SOURCE :http://www.msn.com/en-in/money/topstories/how-saudi-arabia-benefits-from-cheap-oil/ar-BBjbQmr How Saudi Arabia Benefits From Cheap Oil By Matthew Johnston
Since the middle of last summer oil prices have dropped significantly and many have wondered why the traditional "swing producer" Saudi Arabia has not intervened by cutting production as it did during the Asian financial crisis, the popping of the tech bubble in the early 2000s, and again at the start of the recent financial crisis. In fact, Saudi Arabia has actually just recently increased production to 10.3 million barrels per day, its highest level on record. Although this decision appears economically unjustified, the cost of earning a lower profit margin is being offset by two significant benefits: one is the economic benefit of maintaining market share and the other is the geopolitical benefit of being hurt less by low oil prices than Saudi Arabia’s strategic rivals. The context: The downward trend in global oil pricesThere are both supply side and demand side reasons for the current depressed level of global oil prices. On the supply side there has been the development of American shale oil and the Canadian oil sands, as well as “new supplies from Russia, the Arctic, Brazil, Central Asia, Africa and growing volumes of offshore oil around the world.” There has also been recent “unexpected resumption of oil production in Libya, Nigeria, South Sudan and Iraq,” as well as the possibility of a future boom in Mexican oil production. On the demand side the slowdown in growth in both China and Europe has meant a decreased demand for oil. Technological advancements leading to increased energy efficiency have had a negative effect on global demand for oil. Given this situation of increased supply and decreased demand for oil, Saudi Arabia is taking advantage of the benefits that a lower oil price provides.
Economic benefits for Saudi Arabia As Saudi Arabia faces increased competition from international competitors like American shale oil drillers, the Saudis are much more concerned about maintaining market share than in previous years. Since shale production in America is more costly than Saudi Arabia’s oil production, the Saudis can still profit from lower oil prices where American producers would be taking a loss. Reuters reports in 2014 that the average estimates of the marginal cost of producing one new barrel of oil are between $70 and $77 per barrel for US shale oil whereas the marginal cost for Middle East Onshore oil production is between $10 and $17 per barrel. The Saudis are effectively driving these higher-cost American producers out of the market by keeping prices lower, thus maintaining a greater share of the market.
Geopolitical benefits for Saudi Arabia Although maintaining market share at the expense of American producers, both Saudi Arabia and its ally the United States benefit geopolitically. As Phil Leech of Capital As Power says, "The cut in prices clearly harms all producers by reducing the amount of profit per barrel, but it certainly harms some more than others. For example as demonstrated by The Economist recently, the current oil price has dropped below the ‘break even price’ for all major suppliers (with the exception of Kuwait), and this includes the traditional ‘swing producer’ Saudi Arabia. But the drop is far more damaging to several international actors, most of whom happen to be strategic rivals to either Saudi Arabia, and/or its closest ally, the US (e.g. Russia, Iran and the Islamic State)." As of October of last year, Saudi Arabia’s breakeven point was less than Russia and Iran, as well as the Islamic State occupied area of Iraq. Although Saudi Arabia is currently above the breakeven point as well, it is in a much better position than its rivals. What is interesting is that Saudi Arabia’s decision not to cut oil production to prop up prices comes at a time when its American ally is in conflict with all three of the above mentioned rivals: conflict with Russia over the annexation of Crimea in the Ukraine; conflict with Iran over its nuclear program; and conflict with the terrorism of the Islamic State. The US has imposed trade sanctionson all three of these rivals; that, coupled with lower oil prices is causing severe economic hardship for these nations, and the hope for Saudi Arabia and the US is that this will cause these nations to make serious concessions to the U.S. led global political consensus. The Bottom Line Thus, although suffering from lower profit margins overall, Saudi Arabia is well positioned to benefit both economically and geopolitically by not intervening to prop up global oil prices. Although the lower oil prices mean American shale oil producers suffer and thus cede market share to the Saudis, the US may be more forgiving of its ally due to the geopolitical benefits made for both countries against the strategic rivals of Russia, Iran and the Islamic State.
