph Schumpeter termed it is inevitable.

Due to the fact that incomes are rising and the middle and upper middle-class consumer is eager to use a credit card, retail opportunities in India are expanding rapidly even in second and third-tier cities, according to the BMI report. Even if India's huge retail market grows modestly, let's say at the same rate as India's GDP (8-9 per cent), modern retailing practices must be built up to satisfy the demand of the growing populace. The government allows 51 per cent foreign direct investment to companies that sell goods through single-brand stores. Through its Bharti franchise, Walmart, for example, found a narrow passage to India but time has come to open India's doors more widely and let the competition begin so that even the poorest can benefit from its "always low prices". Open markets create open minds.

India is not only a huge growth market for Walmart, but it is also a fast-growing outsourcing market, with an expected $1.6 billion merchandise export to Walmart International this year. But that is puny compared with what Walmart buys from China $28 billion according to some estimates and, besides, it has created many entrepreneurial opportunities in China by establishing a most modern supply chain system.

Policymakers should focus their attention on not only how Walmart will trigger a retail revolution in India but also whether India could become another outsourcing hub for the hungry global giant which has 4,008 stores worldwide, including 66 in China. The retailer is able to achieve efficiencies by buying massive quantities from inshore and offshore sources. It helps farmers to provide better produce to meet its international standards, as it is doing in Punjab.

Walmart hires workers at competitive wages, though some say at the lower end, especially women employees (a sex discrimination class-action lawsuit has been allowed to proceed against the retailer in the US). Discrimination is an unacceptable practice in American society and that's how it should be in India, whenever a foreign company is allowed to do business. Just and fair labour practices established in the US should be followed when the government allows Walmart and other multinationals full entry into India. Low prices, non-discrimination, technology transfer, if that's Walmart, Carrefour or Tesco, welcome to India.

The writer is professor of communications and diplomacy at Norwich University, US.

Read more: Open Markets, Open Minds - Edit Page - Opinion - Home - The Times of India http://timesofindia.indiatimes.com/articleshow/6282594.cms?prtpage=1#ixzz0w8ogY7ka

Kolkata MUST rise

Kolkata MUST rise
ND Batra

Ashok Malik’s “A Place Time Forgot” (TOI) is an intriguing commentary on what Jyoti Basu and CPM did or failed to do in West Bengal during the three long decades of complete sway on political power in the state.

Interestingly, his commentary builds upon what historian Rudrangshu Mukherjee wrote in the Telegraph (“Minds in thrall”), explaining the compelling historical circumstances and the powerful influence of men like Rajani Palme Dutt in the “conversion” of privileged young Bengalis like Jyoti Basu and others to communism.

Between the two commentaries, however, there is an intellectual gap, which puzzles me. For example, what kind of political apparatus and propaganda methods CPM used to keep the otherwise intense and individualistic Bengali mind enthralled for so long? How did “a closing of the Bengali mind” occur?

For more than a decade I wrote a weekly column for a Kolkata newspaper and I used to receive lot of e-mail messages from readers. One of my readers describing CPM’s political method of command and control used the expression “goon-o-cracy.” Is this the same as “cadre-cracy”? Why did the news media and the academia succumb to CPM’s influence? What was CPM’s meta-narrative or state fantasy that captured the minds of the people?

What a historical coincident! In 1977 when Jyoti Basu became the chief minister of West Bengal, Deng Xiapeng had ushered in the “Beijing Spring.” Consolidating his political control over China, Deng started gradually opening up the country to marketplace economy and foreign direct investment.

In 1979 Deng visited the United States and China never looked back. Instead of making frequent visits to London, Jyoti Basu should have come to New York. Johnny Walker depressed him, perhaps; California wines would have uplifted his spirits and done some good for West Bengal.

Kolkata and West Bengal are too important to be consigned to the dust bin of history or the catacomb of time past. Thanks to India’s dynamic federalism and diversity, some states like Karnataka, Gujarat and Maharashtra have followed different models and have very done well. Gujarat, for example, has been growing at more than 11.5 percent during the past five years. In spite of Ahmedabad 2002, Gujarat is a very cheerful place to live and work. I know because I lived and worked there before I moved to the US. Open markets create open minds. And that’s how the Bengali mind would liberate itself from the tyranny of the past three decades.

