Insights November Edition

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EDITORIAL

We continue with our spotlight on technology, but this time in the evolving and fascinating field of “Tech Diplomacy”. We were fortunate to have with us here at Synergia the Danish Tech Ambassador, Mrs Anne Marie Engtoft Larsen. Varied aspects of the intersection between technology and diplomacy were discussed, which find a place in this month’s issue, especially concerning the question of why Big Tech should be dealt with as ‘sovereign entities’ and not merely as corporations. The area in which technology has the maximum impact is the military which has been covered based on a discussion held with senior defence analysts centred around technology being the new military centre of gravity.

One of our focus areas is supply chain resilience because, in today’s increasingly fractured world, the disruption of supply chains can be catastrophic to economies, as we experienced during the pandemic. We look at securing the chip supply chain with particular reference to India and how the QUAD members can forge a tech alliance to face up to China in the Indo-Pacific tech race.

Continuing with our last issue’s coverage of a book review on Intelligence, this month, we do a detailed analysis of the prognosis for the art of Intelligence in the digital world. The recently concluded COP27 in Egypt came out with a new promising agreement aimed at mitigating the

climate-induced pains of the developing world; we take a closer look at the prospects of such an agreement on global equity.

Other interesting issues covered are the uphill task that Rishi Sunak faces as his honeymoon period ends, ethical business practices in a connected global market, the implications for the global economy by the looming Chinese middle-income trap and what it means for a nation to default on its debts.

In our global scan, we look at President Xi Jinping’s third consecutive tenure and the dilemma of dealing with Pakistan, a difficult neighbour at best. Anti-right-wing forces may have breathed a sigh of relief as the ‘red wave’ turned into a whimper in the U.S. midterm elections. However, Mr Trump remains a political force to reckon with as he formally announced his second bid for presidentship in 2024, an issue that has been analysed in some detail.

Last but not least, we have a thought-provoking long read on the Indian Constitution and its linkages to the idea of India.

We hope our esteemed readers will continue supporting us as we strive to further evidencebased research on strategic issues with global resonance.

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principal determinant of national power.

To both its supporters and critics, the hijab is not about personal choice; it is a symbol of fundamental political questions left unresolved.

Periodically, technology disrupts the manner in which military engagements are fought and those who fail to stay up-to-date risk defeat!

National interests are not served well if there is a void between the assessment of the intelligence community and the interpretation of other organs of the state.

India cannot hope to normalise its relationship completely as long as Pakistan remains dysfunctional.

Rishi Sunak takes on the country’s top job amidst a surfeit of challenges. What can we expect from him?

In the emerging geopolitical situation, there is a need for collaboration between nations for sustainable business continuity in electronics and semiconductors.

Ukraine has again brought to the fore the intricate role of business interests in conflict situations.

COP27’s moment of triumph has been to incorporate elements of justice for vulnerable communities facing the climate crisis.

If India has to join the Big League of Nations, it must become a forerunner in electronics, and to do so, the semiconductor production in the country must grow.

Justice is, with liberty, at the heart of our Constitution. That is the idea of India.

The world watches as China seems to be walking into the unique double trap of middle-income economics indoors and alienating circumstances outdoors.

Against the backdrop of higher food, energy and import prices, an increasing number of emerging and developing economies are teetering on the edge of debt default.

President Biden must manoeuvre with a divided Congress through a convoluted domestic political landscape.

GEO-ECONOMICS

TECH DIPLOMACY: AN EVOLVING CONCEPT

‘Tech Diplomacy’ encapsulates all that holds value for the equitable and just use of technology.

Without our knowledge, we are becoming victims of Big Tech Giants. Technology comes with weighted values, with the perception of what is right or wrong varying between the technology user and the provider.

This makes it imperative for the user to remain alert to the dangers posed by technology and raise questions accordingly. As aptly put by Dr AS Kiran Kumar Rao, the former Chairman of ISRO, “I think it’s a very good initiative to be asking such questions and then make more and more people aware of things that are happening without their actual knowledge. More so because much that is being done with technology is with the prime objective of making money.”

THE GENESIS

This is where Tech Diplomacy comes in. It is a new word which should not be confused with ‘Digital Diplomacy’ (which is no different from normal diplomacy except that it extensively depends upon digital tools). Tech Diplomacy has a much wider bandwidth and incorporates critical technologies such as AI, semiconductors, 5G, the Internet of Things, quantum computing, VR etc.

Denmark could be credited for coining this word in 2017 when they appointed the first Tech Ambassador in Silicon Valley with a ‘global mandate.’ The approach, colloquially called ‘techplomacy,’ is a pioneering initiative that elevates technology and digitalisation to a crosscutting foreign and security policy priority. It is aimed to redesign convention-

The approach, colloquially called ‘techplomacy,’ is a pioneering initiative that elevates technology and digitalisation to a crosscutting foreign and security policy priority. Diplomacy is usually economical and political. In the current context, it must be accepted that tech will drive diplomacy.

al diplomacy to enable an ongoing dialogue between nation-states and the tech industry. Hence the Tech Ambassador was relocated to Silicon Valley, the Mecca of the tech industry.

Tech diplomacy is in itself a new word. Diplomacy is usually economical and political. In the current context, it must be accepted that technology will drive diplomacy. This is ultimately a formal recognition by a sovereign state of new, powerful and influential non-state actors in the international arena to chart the trajectory of future technology with an eye on the nation’s foreign policy goals.

Today, more than 50 countries have followed Denmark’s footsteps by nominating their Tech Ambassadors, with many stationed in Silicon Valley. However, a word of caution, tech diplomacy cannot be the exclusive preserve of the government or Big Tech. By its very nature, technology is a multi-stakeholder environment, and the stage must be shared with the business community, civil society, academia and media. More importantly, global geopolitics transcends the cyber domain and concerns of human rights and democratic values, thus making any transaction with the tech industry complex.

This article is based on a discussion between a group of experts and Synergia Foundation on Tech Diplomacy.

Ambassador Eugenio V Garcia, the Brazilian Tech Diplomat to Silicon Valley, defines Tech Diplomacy as “the conduct and practice of international relations, dialogue, and negotiations on global digital policy and emerging technological issues among states, the private sector, civil society, and other groups”.

FOURTH INDUSTRIAL REVOLUTION

For the first time in modern history, we are at the brink of a new Industrial Revolution. The first Industrial Revolution started in Britain through the steam engine, creating the textile industry that spread worldwide. It also ushered its own human rights issues with small children employed on the spinning jenny. So, while a transformative technology was created, it had a huge negative side effect on child labour.

The Second Industrial Revolution gave us the internal combustion engine. Parallel to this development was the evolution of the electrical engine, but the internal combustion engine ended up dominating the automobile industry. With over two billion internal combustion engines in circulation, carbon emissions threaten our existence.

The latter half of the 20th century saw the Digital Revolution (also called the Third Industrial Revolution), which shifted from mechanical and analogue electronic technology to digital electronics. Now we are witnessing the Fourth Industrial Revolution (4IR, or Industry 4.0) that has led to rapid changes in technology, industry and societal patterns on the back of global interconnectivity and smart automation.

Defining the complexities of 4IR, Mrs Anne Marie Engtoft Larsen, the Technology Ambassador of Denmark, says, “We have the opportunity to think about not individual technologies but what happens when there are billions of them around the world, the systemic impact of changing mobilisation around the world. It’s about winning the information wars, and that’s not in traditional printed newspapers.”

“AI in the quantum race is much more than just being the first to develop little magic, ten thousand qubits of a quantum computer. It’s about Mastery. How will we use that technology in the future, and how will it benefit Humanity? What values will be built into the machine, the standards we are setting, whether it’s on artificial intelligence or telecommunications.”

We have the opportunity to think about not individual technologies but what happens when there are billions of them around the world, the systemic impact of changing mobilisation around the world. It’s about winning the information wars, and that’s not in traditional printed newspapers. AI in the quantum race is much more than just being the first to develop little magic, ten thousand qubits of a quan-

Ukraine has shown graphically how cyber-attacks have real human ramifications- whether it is closing a hospital that costs lives or shutting off power to the internet, which today has substituted such a critical part of our infrastructure.

Explains Ambassador Larsen, “In this new and changing environment, technology is as much a part of our national security as much a part of our foreign policy. What are our lives going to look like? What is our National Security architecture in the global picture around these New Frontiers that include space, quantum, and inspiring technologies? We are in an age where we are embedding technologies into our bodies through neurotechnology. Limits between what used to be human and what used to be technology are blurring, and the same goes for our politics and foreign policies.”

PILLARS FOR GLOBAL PUBLIC GOODS

The first pillar for ensuring an ethical concern in the development and use of technology is ‘responsibility’. Tech companies must live up to societal responsibilities in developing business models that not only serve the company’s purpose but also what society gets out of the technology.

The second pillar is around democracy. How do we ensure that some of the fundamental values that we hold dear are the ones that are designed not only for technology that we use in Denmark or Europe but globally?

The third pillar is around security-cyber security and national security. Tech companies do not see themselves as geopolitical actors; they deal with anyone and everyone to sell their products purely from the business point of view. This is changing as major powers like the U.S. realise the leverage that technology provides to rival powers aspiring to great power status. This will impact export controls and even Foreign Direct Investments.

FINDING THE MIDDLE GROUND

The tech industry has its own set of complaints and needs a middle ground to negotiate its position with sovereign states. In their view, national regulatory bodies are stifling emerging technologies, negatively impacting innovation and the release of technology for critical ‘public good.’ In the cyber world, the sovereign

tum computer. It’s about Mastery. How will we use that technology in the fu ture, and how will it benefit Human ity? What values will be built into the machine, the standards we are setting, whether it’s on artificial intelligence or telecommunications.”

AMBASSADOR ANNE MARIE ENGTOFT LARSEN Technology Ambassador of Denmark.

boundaries tend to blur; while the nation-states continue to control the physical territory and the digital assets located therein, the big tech can access the markets and influence events across geographical boundaries remotely.

So, who is going to mediate? This is where Tech Diplomacy comes in, adjusting conventional diplomacy to the needs of the 21st century. It seeks to mobilise tech companies, governments, and civil society to collaborate in tackling the challenges that inhibit emerging technologies from being scaled to the needs of the society, responsibly.

This collaboration can no longer be delayed or ignored indefinitely. Technology is here to stay; it is changing the lives of the citizens and, on a broader scale, transforming labour markets, small and medium enterprises, and the entire government services.

There is a realisation that there is a huge gap in the relationship between the governments and citizens on one side and the big tech on the other. Both sides are operating in a vacuum without the right set of rules.

Tech Diplomacy can close this gap, with the immediate challenges being content moderation, anti-trust and competition, data security, privacy and cyber security. The tech industry must be incentivised to create solutions to all these challenges to protect and promote citizens’ rights, democracy, and fair and better competition.

THE WAY AHEAD

Harnessing the tech world is not going to be easy; the pace of advancement is too fast to keep track of. Mr Tobby Simon, President and Founder, Synergia Foundation, ‘When we talk about technologies nowadays, we are alluding to Advanced Technologies, which could be in the GPT realm.’

These Advanced Technologies have dual purposes, so it is not easy to bracket them as a ‘dark power’ for the purpose of regulations which would be very broadbased. So, there is a huge security challenge where and how these technologies end up being used. The convergence of science and technology is a further complicated matter where knowledge-based technologies will create disruptions.

The countries in the biggest danger from these technology-engineered disruptions will be democracies and swing states like Brazil, India and South Africa. Today, the ultimate aim of innovation remains the pecuniary gains accruing from the new invention.

Since the biggest funders for cutting-edge technology remain in the West (except China), when innovations are found, the quest for finding the biggest buyer begins to recoup the investment many times over in the quickest time span possible irrespective of the cost of democratic ideals and practices! The Israeli software, Pegasus was sold to a wide swathe of nations, including

DR AS KIRAN KUMAR RAO, the former Chairman of ISRO

I think it’s a very good initiative to be asking such questions and then make more and more people aware of things that are happening without their actual knowledge. More so because much that is being done with technology is with the prime objective of making money.”

India, with political leanings of all kinds, not out of any ideological fervour but purely for commercial gains. The damage it did, in over 50 nations, is difficult to assess.

Therefore, while regulations have their place, the software/ hardware must come with a ‘kill switch’ to deactivate it remotely from any part of the world before it mutates and creates even greater damage.

However, the inclination and will to implement such a ‘kill switch’ or ‘manual override’ must come from the global political leadership. In this area, too, it may be challenging to reach a consensus, as narrow political compulsions, in democracies and in dictatorships alike, when such spyware is of immense value in political contestations that are waged behind the scene.

Source : Boben Englehart

TECH DIPLOMACYDENMARK SHOWS THE WAY

Despite its small population base (about 6 million), Denmark is an innovation hub and a pathbreaker in democratising technology.

This article is based on a discussion between Synergia Foundation and the Danish Tech Ambassador.

In 2017 when Denmark was contemplating the creation of a ‘Tech Ambassador,’ the clinching argument was how to open a channel of communication directly with big international tech corporations. These entities enjoyed a great influence in the rapid changes taking place.

The first ‘Tech Embassy’ was established in Silicon Valley, transcending borders and regions in rethinking the traditional understanding of diplomatic representation. Australia and Estonia quickly followed suit, and more nations started sending tech ambassadors.

CONCERN FOR DEMOCRACY

When the first Danish Tech Ambassador, Casper Klynge, visited one of the large tech companies to discuss political issues and opinions with its top management, he met a blank wall. He was taken around the whole campus, fed and feted, given a tote bag full of souvenirs, but when it came to discussion on political issues- the concerns and the opportunities- he received a bland reply- ‘There are no concerns as there are no issues!’ Obviously, the corporates did not want to delve into the dangerous minefield of geopolitics.

Then came the 2010 media expose wherein the personal data of millions of Facebook users was purloined by Cambridge Analytica and used for political purposes, including advertising. After a year-long legal battle, Facebook was ordered by the court to pay about $ 643,000 in fines to the UK

Denmark has been a pioneer in evolving what is now being termed as ‘Tech Diplomacy’. In its broadest interpretation, Tech Diplomacy implies giving primacy to technology to further a nation’s external interest, which directly impacts global well-being. This is evident from the initiative called the ‘Tech for Democracy Initiative’ with more than 115 Partners across government, the tech industry, and civil society and spearheading the creation of the first digital foreign policy.

Information Commissioner’s Office for breaching the 1998 Data Protection Act by failing to keep users’ personal information secure.

Highlighting her country’s concern for keeping democracy safe and strong, Ambassador Anne Marie Engtoft Larsen said during an interaction at Synergia Foundation recently, “When it comes to defining society thirty years from now, I do not think there is going to be a problem with how well the technology will affect the way our society functions if, at this stage, there are public-private collaborations on measures that need to be taken.”

Denmark has been a pioneer in evolving what is now being termed as ‘Tech Diplomacy’. In its broadest interpretation, Tech Diplomacy implies giving primacy to technology to further a nation’s external interest, which directly impacts global well-being. This is evident from the initiative

called the ‘Tech for Democracy Initiative’ with more than 115 Partners across government, the tech industry, and civil society and spearheading the creation of the first digital foreign policy.

The tech diplomacy approach has been charged with maintaining the technology aspects of the Danish foreign and security policy. Results include the establishment of the world’s first tech and cyber ambassador and a team with a global mandate and a physical presence in Silicon Valley, Copenhagen, and Beijing. Tech Diplomacy is designed to transcend borders and regions in rethinking the traditional understanding of diplomatic representation.

TECH AMBASSADOR’S ROLES

The Tech Ambassador has a wide canvas to cover. However, the responsibilities can broadly be covered under six heads. These are as follows: -

(A) National representative/ interlocutor for dialogue with the tech world.

(B) Scout out emerging technologies and act as the bridge between the Danish government/ companies with these innovators.

(C) Forge global alliances in multilateral forums with companies, business organisations and NGOs on tech-related issues.

(D) Chart nation’s policies for meeting global challenges.

(E) Project Denmark as an innovator nation and a digital front-runner to attract foreign investments for Danish companies and

The priority areas remain as democracy, security and responsible tech development, with milestones laid down for specific targets every three years. Ambassa dor Anne Marie Engtoft Larsen says, “In the last decade, we’ve seen how nation-states are not the only ones defining and shaping… how our society develops and evolves and functions.’’

The role of tech am bassador is fundamen tally to represent Danish values – the opinions and perspectives of Dan ernment – to the global

To ensure ‘responsible tech companies would be

concerns of individuals and society while writing the algorithms for data-driven business models. International policies will have to be negotiated with well-defined rules and regulations to correct defaulters stepping outside acceptable norms. With the most digitised public sector in Europe, Denmark is poised to lead the way in this matter with concrete examples.

As regards preserving democratic values, the EU’s General Data Protection Regulation (GDPR) is an important step in the right direction but falls short of a watertight protective shield. There is a need for the UN to step in with a roadmap for digital cooperation and a UN Tech envoy.

The dilemma lies in how to maintain a free and open internet but at the same time protect individual and democratic societies from data theft. Dialogue with all stakeholders and especially the tech giants, is the first step towards such a cyber environment.

Security is closely linked to data integrity and its misuse. All new technologies must have a security element embedded into them. Many new technologies are dual-use and are part of a nation’s critical infrastructure (CI).

Therefore, a dialogue between the tech industry and the establishment on how to deal with cyber threats and cybercrime and delineate the division of labour between the private industry and the government is critical.

Security is not only related to national securityindividual security also has to be ensured, especially when it comes to exploiting women and children in the flourishing underground human traffic market.

Danish embassies have Innovation Centres tasked to spot and invite potential innovators for discussion in Denmark. These act as eyes and ears of the government, attracting investments, new technologies and highly qualified personnel to the tech industry in Denmark and market and showcase Danish high-tech products and expertise to the world.

India is an important destination for Denmark.

India is a large nation, with many of its states bigger than some European countries. The high-tech industry is rapidly growing domestically, especially in renewables. A state like Karnataka is drawing nearly 50 per

cent of its energy capacity from wind and solar energy. When hydroelectric power is added to the mix, it increases to almost 65 per cent.

However, in cutting-edge technology, India remains mainly a net importer rather than an innovator. This must change, and to accomplish this, Denmark and India can forge a mutually beneficial partnership anchored upon the technological prowess of Denmark and take advantage of the scale that a country as large as India can generate. Collaboration is essential - technologically, financially and diplomatically.

Not that India is standing still; there are areas where remarkable progress has been made. One good example is the India Digital Stack, the UPI, which has increased bank transactions from 25 million per month to an amazing six billion a month!

In conclusion, a quote from Ambassador Anne Marie Engtoft Larsen would be apt, “It’s a fractured world, and in the 1990s, there was a sense of despair whether there would be ever more of democracy.’’

Then Francis Fukuyama came out with his famous book ‘End of History’ (which proposes a state in which human life continues indefinitely into the future without any further major changes in society).

But it did not turn out this way. Now, we have a moment to improve democracies with a strong partnership between Europe, India, South Africa, Indonesia, Kenya and hundreds of countries around the world that have massive young populations who expect their societies, governments and politicians to use technology for social, economic and civil liberties.

