A chill ran down my spine, and it wasn’t just the biting cold of the mountain desert at Kumbitam, Ladakh. I was frightened and thrilled at the same time. You would be too, if you held death itself in your hands. I was about to fire another burst of rounds from the greatest piece of machinery ever invented by man in my opinion. The AK-47.
I follow instructions, load the cartridge of 30 bullets, take aim, unlock the safety catch, and fire. All this in less than 15 seconds. I was aware of the infinite lightness of this beast—whose burden is to kill. For a gun that can fire 600 rounds of 5.44 mm chambered steel-cased ammunition per minute, it weighs only a little more than 4 kg, about as much as a child’s school bag.
There is something strangely uplifting about this weapon. One feels free, liberated by the rawness of its touch and reassurance of its reputation. As I continue firing some of the 150 odd rounds I fired that day at the 8th Mountain Division of the Indian Army, the bullets whizz away at the rate of 780 metres per second, which is the AK-47’s average muzzle velocity.
Down the decades, its trademark rat-a-tat-a-tat sound has reverberated through thousands of conflict zones across the world. From the killing fields of Vietnam to the icy heights of Kargil, from the gang wars of Mexico to the death zones of Iraq and Afghanistan, on to the bad streets as darkness falls over Johannesburg. That rattle brings with it death or a terrible wound—it can also be a harbinger of victory.
In the high mountainous corners of desolate Ladakh, this gun generates a sort of resonance that cannot be described, only dreaded.
The AK-47 is at once a forbidding firearm and a piece of art. One instant the peacekeeper, the very next the instrument of terrorists’ carnage. At once, friend and foe. A darling of special forces of the State and beloved by revolutionaries from Mozambique to the Hezbollah (both have it on their flags) keen on its overthrow. This is a gun with multiple personalities enough to fill an entire psychiatric ward.
Make no mistake, the Avotomat Kalashnikova 47 is the world’s greatest assault weapon. It was conceived in 1942 in the midst of World War II. German forces were running the Soviet Union over, 1,500 miles had been conquered by the Wehrmacht, 7 million Soviet citizens lay dead. The assault rifle was already a German invention, splattering blood relentlessly on the Steppes. It was then, during the savage siege of Stalingrad that would eventually destroy the German 6th Army and with it Hitler’s ambition, and cost at least 350,000 Soviet and 400,000 German lives, that work began on the rifle that was to attain iconic status.
Mikhail Kalashnikov, the man who designed this magnificent firearm, was hurt in battle and was recouping in hospital; born in 1919, the year of Amritsar’s Jalianwalla Bagh massacre (thankfully, the gun came many years after Dyer), Mikhail was one of 18 children his mum bore. In this hospital, as he later recounted in interviews, he was encouraged by a fellow wounded soldier to develop an automatic rifle to rival what German soldiers had.
Kalashnikov, being a perfectionist, developed one better. He put brains and skills together and came up with the gun that even today, some 60 or more years on, remains the weapon of choice the world over. So successful has it been that more than 90 million pieces of this gun have been manufactured, since. The AK-47 has been used in at least 120 countries worldwide.
What is even more amazing is that in the technologically fast changing world of firepower, over half a century of the AK-47 has seen only two modifications, and that too, so minor you wouldn’t even notice. The first was when Chinese designers developed the AK-56 (in 1956), which differs slightly in its fully hooded sights in contrast with the original AK-47’s partially enclosed one. Some even consider this copycat version poorer since it lacks a threaded muzzle that gives the AK-47 its trademark soft recoil.
The other attempt at upgradation was by Soviet engineers, who developed the AK-74 (in 1974). Again, this had new bullets, but while more accurate, their killing capacity couldn’t match that of the old bullets. The original old killers have a way of producing what science terms ‘hydrostatic shock’. Once on target, each bullet pierces its way in and fragments into body tissue, making it almost impossible to treat. The new guns create much cleaner wounds.
What is more, given that the AK-47 gun can shoot 600 rounds a minute, it has turned target accuracy a mere matter of academic interest rather than operational performance.
Mikhail Kalashnikov is still alive. He has only two regrets. One, that the gun, though perfect, took so long to develop. It entered service with the Red Army only after the end of the War—in 1947. By then, the Soviet Union had made a dead mouse of the Nazi Hitler in his bunker, and an iron curtain was being drawn across Europe. The gun’s debut, thus, was in the clasp of an iron fist.