A different kind of renaissance would begin, one based on information technology.

Jyoti Basu like Vladimir Lenin will be forgotten.In India’s best national interest,

Kolkata MUST rise and shine and compete with Singapore, Hong Kong and Shanghai. It is not a pipe dream; it is an economic and political necessity for India’s “look-east” policy.

Obama's War and Peace

Obama’s Afghanistan war and India
ND Batra
India has vital interest in the success of President Barack Obama’s surge-and-exit strategy for destroying the Al Qaeda-Taliban nexus and plexus in Afghanistan and Pakistan.

The Af-Pak region is not a passive sanctuary for the Taliban-Al Qaeda; it is the global supply-chain hub of terrorism.The US Federal prosecutors have charged a US citizen David C. Headley for aiding and abetting Pakistan-based Islamic terrorists who perpetrated the honorific bombing in Mumbai last year that killed 170 innocent people. Five more American citizens of Pakistani origin have been arrested in Pakistan for their suspected links with the Taliban-Al Qaeda and for planning to commit jihadist terrorist acts. Mr. Obama reminded the American people at West Point that the paramount goal is “to disrupt, dismantle, and defeat al Qaeda in Afghanistan and Pakistan, and to prevent its capacity to threaten America and our allies in the future.”

It is an existential war against a global menace from which no one, not even Pakistan can escape, despite the fact that it nurtured the Taliban and has been providing safe havens to Al Qaeda. Although Mr. Obama strongly disagreed with the Iraq War which he regarded as a war of choice, the lessons of the war and insurgency cannot be lost, especially how the Bush administration’s well-planned troop surge worked enabling the US to handover security responsibilities to the Iraqi government.

Mr. Obama is not looking for a closure or an endgame because there can be none so long the United States remains an indispensable global power. Finishing the job does not mean quitting. Sixty-four years after World War II, the US maintains a significant military presence in Germany and Japan, as it does in South Korea since the armistice in 1953.

Central Asia is too important to be left to jihadists; or any aspiring power to dominate the region. Other countries may be rising but the United States is not declining. In fact the United States too is rising, even during the recession. Since the new surge-exit strategy announcement, Secretary of State Hillary Clinton and Secretary of Defense Robert Gates, two most powerful cabinet members who have played a decisive role in shaping the new military thinking, have been going around on public forums to explain how the job will be done and how much flexibility is built into the exit date which the president set as middle of July 2011.

Secretary Gates, who also served the Bush administration in the same capacity and was responsible for the successful surge strategy in Iraq, told the Senate Armed Services Committee that the mid-2011 exit strategy would be the beginning of transfer of security responsibilities to the Afghanistan government keeping the ground actualities in mind, nonetheless, with continuous partnership with the United States.

Success is not being conceptualized in binary terms—success/failure—but rather as a continuum, for which there will be assessment outcome metrics. Exit strategy is not abandonment, as Secretary Clinton told the Armed Services Committee, “We will help by working with our Afghan partners to strengthen institutions at every level of Afghan society so that we don’t leave chaos behind when our combat troops begin to depart.” This sounds a tall order to the naysayers, who wonder: Can Afghanistan secure itself? Can it govern itself?

Can it manage its borders? Again, these questions do not require yes or no answers but rather how much Afghanistan can do on its and how much help it would need from the US and the 43-nation NATO-led coalition in Afghanistan, which committed another 7000 troops in addition to the 30,000 troop surge announced by Mr. Obama.Except for Tony Blair’s reluctant Britain, Europe showed little enthusiasm for the Iraq War. But for fighting the Taliban-Al Qaeda in Af-Pak, European countries, who have been victims of terrorism, London, Madrid, Paris, for example, are absolutely committed.

A day after Mr. Obama announced the troop surge, the Nato Secretary General, Anders Fogh Rasmussen, spoke unequivocally, "What is happening in Afghanistan is a clear and present danger to our citizens. Instability in Afghanistan means insecurity for all of us."