EXPERT VIEW

NATO has formed a Centre of Excellence for quantum computing at the University of Copenhagen. It was not a Greenfield project but an existing institution, the Niels Bohr Institute, that NATO could build upon. Recently, the Novo Nordisk Foundation announced a DKK 1.5 billion investment in this centre. Its founder, Niels Bohr was a great enthusiast for cross-country collaboration and for this reason, he came under the scope of the CIA!

Denmark is a small country, but it is fully digitalised. So, if it goes offline, it cannot use its devices, and the society comes to a stop. But it is not only high-tech items like semiconductors that are important for daily life in Denmark; something as low-tech as a bicycle which is as ubiquitous in Denmark as smartphones, is equally important! Today it takes almost ten months to get a particular model of bicycle.

For such a small country, our bargaining powers are close to nothing but having such highly developed research institutions in Denmark has helped. Denmark believes in multilateralism, especially with Nordic countries like Sweden, Norway, Finland and Iceland, to try to find solutions together.

The Danish government works closely with Danish companies overseas to help them with problems with their supply chain disruptions and advise on alternate suppliers to clear the blockages, what we call the ‘triple bottom line.’ It’s our obligation to look a little further than just a shortage.

The triple bottom line (TBL) means that we also need to think about what the employment conditions at the source are, what is the sustainability profile of the provider of this technology and whether it is profitable. The TBL transcends technology and shortage.

The Danish Ministry of Foreign Affairs looks at Danish companies in multilateral arenas to avoid repeating past mistakes, not to look at issues in a short-sighted manner and not merely from the perspective of profit. It has taken a long time for the EU Commission to review critical materials and technologies and draw the trace thoroughly. Since 2021, the EU has been investing in getting these production facilities back into Europe.

So, in short, we are basically looking for like-minded countries. We try to take up these discussions not only from a supply and demand and profit perspective and a sustainability and employment condition perspective.

Let’s try to transcend the crisis right here and work on how we can be as resilient and flexible as possible with our supply chains across different types of critical resources and materials in a longer time span than just one year.

The discussion has to be elevated beyond industrial verticals to other verticals like policy, research and industry. In 2017, Denmark introduced a new diplomatic toolbox called Technology Diplomacy or Techplomacy. It was a new initiative that focussed on bringing technology into foreign policy and security realms and treating big tech companies like countries.

Many big companies in India, the U.S., and worldwide influence the world’s citizens more than Denmark. For example, there is a new Czech Ambassador based in Silicon Valley with the mandate to create a bridge between her government and big tech on the global scene.

The verticals are blending today; everything is about security today. Even in a forum like G20, techplo macy is part of the discussion.

ESKE BO KNUDSEN ROSENBERG, Consul General of Denmark in Bangalore

THE QUAD: A TECH ALLIANCE?

The QUAD needs to reset its focus on the current geopolitical environment where technology has become a principal determinant of national power.

This article is based on a joint discussion by the U.S. National Bureau of Asian Research and the Synergia Foundation on Critical and Emerging Technologies.

Emerging technologies transform governments, businesses, and citizens into a digital society. Critical infrastructure, financial systems, and communication methods are migrating to an increasingly decentralised internet. New tech innovations like Web3, blockchain and AI have massive potential to strengthen democracies and global economic security while decreasing the digital divide.

However, these innovations come with significant risks. Disruptive technology is now regarded as one of three looming global crises for which we are largely unprepared. Increased exposure to cyber threats, complexities around critical resources and supply chains, and environmental concerns complicate technology’s adoption worldwide.

Whenever the Quadrilateral Security Dialogue or QUAD features in any conversation, we risk either underselling its importance or overselling the pace of its outcomes. Notwithstanding these, the QUAD is emerging as a critical piece in the jigsaw of global affairs.

The QUAD re-emerges as a partnership that may be tied to another initiative called the Indo-Pacific Economic Framework and the Asian-Pacific Economic Cooperation (APEC). Increasingly, between the member countries, there is a rethinking of redefining the military-oriented relationship that dominated QUAD earlier and resetting it to the current geopolitical environment where technology has become a principal determinant of national power.

Technology has become an area where the QUAD is refocusing its attention. There is tremendous potential for emerging technologies to drive geopolitics and economics. Therefore, a more realistic target for countries should be to ensure that their adversary does not dominate the supply chain by building in redundancy.

Since the QUAD evolved from a military background, there are limitations in areas such as commercial activities, society, and economics. Even the academic element, which has become important in the recent past with the inclusion of technology, was not included in the QUAD in a major way. Technology has become an area where the QUAD is refocusing its attention. There is tremendous potential for emerging technologies to drive geopolitics and economics.

THE CHINA FACTOR

China invariably comes in whenever the QUAD is discussed. Elaborating on this dimension of the Quad, Mr Jacob Gullish, the Executive Director of Policy, Digital Economy, and Media Entertainment at the US-India Business Council of the U.S. Chamber of Commerce, says, “There is this idea that the people who own critical technologies will position themselves for leadership in other areas of the economy of society and Global Leadership. Over the years, we have seen the formation of an anti-China Coalition.”

There is clearly a group of countries that are coming to-

gether to counterbalance the growth of China but also to counterbalance the way China has grown. But this is not the first time there has been this anti-China coalition. It requires some harkening back to the 1980s, prior to China’s opening and liberalisation.

There was another anti-China Coalition that also involved many of the QUAD countries. As we jump forward in time 40 years later, we’re starting to see that same economic backlash against the Chinese. If China is the elephant in the room and QUAD has to counterbalance its influence, then India becomes a valuable partner not only in Quad but also within the India-Israel-US-UAE (I2U2), the G20, the OECD and other such bodies.

QUAD: SEMICONDUCTOR SECURITY

Semiconductors have increasingly become critical to the world, geopolitically and geoeconomically. Advancements in many emerging technologies, such as AI and 5G, are, in turn, reliant on progress in semiconductor technology. As a result, several countries have initiated efforts at indigenising the semiconductor supply chain to achieve some degree of subsections as indicated by the US CHIPS Act or the SemiconIndia programme.

The semiconductor supply chain is exceptionally vast, and it is unlikely that any company or country can dominate in the space. Therefore, a more realistic target for countries should be to ensure that their adversary does not dominate the supply chain by building in redundancy. A secondary goal can be having enough expertise in all parts of the supply chain to outpace or constrain the adversary.

Both these goals require partial indigenisation. The states can achieve them both through multilateral strategic cooperation. Therefore, cooperation in this space is a necessity and not a choice. And that is where strategic groupings such as the QUAD come into the picture.

This grouping, compared to many others, such as the European Union and even countries like Taiwan and South Korea, has a precise geopolitical motivation for outpacing China’s technological growth. Moreover, each of the QUAD countries has some unique strengths in the semiconductor supply chain, and to understand this better, we can split the semiconductor production

Over the years, one of the major changes in the relationship includes the inclusion of academia and businesses, as opposed to government-driven initiatives, which paves the way for wider stakeholder consultation. In addition, talks are being held at a much

supply chain into three broad stages-Chip Design, Chip Manufacture and Assembly Testing and Packaging.

Cassandra Chahal, a Research Analyst at Georgetown University’s Centre for Security and Emerging Technology, describes the U.S.’s capacity in this field, saying, “The U.S. has strong capabilities across all supply chain segments. However, it is undisputed as a global leader in the semiconductor design stage, hosting the world’s top IDM or integrated design manufacturing companies and accounting for over half of the global revenues in this market. It dominates in two key sub-stages in the design process – electronic design automation (EDA), which is the software used to design chips, and core intellectual property that design firms license and incorporate in their designs. All the country players in the space are either located in the U.S. or acquired by a U.S. company. The U.S. is a clear leader.”

But despite having a disadvantage in the design stage, when we look at semiconductor manufacturing, on the other hand, you see that US-based semiconductor manufacturing has declined since the 1980s. The causative factor primarily has been the higher labour costs that made the East and Southeast Asia markets much more attractive.

But it still plays an important role in one sub-state of semiconductor manufacturing: specialised equipment tools and software needed to manufacture chips. It headquarters three of the top five semiconductor manufacturing equipment uses, and it is through export restrictions on companies utilising this manufacturing equipment that the U.S. has sought to constrain Chinese semiconductor companies, as was recently announced.

Japan, another QUAD member, has a strong hold on the technologies and the chemicals needed for manufacturing chips. This includes photo resists and the etching gas market. But Japan lags in semiconductor design or even in testing and packaging.

Australia has no significant presence in any of these three stages. However, it occupies an important role in the broader electronics supply chain due to the availability of critical materials and advanced mining capabilities. For example, it has significant silica deposits that can be used in semiconductor manufacturing. It also has gallium and indium deposits, critical for producing composite semiconductors, which are more use-

higher level than before; they will be driven by the National Security Council Secretariat rather than an individual Ministry or a department. Technology is the next determinant of national power.

PANKAJ SARAN

Former Deputy National Security Adviser of India.

Executive Director of Policy, Digital Economy, and Media Entertainment

the U.S.-India Business Council of the U.S. Chamber of Commerce.

There is a tremendous potential for emerging technologies to drive not only some of the geopolitics but also the economics underlying a lot of power in the world.

ful in basic applications like solar cells and such.

When it comes to India, several experts say that India has missed the boat on Semiconductor manufacturing and is coming into that space 50 years late, having missed 50 years of that learning curve. But the good news is that semiconductors are no longer an art. They are a science. They are highly automated and can be set up anywhere in the world, and the Indian government is already pooling in a lot of money to boost domestic manufacturing through various schemes under its semiconductor mission. It is trying to do so through Joint Partnerships with other companies locally. And these would be for Fabs and not necessarily at five nanometers and below, but anywhere between 28 to 65 node size is a goal.

In terms of projected strength, India’s comparative advantage is in trained human capital, which has led several semiconductor companies to build their design houses in India. However, one missing element in the Indian semiconductor design ecosystem is the lack of focus on intellectual property.

Because of this, despite having professional talent, many companies don’t feel adequately protected and prefer to provide design services to existing semicon-

ductor firms rather than build their own products.

The assembly testing and packaging (ATP) is a very labour-intensive task, and hence China is an important player here. But moving ahead, this could be changed given that the conditions for the success of the semiconductor packaging market are also present in India. Besides the vast population and enormous labour-intensive resources that India offers, India also has the potential to become a key player in the ATP Market.

DR S. CRISTOPHER

Chairman of the Defence Research and Development Organisation, Ministry of Defence, India.

With the well-known story of supply-chain disruptions and shortages of chips during the pandemic, it has become evident that each country must find its strengths. And since it is not possible to have all of it in one country, we must align the interests of like-minded countries.

It already, to some extent, has expertise in the downstream assembly of electronic components. For instance, Samsung set up its largest mobile phone manufacturing plant in India, where it now tests new devices and assembles them for export. This expertise would provide a base for entering upstream stages like ATP for semiconductors, like getting Zoom on Mobile phones.

Therefore, each of the four countries has unique strengths. Given their strengths, the QUAD can become a favourable platform for a strategic partnership on semiconductors that ensure that no part of the supply chain becomes dominated or threatened by China and

JACOB GULLISH

at

Source : Rebel Pepper

that each country prospers.

Outlining the future trajectory for QUAD’s collaboration on the semiconductor supply chain, Cassandra Chahal recommends, “It can form a QUAD-consortium that pools resources to build fabrication capabilities across the four countries. This will be cost-efficient and resilient because of geographic diversification, and fabs constructed as part of this consortium could also give preferential access to fabless companies within the QUAD.”

The four countries can encourage the formation of strategic R&D cooperation between companies within the QUAD by taking certain measures to ease the process, such as faster visa processing, fewer employment barriers, facilitating capital flows, and establishing QUADwide patent prosecution mechanisms.

They can also allow preferential access to EDA tools at a lower cost to diversify the fab designs beyond the US. And, of course, we have to recognise that several other countries beyond the QUAD are players in the semiconductor supply chain and have stronger capabilities in the sector. Therefore, instead of aiming to be an exclusive industrial block, the QUAD partnership can be a starting point to build trust and build other silicon powers on board, such as Taiwan, Vietnam, South Korea, Singapore and others.

The QUAD’s flexible structure aligns with a well-balanced approach. As the four countries take crucial steps to improve their semiconductor ecosystem, aligning efforts at this early stage will prove fruitful and can build mutual confidence for them to collaborate in other cities. On the government side, the QUAD offers a strong platform to bring in others. The QUAD can serve to build these problems of trust and bring others into the scene.

The QUAD’s semi-formal arrangement, which does not have a permanent Secretariat and has ad-hoc working groups, allows for experimentation and agility in collective efforts and involving others. This is evident when you look at the different countries that they are already having conversations with. Perhaps the conversation could involve South Korea, Vietnam, Singapore, and others moving ahead. The QUAD grouping offers that space and flexibility.

The I2U2 is an immensely powerful symbol; therefore, it is clear where that high-trust ecosystem resides. At the end of the day, private companies must make these decisions about who they trust and with whom they can build resilient supply chains and where they can ensure that their investments in innova-

ROLE OF THE PRIVATE SECTOR

Private sector companies can take the lead because they have the technology. And if they have learned the lessons of the pandemic, they recognise that having resilient supply chains is critical to ensure uninterrupted supply to the consumer. The signals being sent by governments are clear about the strategic risks going forward, which should help private companies to figure out where they ought to put their collaboration attention, energy, time, money, and investments.

Ambassador Atul Keshap, President of the US-India Business Council at the U.S. Chamber of Commerce and a retired U.S. foreign service senior member, succinctly says, “The I2U2 (India, Israel, US, UAE) is an immensely powerful symbol; therefore, it is clear where that high-trust ecosystem resides.”

“At the end of the day, private companies must make these decisions about who they trust and with whom they can build resilient supply chains and where they can ensure that their investments in innovation and research are not going to be stolen or turned against them by a partner that might end up being unfriendly and this is where you’ve got to make smart decisions. The government cannot create a framework for every single possible collaboration.”

CONCLUSION

It must be understood that Critical Emerging Technologies are a subset of about 18 advanced technologies. So, it is not just confined to semiconductors or AI there are about 18-19 advanced technologies that we need to look at. Several sets are outside the purview of what earlier used to be the exclusive domain of the government.

Now mostly private and even non-state actors have access to these easily. These technologies are basically dual-use, which means they can be used for good and bad, and it is easy for people to disrupt these technologies.

The bigger challenge is that technologies are developing so fast that you need lots of investment and human resources that one country is not able to adapt quickly. And so, here comes the need for collaboration.

tion and research are not going to be stolen or turned against them by a Partner that might end up being unfriendly and this is where you’ve got to make smart decisions. The government cannot create a framework for every single possible collaboration.”

AMBASSADOR ATUL KESHAP, President of the US-India Business Council at the U.S. Chamber of Commerce, and a retired U.S. foreign service senior member.

TECH-THE ECONOMIC CENTRE OF GRAVITY

Periodically, technology disrupts the manner in which military engagements are fought and those who fail to stay up-to-date risk defeat!

This article is based on a talk on Technology, the Centre of Gravity for the future at the event Securing India@75 by Valley of Words.

Technology, while important, had always been considered an enabler in the military arena, a subset of knowledge. But since the late 1980s and early 1990s, the Revolution in Military Affairs (RMA) was showcased by the American military in various theatres of operations, and technology was there right in front.

Technology is, undoubtedly, the centre of gravity in any future conflict. Ignoring this reality would amount to looking at the challenges of the 21st century with the intellectual capacity of the 20th century!

FULCRUM OF ALL ACTIVITIES

Technology has rapidly become the fulcrum of all activities-economic, social and intellectual and the military arena is no exception. Technology has three critical aspects that need to be closely studied.

The first one is Advanced Technologies which includes Advanced Computing, Advanced Manufacturing, Directed Energy weapons, new Advanced nuclear devices and many others. Within this, you have a subset which is critical emerging technologies- AI, Quantum Computing, bioinformatics, and Critical Infrastructure (Cis), which are the second layer of technologies.

The third layer is General Purpose Technologies (GPTs), which is your electricity, your mechanical tools etc., in fact,

The military has to take the initiative and set the stage for the industry to follow. Once its overall strategic framework is in place, it can pick the weapon systems that will enable the strategy to work. However, it is not enough to lay down the military or the political strategy; the technology strategy also must be articulated concurrently. Militaries are used to working in a structural mode, but they must ensure that technology is a prime driver of strategy in this structure.

anything and everything that affects the society at large. There is an underlying common thread-security in all these three layers of technology.

It is important for decision-makers on important matters like semiconductor manufacture etc., to understand the broader narrative related to that particular technology’s interface with security. While telecommunications and electronics were always closely linked with the security domain, today, we increasingly see how GPTs are becoming security driven with IoT, smartphones etc.

The second aspect is the dual nature of technologies-it can be used at the front end of conflicts and also at the back. At the development stage, no one is clear, even the designer, how it will pan out once it is in mass use. A good example is how off-the-shelf satellite internet broadband created by Elon Musk for mass commercial exploitation played a crit-

ical role at Ukraine’s political, strategic, and tactical levels.

The Starlink system, which has more than 2200 low earth orbit satellites in its constellation, claims to have provided broadband internet to more than 150,000 ground stations (many of them man-portable) in Ukraine. It was costing SpaceX, the mother company, almost $20 million a month to provide this service.

However, the results have more than justified the cost. At the political level, it enabled President Zelensky to persist with his narrative about the war to generate a massive international military assistance effort despite the Russians blacking out his internet system through cyber operations. At the lower tactical levels, Ukrainian infantrymen were using backpack terminals to direct mortar and missile fire on advancing Russian columns, inflicting heavy personnel and material damage.

And the third and most important thing is that these technologies are moving at such a fast rate that it is now challenging for governments to keep pace with accelerated development. And here comes the need for the governments to coordinate their efforts with the private industry. Even DARPA (Defence Advanced Research Projects Agency) is compelled to work with private industries because most of the technology is slowly, even in military and dual-use, residing in the private industry.

Technology disrupts the manner in which military engagements are fought. In Ukraine, there is a constant contest between the armoured fighting vehicle (in combat since 1917 in various avatars) and the shoulder-fired missile and drones.

With the Ukrainian battlefields littered with the debris of hundreds of tanks and APCs, the question is whether armoured vehicles have become irrelevant on the modern battle- field. Similarly, man-portable air siles (MANPADS) air space below a fatal death attack helicop ters and close air support jets, rendering them almost incapable of in fluencing the close battle.

In the larger context, China claims that its ‘carri er killer’ missiles will take out American career groups from landbased launchers. Does it mean the much-vaunted US Carrier Groups, costing scores of billions a piece and symbols of America’s power projection, are now redundant? So, what is the next great weapon

system? The sum total is that technology does not allow the status quo to remain for very long.

MILITARY-TECHNOLOGY INTERFACE

Like all modern businesses, warfare has become irrevocably linked to high-level technology, and like the business world, if the technology is not updated, you are staring defeat in the face. The fate of Iraq under Saddam is a vivid example of how even combat-hardened militaries equipped with obsolete/ obsolescence technology are swept aside by numerically inferior but technologically superior adversaries.

At a point, the political leadership has to take a call on whether the economy can sustain this relentless march for better technology.