The Soviet Union lost nearly 20 million to the War which killed 5 million Germans. Had the gun come earlier, Soviet Russia could have suffered far fewer casualties, and perhaps even have ended hostilities sooner. This remains one of the intriguing what-ifs of world history.
Kalashnikov’s second regret is the sheer number of people his gun has killed and wounded. In an act of supreme irony, the man who designed this gun has now set up a fund for gunshot victims.
On that cold day, as we finished our test-firing of the AK-47 in Ladakh, I felt a strange numbness which overcame the uplifting sensation of freedom or even exhilaration that I had experienced just a moment earlier.
Next to me, firing away was a fellow journalist, Muzzamil Butt, working for Sahara, a TV channel. Later at the mess, as we finished our third round of Old Monk, both drinking at a slightly faster pace than we were accustomed to, I asked him how he felt. His answer was startling: “I have overcome fear. It’s the end of my nightmares—this gun began it, and now after firing it, has set me free.” Muzzamil had once been shot covering a protest in Srinagar; the bullet had come through the barrel of an AK-47. He has lived to tell and win his personal battle.
A RECENT Hindi film made by Shyam Benegal, Welcome to Sajjanpur, has an interesting moment. A villager bypasses the post office and sends an SMS instead to his relative. Scenes like this hearten urban moviegoers who’re keen to see technology work its merry miracles with the masses. But they also worry rural retailers and marketers who fear that the day may not be far that they too are bypassed— ‘disintermediated’ in jargon—as the humble ringtone turns into a giant sucking sound across the vast hinterland of India.
As the cellphone assumes the status of the individual’s most prized possession, phone bills are sucking away so much money that there’s little left for other things. Almost nobody can escape. The first and hardest hit are marketers directly in the way of the mobile revolution. If you are selling products such as watches, radio sets or even cycles in rural India, you are up against a force you have no time left to ignore any longer.
Rama Bijapurkar, marketing consultant, has witnessed this first-hand in her travels across India’s hinterland. “There is a definite category collision brought on by the sale of cellular devices,” she says, “especially in rural India. In some categories, this collision could be as deadly as the asteroid that wiped out the dinosaurs. It is distinctly possible that entry-level products such as radios and watches become history within a very short time in rural India.”
THWACKED BY THE HANDSET According to data available with NCAER, a statistical research organisation, half of all radios, watches and cycles sold in India are in the rural market. The cellphone looms large now as a rival for the interest of these products’ buyers. It has become the first consumer durable that a person buys, which means that other big-ticket purchases are put off till later. Increasingly, a ‘later’ that never comes. In the case of watches and radios, the phone acts as a substitute—and so far as cycles are used to reach someone, indirectly for these too. “Cellphone expense cuts down on rural commuting significantly,” observes a microfinance professional with experience in rural Uttar Pradesh. Since plenty of commercial activity in rural India centres round agriculture and trade, the phone keeps the need for physical travel to a minimum. So it’s not just cycles, even motorcycles and related products have been affected.
A recent study by Virgin Mobile, a telecom operator, estimated that a growth rate of over 30 per cent a year is feasible for cellular phone sales in rural India. Philips, which has been rural India’s top marketer of radio sets for decades together, refused to comment when contacted for this story. The silence, presumably, is not without reason.
That some products are bought at the cost of others is well understood in low-budget markets. “The rural customer is unique in the sense of price sensitivity,” says B Narayanaswamy, president, Ipsos Indica Research, a consultancy that has done extensive work in Indian villages, “For him, the mobile phone provides a multiple product platform. Thus anything in the price ballpark, from watches to radios to torches, has already seen sales dip.”
The availability of cheap loans for cellphones also lowers the entry barrier. “A lot of microfinance lending is done to enable communication and trade, and is targeted at purchasing a cellphone,” says the microfinance professional. In any case, logic dictates that lenders should be happier lending money for a product that’s relatively easy to trace, at the press of a few buttons.
This is bad news for other products.