When the United States and Europe work together in solving international security problems, the probability of success increases as it happened in the Bosnia-Herzegovina War (1992-1995), the post-Yugoslavia break up tragedy that led to international conflict resulting in the ethnic killing and massacre of more than 100,000 people. Though belated, the Nato intervention brought the war to an end.

The hope of bringing peace to Af-Pak rests on the US-Europe strategy and concerted action, in which India must play a constructive role to protect its own national self-interest.

(ND teaches communications and diplomacy at Norwich University, US)

US New Diplomacy

Times of India
Top Article:
Exercise Of Smart Power
N D Batra
27 July 2009, 12:00am IST

Recently, US defence secretary Robert Gates, a no-nonsense seasoned hand from the Bush administration, stated explicitly in Foreign Affairs that "to fail - or to be seen to fail - in either Iraq or Afghanistan would be a disastrous blow to US credibility, both among friends and allies and among potential adversaries".
US secretary of state Hillary Clinton - who recently visited India to reaffirm the strategic and economic bonds built by the previous administration - wholeheartedly endorses Gates's views when he said that because of its grinding poverty and unfriendly neighbourhood, "Afghanistan in many ways poses an even more complex and difficult long-term challenge than Iraq - one that, despite a large international effort, will require a significant US military and economic commitment for some time". Read "some time" as a long, long time, even though it has been often said that Afghanistan is the graveyard of empires. Gates has asked for an additional 22,000 troops for the army, for the next three years. An extra 17,000 troops and 4,000 military trainers are being sent to Afghanistan. Do not expect the US to leave the Af-Pak region to its own devices; nor will US presence be against India's national interest.
Gates's national defence strategic vision goes far beyond what has ever been attempted anywhere. A most serious problem that the US military confronts is how speedily it can move forces from one danger zone to another. Gates's solution: build a swift and lethal force fitted with precision-guided weapons, on-the-spot intelligence-gathering by a network of satellites; troops that can be airdropped to a battle zone bypassing existing bases or beachheads. Networked with GPS, unmanned aerial surveillance vehicles and remotely controlled drones that can provide real-time battlefield view, a lighter and speedier force can end the war quickly with fewer civilian casualties.
In the early days of Iraqi operations, swiftness was achieved through maximum cooperation among Special Forces, army, navy, marines and air force, enabling them to act as one cohesive yet flexible force. This strategy that the Pentagon should incorporate into its war manual, according to Gates, will nevertheless not be enough. The army must be trained for the unconventional war carried out by a dispersed and networked enemy that draws its sustenance from many non-state actors sheltering in failing or unfriendly states. Besides, 'GI Joe' should be ready for doing social reconstruction and building civil society for which much more than a smart military doctrine is needed. Neither the Rumsfeld doctrine of 'shock and awe' nor the Powell doctrine of massive force application to serve a well-defined public-supported national interest is enough for the Af-Pak situation.
The al-Qaeda-Taliban asynchronous warfare strategy has made nonsense of every military doctrine. The US needs a new model for dealing with the enemy. "Terrorist networks", Gates has said, "can find sanctuary within the borders of a weak nation and strength within the chaos of social breakdown. A nuclear-armed state could collapse into chaos and criminality. The most likely catastrophic threats to the US homeland ^ for example, that of a US city being poisoned or reduced to rubble by a terrorist attack ^ are more likely to emanate from failing states than from aggressor states." The new defence strategy must take into account "the lethality of state conflict with the fanatical and protracted fervour of irregular warfare" and "wars...in which Microsoft coexists with machetes and stealth technology is met by suicide bombers," added Gates quoting defence scholars. That has been India's dilemma.
While Pakistan's nuclear threat has held India back from taking defensive-offensive measures, ISI-backed and professionally-trained terrorist groups under the disguise of charities and civic societies have been causing mayhem from India's heart of democracy, the majestic Parliament, to its city of palaces Jaipur to its most cosmopolitan corporate and cultural nexus and plexus, Mumbai. The Taliban-al-Qaeda in Afghanistan-Pakistan cannot be eliminated by traditional military strategies. The enemy has to be tracked down "hilltop by hilltop, house by house, block by bloody block", argues Gates, for which "the United States needs a military whose ability to kick down the door is matched by its ability to clean up the mess and even rebuild the house afterward".
Addressing the Council on Foreign Relations before her India trip, Clinton called it the exercise of "smart power...the use of all means at our disposal, including our ability to convene and connect. It means our economic and military strength, our capacity for entrepreneurship and innovation...The question is not whether our nation can or should lead, but how it will lead in the 21st century...America will always be a world leader..." As the Pentagon is "re-programmed" and recalibrated to become a new effective global force, the US cannot forget the much larger potential threat emerging: China's growing mastery of outer space and cyberspace, satellite warfare and cyber warfare. That is where the future US-India strategic dialogue should begin.
(The writer is professor, communications and diplomacy, at Norwich University, US.)