Then the question arises, will there be any economy if no nation is left to run? Investment in military / dual-purpose technology is like an expensive insurance policy with a very high premium- a policy you hope and pray does not ever get encashed! But like any other insurance, it creates an environment of trust, peace of mind, and stability in which all other organs of a state prosper.

The industry is already at the 4.0 stage. Can the military keep pace? Is it now time for the military to give directions to the industry and show where technology should lead? To develop smart systems, the military, in conjunction with the civil industry, will have to have the right philosophy, doctrine, and strategy. This strategy must be clearly enunciated in how the nation will fight its wars and how the industry will provide the tools and the processes to fight to victory.

A good example of this interface is an American company called Palantir Technologies, whose internet site claims that it “builds software that empowers organisations to integrate their data, decisions, and operations effectively.”

It has been a long-time government contractor that has worked with the Space Systems Command and many other Pentagon agencies, principally as an analytic data company. However, over the years, it has grown exponentially and is now investing in the

In partnership with BlackSky Holdings, a leading geospatial intelligence company that owns commercial satellite imagery, Palantir analytics will interpret imageries for any purpose-civil or military. The

collaboration will combine high-resolution imagery and deep analytics to inform decision-makers in real time, providing an immense advantage in time-sensitive operations.

THE WAY AHEAD

The military has to take the initiative and set the stage for the industry to follow. Once its overall strategic framework is in place, it can pick the weapon systems that will enable the strategy to work. However, it is not enough to lay down the military or the political strategy; the technology strategy also must be articulated concurrently. Militaries are used to working in a structural mode, but they must ensure that technology is a prime driver of strategy in this structure. Else they will get it all wrong and fight the next war with weapons designed for the last one!

The military cannot afford to be stumped by a ‘Black Swan’ event; it has to be prepared for any eventuality. After all, the ICT revolution is not really a revolution but a continuum.

It should be possible to ride it like a rider does with his horse or a surfer rides the wave. The military cannot afford to be left behind and then try to catch up.

However, in their hurry to keep up with the galloping technology, the military should not end up investing in the wrong project.

During the two decades between the First World War and the Second World War, it was only Germany which invested and prepared for armoured warfare while the victors of the Great War- France, Great Britain and even the U.S., failed to realise its value as an independent, battle winning arm of manoeuvre.

Therefore, each side that invested the kind of technology in their tank fleet was a prisoner of their respective doctrines. To cite one example, the Germans invested in faster tanks, with every tank equipped with a radio. In contrast, the French went for much heavier tanks with no radios, fit only as infantry support weapons. The Blitzkrieg of 1940 proved who was right and who was wrong; within six weeks, German panzers were rolling into Paris!

In the Indian context, there are three technologies that India is good at - nanosciences, genetics and robotics. A combination of these can give us a marked advantage. After all, the world is moving away from WMDs (Weapons of Mass Destruction) to KMDs (Knowledge enabled Mass Destruction). Can India harness its strengths in the three cutting-edge technologies to create a KMD and asymmetry that we can learn to master?

From the industrial perspective, there are three options. The first is to upgrade the entire inventory, but it would be time-consuming, and the desired asymmetry cannot be created in a short span of time.

The second option is to enable precognition by using AI and other technologies. Massive Analytic, a London-based start-up, claims that it has developed a technology called ‘artificial precognition’ which can look at large sets of data through machine learning to recognise patterns and make accurate predictions ranging from surges in demand for products to an imminent cyberattack.

The third is the option of keeping military inventories small and manageable but entirely smart so that upgrades are possible and the entire inventory does not become obsolete in one go.

THE ART OF INTELLIGENCE

National interests are not served well if there is a void between the assessment of the intelligence community and the interpretation of other organs of the state.

This article is based on the 138th Synergia Forum based on the book ‘The Art of Intelligence’ by Vappala Balachandran.

Today, the narrative around intelligence is generally focused on electronic means -satellites, long-endurance drones, electronic eavesdropping including mining data from the web, the list goes on.

This is a natural progression because the choice is obvious when the digital world enables the procurement of high-quality information remotely without risking lives and national reputation.

However, despite the modern tools for collecting, collating, analysing and finally disseminating intelligence, the human element cannot be ignored. While human intelligence or HUMINT may have become a relic of the past, it has not become extinct, especially at the tactical or ground level.

INTELLIGENCE DOWN THE AGES

Intelligence has played a vital role in national defence since the inception of organised warfare. Every successful plan, whether at the highest political level where the decision to go to war is made, at the strategic level where war objectives are decided or at the operational level where military commanders chalk out their campaign plan to achieve the political objectives, relies on intelligence. The means may vary- from a satellite tracking Osama Bin Laden’s Abbottabad compound on a 24x 7 basis to a special forces team putting eyes on a target, waiting to laser it with a missile from a loitering aerial platform.

Intelligence has played a vital role in national defence since the inception of organised warfare. The rapidly changing nature of emerging threats and their diversity underscores the need for sound intelligence to be made available to the highest decisionmakers in the shortest time with the greatest accuracy. Along with the transformation in the nature of the threat, intelligence covers a large mosaic with assorted tools tailor-made for every contingency.

The rapidly changing nature of emerging threats and their diversity underscores the need for sound intelligence to be made available to the highest decision-makers in the shortest time with the greatest accuracy. Along with the transformation in the nature of the threat, intelligence covers a large mosaic with assorted tools tailor-made for every contingency.

Ignoring intelligence inputs can have a devastating effect. In a 1989 article, Pravada, for the first time, accepted that Josef Stalin ignored warnings from Soviet spies, including the master spy Richard Sorge, who provided the exact date and time of the launch of Operation Barbarossa, Nazi Germany’s invasion of USSR. But the main blame for miscalculating the time of the start of the war, for the country not being turned into an armed camp in time, for not being brought into a state of full military preparedness lies with the USSR political leadership of that period,” disclosed the

surprisingly forthright article on the 44th anniversary of the Soviet victory in World War II.

Even with the plethora of modern electronic tools now available to the political leadership and their intelligence organs, intelligence failures occur with profound ramifications. The 2003 invasion of Iraq by the U.S. could be categorised as one such failure as the case for the war was based entirely on the intelligence assessment that the Saddam regime possessed weapons of mass destruction (WMD). After the war, it emerged as merely a presumption- some would go as far as to say that it was just a pretext for war without any substantive proof of its authenticity.

The WMD Commission established after the war highlighted this failure in a 2005 letter to President George W Bush, stating, “the Intelligence Community was dead wrong in almost all its pre-war judgments about Iraq’s weapons of mass destruction. This was a major intelligence failure. Its principal causes were the Intelligence Community’s inability to collect good information about Iraq’s WMD programs, serious errors in analysing what information it could gather, and a failure to make clear just how much of its analysis was based on assumptions rather than good evidence. On a matter of this importance, we simply cannot afford failures of this magnitude.”

OPERATIONAL SECRECY VERSUS OPEN DEBATE

National interests are not served well if there is a void between the assessment of the intelligence community and the interpretation of other organs of the state, including its academia. Sometimes the obsession with maintaining secrecy on the part of the intelligence services can turn counter-productive.

Quoting Senator Patrick Moynihan’s 1998 book, ‘Secrecy-The American Experience,’ Mr Vappala Balachandran, an Indian national security intelligence specialist and former Special Secretary of the Government of India in the Cabinet Secretariat and author of the book, “Intelligence over Centuries,” highlights how secrecy on the part of intelligence agencies has significant consequences for the national interest when as a result, policymakers are not fully informed, the government is

The US is the only country with a legal definition of covert action. In a research report by the Congressional Research Service on July 2 2019, they reproduced the US Code Title 50 as an activity or activities to influence foreign policy where US role will not be apparent. This is what we call deniability, and it is there in the

not held accountable for its action, and the public is not engaged in informed debate.

A concrete example is the 1962 Bay of Pigs operation launched by the CIA for an invasion of Cuba by Cuban exiles. This failed operation, costing $46 million and the lives of hundreds of Cuban rebels, soldiers and innocent civilians, would not have taken place if there had been an open discussion on the chances of such an invasion in overthrowing Castro. A 1960 Princeton University paper had warned the Kennedy Administration that Castro was too deeply embedded in revolutionary Cuba and enjoyed significant popular support. The then CIA Inspector General provided the same prognosis.

This calls to question whether the unbridled expansion of intelligence agencies like the CIA in the U.S. and the ISI in Pakistan is not detrimental to a nation’s larger interests. Nowhere has the debate on this issue been louder than in the U.S. Senator Patrick Moynihan notoriously brought bills in the U.S. Senate, first in 1991 and again in 1995, asking for the CIA to be wound up for good. In 1998 when the CIA missed the preparations for the Indian Nuclear explosion, Senator Moynihan’s voice got even more strident, saying there is no need for an organisation maintained at great cost to the taxpayer, which misses certain very important developments.

In 1997, George Kennan, a legendary American diplomat, is on record saying, “It is my conviction based on 70 years of experience, first as a government official, and then, in the past 45 years as a historian, that the need by our government for secret intelligence has been vastly overstated.” There was logic in such a demand: by this time, the CIA had grown bigger and more influential than even the State Department!

THE INDIAN INFLUENCE!

“The Intelligence Bureau of India is the oldest intelligence agency in the world. It was started in 1887. But the British Raj camouflaged it so as not to trigger unhappiness in India, a colony, so they kept it within the police,” says Mr Vappala Balachandran. As per Mr Tim Willasey-Wilsey, a Visiting Professor of War Studies at King’s College, London, the intelligence system that the British created in India had a reverse polarity effect in the UK. “The creation of MI6 and MI5 in

US statute book. This protects the operatives while there is still higher accountability. Unfortunately, in India, we have no law for the Intelligence Bureau or the RAW. So, there is no protection for the people sticking their necks out for the country.”

VAPPALA BALACHANDRAN,

Indian national security intelligence specialist and former Special Secretary of the Government of India in the Cabinet Secretariat and author of the book, “Intelligence over Centuries,”

1909 was significantly affected by the experience of the much older Intelligence Bureau in India. Men who had experienced in-country Russian spies in Afghanistan, and the Northwest Frontier, all, who worked against the independence movements of the Congress Party, and the Muslim League, returned to London and made use of their knowledge on the Irish Question and on the questions of German and Russian infiltration,” says Mr Wilsey.

The tradition that the chief of MI6 writes in green ink also came out from India; even today, both the directors of the Indian and Pakistan Intelligence Bureau still write in green ink, which is a tradition which predates the formation of British Intelligence. Also, it was a habit during both the first and second world wars for British Intelligence Officers – many of whom would have served in India- to speak to each other on the telephone in Hindustani or Urdu, knowing that it would take much longer for any German intercept organisation to translate the call.

ACCOUNTABILITY FOR INTELLIGENCE AGENCIES

Covert action has often had state sanctions, but few countries bring it under legal protection. “The U.S. is the only country with a legal definition of covert action. In a research report by the Congressional Research Service on July 2 2019, they reproduced the U.S. Code Title 50 as an activity or activity to influence foreign policy where the U.S. role will not be apparent. This is what we call deniability, and it is there in the U.S. statute book. This protects the operatives while there is higher accountability. Unfortunately, we have no law for India’s Intelligence Bureau or the RAW. So, there is no protection for the people sticking their necks out for the country,” says Mr Balachandran.

FORECASTING DISRUPTIONS AT NATIONAL LEVEL

There have been many historical inflexion points when intelligence agencies got it wrong, despite massive budgets and technology at their disposal. While intelligence predictions at the tactical or functional level are more often than not accurate, inaccuracies and even total ignorance have been seen at the highest political and strategic levels. Mathew James Burrows, an American intelligence and strategic foresight expert

One of the big challenges is that the Intel communities everywhere have a very hard time forecasting disruption. Their forte is on the tactical level. But in terms of disruptions, and this gets back

and author, says “One of the big challenges is that the Intel communities everywhere have a very hard time forecasting disruption.” Their forte is on the tactical level. But in terms of disruptions, and this gets back to the failures – the 1979 Iranian Revolution, the Yom Kippur War, and the Arab Spring, these are all big inflexion points. And reading about intel rarely gives you any sense of foreboding of these major historical junctures.

Policymakers are quick to lay the blame for any such major event on the doorstep of the intelligence community. However, there are a lot of failures that masquerade as intel failures, but are policy failures. Here again, the decision to go to war against Saddam presents a good example. Mr Burrows Explains, “Everybody knows that the Intel Community in both the UK and the U.S. did very poorly, talking about Iraq having these nuclear weapons capabilities when we know in hindsight that there was very little activity going on after the first Gulf War.”

But if you dig a little deeper, there’s been a lot of disclosures that the decision to invade Iraq was made shortly after 9/11 at the famous Camp David meeting. Obviously, a pretext was needed that Saddam Hussein was continuing his nuclear program clandestinely, which he was supposed to have given up after the first Gulf War. That was an element in getting rational and public support for the invasion.

But policy decisions really had already been made very early. There were quite a few Iraq hawks in the George W. Bush Administration who had already decided, even before 9/11, that it had been a mistake in the first Gulf War not to go to Baghdad. Perhaps George Tenet, the head of the CIA, skewed the intel partly because the policy debates and policy ambitions influenced him.

The correct way to proceed is for the intel side to tell what is happening or will be happening shortly. It is the responsibility of the policy side to look at the intel and decide on the correct policy step. Because there is close interaction during the build-up to any event between the intel and the policymakers, there is the risk of policy influencing the intel inputs, as in the case of the Iraq war. On the other hand, there is sometimes an information divide between the intel community and policymakers. It is left to the intel side to decide what kind of inputs and briefs are required at the highest pol-

to the failures – the 1979 Iranian Revolution, the Yom Kippur War, and the Arab Spring, these are all big inflexion points. And reading about intel rarely gives you any sense of foreboding of these major historical junctures.

MATHEW JAMES BURROWS, American intelligence and strategic foresight expert and author

icy levels. In such circumstances, the intel may go overboard in providing too much information, which may be too scattered and thus shift the focus from the main to peripheral issues.

THE EMERGING DOMAIN-OPEN-SOURCE INTELLIGENCE

With the information explosion, thanks to the internet and social media, a great deal of information can be culled from the public domain, especially if you want to get an early warning of an impending major event. But intelligence agencies would not like to admit that they have taken their intelligence from these open sources. Mr Mathew James Burrows says, “There’s a bureaucratic reason for that if you’re trying to justify your budget to Congress. You want to talk about all the Intel you’ve gathered, which is obviously clandestine and classified. Open sources are a lot of information put out there by media academics – all of it is essentially free. But what you’re trying to justify is basically the clandestine classified sources.”

‘‘Truman, when he set up the CIA, his idea was that it would have both, and I think intelligence agencies have departed a lot from it. In my later career, I spent a lot of time doing open sources and was part of a unit responsible for trying to bring some of that into the Intel community. But in general, there was an aversion, which undermines the mission in the sense of being able to warn policymakers of the impending major events.”

As per Mr Tim Willasey-Wilsey, there is enough material available on the internet today that private players

Private companies could not only find out exactly who shot down the Malaysian Airlines MH 17 but even found a photo of the actual missile launcher with one missile missing. And in the case of the Salisbury

can arrive at some conclusive evidence before the state intelligence agencies or even Interpol. “Private companies could not only find out exactly who shot down the Malaysian Airlines MH 17 but even found a photo of the actual missile launcher with one missile missing. And in the case of the Salisbury poisoning (2018 poisoning of former Russian double agent Sergei Skripal and his daughter Yulia in Salisbury), they were able to find the real identities of the GIU officers responsible.”

While open-source intelligence is an incredibly powerful product, it has its pitfalls; how do you find the truth when the internet is so full of false information – information that fuels all sorts of crazy conspiracy theories? Some intelligence services also spread false information as part of their covert operation and propaganda roles. An open-source intelligence means that the intelligence services cannot exist by just producing medium-level useful-to-know information.

So, the job now of intelligence services is to find out 0.1% of the information that is unavailable. What is Putin’s next move? Is he serious about using a tactical nuclear weapon? Will Xi Jinping invade Taiwan? And what are Xi Jinping’s ambitions over its border with India?

This is a difficult job because intelligence is extremely difficult to find and often requires a huge amount of skill but also luck. So, does the digital age intelligence officer need a makeover from the classical mould? Has there been enough investment in creating intel operatives with an analytical mind and able to discern fact from the clutter? This is a challenge that all intel agencies are facing in the digital era.

poisoning (2018 poisoning of former Russian double agent Sergei Skripal and his daughter Yulia in Salisbury), they were able to find the real identities of the GIU officers responsible.”

TIM WILLASEY-WILSEY, a Visiting Professor of War Studies at King’s College, London

Source : The Print

INDIA’S PAKISTAN CONUNDRUM

India cannot hope to normalise its relationship completely as long as Pakistan remains dysfunctional.

This article is based on the discussion held as part of the Insights breakfast series 3 with Amb Sharat Sabharwal on India’s Pakistan Conundrum.

While India may have outgrown Pakistan (almost ten times in economy alone) and moved into a different league altogether, its national obsession with its western neighbour has scarcely dimmed over the last seven decades.

On the international stage, while India’s international reputation has grown, Pakistan’s reputation has plummeted. Placed on the FATF grey list in 2018, it successfully got out of the list in October thanks to some deft politicking by its benefactor, China.

Pakistan remains an enigma; while there are perpetual predictions of it being a ‘failed state on the verge of collapse,’ it is neither a failed state nor as near collapse as its detractors may hope for. Ambassador Sharat Sabharwal, who has served twice in the Indian High Commission in Pakistan, says, “Pakistan is in turmoil at the moment, as it has been many times before. It will continue to be until it resolves its dysfunctionalities, which make it a dysfunctional state. However, it has shown remarkable resilience in the face of adversity.”

SAME PATH, DIFFERENT DESTINATIONS

George Bernard Shaw’s observation that ‘The British and the Americans are two great peoples divided by a common tongue’, could be applied equally to Indo-Pak relations. For many decades, while the pre-partition generation was still in power, there was a patronising sense amongst many Indians that, being of a common heritage, India and Pakistan would ultimately give up their wasteful enmity and come together

Pakistan continues to loom large on our horizon now increasingly as a threat in conjunction with China. So, there’s been an intense debate on how to deal with Pakistan. There are two extremes to this debate – on one end, people believe that the common heritage of the two countries and people-topeople contact and bonhomie will resolve all the problems. At the other end of the spectrum is a purely militaristic view. And then there are some options lying in between.

or even become one nation. This attitude strengthened the narrative in Pakistan that India has never reconciled to the partition, and the ‘Hindu Rashtra’ is just biding its time to usurp the Muslim prodigal once the opportunity comes by. This is the existential fear that the Pakistani Army has been able to keep alive over the last 70 years to secure its primacy.

The question that is most often asked is that if India and Pakistan were cut from the same geographic and ethnic cloth, with the same parliamentary-style system, why has India thrived as a vibrant, albeit noisy, democracy and Pakistan a political ‘basket case’?

Lakhmir Chawla, writing in openDemocracy in 2010, has a hypothesis, “The crucial factor is the cycle of dictatorship and democracy in Pakistan. India has had an unbroken chain of democracy since its inception and adoption of its constitution in 1950. On the other hand, Pakistan has had an unbroken chain of ineffective democratic governments,

followed by dictator-led ineffective governments, since its inception and adoption of its constitution in 1956.”