Cellphone penetration, meanwhile, deepens by the day. “We are very bullish on rural India,” exults Vipul Sabharwal, director, sales, Nokia, “Today Nokia has over 15 entry devices that range from Rs 1,300 to Rs 5,000. The village market demands three features: the phone has to be affordable, durable and practical. The Nokia 1202 is our lowest cost mobile device, designed specifically for people in rural areas. It features a flashlight, extended battery life, loud ringtones and a phone book. The Nokia 1650, priced at Rs 1,700 is Nokia’s lowest cost colour phone, and it includes an FM radio. And yes, the multi-functionality pull does make it attractive, and crowds out the need for the consumer to purchase the same functionality separately.”
All this, even before secondary effects start kicking in. Once phone subscribers start using their handsets to buy music, audio-visual clips and perhaps even groceries someday, dozens of other marketers will be sweating. Do they have any hope for respite?
RING FENCING Rural marketers are faced with a cellular challenge. What should they do by way of response? “Provide value,” advises Jagdeep Kapoor of Samsika, a marketing consultancy, “Less is definitely not more in rural India.”
Some products need not become obsolete. “Torches, for instance, can survive,” he adds, “A phone battery is no match for a torch, but they have to give value. Electricity outages are real in these parts. More power at lower price points with emphasis on design will help.”
Watches, on the other hand, may need to take a leaf out of Titan’s marketing book. In urban India, the brand went beyond functionality to sell watches as fashion accessories instead of timekeeping devices. “For watches, they have to move up to a gift category—say, as wedding gifts. Just a cheaper priced watch is not the answer,” says Kapoor, “It’s not going to be easy for these brands to restructure their marketing strategy, but if you make the consumer move beyond the entry level, there is certainly scope.” Rural incomes are rising, and anything worn on the body can act as a status symbol—also a reason that cellphones are often waved about in social settings.
Then, marketers need to do a better job of distribution. ‘Joh dikhta hai, woh bikta hai (what’s seen is what sells),’ as Kapoor’s maxim goes. This is something at which cellphone marketers beat them hands down. In rural Andhra Pradesh, for example, handsets sell right next to ration shops from which people buy their essentials. But as a study by research firm ORG has outlined, other durables suffer from low availability in rural India. Of course, fanning out isn’t cheap; the investment would need to be justified by higher sales prospects in the future. This, again, comes down to the challenge of generating rural demand in the face of the cellphone threat.
But then again, going back to Sajjanpur, gaining visibility can also be done via cinema exposure. If marketers can get filmmakers to weave interesting usages of their products into their film scripts, perhaps they’d have a better chance at prolonging their survival. Still, it’s hard not to pity the marketing executive in any of these hardhit categories, should he get that phone call informing him of his next posting—somewhere in the labyrinth of rural India. It promises to be the toughest marketing job in the world. Crack the problem, though, and it could bring you everlasting fame as part of a business case study.
All the bluff and bluster of services driven, $1 trillion economy comes apart, almost minute by minute, as the monsoon gets delayed.
Unlike the G 7 countries, where a miniscule per cent of people survive on the farm, in India and China more than one thirds of people survive on the mercy of the land. And unlike China, India is a democracy. Already there are protests in Uttrakhand and Madhya Pradesh on water shortages, these could just be starters should the Monsoon fail. The Monsoon is the umbilical cord of the Indian economy - even 60 years after independence - that cord has not been cut.
While estimates differ, there is a broad agreement among economists that the monsoon determines at least two per cent of GDP growth for India. In the context of the slowdown, a bad monsoon can be a disastrous. Even more so because so far buoyant rural demand has allowed India to grow at more than 6 per cent per year.
The share of the Monsoon fed agriculture in total output in India according to official statistics is at 18 per cent. The trick is the number of people dependent on it - and that is overwhelming. A government that swears by the national employment guarantee scheme cannot afford bad rains.
A failed monsoon will put pressure on FMCG’s, the sensex as well as tertiary sectors such as transport and storage. It will also curtail any food grain export hopes India may have harbored and put pressure on the trade deficit by encouraging imports.
“Monsoon is critical. It is a trigger not just for the FMCG sector but also for the economy. I believe that if the Monsoon fails, it shaves off the demand. At the end of the day a good one percent of the economy as a whole gets written off.”, comments Chennai based C K Ranganatan of Kavin Care, India’s second largest shampoo firm.