India's Challenge

Imagining post-election India
ND Batra
From The Statesman

India’s elections might seem a trivia pursuit to some observers in the West — just an exercise in ritualistic vote casting by 714 million voters driven by narrow considerations of caste and creed or, maybe, monetary benefits. It is true that most political parties, especially at the regional level, are not motivated by any big ideas or ideological agendas except to jockey for a piece of the pie when the post-election government formation begins to take shape. Neither of the two major national parties, the ruling Congress and the BJP, however, can be accused of having no ideology or lacking a political and economic platform; nevertheless, it is most unlikely that either of them would have a dominant position in Parliament after the election.

Localism and regionalism have been dominating Indian politics for several years and there is nothing particularly wrong with this state of affairs. National parties must reflect and accommodate regional needs and aspirations so that no one is left behind; but they cannot do so if they cast themselves up in ideological straitjackets. Even if a great national leader like Jawaharlal Nehru rises again, India would remain a country divided against itself, which would not necessarily be a disaster. In fact these divisions create opportunities for greater economic and political freedom; and experimentation. You can see the cultural differentiation between West Bengal and Gujarat. That is the beauty of the federal system. You can see how India’s culture of differentiation and the abiding spirit of free enterprise (the Gujarati-Marwari spirit) have been gradually transforming the country into a dynamic economy. In spite of the global slowdown, the economy is still likely to grow 6.5 per cent for the year ending March 2009 and according to Reserve Bank governor Duvvuri Subbarao, “India will be one of the countries that will recover fast.” About a decade ago, India reached the tipping point when economic growth became irreversible, regardless of who would govern the country.

After the post-election realignment of political forces when the new government takes office on 2 June, disciplined liberalisation of the economy ushered in by the Manmohan Singh government would continue. The need for steady economic growth and the role of the marketplace have begun to dominate thinking, which would subsume as well as transcend everything else including local and religious interests. More and more Indians have come to accept the view that the way to prosperity is through well-regulated banking and financial system, free marketplace economy and bold entrepreneurship.

An entrepreneur seeks innovations, builds networks and breaks barriers, and in the process he enriches society as you can see it happening in India’s burgeoning health industry that has begun to draw global attention. In spite of Satyam and the global slowdown, India continues to excite the world’s imagination and investors keep exploring its possibilities. For many global investors India offers another avenue of growth and diversification where they can put their resources to alternative productive uses. Tata, Reliance, Infosys, Tech Mahindra and Wipro are not the only companies for which India has become famous. There is also the growing field of auto industry, biotechnology, petrochemicals and pharmaceuticals, where Indian companies have built international brand names. The global buzz that India is full of talented young people who can perform competitively in knowledge economy continues undiminished. Knowledge economy depends upon extracting and creating new knowledge from existing knowledge databases.

Although India is far from becoming a full-fledged knowledge economy, this is the trend. Other developing fields such as genetic engineering and high-tech healthcare will hasten the transformation of India in the next decades. But much more needs to be done to “go back to nine per cent... we need the world to recover fully. Private investment demand has to pick up”, said Mr Subbarao. One of the biggest hurdles for rapid economic growth in India is the red tape, which takes myriad forms such as expectations of under the table money; fear of the loss of bureaucratic power due to privatisation; and the fear of foreign direct investment.