Mr Aditya Sondhi, a Senior Advocate, while delivering the 18th Gen KS Thimayya Memorial Lecture in Bangalore, has an explanation. He says, “Institutional imbalances in Pakistan have led to the subversion of democracy. Had its Supreme Court played a more active role and its Army played a less active role politically, its history would have been dramatically different. And remember, they got their constitution in 1956, a crucial six years after us, by which time martial law was already there to stay.”

“This is where we ought to acknowledge institutions’ serious role in a constitutional framework to make us a liberal democracy. Here I pay tribute not only to active institutions such as the Supreme Court, the bureaucracy, the media, and others that have kept our Constitution afloat but significantly to passive institutions such as the armed forces. But I think less credit is given to the Indian Army for having kept away from political adventurism, which really paved the way and created a democratic space for us to grow. The early years and the decades of a country are where democracy is vulnerable, and I think passive institutions that do nothing are critically important to the idea of India.”

A DYSFUNCTIONAL STATE?

Why Pakistan can be categorised as a dysfunctional state is easy to understand. Firstly, the civil-military imbalance is too glaring to justify the claim that Pakistan is a democracy. To use a much used cliché, but sadly nothing describes Pakistan’s civil-military equation better, “Most countries have an army, but Pakistan’s army has a country.” Secondly, religious extremism and the ready availability of guns and lethal weaponry make for a dangerous cocktail-the results are all there to see. Thirdly, Pakistan’s propensity to live beyond its means and punch beyond its weight-for 70 years, it has spent immense treasure to gain Kashmir, and even today, giving up the Kashmiri dream is a political death wish in Pakistani politics.

The fact that union with Pakistan no longer resonates with the Kashmiri people fails to deter the Pakistani state, especially its military, which fears it may lose its raison d’etre. Ambassador Sharat Sabharwal, says “Nawaz Sharif, who was Prime Minister, told me in his last meeting with me in June 2013, “I was talking of good relations with India and resolving the Kashmir issue, etc., during the election campaign, and many senior

Pakistan is in turmoil at the moment, as it has been many times before. It will continue to be until it resolves its dysfunctionalities, which make it a

party men told me not to do it as I may lose votes, but I kept on doing it. I did not lose any votes. In fact, I may have gained some. So, Kashmir does not resonate. It’s kept alive by the Pakistani establishment and their ecosystem as a stick to beat India with; you can criticise India anytime you go to the UN or bleed us in the valley.”

For both India and Pakistan, the Kashmir dispute has become even more intractable, with China becoming, indirectly or directly, a party to the dispute. The Chinese are deeply involved in a part of illegally occupied territory in Gilgit- Baltistan, and Chinese actions in eastern Ladakh call into question whether an Indo-Pak political solution in Kashmir would be acceptable to China.

DEALING WITH PAKISTAN

Pakistan continues to loom large on our horizon now increasingly as a threat in conjunction with China. So, there’s been an intense debate on how to deal with Pakistan. There are two extremes to this debate – on one end, people believe that the common heritage of the two countries and people-to-people contact and bonhomie will resolve all the problems. At the other end of the spectrum is a purely militaristic view. And then there are some options lying in between.

There is no military solution to the ‘Pakistan problem’; nuclearisation of the subcontinent has ensured that. Even if in military circles there may be talks of ‘space for conventional war under the nuclear overhang,’ the fact remains that this space is too shallow and transitory, as the international community cannot stand by and allow two nuclear-armed nations to slug it out in a conventional war that can turn nuclear in the blink of an eye! New Delhi’s only option remains to deal with Pakistan politically.

As regards the ‘failed state’ thesis, Ambassador Sharat Sabharwal rules out such a possibility, saying, “My assessment is that so long as the Pakistan Army remains reasonably professional and disciplined and as long as it sits on a pile of nuclear weapons, the chance of change in the external boundaries of Pakistan will be minimal. It is not a failed state, even though it’s called a failed State. It is a functioning system of administration- not very efficient, and public services could be more satisfactory, but that happens in many other countries. Though it has areas of lawlessness in Baluchistan and the tribal belt.” The Pakistan Army will never abandon the asymmetrical war tool against India if it can maintain a fig leaf of deniability. While terror ac-

dysfunctional state. However, it has shown remarkable resilience in the face of adversity.”

AMBASSADOR SHARAT SABHARWAL,

Former Indian High Commissioner to Pakistan.

tivity may have gone down in recent years (for various reasons), it could be ramped up, and India needs to be prepared for it.

Around 2011-12, Pakistan moved briefly away from linking trade to politics and came very close to giving India the Most Favoured Nations (MFN) status. Pakistan has always linked trade with politics, unlike India. India withdrew the MFN status post-Pulwama. However, such a move has minimal impact on the Pakistani economy as Pakistan’s exports to India are just $400 million- less than 2 per cent of their global exports. While trade closure may harm individual Pakistani (and Indian) businesses, it does not have the potential to change the calculus of the Pakistani military establishment.

Internationally, Pakistan feels no pressure to change its India policy. Undoubtedly, it has been able to leverage its geographical advantage to its great advantage while dealing with the international community. “With the United States, the relationship was always transactional. It’s become even more so, but the problem is that the transaction is renewed now and then; in contemporary times too, when they gave the F-16 maintenance package, there are some reasons behind that. The simple fact is that the Americans are not going to abandon Pakistan. Because of its strategic location, it sits at the nexus of the Chinese, Indian, Central Asian, Russian, and Iranian landmass and the countries in the Gulf, ”says Ambassador Sabharwal.

THE WAY FORWARD

There are perceptible changes in the makeup of Pakistan that are encouraging but are not so cataclysmic that they can transform its outlook entirely. For one, there is a sizable constituency in Pakistan which realises the value of a stable relationship with India is in its interest. They disagree with us on Kashmir. They disagree with us on many things, but basic self-interest tells them that this kind of relationship that we have maintained with India is unsustainable.

The National discourse in Pakistan is far more introspective than ever before. Introspection has come because of the media revolution and the people’s suffering due to the policies followed largely at the behest of the Pakistan Army, which keeps on placing its self-interest over the interests of the Pakistani people. There is a widespread realisation of the growing gap between India and Pakistan, that this cannot be breached, that you have to make some changes. Although the old order doesn’t give up easily and will not give up easily. Lastly, an unprecedented criticism of the Army is seeing the light of day, more frequently than ever before.

All these trends are still weak, unable to overcome the resistance of Pakistan’s security establishment and other entrenched interests. But from the Indian point of view, the latter need to take note of them because these tendencies must grow if Pakistan is ever to become a regular and sensible state. No single instrumentality can enable India to deal with Pakistan from

time to time. So, it has to be a combination of various instrumentalities at its disposal. India cannot hope to normalise its relationship completely as long as Pakistan remains dysfunctional. It can try and manage it to reduce the volatility of this relationship and reduce the violence to the extent possible. This becomes even more important with the Chinese front becoming hot.

“At least in the foreseeable future, you must manage this relationship. Do not set your sights too high; manage this relationship by combining deterrence with a selective and calibrated punitive approach, but dialogue and diplomacy will be essential,” concludes Ambassador Sabharwal.

ANAND ARNI Formerly Special Secretary in the Research & Analysis Wing.

Change at the top in the Pakistan Army, is not just a bureaucratic event but the ushering of a new political force. An old song lamenting that “Old Soldiers Never Die, They Just Fade Away”, was famously quoted by General Douglas MacArthur on being removed from command in Korea. The same cannot be said of top Pakistan Army generals, who refuse to fade away. Amidst all the noise and furore over General Bajwa’s alleged financial stature, impressive as it is, which followed the General’s ceremonial departure, the new incumbent was smoothly ushered into the most powerful seat in the country.

Gen Asim Munir is a lesser-known entity in an Army where too much publicity of high-ranked officers can, at times, prove fatal. Having served in the nation’s two top intelligence setups at the highest level-as Director General of Military Intelligence (DGMI) and, more importantly, as the all-power Director General of Inter-Services Intelligence (albeit for just nine months), the orientation of the new Chief can be gauged.

As per Mr Anand Arni, former special secretary in India’s Research and Analysis Wing, Gen Munir’s elevation seems to be a result of a consensus based on the seniority principle (not always sacrosanct in the Pakistani military) between Prime Minister Shehbaz Sharif and Gen Bajwa (who would like his own man in his place to avoid any future complications). The immediate threat to the military is how to control Imran Khan, who has apparently ‘gone rogue.’ Of course, once it comes to affixing red lines which harm the interests of the military, Gen Munir will not hesitate to secure his organisational interests. Domestic issues are more pressing than India, and hopefully, this will draw most of the new Chief’s attention.

On external relations, the new Chief is unlikely to make any dramatic changes to the India policy, retaining control of its trajectory as has been the norm. The same goes for the Afghan policy, where a great amount of treasure has been sunk to make any turnabouts. In any case, Pakistan is in the driving seat.

FACING AN UPHILL TASK!

Sunak takes on the country’s top job amidst a surfeit of challenges. What can we expect from him?

As Britain’s new PM, Rishi Sunak has the eyes of the world on him. In a rather hasty and unexpected turn of events, Sunak took on the country’s top post without being elected to it! Used to unsolicited observations, not always kind, and hostile innuendos for his (and his wife’s) fabulous wealth, he is a man who is accustomed to facing the big bad world.

As Britain’s first Indian-origin Prime Minister, Rishi Sunak scripted history after being elected unopposed as the new leader of the governing Conservative Party. In a series of firsts, he is also the youngest British prime minister in 210 years. The 42-year-old is a devout Hindu.

The UK is getting a battering trying to cope with the economic mess left by the pandemic and a hasty BREXIT, inflation worries, and the consequences of a war in Europe. It is, in short, not the best time to take occupation of 10 Downing Street! Everyone wants stability and expects Sunak to create it overnight. Can Sunak deliver and hang on to the job? The Conservative Party is already lagging behind the Labour Party in opinion polls. With rising inflation and energy prices out of control, can Sunak reverse the UK’s fortunes?

WORKING OUT PRIORITIES

The fact that Sunak is a career investment banker, understanding the market forces that control the highs and lows in the economy is a plus point. He spent 14 years with the U.S. investment bank Goldman Sachs and was Boris Johnson’s Chancellor of the Exchequer, which gives him an insight into the financial labyrinth that makes up a government’s economic policy. Perhaps these attributes made him the front runner when the Tories had to pick a successor to

Sunak’s priority is the economy. As a former Chancellor, he could easily make that his first job but unfortunately, as the PM, his responsibilities cover a much broader canvas.

As a first, he seeks to rebuild party unity and make some difficult economic decisions, especially on taxation and public spending, that might destabilise the fragile unity within the party. Sunak, in his early remarks, has emphasised a commitment to levelling up to a net zero policy on the climate crisis and supporting Ukraine.

Sunak’s priority is the economy. As a former Chancellor, he could easily make that his first job but unfortunately, as the PM, his responsibilities cover a much broader canvas. During his campaign against Liz Truss, he outlined his mandate of economic conservativism and tried to balance the books again. And as a former Banker, Sunak knows his job is to re-establish an element of confidence in the market and to cool it.

In keeping with these financial commitments, his finance minister announced a fiscal plan outlining spending cuts and tax hikes worth £55 billion. The measures immediately impact financial hardship on millions of Britons as they struggle with the country’s worst cost-of-living crisis in decades and its longest-ever recession. Tax cuts and austerity are key parts of the new government’s fiscal plans. The fiscal tightening comes amidst Britain’s economy, already in a recession with an expected contraction of 1.4 per cent next year.

CUTS AND TAXES

Sunak represents the old style of politics and comes from

the befuddled Liz Truss.

Rishi

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an affluent, well-educated background. For many in the Conservative Party, he represents what they wanted to get rid of, so there is some cultural unease about his being in power. And this might be Sunak’s biggest challenge yet – to govern effectively while holding a divided party together.

The media is already snapping at the flanks, unhappy at the rising rates of taxes and their impact on the common people. In an opinion piece, the Guardian wrote, “Instead of the impressive intellectual Britain was promised, we see a leader with nothing to offer beyond cuts and culture war.” This could well sum up the sentiments of a press that has no qualms in cutting Sunak to size, in fact, waiting for him to fail and be ignominiously ejected from office. That is something that makes good copy! The frustration is natural if you look at the extent and depth of cuts and additional taxes- it spares no one – rich or poor.

With Sunak’s economics, we know from his earlier campaign that it is built on fiscal responsibility. He believes in a low tax growth agenda, which analysts warn takes two or three years to unlock.

The latest budget plan outlined fresh taxes for the highest-earning Britons who will now pay the top 45 per cent tax rate on income above 125,140 pounds rather than 150,000 pounds. The government has put a freeze until April 2028 on the amount people who can earn tax-free as well as the level at which the higher rate of income tax kicks in.

The Office for Budget Responsibility estimates that 3.2 million people would be pulled into income tax because of the six-year threshold freeze. In addition, 2.6 million extra people would become higher-rate taxpayers. Shareholders will experience a cut in the amount they can earn in dividends before they pay taxes from the current level of 2,000 pounds ($2,366) to 1,000 pounds next year and 500 pounds from 2024.

In keeping with climate concerns, there are revised budgetary cuts. Electric cars will no longer be exempt from vehicle taxes from April 2025 because they have become increasingly common. Profits from energy companies will be taxed higher, an increase to 35 per cent from 25 per cent from January next year until March 2028. There will also be a new, temporary 45 per cent tax on electricity generators, designed to target profits made by low-carbon generators. These changes are expected to raise 14 billion pounds next year.

With respect to expenditure, spending would grow but more slowly than the economy, according to the finance minister. However, three areas will be boosted: education, health and social care. An extra 2.3 billion pounds per year investment in schools for the next two years has already been slotted in.Similarly, the staterun National Health Service budget will see an increase in each of the next two years by an extra 3.3 billion pounds. This would be topped by an increase in funding available to the social care sector of up to 2.8 billion pounds next year and 4.7 billion pounds the year after.

ON FOREIGN RELATIONS

On the international stage, the UK stands isolated, having left the EU. In a recent announcement, Sunak ruled out any deal that relied on EU law alignment. It reaffirmed that the UK would not pursue any post –Brexit relationship with the EU based on realignment with EU laws. There are suggestions that it is a move towards a Swiss style which offers less trading friction and more migration. Mr Sunak has reiterated that there will be no stark changes to the Brexit and EU deal, which he strongly supports.

Internationally, Britain has been an object of amazement and ridicule because of how politics and government changes have taken place. The image of Britain as the mother of parliament, with its history and continuity, has taken a bit of battering. At about the same time, the passing of Queen Elizabeth resulted in an intense outpouring of support from across the world, which reinforced the sense that Britain has a form of history and continuity despite the chaos.

This served as a reinforcement to many people in the UK that they have been through turbulent times like these before. A sense of trust and satisfaction has emerged among the people that Britain has a system in place whereby even if a prime minister falters, there can be a turnaround within six weeks, and a new person can be put in place to push through an alternative programme. If the UK can maintain its pragmatic stand amidst the economic crisis, there will be more to manage, such as impacts on the UK’s international role. There might be short-term cuts in defence spending with the longer-term aspiration of hitting three per cent by 2030.

There aren’t any significant shifts in policy, such as those in Ukraine. Relations with the global South are potentially more vulnerable than its reputation with Europe and the US. If the UK keeps up its policies on Russia, Ukraine and NATO over the next two years, which seems likely, there aren’t going to be any shifts in foreign policy.

Assessment

Rishi Sunak has his hands full. Sorting out Tory’s internal mess already appears to be Sunak’s priority. Sunak comes by after a decade of Conservative party leadership in the UK, which has seen a mix of leaders and policies. He will need to rein in disparate voices to ensure stability for the new government.

Economics as a priority should help the UK solidify its position internally and globally. Sunak’s prior experience as a Chancellor and background in finance makes him a good fit to balance the books. He will have to manage the ‘austerity’ drive with supportive efforts for the economically weaker sections.

IS IT MORE THAN JUST THE HIJAB?

To both its supporters and critics, the hijab is not about personal choice; it is a symbol of fundamental political questions left unresolved.

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The death of 22-year-old Mahsa Amini while in police custody in September has struck a chord in the hearts of the common people in Iran. Allegedly arrested by the Gasht-e-Ershad (guidance patrol), better known as the ‘morality police,’ for not covering her hair appropriately under her hijab, young Mahsa slipped into a coma during detention and died in a hospital three days later. Authorities denied that the death was caused by beatings in a Tehran police station and claimed the cause was a pre-existing cardiac condition.

Whatever may have been the medical diagnosis of the deceased, the fact is that it triggered Iran’s largest ground-level mass protest in recent times. The fact that women took the lead, burning their hijabs in public, makes these protests an even greater cause of worry for the ruling regime.

As per western media reports, the protests have broken out across the length and breadth of Iran, involving every ethnic group and people from all walks of life. Overnight Mahsa became an international martyr, with western media comparing her death with the self-immolation of a street seller in Tunis, which is said to have triggered the Arab Spring in 2011.

Expectantly, the regime struck back with a vengeance. Calling the protestors ‘western stooges’, with legislatures demanding the strictest punishments for them. According to a CNN report, out of 290 parliamentary members, 227 have signed a letter addressed to the judiciary to teach the

Women wear the hijab as a religious choice worldwide; unfortunately, it has become a symbol of repression and marginalisation in Iran. By examining the historical causes of the ongoing unrest, Iranian protestors’ current opposition to the hijab does not necessarily signify a rejection of Islam or Islamic principles.

anti-hijab protestors a ‘good lesson’.

All reports indicate that contrary to the government’s claims, protests have continued, and the government, on its part, has arrested thousands. Since independent journalists cannot access the trouble spots and there is an internet blackout, the exact number of fatal causalities is unclear. Western media sources claim that they are around 200.

WOMEN TAKING THE LEAD?

Individual acts of bravery often spark revolutions, and the Iranian government would hope this is not the case with the ongoing unrest. However, it is symptomatic of all that has been going wrong in a proud country blessed with abundant natural resources, mesmerising geography and highly cultured people. The rejection of the morality police and the ‘dress code’ imposed by its zealots symbolise wider demands for fundamental political and economic reforms. While the West would gleefully call these protests a ‘valiant struggle by the people to overthrow a hated regime,’ the reality may be more prosaic. The Iranian women, once

considered the most modern in the Middle East till the 1979 Islamic Revolution, demand the freedom of choice to live life their way in the manner they dress, the activities, including sports that they participate in and overall, their status in the Iranian society. Exposed to the rest of the world through the internet, the Iranian woman is no longer the submissive, meek and obedient person that the Mullahs would like her to be.

The hijab per se is not as bad as the tent-like chaudri which the Taliban imposes on Afghani women at the pain of death, but it symbolises their oppression as second-rate citizens. The violent outpourings after Mahsa Amini’s death represent the collective grudges of Iranian women against the state and its socioeconomic marginalisation of their gender. Incidentally, this is not the first time that Iranian women have protested the extreme mores of radical Islam. Similar protests erupted in 1979 after Ayatollah Khomeini proclaimed that hijab was mandatory in the workplace. Due to their participation in the ground-breaking protest, many educated Iranian women lost their jobs as teachers, doctors, and nurses.