And it is not just the shampoo or the soaps we may suffer. We could be all in the dark. After all that fancy engineering with massive dams like Tehri, there is a 34 per cent deficit in India’s dammed reservoirs already. Bad rains will mean North India in a partial eclipse.
India’s hope of keeping the recession away was counting on the fact that we have robust domestic demand - but that too may be hit with a bad monsoon. The cumulative effect of an economic slowdown and a bad monsoon can be deadly.
To sum up, if as you read this and if it is not raining, be prepared for a longer economic downturn. A lack of money supply can be made up with the monetary policy, lack of bank loans interest rates can take care of – but short of hiring the American Indians - rains will be tough to come by.
Deng Xiaoping was given to one liners. He famously said that "you should cross the river by feeling for the pebbles" To take the analogy further, the river, or rather the gulf, between a rising belligerent China and an insecure India is a fast flowing torrent and the pebbles are sharp. The relationship between the two countries as they rise from a colonial past to a future as emerging giants is the biggest story of the 21st century.
It is a story of new global competition and old deep seated bilateral suspicions, of economic growth yet diplomatic distance. Of dangerous unsettled borders and a potent arms race. It is a tale of international alliances diplomacy trying to off set regional intrigues.
In other words, a great game with Chinese characteristics is playing out. It is apparent in China's encirclement through military aid and diplomatic support to in India's littoral. It is visible in remote and inhospitable Oil fields and bauxites mines in Africa where both compete. It is even there in the Silicon Valley as India cedes ground to a newly computer literate China. It is present in India's own high street where China floods cheap toys and electronic goods on the back of a mighty manufacturing machine and an artificially cheap currency.
India has a legitimate fear of this rising giant but from its economic policy and diplomatic maneuvering very little it seems by the way of strategy. A rising China, on the other hand, just does not see India in the same league. It has tried to undercut India every where. Says Bharat Karnad security expert at the center for Policy research a Delhi think tank, "India is suffering from strategic myopia. China is a nation which recognizes only the language of power. After the nuclear blasts of Pokhran II we had a window of opportunity to come level with China. However out timidity has come n our way. India must asses the complexity and scope of Chinese power they compete with us on all levels and this has to be recognized."
The latest example of that rivalry was the NSG waiver where China tried till the very end to scupper Indian entry and the fact that this came as a surprise to Indians underlines how little India knows about China. Says a diplomat, who was closely related to the negotiations in Vienna, "We fell yet again for the verbal trap. The Chinese assurances to our leaders counted for nothing on the table."
However this has been the pattern ever since the 1962 war. China believes that if India can be isolated globally it will leave the field free from the Asian super power play.
This new great game has four parameters - economic, military, diplomatic and bilateral relations particularly the vexed border question. There is also need to look at India's space for maneuver. To articulate and define what options India has and how can they be calibrated.
1. Here comes the hot stepper - The Chinese economic Threat
The great leap ahead of India that China has now taken is a relatively recent phenomenon. As recently as the 1980's, both countries were at par with extremely low per capita incomes and little integration with the global economy. Control on capital, on investment and trade characterized both countries economic profiles according two World Bank statistics.
However beginning from the mid 1980's dramatic change unfolded in China. It has changed the world. The economic rise of China is the phenomena with perhaps no equal in world history. China by any reckoning is the original 800 pound gorilla. China is the world's third largest economy with a gross domestic product of US$3.4 trillion in exchange rate terms. This is nearly four times India's economy which is just under $ 1 trillion billion. The reason why you see all those grand cities, the great roads, the train to Tibet and other obvious signs of China emerging greatness is the fact that an unusually large percentage - a full 40 percent of its gross GDP is used as investment.
Foreign direct investment in China in the year 2007 was a staggering $ 699billion. China holds the world largest cache of foreign reserves at $1.4 trillion India's is about one fifth at $295 billion. Chinese exports to the world are the greatest example of its robust global engagement. To put China's exports in perspective it is interesting to know that they are larger then India's GDP and stood in 2007 at $1.2 trillion.
Many optimists believe that the growth of trade between China and India will mitigate the differences between the two Asian giants While it is true that trade has indeed grown from just $2 billion in 2000 to over $ 25 billion in 2007, an annual growth rate of about 45 % it has not been all positive for India.