SEE SLIDESHOW (below):Biggest oil producing countries in the world >> The world's top oil producing countries RELATED TOPICS:
Four MV-22B Ospreys arrived at Tribhuvan International Airport May 3 to support relief efforts in central Nepal after a magnitude 7.8 earthquake struck the country on April 25. An international humanitarian assistance and disaster relief operation has been taking place in and around Kathmandu since the earthquake struck. These aircraft are part of the first wave of U.S. military aircraft that will arrive in country to support the relief effort. The United States Agency for International Development has been coordinating the U.S. government's response efforts, conducting disaster assessments, and providing search and rescue capabilities since the disaster struck. On April 29, the U.S. military deployed a 20-person Joint Humanitarian Assistance Survey Team led by Brig. Gen. Paul Kennedy, to Nepal to support the USAID'S response efforts. A unique capability was identified during that initial assessment and USAID requested Department of Defense aircraft in order to access to hard-hit areas and speed up the delivery of critical emergency supplies. 'The MV-22B Osprey is the ideal aircraft for this type of HADR mission," Kennedy said. "With its medium-lift capacity and ability to cover large distances in a reduced amount of time, we'll be able to ferry supplies to outlying villages for Nepalese forces and NGOs to distribute." Since the Osprey's arrival in Okinawa, it has established a solid track record as the Marine Corps' go-to aircraft for disaster relief, successfully contributing to the humanitarian efforts during Operation Damayan in 2013. During that mission, the MV-22Bs evacuated more than 1,200 people, saving lives and delivering more than 20 tons of supplies to remote areas where neither traditional airplanes nor helicopters could reach.
The MV-22B has the ability to quickly convert from a rotary to fixed wing configuration, which makes it notably faster than more traditional rotary wing assets. "This means that we can get more relief aid and much needed supplies to more isolated areas in significantly less time," said Kennedy.
USAID has sent plastic sheeting and other critical humanitarian supplies to Nepal to be distributed to families in hard-hit areas such as Gorkha and Sindhupalchok, where homes have severely damaged or destroyed. USAID will identify how the MV-22Bs can best be deployed to expedite these materials to the people that need it the most. Official sources have reported that more than 5,500 deaths had resulted from the earthquake in central Nepal and another 7,000 people had sustained earthquake-related injuries. 39 of Nepal's 75 districts have been affected. The United States military has been training with Nepalese forces to respond to just such a disaster for years. Most recently, Kennedy's Marines from the 3d Marine Expeditionary Brigade worked together with their Nepalese counterparts during two earthquake-focused training events in Nepal in 2013 and 2014. "It seems unlikely that an amphibious force would come to this landlocked country but this is an event that we have been preparing for with our partners for years," said Kennedy.
The V-22 Osprey is a tiltrotor vertical/short takeoff and landing (VSTOL), multi-mission air-craft developed to fill multi-Service combat operational requirements. The MV-22 replaces the current Marine Corps assault helicopters in the medium lift category (CH-46E and CH-53D), contributing to the dominant maneuver of the Marine landing force, as well as supporting focused logistics in the days following commencement of an amphibious operation. The Air Force variant, the CV-22, replaces the MH-53J and MH-60G and augment the MC-130 fleet in the USSOCOM Special Operations mission. The Air Force requires the CV-22 to provide a long-range VTOL insertion and extraction capability. The tiltrotor design combines the vertical flight capabilities of a helicopter with the speed and range of a turboprop airplane and permits aerial refueling and world-wide self deployment.
On 17 September 2007 the first combat squadron of V-22 Ospreys deployed for Iraq, beginning a new form of aerial warfare. Marine Medium Tiltrotor Squadron 263, nicknamed "The Thunder Chickens," with 10 Ospreys left for Iraq aboard the USS Wasp, a Navy amphibious assault ship. The departure from the Marine Air Station at New River, NC, was made under tight security without advance notice to the media and with no ceremonial speeches by Marine Corps officials. They will be based at the Al-Asad Airbase in western Iraq for at least seven months of combat operations. The Marine Corps MV-22 Ospreys will be used to transport combat Marines and cargo throughout al-Anbar province.
During the two-year [2002-2003] flight test program, DoD reviewed buying existing helicopters as an alternative, should the V-22 fail to meet safety and reliability requirements. The FY2004 Defense Planning Guidance (DPG) directed a study of alternatives for the V-22, including the Sikorsky S-92 Helibus, an upgrade of the existing CH-53E Super Stallion, or the AgustaWestland EH101.