Women wear the hijab as a religious choice worldwide; unfortunately, it has become a symbol of repression and marginalisation in Iran. And by examining the historical causes of the ongoing unrest, Iranian protestors’ current opposition to the hijab does not necessarily signify a rejection of Islam or Islamic principles. Regardless, if we look closely, we can see that the ongoing protests differ from the previous ones in three pivotal ways. The first is the significant part that women play in pushing for change. Iranian women are adamant about taking back their position and status as equals in society after years of oppression and brutal socioeconomic inequality that stripped them of their fundamental rights. Many women have already stopped wearing their hijabs.

The second difference is that the current protests are widespread and not just among middle-class or college-educated people. While the working class has been actively organising anti-government protests lately, today’s protests are supported by well-known celebrities, athletes, artists, and even wealthy bazaris. This apparent decline in support from the working and upper classes is a significant development that denotes the beginning of a widespread social backlash against the regime’s style of rule and its outmoded ideology.

Finally, perhaps most importantly, the regime came dangerously close to losing control of Oshnavieh for the first time. Also, protests are not just limited to large cities; they have spread to smaller ones as well. As a result, the regime’s security forces may face significant operational difficulties and struggle to maintain a substantial presence in big cities and rural towns. Previous protest movements in Tehran were successfully put down because they were primarily restricted to major cities, allowing the government to concentrate its resources on a small number of areas. Tehran may need to limit its resources and rotate its forces to respond to many incidents at once, which could result in weariness, a decline in morale, and operational shortcomings.

THE LARGER PICTURE

As much as Iran’s numerous foes would like the world to believe, the Ali Khamenei regime is far from being toppled. The movement may be spontaneous, but it lacks leadership and a coherent plan of action and is stymied by the absence of a communication network. Important pressure groups like merchants, reformist politicians, moderate clerics, and the army have been silent. Calls for general strikes have been largely ignored as markets remained open, with public transport clogging streets during rush hour. Conservative Iranians worry that their country will become another Iraq torn apart by sectarian and social unrest.

A part of the blame could be apportioned to the ruling president Ebrahim Raisi, a die-hard conservative determined to reintroduce the old cultural revolution. He gave free rein to the Gasht-e-Ershad to haul women for ‘re-education’ if dressed inappropriately. A hijab and chastity degree made it an offence for women to post pictures on social media without a hijab. Raisi’s election last year has been one of the major sources of internal discontent. The election is widely considered manipulated to keep the moderates out, and whatever flexibility the previous ruling clergy had displayed, it was ended.

Sanctions have turned a once flourishing economy into a basket case- agriculture is struggling, and there is a shortage of food and medicines, which was glaring during the pandemic as thousands died due to lack of medicines. Inflation has soared, and there is very little employment; the only way to a decent life is to emigrate. The U.S. has never forgiven the Iranians for throwing out their most dependable ally in the Middle East, Mohammad Reza Pahlavi, who, with his dreaded secret police, the Savak, ran an equally oppressive regime. The hostage crisis that followed was an even bigger humiliation for Washington. So, they have an axe to grind, which must not worsen the situation for the Iranian people.

There is little that the West can do to make things easier for the Iranians. Having imposed years of crushing sanctions that have hurt the common man the most, they have no space left to exert further pressure on the ruling elites. The solution lies with Iranians, who must find their way out of this mess; outsiders with their petty interests uppermost will make the situation only worse.

Source : Rodrigo de Matos

A DIVIDED CONGRESS: SHIFT IN POLICIES?

Mid-term elections are normally a report card on U.S. presidential administrations two years into their terms. It is expected that voters would voice their frustrations with the policies of the Administration that they dislike ushering more of the opposition into the legislative chambers- the House of Representatives and the Senate.

This time with President Biden’s approval rating being at an all-time low and question marks on whether he will run for a second term considering his age, polls predicted a huge red wave of a Republican victory. This was to be the clarion call for the return of Mr Trump to the White House. To the immense relief of the Democrats, the ‘red wave’ failed to rise, and the voters came in huge numbers to save the day for the ‘Blues’.

Now analysts are debating the causes of this apparent turn of fortunes. Was it the loud and offensive Republican campaign, at times personal, which backfired? Or is the shine from Mr Trump’s stature as the only Republican leader fading away?

THE DOMESTIC SCENE

James Carville’s iconic phrase best describes the priorities of current politics in the U.S., “It is the Economy, Stupid!” uttered when he was the economic adviser to Bill Clinton during the 1991 Presidential campaign. Despite the ‘victory’ in the cold war, the faltering U.S. economy cost

While the principal causes of inflation, the pandemic, and the economic fallout of the war in Ukraine, were beyond the control of the Biden Administration, the economic impacts could have been better anticipated and timely measures put in place to soften the blow. However, the focus was apparently entirely on foreign policy and climate change, as per the critics, and the Biden Administration took its eyes off the economy.

President HW Bush the presidency.

With the American economy under severe strain, the Republicans were banking upon it to strengthen their grip on Congress. The rising inflationary trend has impacted the less well-off more than the affluent classes, prices have risen sharply, and the pandemic saw laying off at an unprecedented scale.

While the principal causes of the inflation, the pandemic, and the economic fallout of the war in Ukraine, were beyond the control of the Biden Administration, the economic impacts could have been better anticipated and timely measures put in place to soften the blow. However, the focus was apparently entirely on foreign policy and climate change, as per the critics, and the Biden Administration took its eyes off the economy. When the economy went into a spiral, the response from Washington was “ too little, too late”, thus worsening the situation.

President Biden must manoeuvre with a divided Congress through a convoluted domestic political landscape.

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But there was a silver lining for the Democrats; the Federal Reserve stepped in with an interest rate rise, which acted as a dampener on inflation even if it made borrowing costly. More importantly, unemployment rates in the U.S. remain low despite the job losses in specific industry segments due to COVID lockdowns. The employed population accumulated their savings during the two years of the pandemic, giving them a strong reserve, which is now flowing into the market, despite inflation. So, the demand side is higher, while the supply side is putting pressure on the economy.

Another plus point for the Biden Administration was the “Build Back Better” campaign. This focused on bringing the quality of infrastructure in the country up to modern standards through higher levels of investments. The massive government spending on infrastructure has brought the Administration into conflict with the Republicans, which are against any substantial increase in government spending.

But President Biden navigated the opposition with some smart negotiations with influential members of the House of Representatives and the Senate. As the massive infrastructure bill was touted to benefit the American people, it sailed through Congress.

Another popular initiative was the Administration’s student loan forgiveness plan, which was naturally popular with the youth, who are reported to have voted in huge numbers. The Democrat’s support for the reversal of the Roe vs Wade ruling also found resonance amongst the younger voters, especially women.

A major weakness in the Republican campaign was

their failure to pin the blame of the economic crisis on mismanagement by the Biden Administration, who, despite all their problems, have been able to bring about some economic successes, as mentioned above.

So, what is the way ahead for the balance of President Biden’s Presidency with the Congress being so much divided? Libby Cantrill, head of public policy at Pacific Investment Management Company (PIMCO), says, “A shift in Congress would throw sand in the gears of regulatory efforts- and investment markets may favour the prospect of fewer business regulations.” This may weaken the U.S. government’s oversight of markets to prevent exploitation.

The war in Ukraine is costing the U.S. a lot of taxpayer money. As per a press statement issued by Secretary Blinken in September, the total U.S. military assistance to Ukraine has reached $ 15.2 billion since January 2021. This will only increase as the war prolongs and Ukraine goes on the offensive. Once peace comes, the cost of rebuilding will ultimately put additional pressure as the U.S. will have to take the lead in the ‘New Marshall Plan.’

IS DONALD TRUMP OUT OF THE EQUATION?

One certain outcome of this mid-term election is that the electoral strategy of former president Donald Trump has failed to achieve its objectives. He expended his energy on a one-issue campaign (the validity of the 2020 presidential election results and the impartiality of the electoral system). Former President Donald Trump had everything going for him in a weak economy and a weak president in Biden but failed to make any significant gains.

Source : Walt Handelsman | Tribune Content Agency

The GOP has to soon make public its choice of nominees for the 2024 elections. Mr Trump has made his intentions to return to the White House very clear; with a weakened Trump, many more rivals would rise to stake their claims, leading to fissures in the Republican party. Second-time winner, Governor Ron DeSantis of Trump’s home state Florida, has emerged as a credible contender for the 2024 presidential elections.

The midterm results have also restored somewhat the battered image of President Biden. Now pundits are busy re-calibrating their predictions for 2024!

Dr Leslie Vinjamuri, Director, U.S. and the Americas Programme; Dean, Queen Elizabeth II Academy for Leadership in International Affairs, wrote in the Chatham House, “Once again U.S. democracy has surprised, and the wisdom of U.S. voters has confounded the pundits and the pollsters. After six grim and hyperbolic years, Americans appear to have voted for stability and calm”.

THE GEOPOLITICAL CONUNDRUM

As a matter of policy, the Republican Party opposes American direct and indirect involvement in conflicts which have little consequences for American strategic interests. Apparently, it has learnt its lessons from the 2003 Iraq War! However, Ukraine has received bipartisan support so far. But how long will this unstinted support continue?

The U.S. has already invested a great deal in Ukraine to step back any time soon. On their part, the Ukrainians have proved the investment as money well-spent by giving the Russians a bloody nose and blunting their conventional military potential significantly. Marci McGregor, a senior investment strategist at the Merrill and Bank of America Private Bank, says that “regardless of the election outcome, defence spending is likely to continue to support Ukraine and to rebuild our peacetime arsenal.”

The U.S. has so far backed President Zelensky’s stand to negotiate peace with Russia only on Ukrainian terms. This may prolong the war to a point when the U.S. may have to ultimately coerce Kyiv to compromise to arrive at a negotiated settlement with Moscow. Reports indicate that the White House has already made the first tentative overtures on this account.

The U.S.-China rivalry is not much of an election issue. There is bipartisan support for the Chinese policy adopted by President Joe Biden, which has not significantly deviated from the broad trajectory put in place by the Trump Administration. The U.S. is aware that the end of China’s ‘peaceful rise’ threatens its interests and global stability. The independence of Taiwan is another important foreign pol

icy issue with bipartisan acceptance. President Biden has not relaxed the harsh trade policies imposed by his predecessor.

However, there are some differences in nuances between the two parties; Democrats believe that complete economic decoupling from China would not be in U.S. interests, and they want increased engagement with the all-powerful Chinese Communist Party (CCP) to manage global stability better. President Biden believes in a collaborative approach to deal with China by forging closer links with allies in Europe and the Asia Pacific. The Quad and the AUKUS agreement are examples of this policy.

The Republican view of China is more one-dimensional in which China is a natural threat to the U.S., a status quo power, and must be dealt with as such with little compromise or concession. They will pressure the Administration to be more forthright in their support to Taiwan and try to shift the geopolitical focus away from Russia to China.

Any move by President Biden to reduce trade restrictions on Beijing will be met with fierce opposition. Also, the western tirade against China’s human rights record in Xinjiang and Hong Kong will continue to be a principal weapon in the war of narratives.

THE INDIA ANGLE

What can India expect from the White House as it enters the second half of its innings after successfully crossing the midterm barrier? A return of focus on the Indo-Pacific would be welcomed by India, despite its differences with the western democracies over the Russian invasion of Ukraine. During President Trump’s presidency, there appeared to be a good personal rapport between the two leaders, which is not so evident in the case of President Biden.

It will not be easy for President Biden to shift focus from Europe to Indo-Pacific. His E.U. allies are struggling with a severe energy crisis playing havoc with the cost of living in Europe.

In October, the Biden Administration overruled the Trump decision to block military supplies to Pakistan for its support to the Afghan Taliban and the Haqqani focus is the $450 million F-16 fighter sustainment programme which has been approved, overlooking India’s objections. The Secretary of State, Mr Antony Blinken, claimed it would “sustain Pakistan’s capability to meet current and future counterterrorism threats.”

CHINA’S DEADLY DOUBLE TRAP

The world watches as China seems to be walking into the unique double trap of middle-income economics indoors and alienating circumstances outdoors.

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For all purposes, in the recently concluded 20th National Congress of the Chinese Communist Party (CCP), it was projected as if China’s political moorings and economic heartbeat remained in symphony. Not a murmur was heard on the impacts of President Xi Jinping’s draconian ‘Zero Covid’ policy and its effects.

The reality is that China faces a challenging time ahead. Neutral observers call the impending economic crisis confronting the Chinese Model one of ‘non-development’; its growth crashed from a consistent double-digit of the past to 7 per cent. This could be an inflexion point for China.

As economies expand in size, it is inevitable at a point for their growth rates to first stagnate and then start declining; no economy can sustain high growth permanently. China aspires to give its citizens a high level of development and social equality enjoyed by tiny but prosperous nations like Singapore and Taiwan by 2035. However, these ambitious targets can only be met if the economy gets a boost through innovative measures to bring back double-digit growth.

SNAGS IN THE ECONOMY

Discerning analysts claim that there has been a perceptible shift in the pure market economy being practised by China for decades under President Xi Jinping’s watch. This is ironic because this transformed the socialist giant into the economic powerhouse it is today.

Any shift from free enterprise will come at a cost, especially if it means an increase in government controls and ownership of industry. Such a move always makes the economy slothful as bureaucracy and its inefficiencies squeeze out innovation and capital mobility.

The robust growth which lifted millions of Chinese from abject poverty was driven by a hybrid model of state capitalism flourishing side-by-side with private ownership and free enterprise. This model was even touted as a favourable alternative to U.S. capitalism. Any shift from free enterprise will come at a cost, especially if it means an increase in government controls and ownership of industry.

Such a move always makes the economy slothful as bureaucracy and its inefficiencies squeeze out innovation and capital mobility. Bureaucratic delays concerning policy implementation have often been cited as the main reason for policy failures in China. This has impacted efforts at poverty reduction, corruption eradication and overcoming the resistance from vested interests to reforms.

China’s real estate is a classic example of this tinkering with a functioning system. In response to Beijing’s central planners’ high targets for gross domestic product, the government cranked up spending on infrastructure and residential real estate. This unstable environment was bound to implode, and it did. A sharp decline in home prices and household net worth has resulted in mounting loan defaults.

RESEARCH TEAM

China’s dominance through manufacturing and trade will retain it as an economic powerhouse. But the state’s tightening grip on the economy undermining free enterprise raises the possibility of the middle-income trap that has bogged down many emerging nations. Covid – 19 lockdowns have further fuelled speculation about a failed transition to a high-income economy due to rising costs and declining competitiveness.

As far back as 2014, President Xi Jinping had recognised the danger. In an Apec meeting held in Beijing, he had cautioned, “For China, the middle-income trap must definitely be avoided.” However, now he seems to ignore his own warning as China’s post-Covid growth falters, slumping to 0.4 per cent in the second quarter, compared with a year earlier. These developments could put paid to the ambitious ‘Great Rejuvenation of the Chinese Nation.’

The China 2030 report by the World Bank, in collaboration with the Development Research Centre of the State Council, a key government think-tank, highlighted that the key to avoiding the trap was keeping total-factor productivity growth near its past high rates. This could have been done only through policies and reforms that improved economic efficiency but sadly, such initiatives have not been visible.

Like Japan, the rising prosperity of its people and the decades-long official policy of the one-child family is showing their effect. The ageing (and hence non-productive) population contributes to the middle-income trap that China confronts.

The government responded by bringing forth a series of policy adjustments to foster economic development, such as the release of the New Normal Theory, which emphasised the pursuit of quality GDP growth. The 2016-2020 national development plan notes the middle income, which necessitates supply-side structural reforms, expansion of the middle-income popula-

tion and a campaign to reduce economic risks. Chinese authorities have systematically tackled industrial overcapacity, debt crises, and a property bubble in the past five years. However, there are still a fair number of systemic challenges which remain and require redressal.

TRADE WARS SHAPING GLOBAL ECONOMY

China has passed through three main stages in its pursuit of global economic primacy. In the 1980s, China initiated reforms that encouraged foreign capital entry into the country. In the 1990s, China’s mission of joining the World Trade Organisation resulted in a policy of “alignment”, changing China’s institutional system to conform to international rules. These two stages saw China opening up to the outside world.

The current stage of going global, which began in the early 2000s, was manifested by the “Belt and Road” initiative, the Asian Infrastructure Investment Bank, and the New Development Bank. This stage gave rise to excess capital, excess production capacity, and infrastructure construction technology which constituted a massive driving force for “going global.” Relations between the West and China have evolved through these phases. Within China, there is an increasingly nationalistic colour whereby China has begun to export its own “models” of economic development and political system.

THE COLD WAR WITH THE U.S.

The international environment and geopolitics have further enhanced the risk of the “middle-income trap.”

China’s rapid rise has become a curse because it has made its largest trading partners, the U.S. and EU, nervous and wary. Unsure of the trajectory of China’s Middle Kingdom ambitions, the Western powers are responding antagonistically, calling for economic and technological decoupling; thus, both sides are irrevocably stumbling towards the classic ‘Thucydides Trap’.

It is on the technological front that the bitterest arguments are hogging headlines. There is a desperate pushback from the U.S. to frustrate China’s technological advancement to match its own.

Last month the U.S. imposed sweeping export controls that will prevent Chinese companies from developing cutting-edge technology with applications in the military. Paul Triolo from Albright Stonebridge Consultancy claims that the “U.S. has essentially declared war on China’s ability to advance its use of high-performance computing for economic and security gains.” From an American perspective, if China’s technological ascendency is blocked, both may escape the Thucydides Trap.

There is a price to be paid for the U.S., too, as the Chinese market is hugely lucrative for its economy. Unfortunately, as we saw in the last Cold War, once the ‘conflict’ commences, security concerns overshadow all other considerations, economic and social. It will not take much time for the United States to abandon the Chinese market for the sake of security, if the situation warrants it. The United States can develop other markets, but an economic decoupling between China and the U.S. could impact other regional markets, too, that are vendors to Chinese manufacturers.

While the likelihood of a military conflict between China and the United States remains small, clashes in hot spots like Taiwan Straits and the South China Seas are distinct possibilities as militaries from both sides jockey for tactical advantage.

However, the danger of economic contestations spilling into a military arena is more serious. In the 1930s and early 1940s, relations between the U.S. and Imperial Japan deteriorated rapidly once the U.S., under domestic pressure, started strangling the Japanese

Source : World Bank economy through sanctions and denial of technology/ natural resources. In authoritarian regimes with strong militarist traditions, such economic indignities only strengthen the ultra-nationalists and their cohorts, leading to wars.

Assessment

Those cheering from the sidelines as the Chinese economy slides down must be wary that in a globalised marketplace, no one is immune from such cataclysmic events. The Chinese economy is integral to global economic order and has been the driver of global growth, especially when the West was declining. Many Asian economies are coupled with China’s growth and will suffer equally.

Having thrown the challenge to the West, President Xi is prepared for the ‘technological decoupling.’ In his speech at the Congress, he indicated his key goal to “accelerate the realisation of high-level scientific and technological self-reliance and self-improvement.” Developing intellectual property rights protection is a critical component of this technology and innovation process, which China needs to focus on.