The primary goal of rapid economic growth and its ultimate measure is poverty reduction by generating opportunities for employment, especially for the rural people, who mostly depend upon agriculture. Even today rural India is being held hostage to nature’s uncertainties.Technology can break nature’s stranglehold on poor farmers, many of whom have committed suicide. Most rural workers need to be absorbed into agro-industry, manufacturing and service industries; and that again will necessitate massive investment in building rural and urban infrastructure and upgrading the existing one.

Rising expectations at home and abroad would create compelling conditions for the new government, regardless of its ideology, to put its act together and become pro-active in anticipating crisis and solving problems. India has become an integral part of the globalised economy and the country has flourished on the synergy between multinational corporations and the ingenuity of its people for innovative solutions to complex problems. Ingenuity means transcending a system’s limitations by finding an alternative route to reach the same goal. When a creative and ingenious mind hits a block, he gets energised to find another way and improvise by transferring intelligence from one application to another.

The challenge is whether India’s ingenuity can be tapped to undertake collective action to build reliable highways, ports, railroads, power plants and airports speedily enough to handle future growth. Corruption is a serious problem in every society but more so in India. The source of corruption is the unchecked exercise of power. Elected officials can be removed, though one might say cynically, only to be replaced by another bunch of hoodlums. But democracies do have methods of dealing with corrupt people in high places.

Public accountability through the media, including television disclosures as well as social networks and blogs, is the key to fighting the menace. If laws are enforced rigorously, the corrupt will find their rightful place in jail. War against corruption and poverty will never come to an end but the media can play a great role in fighting the scourge through courageous reporting. It is the moral responsibility of leaders to create conditions that encourage risk-taking and reward entrepreneurship. It is only through free spirited and full-blooded entrepreneurship that the post-election India can meet the challenge of national, local and regional aspirations.

(ND Batra is Professor of Communications at Norwich University. He is taking time off from the weekly column “Cyber Age,” which he has been doing since 1995, to complete a book about the American spirit of ingenuity and innovation. He will be back with a new column of ideas soon after the book is done.)

India goes to election

Reflections on India at election time
ND Batra
Fromg The Statesman

The public trust in leaders in India is limited by their parties’ narrow-minded regional-and-caste based ideologies, rampant corruption and unscrupulous opportunism despite their occasional Madison Avenue style public relations image-building. According to the Association for Democratic Reforms, of the 1,425 candidates 222 have criminal records, including “charges of murder, attempt to murder, kidnapping, extortion,” and other heinous crimes. The scars and burns of the Gujarat communal massacre in 2002 and the mass killings of poor helpless Sikhs in Delhi in 1984 are still seared into people’s visual memories.

Thanks to television and global media, we saw how ugly and inhuman people can become at times and felt ashamed of ourselves. This is what the media revolution does to a democratic society like India. It never lets you forget the past and it also fuels the desire for change at a rapid pace.

Dr N Bhaskara Rao, writing for the Center for Media Studies, observed that “in the last fortnight of March 2009 there were more than a dozen instances from around the country that we saw news channels showing cash in large volumes being transported or distributed by political leaders in the context of the Lok Sabha poll.” Although this kind of anecdotal observation needs to be vetted by empirically verifiable evidence, perception is reality in the public mind.

While the Internet makes India global, it is television that mirrors the actual realities and can uncover hidden problems including corruption and criminality. Television gives everyone easy access to information and even the most complex topic has to be simplified into terse statements, sound bites and visual moments. Television turns the abstract into the concrete and the visual. It can make corruption and injustice visible.

An uneducated worker or a farmer can easily understand what is happening; and given the Indian habit of building quick grapevine communication, eventually every topic ends up in political discussion, and into the voting booth. So when television shows some parts of India clean and bright, naturally the voters, the urban and rural poor, may ask, what about us, the slumdogs?