From March to June 2005, an operational test and an evaluation was conducted that deemed the Osprey operationally suitable and operationally capable. On 28 September 2005 the Defense Acquisition Board endorsed the V-22 Osprey and recommended moving toward full production of the aircraft. Textron and Boeing will build at least 458 of the V-22 aircraft for the Marine Corps, Air Force and Navy. The Marine Corps accepted the first production Block-B MV-22 Osprey in a ceremony at Bell Helicopter in Amarillo, Texas, 08 December 2005. This progression from Block A to Block B marks the baseline configuration that will reach initial operational capability in 2007. VMM-263 stood up as the first operational MV-22 squadron on 03 March 2006 under the command of Lt. Col. Paul Rock.
The MV-22B configuration aircraft serves as the baseline design. The CV-22 configuration will include additional wing fuel tanks, a Terrain Following/Terrain Avoidance radar, and enhanced avionics packages to satisfy SOF specific mission requirements. The V-22 will replace the CH-46E and CH-53A/D helicopters in the Marine Corps; replace USSOCOM's MH-53J and MH-60G helicopters; and supplement USSOCOM's MC-130E/H fleet. CSAR requirements of the USN by the HV-22 variant will augment and replace an as yet to be determined (TBD) aircraft.
Due to its range, payload flexibility, and speed, the MV-22 is envisioned as a major component of the Navy/Marine Corps concept of Operational Maneuver from the Sea. The Air Force requires the CV-22 to provide a long-range VTOL insertion and extraction capability and to supplement the Special Operations Forces (SOF) MC-130 aircraft in precision engagement. The V-22 is expected to operate in both global and regional conflicts in support of operations ranging from peactime engagements to conventional, high-intensity, general warfare. Projected threats to the V-22 include small arms, man-portable air defense systems (MANPADS), anti-aircraft artillery, missiles and projectiles fired from high performance fixed wing and rotary wing aircraft, lasers, and integrated air defense systems.
The V-22 "Osprey" Program is a Department of the Navy program responsible for developing, testing, evaluating, procuring, and fielding a tilt-rotor, vertical takeoff and landing aircraft for Joint Service application. The V-22 provides the Navy, Air Force, and Marine Corps with a multi-engine, dual piloted, self-deployable, medium lift, Vertical Take-Off and Landing aircraft to be used to conduct combat, combat support, combat service support, and special operations missions worldwide.
The V-22 Osprey Program consists of a Joint Multi-Mission Vertical Lift Aircraft that provides the USMC, Headquarters USSOCOM, USAF, and the United States Navy (USN) with a multi-engine, dual piloted, self-deployable, medium lift, vertical take-off and landing aircraft to be used to conduct combat, combat support, combat service support, and special operations missions worldwide. Missions include, but are not limited to, amphibious assault, land assault, raid operations, medium cargo lift, Combat Search and Rescue (CSAR), and Special Operations Force (SOF) support. The aircraft (MV-22 for the USMC, CV-22 for USSOCOM, and HV-22 for the USN) are capable of conducting operations in adverse weather, during daylight hours or at night, in climates from arctic to tropical from aviation and air capable ships (primary operating and support sea bases are Amphibious Assault (General Purpose) (LHA) and Amphibious Assault (Multi Purpose) (LHD) class ships, or from improved and unimproved landing sites ashore; and in a variety of conventional, unconventional, and contingency combat situations including Chemical, Biological, and Radiological warfare conditions. An air refueling capability will extend the aircraft's combat mission range when required, and it will be self-supporting to the maximum extent possible.
The aircraft is manned by a pilot, copilot, and enlisted aircrew appropriate for the specific service and type of mission being flown. The V-22 is optimized to transport troops (i.e., 24 combat-equipped Marines, or 10,000 pounds of external cargo) to austere landing sites from aviation capable amphibious ships and expeditionary forward operating bases ashore. The V-22 will be capable of flying over 2,100 nautical miles with one aerial refueling, giving the Services the advantage of a Vertical/Short Takeoff and Landing aircraft that can rapidly self-deploy to any location in the world.