President Xi Jinping is aware of the many snags in the Chinese economy characterised by excessive policing by the state, bureaucratic control, and a shift away from free enterprise. His new thrust and the extension of his tenure (for life?) give him the incentive and the bandwidth to put in place effective policies to jump over the middle-income trap’ and let the economy take off. But can he do it?

Singapore, Hong Kong, and South Korea are rare exceptions to the rule that emerging economies struggle to graduate to high-income status

SOVEREIGN DEBT DEFAULT

Against the backdrop of higher food, energy and import prices, an increasing number of emerging and developing economies are teetering on the edge of debt default.

This article is based on a discussion with Mr Shreyas Jayasimha, the founding partner of Aarna Law LLP.

Early this year, Sri Lanka created two firsts in its relatively short history- it witnessed an executive president fleeing from the presidential palace after resigning, and the small but proud nation defaulted on its foreign debt, except to what it owed to multilateral agencies like World Bank. Recent trends indicate the tendency of states to slip into sovereign debt default for various reasons. These incidents could have far-reaching socio-economic and legal implications.

Recently, Russia faced its first major external debt default since the 1917 revolution but under the most unusual circumstances. It owed a mere $117 million in payments on two dollar-denominated Eurobonds. The Russian Foreign Ministry was ready to make payments in roubles as dollar payments by Moscow were blocked. At the time of the Ukraine invasion, Russia had 15 international bonds with a face value of nearly $40 billion outstanding, with around half of them in foreign hands.

During the pandemic, as per Moody’s, the sovereign bond default rate surged to a record high of 4.2 per cent, with Argentina, Ecuador and Lebanon defaulting on their sovereign debts in 2020.

A HISTORICAL CONTEXT

Sovereign debts comprise an antithetical pairing- the sovereign status of the bond issuer government and the debt

Many economic experts of yesteryears have termed a sovereign debt default as a ‘Black Swan’ event. Hence measures that protect investment and (foreign) investors’ interests, such as investment protection treaties (also called Bilateral Investments Protection and Promotion Agreements (BIPA) or Investments Protection and Promotion Agreements (IPPA) and Investor Compensation Funds such as the one created by SEBI, are imperative.

obligation it consequently incurs. They are also paradoxical in terms of risk assessment. Evidently, sovereign countries have more creditworthiness than individuals; however, if they default, limited recourse to compensation is available to the investors other than seizing the defaulter’s overseas assets.

A sustainable sovereign debt is linked to the inflow of foreign investment and foreign exchange that boosts domestic growth, development and economic health, while defaulting and debt distress is a painful process which threatens macroeconomic stability, setting back a country’s development for years. However, the sovereign debt crisis is not a new phenomenon; it dates back to the mid-twentieth century when several nation-states and modern economic institutions and relationships were established.

Cases in point are the sovereign debt default by nations

such as Russia in 1998 and Argentina in 2001 because of historical reasons. After the USSR had split into separate countries, Russia assisted its former constituent republics by importing heavily from them, thus using up its foreign saving.

The command structure of the Russian economy and the economic cost of the first Chechnya war were other reasons. On similar lines, Argentina’s sovereign debt default was the culmination of three consecutive years of economic recession resulting from a long military dictatorship, unfinished projects starting with foreign investment, higher defence spending and the Falkland War. It may be said that the Argentine debt crisis also spurred innovative debates around the use of investor-state arbitration as a tool of international law to enforce sovereign bond contracts.

More recently, the 2008 US financial crisis, coupled with acts of internal economic imprudence like paying high wages with an under-competitive economy, corrupt state-run businesses, reckless borrowing and a floundering tourism industry caused the Eurozone nations of Portugal, Italy, Greece and Spain to default on their debts.

THE FALLOUT

The factors leading to sovereign defaults have been highly varied, resulting in difficulty in accurately predicting the crisis’ time or whether a country’s economic downturn will result in such a debt default. Moreover, since external borrowing by the government has only recently become a norm, sovereign debt defaults on loans financed by foreign currency were rare. Hence many economic experts of yesteryears have termed a sovereign debt default as a ‘Black Swan’ event.

While various circumstances could enhance the risk of sovereign debt default, such as sanctions and asset freezing in Russia and fiscal mismanagement in Sri Lanka, it can be said that the affected country’s economic, social, political and developmental fallout may follow certain patterns.

Despite several political commitments made by the international community, the sovereign debt crisis continues to constrain the development prospects of many low and middle-income countries. The austerity measures linked to loans and debt relief often degrade living conditions and limit investment in accessible public services.

INDIA STORY

India’s external debt as a percentage of GDP has declined consistently from around 40 per cent of GDP in the 1990s to almost 20 per cent since the 2000s and has not spiralled since the 1991 economic reforms. Recently, the Indian rupee has depreciated, troubling macroeconomic stability, including external debt. India is experiencing high inflation and large twin deficits. In response, the RBI’s increase of policy rates could eventually slow growth, making a higher ratio of external

debt to GDP possible in future.

Implications of a sovereign debt default in India, as elsewhere, depending on the country’s economic state, the value of its currency, banking system, stock market, corporate borrowing, EBCs, nature of the creditors, the gravity of external debt, etc.

However, in all cases, the default leads to a loss of reputation, making it harder for the government to attract foreign investment in the future because of the higher interest rates due to its reduced credibility. Intricately linked Indian and global markets might result in the slow growth of the Asian economy. Withdrawal of investments by foreign portfolio investors as well as India terminating development contracts abroad, hyperinflation, unemployment, plummeting exchange rates in the international market, national banks’ lending at higher interest rates, thereby stalling growth and exports, and reduced living standards are other fallouts.

PROTECTING THE INVESTORS

Hence, measures that protect investment and (foreign) investors’ interests, such as investment protection treaties (also called Bilateral Investments Protection and Promotion Agreements (BIPA) or Investments Protection and Promotion Agreements (IPPA)) and Investor Compensation Funds such as the one created by SEBI, are imperative. This results in the destination country attracting more foreign investment and foreign exchange, consequently generating more growth potential.

This indicates some advantages for India if it affiliates with the ICSID Convention. Adopting a stable, mutually acceptable dispute resolution structure, including conciliation, could guarantee enhanced protection and rights to Indian investors and their foreign investments. Such a move would enhance the state’s image in relation to investors abroad and its investment destination countries.

LEGAL SAFEGUARDS

A common way to restructure sovereign debt has been via a bond exchange, where investors are offered new bonds in exchange for the old instruments on a “take-it-or-leave-it” basis. Restructuring options generally include (1) “rescheduling,” or deferment of either interest payments or the principal on the old debt; (2) a “coupon reduction,” or a reduction in the rate of interest payable on the old debt; and (3) a “principal haircut”-or reducing the principal outstanding on the old debt.

In choosing which combination of these three options will be most effective, a country will often balance the magnitude of the needed debt relief against the affected creditors’ preferences and propensity to hold out.

Separate from debt restructuring options, it is also timely and relevant to review the international legal

framework concerning investment treaty claims that could arise in the context of sovereign bonds.

Bilateral Investment Treaties (BITs) concluded between sovereign states are a form of International Investment Agreements (IIAs). These are agreements wherein states mutually guarantee certain minimum standards of protection for investments made in their territories by foreign investors from the territories of other states party to such investment agreements. Qualifying investors are protected from certain forms of adverse state action that could hamper the foreign investor’s investment. Generally, IIAs offer protections against expropriation without due compensation, discrimination or treatment that is not in accordance with “fair and equitable treatment” obligations etc.

THE WAY FORWARD

In 2011, an international tribunal decided to accept jurisdiction in the case of Abaclat and Others v. Argentine Republic, wherein 180,000 Italian bondholders brought claims against the Republic of Argentina under the Argentina-Italy BIT. However, the matter was ultimately settled, and the tribunal did not decide whether “Argentina’s conduct in defaulting on its debt and its actions in connection with its global debt restructuring resulted in a breach of its international law obligations.”

Nevertheless, many important issues were raised through this case, including those in relation to the management of mass claims of bondholders and ad-

dressing possible due process concerns of the state involved.

The aftermath of Abaclat has also resulted in a more nuanced consideration of bondholder claims through the lens of investor-state arbitration. Among other things, the increased use of collective action clauses in sovereign bonds permitting a specified majority of bondholders to bind all bondholders through consent to debt restructuring (essentially limiting the options of certain minority groups of bondholders to resist the restructuring) as well as the trend to expressly prohibit claims on sovereign bonds that are the subject of a concluded “negotiated debt restructuring” by the host state are now becoming the way forward.

At the core of Investor-State Arbitration is the capacity of a qualifying investor to protect its economic interests by bringing claims arising from violations of an IIA, against a foreign government, before impartial arbitrators. The analysis of the possibility of treating breaches of bond contracts as breaches of IIAs involves a threshold legal question of whether a sovereign’s payment obligations on outstanding bonds could constitute a protected “investment” under a particular IIA or BIT.

Decisive debt restructuring, debt transparency, responsible and democratic handling of public funds, medium-term debt management strategy, limiting fiscal deficit and appropriate legislation can go a long way in preventing a sovereign debt default.

CHIPPING AT THE CHAIN!

If India has to join the Big League of Nations, it must become a forerunner in electronics, and to do so, the semiconductor production in the country must grow.

This article is based on a talk at the IESA Summit on ‘ Roadmap for making India the Electronics and Semiconductor Nation in this decade’.

The perception in the public domain is that the semiconductor industry supply chain lies in tatters with its impact on the automotive and electronics industry hitting the supply side. This was due mainly to the short-sightedness of strategic vision in the industry, which looked ahead by a mere six months.

When the pandemic drastically reduced demand in all segments, including the automotive industry, the major auto manufacturers scaled down production. However, adjacent markets like smartphones, tablets and laptops saw tremendous growth and took over the available capacities of semiconductors. Around September 2020, the semiconductor industry faced an inventory deficit as it had not appreciated the bounce bank in the market.

So, the question arises of how the semiconductor industry should balance out its demand and supply side to maintain equilibrium in this strategically important industry.

THE AUTOMOTIVE INDUSTRY

Any prolonged disruption can be fatal to the industry in a connected market where offshore supply chains are the lifelines. This impacts global economic well-being, and the global automobile industry is a good example.

The industry lost out on selling nearly 10 million cars in 2022, and according to some predictions, the trend may continue for another two years or more. Even though the deficit between the demand and supply of chips for the industry may be reduced, that is only on par with the synchronous nature of demand. About 70 per cent of the auto-

The ongoing crisis shows that the semiconductor industry needs to be agile on three fronts. In the commercial aerospace market, semiconductors are used in avionics and related equipment.

mobile business uses semiconductors above 90nm, which are mature nodes. Any node between 10 and 65 nm is an advanced node, and currently, 6-7 nm nodes are being developed, representing the latest technology. In the advanced categories, the capacities outweigh the demand, reducing the investment in developing and manufacturing even more advanced technology.

While mature nodes may be most in demand, the fact is that automobile innovation is a continuous process, and the electronic component of automobiles is expanding exponentially- a modern car is a veritable computer on wheels! The consumption of semiconductors in the industry has doubled between 2017 and 2021, and the graph is likely to be on an upward trajectory for the next three to four years at least.

The existing output of semiconductors will not be able to match this demand, especially regarding the further development of mature nodes, at least till 2026.

Mr Prashant Doreswamy, Country Head, Continental Corporation, India, and Managing Director of Continental Automotive Components (India), explains the digitisation of automobiles, “The Porsche 9/11 manufactured around 1978 had eight semiconductors. In contrast, today, an electric car has about 5000 semiconductor parts in it. Until the 1980s, automotives were mainly based on metal and plastic parts; however, after that era, car parts have become in-

creasingly electronic, which paved the way for software to enter the arena. Most of the parts of a car today are run by Electrical Control Units, also called ECUs. The ECUs are slowly transforming into HPCs, which are High-Performing Computers with better processing capabilities.”

PRASHANT DORESWAMY, President and CEO Continental India

The Porsche 9/11 manufactured around 1978 had eight semiconductors. In contrast, today, an electric car has about 5000 semiconductor parts in it!! Until the 1980s, automotives were mainly based on metal and plastic parts; however, after that era, car parts have become increasingly electronic, which paved the way for software to enter the arena. Most of the parts of a car today are run by Electrical Control Units, also called ECUs. The ECUs are slowly transforming into HPCs, which are High-Performing Computers with better processing capabilities.”

THE AEROSPACE EXPERIENCE

The experience of the aerospace industry has been different in the current disruptions of the semiconductor supply chain. While the aviation industry is much more technologically advanced, it is no match for the automobile industry in terms of the consumption of semiconductors. Out of a total worth of over $500 billion in the semiconductor market, the aerospace and its defence counterpart account for about $ 11 -15 billion. Explaining this, Mr Gopi Hanumanthappa, MD at Thyssenkrupp Aerospace India, says, “The reason being the volume of consumption of semiconductors in each of the industries-where the aerospace industry has a few hundred, the automotive industry needs over a thousand semiconductor units in each car. Apart from this, the build rates in the automotive industry are in the millions, whereas in the defence industry, it runs into a few thousand. It is a question of limited vs exponential need between the two industries.”

The ongoing crisis shows that the semiconductor industry needs to be agile on three fronts. In the commercial aerospace market, semiconductors are used in avionics and related equipment. Whereas, in the defence sector, it’s more than just avionics and moves into radars, etc. Space is an entirely different dimension in terms of semiconductors, where the level of electronics used is increasing significantly. The future of conflict is moving from manned to unmanned autonomous vehicles. The lesson from this is that each country needs to build its resilient supply chain and must not depend on global supply chains for critical operations.

“While today, the Aerospace industry may not feel the pinch, the rising demand in a host of industries and the critical condition of the semiconductor supply chain will be faced by the industry sooner than later,”

says Mr Hanumanthappa. From India’s perspective, complete units for the military aviation sector are being imported, so the impact of the chip shortage has been dampened. But if India moves at flank speed with the ‘Make in India’ in all segments of its industrial base, the shortage will be felt.

GOPI HANUMANTHAPPA, Managing Director, Thyssenkrupp Aerospace India

While today the Aerospace industry may not feel the pinch, the rising demand in a host of industries and the critical condition of the semiconductor supply chain will be faced by the industry sooner than later.”

TELECOM INDUSTRY

Many of the current needs of the 5G rollout are creeping into the semiconductor industry. ‘Fiberisation’ is a critical part of 5G that will help interconnect the points. India’s fibre penetration per capita is just about 1/10th of the U.S. and much less than China’s. Modern 5 G telecom runs on pluggable optics, which must be upgraded to 5G standards if India’s expectations of 100 Mbs or 1 Gb speeds are to be met.

Explaining the role of semiconductors in the telecom industry, Mr CS Rao, President of Reliance Communications, says, “ The cell sites in the 4G equipment need to be migrated to the 5G. Each cell site must be capable of delivering at least 10 Gbps of speed. This can be thought of being equivalent to a server serving a set of two thousand on a continuous ratio of 1:10.

The macro-level air connectivity happens when there is a higher densification of data points. It is set to increase by a factor of 5, as 5G works at 3.5 times the frequency at which today’s networks run. As the frequency increases, the cell sites shrink; hence, you need to have more points of presence.

This is what is going to create a lot of demand for electronics for cell sites. In the future, there will be a large spike in demand for small cells, whose densification factor would be 1:10.”

CS RAO, Chairman & Co-Founder Quadgen Wireless Solutions.

Today the electronics come from QUALCOMM and other major players with the required facilities in a particular geographical area. A huge bottleneck will occur if there is a natural or man-made disruption in those areas. The 5G network is predicted to simulate the growth of a host of private digital networks and electric utility segments. Any disruption will have a ripple effect over a wide swathe of industries.

The 4G/5 G-enabled energy network is predicted to expand rapidly, with about 80 billion connections in the U.S. and Europe alone. The system uses electric meters with embedded SIM cards in addition to a 4G or 5G network that every house will use for operations and the utility end users.

Big Indian corporations like TATA have also been lobbying the Indian government to make 5G available to the corporate sector. This will further stimulate the growth of electric utility networks for hyper-connectivity through 5 G. If this digitally enabled network is extended to the oil and gas distribution networks, the growth of the centrally controlled digital ecosystem will be huge. Can the semiconductor industry match this demand?

SUPPLY SIDE DISRUPTIONS

The supply-side shortages in the semiconductor supply chain had begun before the pandemic. In fact, it started when the Trump Administration started selectively imposing trade embargoes on China, and the companies in the U.S. and China who foresaw the disruption started hoarding chips.

In the past few years, there has been a lot of investment in the 28nm and below nodes. Yet a constrained supply remains, especially when manufacturing auto-qualified power and power management devices. This could be a looming problem because such devices have hundreds of parts, and even a shortage of a few parts can hold up the manufacturing process.

Describing the situation in the Indian automotive industry when the supply disruptions hit India, Mr Suresh Kamath says, “From an Indian perspective, it seems that the customers in the automotive industry suffered the most, and that’s when semiconductors came into the limelight.

Automotive companies work on just-in-time delivery, and when it came to the point of return to factories, they realised that it would not work. They started ordering for the next year, and we started putting orders on supply, which disrupted the chain in manufacturing in OEMs and semiconductors.”

SURESH KAMATH Managing director, Avnet, India.

From an Indian perspective, it seems that the customers in the automotive industry suffered the most, and that’s when semiconductors came into the limelight. Automotive companies work on justin-time delivery, and when it came to the point of return to factories, they realised that it would not work. They started ordering for the next year, and we started putting orders on supply, which disrupted the chain in manufacturing in OEMs and semiconductors.”

The pandemic witnessed a unique phenomenon wherein some parts of the world continued to work (where chips were needed) while other parts were shut down (chip manufacturing areas). The war in Ukraine exacerbated the supply side because the gas used in producing semiconductors majorly comes from Ukraine. Also, the freight costs went up due to the pandemic.

Since it is now evident that this sort of trend will continue, it becomes important that we have a plan in place instead of following a just-in-time approach. “There are good times and bad times, but if we navigate it well, we can help the industry grow further,” says Mr Kamath.

GEOPOLITICAL IMPACTS

Supply chain challenges are accelerated by geopolitical situations, like the war in Ukraine and the U.S.-China rivalry. In these times, businesses do not exist in sterile environments cut off from what is happening worldwide; they are, in fact, a part of the larger narrative around security. Most industries operate under the underbelly of security; examples include aerospace, telecommunications, healthcare, etc. For example, think of 5G, which has a large network of undersea cables which are very exposed. Once businesses look at the future through the lens of security, they can get on top of disruptions more quickly.

As new issues arise, the challenge becomes managing the ‘unknown unknowns’. When things are viewed linearly, everything comes as a surprise. But if you add a special dimension to it, it becomes easier to make out patterns. However, the challenge for most people in the industry is that they are not trained to do this. Everything becomes a ‘predictable surprise’ if the training is done right.

The Chinese have gone deep into the sea and discovered an immense amount of rare earth, enough to last them for the next two hundred years. Unfortunately, the flashpoints are within our region, which suggests that the businesses in this region need to be prepared for such predictable surprises.