With cell-phone cameras everywhere, every “note for vote,” to borrow Dr Rao’s phrase, can be captured for the 24/7 television.

It is legitimate for a farmer on the verge of suicide to ask the question: How can you leave us behind? Trickle down economy has not been good enough even for the United States; but for India the economic growth must reach every nook and cranny, the lowly and the humble, the rag pickers of Dharavi-Mumbai and the rat eaters, Musahars, of Bihar.

I regard it as an assertion of the people’s right for equal access and equal opportunity to share the good life that one sees on television, soap operas and commercials. In other words, the pace of economy cannot be slowed down; rather it has to quicken to meet the rising aspirations created by television news media in India.

Since globalisation, privatisation and free market have begun to create more jobs, there’s no reason why any government, communist or otherwise, could afford to oppose the trend and still stay in power. On the contrary, one sees a growing trend in various states in India for generating competitive advantages to attract direct foreign investments and collaboration.

I have always wondered why Bengal lost Tata’s Nano, the little beautiful car which has become part of the global chatter. Competition: This is the global paradigm shift that Indians must understand. So if Bangalore, Hyderabad and Chennai rise, can Ahmedabad with Nano in its workshop remain far behind?

In a competitive environment of the free marketplace, the states, communists or communalists, have to position themselves to attract private investments and encourage entrepreneurship. Information technology industry in India has reached a critical mass and in spite of the Satyam scandal it will continue growing.

But India needs balanced development, including massive emphasis on agriculture and rural development to spread wealth and reduce disparities.

This is not to minimise the importance of information technology as an engine of economic growth. The change of government will not adversely affect the information technology base and the trust that Indian knowledge workers have been building for more than a decade. The Satyam hiccup would not change the fundamentals that India is a reliable source of off-shoring for major companies like General Electric, Dell, Hewlett-Packard, IBM and others, who value India’s knowledge workforce.

One can say with confidence that the technology sector will continue to receive the excellent support that it has been receiving regarding infrastructure and developmental policies. ITs foreign collaborators and partners need not have any concern. In fact, whatever party or coalition comes to power in New Delhi, it will certainly make all-out efforts to ensure a growth-friendly environment to attract foreign investment. But at the same time we should keep in mind that since not everyone can go to IIT or IIM, jobs off-shored to India from the United States and Europe would play a marginal role in lifting people out of poverty and raising them into the growing middle-class. There has to be something else, something much more dynamic like the rise of millions of cell-technology mobile small entrepreneurs who can grow like giants.
The next leadership must forge millions of levers to lift India out of poverty.
This much I know that once again India’s millions of electorate will regretfully affirm that the age of giants, those larger-than-life men and women ~ Jawaharlal Nehru (Tryst with destiny), Sardar Vallabhbhai Patel (Integration of states) and Indira Gandhi (Liberation of Bangladesh, accession of Sikkim, bank nationalisation that has protected India from the global financial crisis today) ~ is over forever.

Nonetheless, Dr Manmohan Singh has been good enough for the country. He has kept the hurly-burly political alliance together for five years, persuaded the country to accept the path-breaking nuclear deal with the United States, braved the Mumbai terrorist attack, and on the top of it, he has managed to keep up the average economic growth around 8 percent. Now it is the age of exploration of space, outer space, rural space and cyberspace, for which India needs bravehearts, men and women with courage, integrity and imagination.

Obama as global shepherd

President as global shepherd

ND Batra
From The Statesman

Reflecting on the G-20 meeting in London, it would appear that world leaders of the most powerful economies had succeeded in realising that concerted action was needed to halt the precipitous global economic slide and begin taking concrete steps to effect global recovery, regardless of the primary source of the trouble; which of course everyone knows started with the United States banking system’s disastrous financial innovations like sub-prime lending, credit default swaps, liar’s loans, et cetera.