Testing has confirmed key advantages in range, speed, and payload, in comparison to current rotary-wing aircraft that are inherent to the tilt-rotor concept. In the planning and execution of missions, these three improved characteristics of range, speed, and payload can be interchanged and utilized in countless ways. Together they provide a major step ahead in tactical flexibility. For example, the increased range of the MV-22 (as compared to the CH-46 and CH-53 helicopters) enables the execution of combat assaults at extended ranges. The ensuing greater radius of action will allow the Landing Force Commander more options in LZ selection, enabling the force to go where the enemy isn't. This increased range can also be employed to provide reduced exposure of the LHA/LHD platform to shore threats. In raid or Other Expeditionary Operations, MV-22s will be able to launch at a greater distance, employing greater speed to get to the objective area hours before such an operation using CH-46s. In medical evacuations, the longer legs, greater speed available, coupled with the point-to-point VSTOL capability of the V-22 will save lives.
The V-22 is the first tilt-rotor aircraft to be fielded in the military. It is a hybrid aircraft, combining selected capabilities of an airplane and a helicopter. The Federal Aviation Administration (FAA) has classified tilt rotors as powered lift aircraft, neither airplane nor rotorcraft. The V-22 uses many unique items to achieve its configuration and capability. The airframe incorporates new materials and structural designs. Advanced avionics provide mission enhancement while new wiring technologies increase reliability and reduce weight. New hydraulic technology is also applied. Redundant digital systems such as fly-by-wire flight controls are used in lieu of traditional hybrid redundancies. New processes are applied in the operation and maintenance of the V-22. Examples include the mission planning station used by aircrew before flight, and the maintenance station used between flights to automatically identify defects and conduct trend analysis to predict future maintenance actions.
Russia | Rafale | Lieutenant General | gdp | France | Finance Mini ..
This year's budget gave a hike of 7.9% in military spending, and as a percentage of GDP, total defence spending is 1.7%, the lowest since 1960s.
We don't have the money to buy the weapons we really need - that's what the Indian military brass has told Parliament's standing committee on defence. The report on the military's concerns was submitted last week and India's generals explained that thanks to a record low budget allocation this year, defence forces won't be able to buy operationally critical equipment like artillery guns, carbines, missiles and antitank systems for the army as well as patrol vessels and surveillance h helicopters for the coast guard.
This year's budget gave a hike of 7.9 per cent in military spending, and as a percentage of GDP, total defence spending is 1.7 per cent — the lowest since 1960s. India's army has said the country's defence budget should be brought up to 3 per cent of GDP. China's defence spending is 2 per cent of GDP, Pakistan's 3 per cent, America's 3.8 per cent and Russia's 4.1 per cent, according to ministry of defence estimates.
The defence ministry is planning to petition the finance ministry for additional funds in June.
Defence submissions to the committee have made the point that the budgetary hike will cover maintenance and salaries and committed liabilities for past purchases. Only 8 per cent of the capital allocation in the defence budget is for new projects.
Submissions made to the House panels say the army has identified 20 key projects it wants to sign but that the "money is not there". "Yes, a lot needs to be modernised. We are aware of it. We have got our plans but finally there is a funds crunch. That is being reflected in the way funds get sanctioned on the ground," a senior army Lieutenant General told the panel.
Defence brass is typically not identified in submissions made to House panels.
Countering criticism that its own system of procurement is prone to delays, the army told the panel: "The crunch is that you do not have the money. Just because the money is not there, there is a certain slowing down when it comes up to that level of sanction, the big projects because all the big projects go to the finance Ministry and tend to slow down. So, if the money is there, I am sure the things would fall into place."
Similar representations have come from the air force, which has been given only a fourth of its required funds for new projects. In fact, the money for air force's new projects - Rs3,264 crore - will barely be enough to make the first installment payment for the 36 Rafale fighters India is purchasing from France.
For the coast guard, not only is there not funds for new acquisitions, this year's budget allocation will have to be used for paying commitments for last year.
"With this (coast guard) budget they can go on for six months. We are hoping to take (it) up with the finance ministry in the month of June," Defence Secretary RK Mathur said.
MODI's CHINA VISIT :AT THE LEAST, WE SHOULD NOT FOOL OVERSELVES By Arun Shourie
China sees India as a potential nuisance, let’s not be in a hurry to resolve the border dispute when the distance is as vast as it is now, Arun Shourie tells National Editor (News Operations) Rakesh Sinha in an interview days before Narendra Modi leaves for China.
How do you view the Prime Minister’s forthcoming visit to China?