THE WAY AHEAD

Recently, the Government of India extended its semiconductor scheme to include everything earlier in a different grade. A realisation has begun to dawn that there is an opportunity in 8-inch wafer fabs and older nodes; therefore, they deserve the same incentive given to higher nodes. In GaN and silicon carbide, India has an excellent opportunity to become the world’s power electronics hub.

No other government in the world is taking up 70 per cent of the cost in this process. There are huge opportunities in these new technologies as, ultimately, electric vehicles will depend on silicon carbide and gallium nitride. Although traditional nodes exist, the changes in the automotive industry will require newer technologies. All high-performance computing devices will require advanced nodes.

DR SATYA GUPTA, CEO, EPIC Foundation,

The incremental use of chips in the automotive industry will require a huge capacity of semiconductors. On looking at the quarterly results of semiconductor companies in the last few months, it looks like supply will outstrip demand by a heavy margin. In some cases, we see how inventory has become double what it was before for many companies. It is highly unlikely that any automobile company in China shut down because of this issue, whereas Indian automobile companies suffered severely, which can be attributed to chip hoarding!!”

If India must join the Big League of Nations, it must become a forerunner in electronics, and to do so, the semiconductor production in the country must grow. Although the Indian manufacturing sector has grown to $78 billion, 95 per cent of it is for international products, and only 5 per cent is being channelled into the Indian market and products.

Dr Gupta further explains, “For a U.S. $100 product, the manufacturing cost is about 8 per cent, for which we give 4 per cent PLI and 12 per cent design royalty back to China. So, in effect, it is almost as if we are funding Chinese R&D through these schemes. This includes products such as mobile tablets, LED chips for bulbs etc. However, the LED bulb is the only product that hosts its complete production and assembly processes in India. It includes the buy-in decisions and brands which consume about 70 million chips per year, each of which comes from China today.”

Although the entire process of chip manufacturing is a bit of a struggle, it must be viewed as an opportunity. Therefore, we must take such products that are high in value but also have the potential to go into high-volume production.

Since India does not have a ‘use and throw’ culture, we must design a product differently. For example, schoolchildren used tablets extensively for online classes during the pandemic. Mr Gupta further elaborates, “We need to make our tablets different, and we need to make them repairable and upgradable, in tandem with India being a country that derives economic value differently. We must aim to increase product reliability.”

One of the biggest challenges that the design industry will face is deciding if we will procure our components directly in India from semiconductor manufacturers. Therefore, the elephant in the room becomes the question of why there is a shortage of Indian products in the markets.

The government can intervene to improve productivity. Firstly, in PLI, an extra incentive could be given to manufacturers who are procuring their components from Indian manufacturers. Secondly, if ten per cent of the funds allocated for manufacturing can be attributed to the product and design section, then it can change this country’s fate. In steel, the value addition during manufacturing is 40-50 per cent. Similarly, the cement and automotive industry’s value addition is exceptionally high. However, in electronics, value addition during manufacturing is almost obsolete. We need to take 10 per cent of the manufacturing incentive and put it into the chip or product design to help change the course of this country. IESA is pushing MEITY to make its PLI a DPLI, Design and Production-linked Incentive so that local products are given a push.

SUSTAINABLE BUSINESS CONTINUITY

In the emerging geopolitical situation, there is a need for collaboration between nations for sustainable business continuity in electronics and semiconductors.

The times that we live in can be best described by the acronym VUCA (volatility, uncertainty, complexity, ambiguity), reportedly coined in 1978 by the U.S. Army War College to describe the challenges of the post cold war world. They, in turn, had based it on the leadership theories of Warren Bennis and Burt Nanus.

Shifts, some may call them tectonic, are taking place in geopolitics, new collaborations are being hammered together, and sovereign relationships, alignments and leverages are being redrawn and repurposed.

SECURITY NARRATIVE OF SUPPLY CHAINS

Few people are aware of the security narrative while building the electronics and semiconductor industry supply chains. The defence industry has in history triggered the most revolutionary technological innovations; interestingly, the first chips emerged from the Cold War arms race. The first computers running on chips not only guided the Apollo space crafts to the moon but were also the brains of the American deterrent based on the Minuteman ballistic missile.

Manufacturing semiconductors without external support is not possible for various reasons, non-availability domestically of an assured and plentiful supply of rare earth, the specific technology, the machine tools etc. Even if a nation has the economic capability to start such an industry, the cost of production will be exorbitant, nearly 30 to 50 per

Few people are aware of the security narrative while building the electronics and semiconductor industry supply chains. Geopolitics can play spoilsports and disrupt the entire industry. Therefore, like-minded nations must join together in creating a collaborative effort to share the technology and resources and grow and succeed together.

cent higher than the international market price.

Take the case of the global undersea cable network of 5 G. All global communications barring satellite-based, pass through them. But these are highly vulnerable and can be cut by a single frogman. The supply chain framework of semiconductors is equally open to attacks, especially if the attackers have mapped all its choke points. Most of them are within the Asia Pacific region, which makes the region so prone to conflicts and war. 90 per cent of the semiconductor supply chain is either located or transits through the Asia Pacific.

This is best described by the Chinese word ‘weiji’ and the Japanese word ‘kiki’, meaning ‘crisis’. The world is living through a chain of crises, one after the other and not surprisingly, the average shelf life of a Fortune 500 company is just about 8.3 years! Therefore, there is risk in building something big as no investor would look for the investment to last only such a short period. But then there is also an opportunity for those who can deal with the risk and the danger and, in the short time available, come up with a winning

This article is based on a talk at the IESA Summit on ‘ Roadmap for making India the Electronics and Semiconductor Nation in this decade’.

combination; the profits are immense.

CHIPS IN DEFENCE

As per Dr S Christopher, former chairman of DRDO and Secretary Department of Defence R&D, the electronics in a modern tank form as much as 40-50 per cent of its total cost! And this one tank is just a node in a big network that exists on the modern battlefield. Electronics enable it to see not only around its immediate neighbourhood but much beyond through networked situational awareness.

In addition, there is an Identification Friend or Foe (IFF) and an active protection system with a vast array of sensors deployed to warn the tank of incoming threats. Even then, this expensive piece of equipment can blow up with a single drone strike, as we are witnessing in Ukraine! So, it is ultimately semiconductors battling semiconductors for supremacy on the battlefield.

The chip has an equally all-pervading presence in other fields, including -aerospace, automobiles, health care etc.; the list is endless.

THE CHALLENGES

The chip is the bigger form of a Die, which is the one which needs to be manufactured in the Foundry. The CapEx for the foundries is between 5 to 10 billion, and India has set aside, at this point, about 15 billion. There are other equally binding reasons for collaboration. Apart from the cost of the Foundry, there is the huge operational cost and the technical know-how that only comes with decades of operating the system. It is no little wonder that the Taiwanese company TSMC is the global leader today in the area of foundries having decades of experience in the field backed by substantial U.S. and Chinese investments.

While it would be profitable to have foundries parked in one convenient place with good infrastructure with all countries using them to keep costs down, from a security point of view, this may not be the best option. The pandemic, which closed the chip supply chain for some time, wreaked havoc far and wide in all kinds of manufacturing, including the automobile industry, where car supply was pushed back by months.

Then is the economy of scale. Even if India sets up its Foundry, will the demand match its capacity? “If you look at the quantum that is going to be produced from the chips or a single die, it is so large that it is not going to be fully utilised efficiently.

‘‘If we cater to one nation or one country’s needs alone, there will be a surplus quantity. So, in other words, your production cost will also go high apart from the CapEx,” says Dr Christopher.No country can say today that it has the best, the lowest cost-producing mechanism, even if it has the best expertise in terms of human resources. Technology is evolving so fast that it is challenging to keep pace by one single country as

chips get smaller and smaller in size, with a typical chip being half the size of a coronavirus!

No country can hold on to its legacy technology for too long. The discs in which the chips are made started with a 2-inch to 4-inch, then 6-inch and today 12 inches minimum. Today you’re talking about the 3 nm type of technology. Engineering-wise, there will be a No-No for any single country to have all these things, including cheap labour apart from the resources like pure water and uninterrupted electricity.

Geopolitics can play spoilsports and disrupt the entire industry. Therefore, like-minded nations must join together in creating a collaborative effort to share the technology and resources and grow and succeed together.

CHIPS AS GLOBAL COMMONS

The next generation of warfare would see conflicts in outer space, deep sea and cyber. All these conflict domains are heavily focused on technology, which is basically chips. Should not the world declare chips as a Global Commons because it is so ubiquitous that it is needed in almost all human activities? Its ubiquity makes it so attractive for nations to be in control of its production, with every nation competing to gain primacy.

Therefore, it was not surprising when last month, the U.S. imposed unprecedented restrictions on selling advanced chips to China in its drive to rein in Chinese technological and military ambitions. The move aims at cutting off Chinese access to critical technology that has applications in advanced computing and weaponry. American companies need a licence to sell chip manufacturing equipment to China.

Controls have been imposed on semiconductor production items and transactions for specific end uses. No U.S. citizen or green card holder can work on certain technology for Chinese companies and entities, and even foreign companies with access to American technology will come under sanctions if found exporting the items or technology to China.

“Semiconductor denial can be an important milestone for a win or loss (in any conflict)”, predicts Dr Christopher.

INTERNATIONAL COLLABORATION

There is scope for like-minded countries to collaborate in chip design and manufacture.

Says Ms Tammy Ben-haim, Consul General of Israel in Bangalore on an Indo-Israel partnership, “We definitely have a lot of things in common that make us natural partners. We see great potential both in the Indian market and in the Indian need for analogue semiconductors. Israel has been a producer of analogue semiconductors since the 70s.” Intel has been manufacturing in Israel for many years, attracted by government

grants and incentives, including a low 5 per cent corporate tax. The partnership has been mutually beneficial. While Israel may have given up billions of dollars in taxes, Intel brought infrastructure into the country and hired more than 12000 direct employees in design and manufacturing. It further generates indirect employment for over 50,000 Israelis. Tower is an Israeli company that also makes semiconductors.

India may have the skill set and the engineers, but developing an indigenous capacity will still take time. “You’re not going to do it now and end your reliance on the global supply chain. Because it’s an investment of ten, fifteen, twenty billion dollars to put up one of these foundries, they don’t start working the next day; It takes a couple of years until they start producing chips that you can use, and the upkeep is also expensive. You spoke about the operational costs - clean rooms, water, engineers, so it’s a big process, but we think we can do it together looking at the bigger picture,” says Ms Tammy.

India, Israel, United States UAE Coalition can be a natural collaboration platform. The UAE bought the American Global Foundries company, which gives them the ability to produce chips and the finances to do it. “It could be a four-way or a two-country project, but it creates a need for like-minded countries,” says the Israeli Consul General in Bangalore.

Israel invests a lot in R&D and international cooperation because it is small. It has entered the European Horizon program, and the research is for the next seven

years, and the total programme is worth about 95 billion euros. It’s not the first European programme that Israel has joined to enhance and increase its research.

PROSPECTS FOR INDIA

While it will not be easy for India to get into semiconductor manufacturing, it cannot be avoided any longer, as this could be a ‘game changer’ or a ‘game stopper’ for the country.

Fabless Foundry is nothing but Chip designing, and many companies, not only in Bangalore but elsewhere in India, are working on it. Indian designers have been working with foreign companies for some time now. As per the Indian Prime Minister, Rs 76 thousand crores have been set aside for this purpose. Three companies have been chosen at this point, with the first company to start production in Gujarat soon.

However, our dependence on external sources will continue, especially for some critical pieces of equipment. In addition, chips for specialised purposes need a degree of security, especially if they are being used in military applications. Under these conditions, India will have to work with others to catch the latest trends, the latest knowledge domains, etc.

By 2030, India will reach the peak of its youth dividend, with the maximum number of youths under 30 in the world. India can become a global player if appropriately trained, including in the semiconductor industry.

Source : Supply Chain Slowdown- Joe Heller

RESPONSIBLE BUSINESS IN TIMES OF CONFLICT

Ukraine has again brought to the fore the intricate role of business interests in conflict situations.

In the closely interlinked modern world, no entity operates in a vacuum. While the primary responsibility for peace, security, and development rests with governments, when crises strike, every organisation- public/ private/ civic- must make a meaningful contribution to normalising the situation.

Ukraine has demonstrated the power of local communities, entrepreneurs and organisations in evolving risk-mitigating strategies in a heightened conflict environment.

ROLE OF BUSINESS IN CONFLICT ZONES

Commerce plays both a direct and indirect role in employment generation activities. Businesses can make a sustainable impact by creating revenues which advance economic development and recovery, developing cities and towns through their investments, focusing on inclusive hiring policies that build good relations between ethnicities and communities, and promoting best practices in the areas of human rights, labour, the environment, and anti-corruption.

Businesses also act as a powerful incentive for bringing people together across national and cultural lines by creating relationships based on a shared sense of identity and purpose. The converse can also be true, whereby companies may negatively impact their operations, and their activities may exacerbate conflict or instability. One common mistake is missing groups while engaging with stakeholders, which

Since businesses are entwined with the daily activities of human beings, it is natural for them to be directly impacted by human rights violations that tend to occur with increasing frequency in volatile situations. Ongoing stakeholder engagement, forwardlooking trend analysis, proactive mitigation measures, and localised decision-making are some of the measures essential for making businesses in these volatile situations in sync with human rights.

can foster community grievances. These unintended omissions can undermine the government’s efforts and, at the same time, create reputational, operational, and financial risks for companies and investors.

Engagement with companies operating in conflict-affected and high-risk areas enhances investors’ understanding of these complex conflict situations. It also improves access to information regarding these zones. When a shared understanding of these areas is achieved, steps can be taken to mitigate the risks and negative impacts posed to and/or by corporate activities, ensure the long-term financial performance of a business, and play an important role in supporting peace and development.

Business facilitates access to essential goods and services during war, which is critical. Quite often, people’s lives depend on it. While the term ‘essential’ is left open to many interpretations, some broad common features across

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definitions exist. Proper access to communications, drinking water, food, banking services, transport, electricity, healthcare and medicines, and sanitation are often deemed essential conditions for life. Most of these services remain essential in wartime also, and for some, their importance increases. Transport services become essential during an evacuation, and access to the internet ensures up-to-date information. The state generally owns, manages, and delivers these essential services.

SHARING THE BLAME

Invariably, human rights are the first casualty in a conflict situation. Since businesses are entwined with the daily activities of human beings, it is natural for them to be directly impacted by human rights violations that tend to occur with increasing frequency in volatile situations. In Ukraine, entrepreneurs, business operations, and civilians have engaged and withdrawn at different points in the conflict, highlighting the tenuous link between business and human rights in conflict zones.

The UN lays down Guiding Principles on Business and Human Rights (UNGPs) for human rights due diligence. However, experience tells us we must go beyond to account for context and the business’s impact on that context. Ongoing stakeholder engagement, forward-looking trend analysis, proactive mitigation measures, and localised decision-making are some of the measures essential for making businesses in these volatile situations in sync with human rights.

The context assumes primary significance in these circumstances, as businesses do not operate in a vacuum. They function in a context with pre-existing power dynamics and tensions, and by virtue of entering that context, they are changing it. Respecting human rights often assumes primary significance for companies operating in conflict-affected areas.

Businesses must avoid contributing to violations of international humanitarian law by recognising ‘acts of

aggression’ in the international armed conflict situation out of sheer pecuniary advantages. A conflict-sensitive approach emphasises effectively preventing, managing, and addressing conflict, including by seeking to understand conflict dynamics and related risks and not sustaining it by pumping money and business into the conflict zone that helps the aggressor/perpetrator.

There are many contentious zones across the globe, including conflict-affected regions where companies contribute directly or indirectly to excesses. In the Democratic Republic of Congo, Chinese companies are making huge profits from illegal cobalt mining under inhumane conditions while bribing the warlords and companies supplying materials for illegal Israeli settlements in the Occupied Palestinian Territories or companies supplying arms to rogue regimes which use them to suppress their citizens.

Businesses, both big and small, have suffered in Ukraine. Most were unprepared for the potential financial, reputational, and legal consequences of remaining active in a war zone. The responses ranged from leaving the region entirely to attempting some engagement. This stay-or-leave decision impacts the everyday lives of ordinary people in the war.

CRIME AND PUNISHMENT

Businesses run the risk of being prosecuted subsequently for complicity in human rights violations under international humanitarian law. During Nazi rule in Germany, while many companies collaborated with Hitler in gassing the Jews, a prominent company, Topf & Sons, facilitated the Holocaust by building incinerators for Nazi concentration camps.

The owner, Ludwig Topf, committed suicide by swallowing a cyanide capsule after he was informed of his pending arrest and trial by the allies after the collapse of the Nazi empire. More recently, the former CEO and chairman of the oil company Lundin are undergoing trial for complicity in war crimes during the Syrian civ-

CHOICE

BEHAVIOUR MORALITY

PRINCIPLE

RESPONSIBILITY

TRUST

RESPONSIBILITY

RELATIONSHIP

il war. In the same conflict, Lafarge, a French cement company, has also been indicted for ‘contributing to crimes against humanity’. Responsible business in conflict zones requires heightened due diligence as their conduct affects human dignity and impacts conflict dynamics. UN Guiding Principles (UNGP) state that ‘… the risk of gross human rights abuses is heightened in conflict-affected areas’. They ask states to ‘…help ensure that business enterprises operating in those contexts are not involved with such abuses.’

CONFLICT ZONE BUSINESS RULES

In recent years, there has been an increase in international attention on the interface between conflict and business. In 2022, the UNDP published a guide on Heightened Human Rights Due Diligence for Business in Conflict-Affected Contexts.

The guide introduces the concept of ‘red flags’, including reports of international human rights violations and humanitarian law and risks in supply chains. The UNGPs also set out clear and direct expectations of conduct for home states and businesses to ensure that they comply with international human rights and humanitarian law in conflict areas.

Corporations working in conflict situations are expected to recognise risks, manage them in their daily operations, measure their impacts, take measures to respond, and ensure that they are conflict-sensitive in themselves. The European Commission also published its proposal for mandatory human rights due diligence legislation. This Corporate Sustainability Due Diligence Directive will require companies to identify and mitigate risks for human rights connected to their global operations.

ROLE OF THE UN

International efforts to help companies implement responsible business practices in these sensitive areas still face many challenges. It has been difficult to

ascertain what constitutes a “responsible” business in conflict-affected and high-risk areas, and practical challenges are unique to such contexts. The UN and other agencies, such as the European Commission, have developed guideline documents to assist companies in implementing responsible business practices.

The Global Compact Ten Principles in conflict-affected and high-risk areas are a detailed guide to maximise long-term financial performance and positively contribute to peace and development while minimising risks and negative impacts to the business and society. The Guidance categorises responsible business practices into four areas: core business, government relations, local stakeholder engagement, and strategic social investment.

The document encourages steady communication with investors to ensure open communication regarding business activity in the challenging local context. Companies are encouraged to join Global Compact Local Network in an operational area, a country-specific, multi-stakeholder platform that can enhance a company’s good intentions due to collective strength.

Assessment

Conflict-affected and high-risk areas present a special challenge to human rights. Failure to adhere to responsible business practices carries additional costs and risks in such contexts, as it can exacerbate tensions and instability.