Although the time for finger pointing and mutual recriminations, as some Asian and European leaders had been doing earlier, seemed to be over, the contentious issue was what would work the best to lift all boats, for example, whether to inject fiscal stimulus to let credit flow again and kick start the recovery or to erect regulatory frame work to control Wall Street’s rapacious capitalism. That was the great Atlantic divide the G-20 communiqué tried to bridge with rhetorical flourishes such as “The era of banking secrecy is over.” Much credit is being given to President Barack Obama for parlaying his well-honed campaign-style charm offensive into global diplomacy, which certainly is true.

Wherever Mr Obama and his graceful lovely wife Michelle Obama went, they won people’s hearts and minds. Through their grand symbolic gestures, eloquent speeches and transparent smiles, America seemed to be refurbishing its image sullied by the Iraq war and the Guantanamo Bay prison camp.

But no less could be said of other leaders also including the powerful European duo, President Nicolas Sarkozy of France and Chancellor Markel Angela of Germany, who asserted that the Anglo-Saxon form of unbridled marketplace capitalism is dangerous for the new world order, especially now when the global economy has become so integrated that a single Wall Street investment bank failure could cause worldwide financial tsunami. The world just cannot leave the United States to its own financial devices, however innovative they may be.

With Prime Minister Gordon Brown, like his predecessor Tony Blaire, being secure in the American safe haven of “special relationship,” the new Europe is essentially a Franco-German Europe. And in the ultimate analysis, French and German leaders prevailed in their views that mandatory stimulus spending by individual countries as the US and the UK have been insisting, would not work without a global regulatory structure.

Although China and Russia, prior to the Summit, made lot of noise about creating a new global currency under the tutelage of the IMF, they had no takers. As Nobel economist Paul Krugman said in his New York column, China is in a dollar trap. The IMF’s Special Drawing Rights (SDR) is a convertible mechanism based on a basket of currencies including the dollar, pound, euro and Japanese yen. Nothing should worry China more than the value of the dollar, whose collapse will wipe out China’s massive, rather frightening, foreign exchange reserves.

China and other developing countries have to determine the optimum level of foreign exchange reserves beyond which the accumulation becomes more of a liability than an asset. China’s excessive dependence upon exports and obscene accumulation of foreign exchange reserves is as much responsible for global financial crisis as the US fraudulent and criminal lending practices.

China and the United States have let down the world, but Mr Obama would not say so much so bluntly. Measured as he is always in his public utterances, Mr Obama said in his post-Summit radio-Internet address: “Ultimately, the only way out of a recession that is global in scope is with a response that is global in coordination.” In broad terms, there was an agreement that banks need to start lending again in order to stimulate growth and generate jobs, but Europeans were unsure about the wisdom of infusing their economies with massive multi-billion dollar stimulus packages, the kind of seemingly bold steps that the Obama administration has announced, for example, to buy toxic bank assets and shore up their finances so that they start lending again.

European leaders see the global crisis primarily as a consequence of lack of financial controls and most of the G-20 communiqué is about establishing the regulatory framework, including the closure of tax havens (Switzerland, Hong Kong, Macao, Mauritius, for example) and close supervision of hedge funds and private equity firms. But it was the eye-catching amount of $1.1 trillion through the IMF and World Bank in loans and guarantees to help developing countries, who have been badly affected by economic downturn, that answered the question, Where is the beef? “The whole world has been touched by this devastating downturn, and today, the world’s leaders have responded with an unprecedented set of comprehensive and coordinated actions,” said Mr Obama, calling the agreement “a turning point in our pursuit of global economic recovery.” The market responded to his optimism with a surge and the Dow closed over 8,000 in spite of the increasing US unemployment figures. Looking from a glass half-full half-empty perspective, the Obama stimulus package for the global economy through domestic spending, which was rejected by the Europeans, might be seen as being funneled though the International Monetary Fund ~ in spite of the IMF’s dubious reputation of being an organisation whose actions in the past, some believe, have caused more harm than good to the recipients of its loans. But beggars have no choice.

Although Mr Obama’s all embracing inclusive diplomacy shepherded the G-20 Summit superbly, it was essentially an European theatrical performance. The so-called BRIC countries were seen but not heard much.

(ND Batra teaches communications and diplomacy at Norwich University)