Arguably the principal achievement of Mr Narendra Modi has thus far been the energy and the clear focus he has brought to foreign policy. A distinguished academic was pointing out the other day that the backdrop of each of the PM’s visits abroad has been China: those to Japan, to Fiji, to Australia, to the two Pacific Powers — US and Canada; the fact that our President was in Vietnam on the eve of President Xi’s visit to India; the Prime Minister’s visits to countries in the Indian Ocean. The GCF
— the Greatest Common Factor — in these has been one: China.
Hence, a clear focus.
Does this suggest that he sees China as the main problem for India?
I certainly cannot say how he sees China. But the fact is that, while Pakistan is the immediate problem, China is the principal challenge in the long run — and in part Pakistan is a problem because of China. China’s great skill has been the manipulation of power and the symbols of power. It has a definite view of its place in the world: that it must be the dominant power in Asia now, and the principal power in the world tomorrow.
And don’t forget the success that they have already achieved towards these goals. China is the most significant factor in international calculations today: its economy is five times that of India; its foreign exchange reserves are ten times ours; its defence spending is three-and-a-half times that of Japan. No country in Asia, and much farther afield, takes a decision without factoring in China’s likely reaction. On the contrary, even allies of the USA are only too willing to head for the Chinese door disregarding reactions of the US: look how 42 countries have already signed up for the Infrastructure Bank that will be dominated by China.
But isn’t the Chinese economy facing deep problems today?
Indeed, it is: the property and stock markets have swollen as bubbles. Local governments have been on a building spree through “shadow banking”. And so on. But China’s problems are not going to solve ours: all they can do is that they may give us a little more time. More important, who knows how China will react if it really landed in serious problems: will it lunge for external belligerence to divert attention of its people?
And please remember, nor is it just that they have acquired capacity, they have acquired the necessary reputation: that they are entirely capable of using force to enforce their interests and claims; that—the complete opposite of the US— China will stay the course: its territorial claims vis a vis countries that it regards as its rivals — Japan — or mere “squatters”— as it sees the countries with claims to the Spratly Islands, say.
Where does India fit into its worldview?
A fundamental objective of China’s strategic doctrine has been to “manage the periphery” — this originally meant the areas from which hostile hordes could descend and wreak defeats on the Chinese. But in general it means all areas from which China’s interests can be hurt: today, with the advance of technologies, etc., the US can affect China’s interests; and so, the US too must be managed. We, in any case, are literally on its periphery.
It views India as a potential nuisance—one that must be kept busy in South Asia. And it has a willing instrument in Pakistan to do so. The Wiles of War, a Chinese war-classic, advises, “Murder with a borrowed knife”!
Second, the Chinese establishment has long felt that Indians are a docile people who will always be doing somebody’s bidding: first they did what the British wanted; then India was under the tutelage of the Soviet Union; now, in their assessment, it is becoming the instrument of the Americans.
Trade with China has grown to $70 billion today. Won’t this so enmesh the interests of India and China that China will come to value India’s partnership?
That is a complete delusion — the delusion that trade, and even economic interests in the large will deflect China from its central objective, of power, of domination. The Japanese leadership reasoned the same way twenty years ago. And see what they are experiencing at the hands of China today. Second, we must look at the nature of our trade with China: we are exporting raw materials — iron ore, bauxite — and importing finished goods: so many of our companies, for instance in electronic items, have become just traders in Chinese goods. Isn’t that precisely the kind of trade against which Indian nationalists, from Dadabhai Naoroji on, protested? And then, before going gaga over that figure of $70 billion, remember that is the total value of trade: it is made up of $15 billion of exports from India to China, and $5 billion imports from China into India!
What about soliciting Chinese investments, especially in what is one of the main priorities of this government, infrastructure?
Two points.
First, assume a contract is given to a Chinese firm to lay a rail track: won’t that involve the same problems—land acquisition, etc.—that an Indian firm would have to face? And if you are prepared to clear the way for that Chinese firm, why not for an Indian firm?
Second, several types of projects and infrastructure have security implications: power, for instance, telecom infrastructure certainly. And China’s record in penetrating networks, for instance computer networks, has been documented time and again: you just have to read the Munk Center’s report on how China penetrated computer networks of over a hundred countries — including India, of course — and used this to send key data from these in real time to Chinese bases; or the earlier Cox Committee’s report to the US Congress: you just have to glance through these and you will see what we will be opening ourselves to if we were to allow them entry into infrastructure in sectors like telecom. So, my response would be: extreme wariness.