Responsible business can make a lasting impact on the peace and prosperity of a conflict–affected zone. The UN and other international organisations, such as the European Commission, have developed guidelines for companies working in these areas to aid in preserving human rights and civil liberties through responsible business practices.

NOW OR NEVER

COP27’s moment of triumph has been to incorporate elements of justice for vulnerable communities facing the climate crisis.

Despite the raging debates for decades, achieving climate targets remain a mirage and the scything IPCC report did not mince its words when it spoke of a “closing window”; we are far from achieving essential targets which were globally agreed upon in Paris.

Unless action is taken soon, the UN Secretary-General warns that some major cities will be underwater. We are in for “unprecedented heatwaves, terrifying storms, widespread water shortages and the extinction of a million species of plants and animals.” Mr Guterres described the latest IPCC report as “a litany of broken climate promises”, revealing a “yawning gap between climate pledges and reality.”

The report clearly calls out that without “immediate, rapid, and large-scale” actions, limiting global warming to 1.5 degrees Celsius is not feasible. A substantial reduction in fossil fuel use, extended access to electricity, improved energy efficiency, and increased use of alternative fuels, such as hydrogen, is essential. “Any further delay in concerted anticipatory global action on adaptation and mitigation will miss a brief and rapidly closing window of opportunity to secure a liveable and sustainable future for all,” warns the report.

The first impressions from COP27 in Egypt are that, hopefully, the international community has been spurred into action by the angst in the IPCC report.

RESEARCH INFORMS ACTION

To keep the 1.5C alive, the IPCC report suggests that global greenhouse gas emissions must be reduced by 43 per

Climate policy is usually divided into two categories: adaptation and mitigation. Mitigation covers all the actions to reduce emissions and thus limit future damage, while adaptation covers how we prepare ourselves and adjust to a warmer world. Adaptation would benefit agricultural productivity, provide food security, protect human health and well-being, and safeguard livelihoods.

cent by 2030; Methane would require a reduction to about a third. Even if this was achieved, it seems likely that we may temporarily exceed the temperature threshold.

This leaves us heading towards a 2.4°C to 2.6°C increase in temperatures by 2100, based on adherence to the conditional or unconditional Nationally Determined Contributions. While laudable, net-zero commitments ( which could bring us down to 1.8) don’t seem credible currently. This is more so because current policies leave us heading for a 2.8°C temperature rise and new pledges are highly insufficient to grapple with the severity of the situation.

The report has some damning evidence to show the weak efforts made by governments globally. The national pledges since COP26 make a negligible difference to predicted 2030 emissions, rendering the Paris Agreement goal of limiting global warming to well below two °C, preferably 1.5°C, simply unattainable!

Climate policy is usually divided into two categories: adaptation and mitigation. Mitigation covers all the actions to reduce emissions and thus limit future damage, while ad-

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aptation covers how we prepare ourselves and adjust to a warmer world. Mitigation has thus far received the lion’s share of attention and funding simply because more mitigation means less need for adaptation down the road. The new IPCC report makes a concerted push towards investing in adaptation projects as it would provide immediate everyday assistance.

Adaptation would benefit agricultural productivity, provide food security, protect human health and well-being, and safeguard livelihoods. There is a clear need for financing to be directed towards this neglected area and what the report calls a growing “adaptation gap” between those who can afford to invest in adaptation projects and those who can’t. If this call to action is not taken immediately, “maladaptation” risks locking communities into greater climate vulnerability, further exacerbating existing inequalities.

TIME FOR BOLD DECISIONS

Incremental change is no longer an option, and there is an urgent need for broad-based economy-wide transformations. The report examines transformations required in the sectors of electricity supply, industry, transport, and buildings. It also analyses cross-cutting systemic transformations of food systems and the financial system, demonstrating how it is possible to reduce emissions beyond current mitigation pledges.

An approach towards zero greenhouse gases emission is already underway in the sectors of electricity supply, industry, transportation, and buildings. Electricity supply has seen the most far-reaching changes as costs of renewable electricity have reduced dramatically. Still, major changes need to be made to ensure that transformations deliver energy access for people who

are currently not served. The impact on existing fossil energy companies and supply chains must be managed alongside grid integration of large shares of renewable energy. There is bound to be a major impact on communities and nations as these changes take place. This transformation must be handled judiciously, and grid integration of large shares of renewable energy must be prepared in advance to deal with the change.

There is a need to develop new technology where efficient alternatives are not in place, e.g., building operations and road transport. In other cases, the most efficient technologies currently available need to be applied more effectively, e.g., in shipping and aviation.

The food system has been prioritised for change as it accounts for one-third of all emissions. Food systems form a big chunk of contributions to climate change, as well as land-use change and biodiversity loss, depletion of freshwater resources, and pollution of aquatic and terrestrial ecosystems. Incorporating a food systems lens implies a cross-sectoral approach that connects all food supply chain actors. It facilitates synergies between interconnected environmental health and economic dimensions.

CLIMATE MEETS JUSTICE

A big part of the global debate on climate change has been the appropriation of blame and accepting responsibility and, therefore, action for climate change. COP27 has, for the first time, acknowledged and acted upon the needs of vulnerable countries by establishing a fund for ‘loss and damage’ from climate-induced disasters. This loss and damage fund has been termed as ‘a step towards justice’ and is a marked change in the climate debate. It is clear that the UN is looking to emphasise

Source : Joe Heller

building political trust among developing countries that are most vulnerable to climate crises without being the principal contributors.

The cover decision, now known as the Sharm elSheikh Implementation Plan, highlights the need for a significant investment of at least USD 4-6 trillion a year if a global transformation to a low-carbon economy is expected. This scale of funding will require a swift and comprehensive transformation of the financial system as well as engaging governments, banks, institutional investors and other financial actors.

In keeping with the IPCC report, adaptation techniques witnessed significant emphasis, with governments agreeing on the path to the Global Goal on Adaptation. This will conclude at COP28, which is expected to improve resilience amongst the most vulnerable. The Adaptation Fund received saw new commitments totalling more than USD 230 million.

Technology has been emphasised as an important outcome of COP27. A new five-year work programme has been launched to promote climate technology solutions in developing countries. In addition, an important post-2025 finance goal has been set up for mitigation work, aiming to reduce emissions faster and secure commitments from key countries to take immediate action to keep us on the path towards 1.5°C. The work programme will start immediately after COP27 and continue until 2030, with at least two global dialogues held each year.

Five key areas were prioritised for collaborative actions: power, road transport, steel, hydrogen, and agriculture. A package of 25 new collaborative actions has been launched to aid action in these areas. A series of funding commitments were made that enhanced support for the climate schemes. UN Secretary-General António Guterres announced a USD 3.1 billion plan to facilitate early warning systems for everyone within the next five years.

The G7 launched a Global Shield against Climate Risks in partnership with the V20 (‘the Vulnerable Twenty’), which received commitments of over USD 200 million as initial funding. Similarly, Denmark, Finland, Germany, Ireland, Slovenia, Sweden, Switzerland, and the Walloon Region of Belgium have also announced a total of USD 105.6 million. These funds have been deployed to recognise the need for even more support for the Global Environment Facility funds targeting the immediate climate adaptation needs of low-lying and low-income states. Another USD 20 billion has been promised by the new Indonesia Just Energy Transition Partnership over the next three to five years to accelerate a just energy transition. This fund was announced at the G20 Summit held in parallel with COP27 and marks how central the climate debate has become to all global negotiations.

Assessment

While 1.5 C is a clear miss, we cannot afford to get lax on what is now a calamitous situation! Research by the IPCC informs us of the immediate steps we need to take in key systems, including electricity, transport, food etc., to affect a meaningful and just change.

The COP27 summit in Egypt has responded to the challenges listed by the IPCC report and reached a breakthrough agreement to provide “loss and damage” funding for vulnerable countries hit hard by climate disasters. This has been the most encouraging step taken against climate change in recent times.

A significant milestone by COP 27 is encouraging a simultaneous push towards adaptation strategies alongside mitigation efforts. It is an important shift in global efforts in the climate vulnerabilities assessment project.

THE CONSTITUTION AND THE IDEA OF INDIA

Justice is, with liberty, at the heart of our Constitution. That is the idea of India.

This article is based on a discussion with Mr Aditya Sondhi, Senior Advocate and AAG Karnataka.

The idea of India is a phrase attributed to Sunil Khilnani from his eponymous book of 1997. Right in his first chapter, he suggested that the idea of India is not monochromatic but plural and multiple. But it is nevertheless an idea, which is the essence of understanding the spirit of a nation. He quotes Rabindranath Tagore, “A country is not territorial but, ideational” - beautiful words from someone who saw nationalism as humanism.

THE NOTION OF INDIA

John Strachey (1885), a writer and civil servant in British India, had condescendingly commented, “There never was an India possessing, according to European ideas, any sort of unity – physical, political, social or religious, nor a nation, nor a people of India, of which we hear so much”. This position has provoked multiple reactions, especially in the 1920s, as to how India was identifiable as a religious, castebased and even a cultural monolith – each proposition with its own inadequacies.

Some argue that our village systems and princely states were based on the rule of law and hence had the essence of a constitution. Some look at the Government of India Act 1935 as a constitution of sorts. But we are clutching at straws here. The adoption of the Constitution on November 26, 1949, and it’s coming into force two months later, January 26, 1950, was the singular moment where the holistic idea of India was set in stone- as Granville Austin called the Constitution, the “cornerstone” of our nation. We did not

The preamble to the Constitution gives us a unique architecture for India – the foundation that is sovereign, socialist, secular, democratic, and republic – upon which four floors of justice, liberty, equality and fraternity are built.

simply gain independence, sworn to democracy, but quickly evolved into a republic defined, governed and administered by a living Constitution – where Ambedkar’s dream of one person, one value (and not just one person, one vote) was sought to be codified.

WHAT IS ‘BHARAT’?

The Constitution begins with the words ‘India that is Bharat.’ The question is, what is the idea of Bharat?

There existed an amorphous concept of Bharat that the Constitution recognises, defines and builds upon. It is not to say that the Constitution is the inception of the idea of India, but it is most certainly the watershed in crystallising that idea. Those who criticise the Constitution as being some foreign, colonial document must realise that this is a constitution that borrows from the best in the world. Importantly it shrugs off the colonial influence as the UK has never had a written Constitution. We have traditionally followed English common law and could have been tempted to follow the British model of having no written constitution but simply a set of traditions and customs to follow.

A purposeful election of a written constitution that has many streaks of American constitutionalism as also many

which are organic to the Indian milieu suggests that, in 1949, we chose to be our own people, to posture our independence and to uplift our own. Kumud Pawde, one of the first Dalit teachers in Sanskrit, is quoted in Veena Venugopal’s book Independence Day: A People’s History as saying, ‘I am a woman …. a Dalit and married to a Shudra. I should not learn or teach Sanskrit in all three cases according to the shastras. But the Constitution of my India allows me to do this, and that is the idea of India.’

THE EDIFICE OF THE CONSTITUTION

The preamble to the Constitution gives us a unique architecture for India – the foundation that is sovereign, socialist, secular, democratic, and republic – upon which four floors of justice, liberty, equality and fraternity are built. Each with rooms of its own – justice – social, economic and political; liberty of thought, expression, belief, faith and worship; equality of status and of opportunity and fraternity that rooms the dignity of the individual and the unity and integrity of the nation.

The legislature is, in some sense, meant to be the designer of the building - who can certainly imagine and reimagine the structure without damaging its basic features. The executive could be seen as the workforce who implement this design, meant to do that job with honest intent to sustain both the intent of the designers and that of the original blueprint as laid down by the constituent assembly.

The judiciary could be seen as the sentinel or supervisor of this architecture to ensure that none of the players cross those lines and that the integrity and spirit of the construction remain as it is. The legal community, the media, activists and civil society at large would represent the floodlights and CCTVs that continue to cast sunlight upon the goings-on in these premises. This architecture is given to us by ourselves, WE, the people of India, giving ourselves the gift of a sacred social contract – as developers, co-owners, inhabitants and protectors. That is the idea of India.

In his recent book, Aakash Singh Rathore argues that Ambedkar was not just the architect of the Constitution but, indeed, the author of the preamble, and the preamble is the soul of the Constitution. While the debate on socialism may be on, secularism is, in fact, the preamble of not just our Constitution but of our very DNA. Liberty is at the core of our Constitution. We are inherently meant to be liberated as a species. The American civil rights activist John Lewis in his memoir, Across That Bridge, says, “Freedom is not a state; it is an act. It is not some enchanted garden perched high on a distant

Our constitution is a mirror to our soul, and we may choose to behold in it all that’s good and right.

plateau where we can finally sit down and rest. Freedom is the continuous action we all must take, and each generation must do its part to create an even more fair, more just society.“

Guru Gobind Singh, in his Zafarnama – or Epistle of Victory – written in Farsi to Aurangzeb after the Battle of Chamkaur in 1705, has these stirring lines to offer “When all has been tried, yet Justice is not in sight It is then right to pick up the sword, it is then right to fight.”

While the Guru perhaps meant this in a martial sense, there is a metaphor to the sword in the Constitution - which is Article 32 – the right to move the Supreme Court for enforcement of fundamental rights is in itself a fundamental right to constitutional remedies – the sword that citizens pick up to fight the persecution of the State in all its avatars.

RIGHT & DUTY

Justice is, with liberty, at the heart of our Constitution. That is the idea of India. Our Constitution mandates a fundamental duty to abide by the Constitution to respect its ideals and institutions, the national flag and the national anthem.

For every right, there is a corresponding duty - for the right to liberty and expression is the duty to uphold and protect the sovereignty and integrity of India; For the right to religion is the duty to promote harmony and the spirit of common brotherhood transcending religious, linguistic, regional or sectarian divides; For the right to freedom of trade and occupation is the duty to protect and improve the natural environment and to have compassion for living creatures; For the right to liberty and freedom of thought is the duty to develop a scientific temper, humanism and the spirit of enquiry and reform; For the right to autonomy and to live a life of one’s choosing, comes the duty to strive towards excellence in all spheres of individual and collective activity so that the nation constantly rises to higher levels of endeavour and achievement. For every right, a corresponding duty. That is the idea of India.

This right-duty axis extends even to the State - for all the powers that the State enjoys, the Constitution, by the directive principles of state policy, enjoins it to strive to promote an order in which justice – social, economic and political enjoins all institutions that the State strives to minimise inequalities in income, that it provides an equal right to livelihood for men and women (and other genders), to distribute the ownership and control of material resources to provide for economic equity, equal pay for equal work, a legal system

What we perhaps refer to as constitutional morality that ought to guide the mothership forward.”

SONADHI,

ADITYA

Senior Advocate and AAG Karnataka.

that promotes justice with legal aid, a living wage and a decent standard of life, encourage cottage industry and culture, and interestingly, to have a uniform civil code and (some of you will be aghast) prohibition of liquor, to promote the interests of the weaker sections especially scheduled castes and tribes, protect the environment its forests and wildlife, protects its heritage and artistic, historical monuments, promotes international peace and security and separates the judiciary from the executive. Not strictly enforceable, but a strong value system that courts have occasionally read into our jurisprudence.

DIFFERENT YET ONE

Emperor Akbar had the Ramayan and Mahabharat translated into Persian and shared them widely. This should remind us of our sense of plurality. We are one because we are different. United, without being the same, a union of states, federal and diverse, complex and various in our ways. A fine indicator of our diversity is Language. The reorganisation of states in 1956 came about on a linguistic basis, eroding the hitherto bifurcation between princely states and governor’s provinces, which paid no heed to the linguistic identity of the people.

Potti Sriramulu, also known as Amarjeevi or immortal for his fast unto death that led to the creation of Andhra Pradesh, carved out from hitherto Madras Presidency, showed that language and culture trump politics. The imposition of Hindi has been strongly resisted, especially in the Southern states. E V Ramaswamy, better known as ‘Periyar’, was one such trenchant opponent of language imposition. Asked in 1930 whether India was a single country, he responded in the negative, saying India was a just collection of various castes, religions and languages. It is the Constitution twenty years later that unified us into one. This Constitution does not speak of a national language, perhaps keeping in mind that India speaks a whopping 447 languages, of which the 8th Schedule lists 22. One of these is Hindi. The list of 22 includes Sindhi – the language of a people without a state.

If India must walk together, we must talk to and understand each other and voraciously translate regional languages into each other. Language, region and culture are paramount indicators of identity.

FACING UP TO THE CHALLENGES

Violence does violence to the spirit of a Constitution. The idea of Ahimsa is more the idea of India. Ram Guha once said that the idea of India is bigger than the nation of India, while the idea of Pakistan is smaller than the nation of Pakistan.

The institutional imbalances in Pakistan have led to the subversion of democracy. Had its Supreme Court played a more active role and had its army played a less active role politically, its history would have been dramatically different. And remember, they got their Constitution in 1956, a crucial six years after us, by which time martial law was already there to stay.

This is where we ought to acknowledge institutions’ serious role in a constitutional framework to make us a liberal democracy. Tribute must be paid not only to active institutions such as the Supreme Court, the bureaucracy, the media and others that have kept our Constitution ship afloat but significantly to passive institutions such as the armed forces that have kept away from politics. Less credit is given to the Indian Army for having kept from political adventurism, which paved the way and created a democratic space for us to grow. A country’s early years and early decades are where democracy is vulnerable, and passive institutions that do nothing are critically important to the idea of India.

As much as we celebrate the idea of constitutionalism, we ought to be conscious that constitutions have their limitations. Typically, governments believe that the Constitution does too much, especially in a rightsbased constitution such as ours. The directive principles that cast a heavy duty upon the government and are, in many ways, the conscience of the Constitution can also often impede the undemocratic efforts of the State.

The churn is on globally - Chile recently held a referendum to scrap the Pinochet Constitution in favour of one that is plural and liberal, but the reform was defeated. The US Supreme Court overruled Roe v Wade and reverted to an era where abortion was illegal and opposed to scripture. It is now likely to reverse the policy of race-based admissions in colleges.

The courts are at the forefront of this societal churn. The Indian Supreme Court has, over decades of jurisprudence, assumed the right to inherently interpret and enforce (and some would say even redraft the Constitution). This is what, in common parlance, we refer to as judicial activism. The Supreme Court has held that Parliament can amend the Constitution but not offend its basic structure – which has, over the years, been interpreted to include federalism, secularism, democracy, judicial independence, the preamble, fundamental rights and the supremacy of the Constitution.

THE WAY FORWARD

The Indian constitution is the lengthiest and the most amended constitution in the world. The need to amend the Constitution is obviously inherent, especially in a complex society such as ours with ever-changing socio-economic needs. And while there have been some unwarranted and even unconstitutional amendments, several amendments have indeed furthered the idea of India. For example, the precious right to education was introduced by way of the insertion of Article 21A, leading to the RTE Act, which has, in some ways, been a game changer.

Similarly, the introduction of article 371J, which provides reservations to people from the Hyderabad-Karnataka region, is a unique constitutional construct. It recognises the backwardness of certain districts and geographies in the country and provides for their advancement through affirmative action. Similar provisions are available in respect of the northeast as well.

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