You imply that India isn’t able to meet the Chinese challenge or threat on its own. What should it do?
First, as we are not able to equal China’s acquisition of influence, yes, we must seek common ground with all countries that are apprehensive of China today—for sharing intelligence and assessments; for coordinating positions in international organisations and negotiations; for technology acquisition, etc. For instance, we must exert ourselves to the maximum to make common cause with countries along the Mekong that are as worried by the steps that China is taking to divert waters. But we must always remember that, just as we will not go to war to safeguard anybody else’s interests, no one will go to war with China, or even sacrifice any vital interest of its own because China has grabbed more territory in Ladakh or Arunachal, or because they are diverting Tibetan waters to the east and north of China.
Look at the way NATO has remained paralysed over Ukraine. Hence, the first point is: closer relationships with other countries, most certainly; but
there is no substitute for building what the Chinese call Comprehensive National Strength.
Second, true, there is a substantial backlash against China’s overt aggressiveness—from East and Southeast Asia to Africa to Latin America — but we have to be able to and adroit enough to take advantage of it. The first requisite is to follow up on the Prime Minister’s visits we talked of earlier: execute the projects that have been announced or agreed with those countries. We also have a reputation for forgetting about the agreements and announcements that were made and the MoUs that were signed, once the visit is over.
Let’s talk about the PM’s visit. What do you think he should bear in mind?
First and foremost, he must bear in mind how the Chinese swept Panditji off his feet. They zeroed in on his intense desire to be a world leader. Remember how Chou En-lai — one of the 20th Century’s great masters of diplomacy — dissimulated as an eager student: asking Panditji about Indochina, about world affairs. Soon, Panditji was asking him whether, in addition to what Chou had asked, he would not also like to know about the Arabs, about U Nu, about the difference between the two types of Buddhism... The next day, Panditji wrote to Krishna Menon that he had found Chou to be not well informed about world affairs, but that after their meeting he was better equipped! And how the Chinese completely bowled him over during his visit to China — with uncountable crowds, and the rest. So much so that, after a strenuous day, Panditji was writing a long letter to Edwina Mountbatten: a wave of freedom has swept over China because of my visit, he wrote . . . What a tragedy.
At the least, we should not fool ourselves. When President Hu Jintao came to India in 2006, the then Foreign Minister told our Parliament that, as a result of the talks, China supported India’s case for becoming a member of the Security Council.
There was absolutely nothing to that effect in the Joint Declaration.
In fact, China was even then blocking and continued to block all attempts to enlarge and reform the Security Council.
I would go further. As Mr Shyam Saran reminded us in his K Subramaniam Lecture, the Prime Minister must remember that the Chinese regard deception, double-talk to be just elements of statecraft, and would be astonished, even offended, if you held the deceptions against them. He recalled how, on his visit to Peking, Mr R K Nehru had told Chou en-Lai that China’s statements on Kashmir seemed to call into question India’s position in regard to J&K being a part of India. Chou had asked, “Has China ever said that India’s position on J&K is wrong?” We had taken this to be endorsement of our position. On a subsequent visit, R K Nehru drew Chou’s attention to the fact that by then Chinese statements had begun mirroring Pakistan’s position even more closely. He reminded Chou of what Chou had said on their last interaction: “Has China ever said that India’s position on J&K is wrong?” Chou now asked in return,
“But has China ever said that India’s position on Kashmir is correct?”
The same sequence had been played out with Panditji directly. Panditji had remonstrated with Chou how Chinese government maps showed vast swathes of India to be part of China. Chou had said that these were “old Kuomintang maps” and the Chinese government had not had the time to check them for accuracy. Panditji had taken this to be an endorsement of our position in regard to the border with China. When some years later, Panditji pointed to the maps, and reminded Chou of what he had said earlier, Chou turned around and said in effect, “Indeed, these are old maps. We have checked them. They set out the border correctly.”
And now the same thing has been happening in regard to the agreement on principles for settlement of the border dispute that was signed in 2005.
Does this mean that India remains suspicious forever, does nothing to solve the border dispute?
Not at all. We should, of course, explore whatever measures can be taken to minimise incidents on the border. But we really should, one, not be in a hurry to “solve” the dispute — especially not when the distance between China and India is as vast as it has become; two, always remember that an agreement is worth something only if you can make it expensive for the other side to violate it.
But what if some local commander in Ladakh takes it into his head to take a swipe? Decides to thrust a thousand Chinese soldiers into Ladakh at the very time their President is in Delhi? Are relations between two great countries to be mortgaged to local commanders?
It will be worse than foolish to make-believe that the foray at the border or the reiteration of the claim to Arunachal is the work of some local commander, or some PLA general. The PLA has always been subordinate to the Chinese Communist Party. President Xi is the chairman of the Military Commission also. And especially these days, the PLA leadership is very much on the defensive because of the anti-corruption drive: a very large number of generals and other senior officers are under investigation.
Therefore, do not fool yourself into believing that what happens is without direction from the high leadership of China. And look, not at what they are saying, look at what they are doing. One of our wisest strategic thinkers, General V Raghavan, tells us how they lull others by talking “strategic reassurance”, even as they foment “tactical turbulence”. And in our case, they are moving fast to reinforce not just tactical but strategic inequality: from Arunachal to the ring of ports, to the projects they are executing in PoK; from the planned railway line to Kathmandu to the militarisation of Tibet; from blocking ADB loan for a mere technical study for a project in Arunachal to preventing reform of the Security Council; even as they forcibly alter the rules of international order in the South China Sea and in regard to the Air Notification Zone in East Asia .
So in your view what should the government be doing?
First and foremost, we must speak clearly to the Chinese about our concerns: about their assertions that Arunachal is just a part of “Southern Tibet”; about infrastructure projects they are executing in PoK [even before the latest announcements in Pakistan, there were already 35 of these]; about the transfer of arms, of atomic and missile know-how to Pakistan; about incursions across the border; about diversion of Tibetan waters; about the military bases in Tibet; about naval bases around India.
Won’t raising these issues guarantee a failure of the talks?
Josh Malihabadi put it well: Badi kartaa hai dushman aur hum sharmaye jaatey hain! The adversary rains evil and we cringe in shyness.
Raising issues apart, what more should the government do?
We must do everything possible to speed up development of the Northeast—and that does not mean just throwing money at the region; and ensuring that people from the region feel welcome and esteemed everywhere in India. Beware of opening up the border towards Kunming : that will only clear the gates for China to suck the Northeast into the Chinese “sphere of prosperity”. Second, we must reflect on what reconciling ourselves to Chinese occupation of Tibet has cost us. Our interests, our security are deeply intertwined with those of Tibet. There are several reasons why China is now fabricating and pressing its claims in regard to Arunachal. But one reason clearly is thatit is preparing itself for the post-Dalai Lama time: that no reincarnation may be claimed to have taken place in Tawang, for instance, as is said to have happened in the case of the Sixth Dalai Lama. The slightest easing on such matters will have catastrophic consequences. Whatever the Chinese say, we must leave no one in any doubt that we will continue to support the Dalai Lama, and his successors.
We should go further and think in terms of a Buddhist civilisational challenge to China: careful observers of China report that large numbers of Chinese are turning again to dharma: including relatives of very high personages of the current government of China. But to do so, we must learn about Buddhism. We must revere those who practise it: especially the masters who are in India itself. Everyone will see through our efforts if we just use Buddhism as a device to attract tourists. Nor can we convince anyone that we are the land of the Buddha, that we greatly treasure the teachings and memory of the Buddha, and simultaneously try to snatch the Bodh Gaya temple from Buddhists.
What if you were asked to suggest just one or two things to the PM?
Don’t worry; I am not going to be asked.
But if I were asked, I would say:
ONE:, do not disregard the institutional memory of the Ministry of External Affairs; more than that, TWO , spend time with those — persons like General Raghavan and Shyam Saran whom I mentioned — who have spent years and years studying China, and its methods. When you meet them, reflect carefully on views and assessments that are contrary to your instincts: remember the consequences that flowed from the heavy hand by which Panditji throttled the views which he said were contrary to his world view—those of the Counsel General in Lhasa, the Political Officer in Gangtok... to say nothing of the letter of Sardar Patel.
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