A closer examination of numbers provides a grimmer picture. India's terms of trade with China are alarmingly classic neo colonial. India's major exports include iron ore, minerals, and cotton and other commodities. On the other India's imports include finished goods, electronic machinery, electric goods, Light engineering and appliances. Says Ajay Sahai, the director general of the federation of Indian exporter's organization, "The devil is in the details. The Sino India trade is skewed in China's favor. In the first nine months of 2008 we had a trade deficit with China to the order of $9 billion. What are most of our exports are raw materials such as iron ore and cotton while almost all of our exports are finished goods. Without value add this trade deficit and its quality can only worsen. Commodities exports may be a short term gain but it can turn out to be long terms dependence on China."
The other reason why India Inc finds it difficult to deal with China is the opaque nature of the Chinese subsidies regime and the fact that China deliberately keeps its currency undervalued. Comments Chennai based Rafeeque Ahmed MD of the 580 crore leather exports house Farida "China is a threat because their legendry productivity has an opaque origin. The Chinese currency is still undervalued; the labor laws in India are restrictive, where as in China, there is very little restriction on hire and fire. We also do not have access to cheap capital where as state owned and quasi state owned enterprises in China get loan write off as a matter of course. India's competitiveness is definitely hamstrung by China. "
In the economic sphere there are two other dimensions India and China compete for the same set of energy resources across the world. You are a race on to secure oil gas and mineral assets to feed the blistering growth in the two courtiers inevitably China beats India at most bids.
No where is this more in play then Africa. China does $ 40 billion of trade with the continent most of that is in buying raw Materials and fossil fuels. In Sudan, India and China have a rare partnership in the greater Nile exploration firm an oil venture where China has 40 % stake and an Indian firm ONGC ands 25 %. However china has 4000 troops and support infrastructure on the ground and used its diplomatic clout in defeating worldwide pretest against the Drafur crisis, India did nothing of the sort.
So what should India do when faced with the might of the Chinese economy worldwide? Says Barry Bosworth, of Brookings Institute, a Washington think tank and an expert on Sino Indian economic relations, "India lacks the ready availability of domestic and foreign capital that is available in China. It moves very slowly to strengthen the infrastructure, and lags behind in creating opportunities for low-skilled labor. Both services and those parts of manufacturing where India does well tend to rely on high-skilled labor inputs. India needs expand the financial resources to improve the infrastructure and reduce the public sector borrowing that limits the funds available for private investment. The development of industrial demand for low-skilled labor is vital to spreading the benefits of growth more broadly throughout society. In the longer term, there is a need to fix a dysfunctional public education system."
The other great competition where India fears the rise of China is its core competence –Information technology exports. While currently China exports just about $1 billion of the stuff, this is changing. And India is taking note. A 20078 white paper on the Chinese IT challenge by NASSCOM a premier India IT lobby SAYS "IT in China is witnessing growth: Leading Chinese firms have reported above average growth rates of 40-50 per cent over the past few years. Venture capital investors have also announced significant Investments demonstrating their conviction in theChina ITBPOStory. Chinese firms are beginning to receive a steady stream of businessEnquiries – from western customers."
Says a Bangalore based IT firm CEO, with an exposure to the Chinese IT training market, "China overtook theUS in August 2008 as the largest net surfing nation. China also has put a man in space all on its own. It does not take rocket science to understand the complex high end IT input that Endeavour took."
Clearly The Chinese are closer then they appear in India's rare view mirror
2. The Sino Indian border question - The line of no control
As flashpoints go the Sino Indian border is potentially the most dangerous in the world. If there is one dispute between the two countries that could turn volatile any time it is the border question. India and China have held several rounds of high level border talks. It has been a futile and frustrating process.
The root problem of the border issue is in the year 1962 when India got a hiding from the Chinese PLA. The humiliating defeat has left India scared. So much so that the government report on the war - which truly broke the back of Nehru's foolish post colonial fool hardy Sino – Indian bohemian, is still a state secret. Titled theHenderson – Brooks report all government including the BJP kept it Classified. It is believed that Jaswant Singh was almost persuaded to make it public but developed cold feet at the last minute.
The Chinese and Indians positions on the border dispute have an amazing simplicity. The only problem is that they are totally at odds. India claims 10,000 super kilometers in the Northern sector the region of Aksai Chin.
China calls claim to the entire Arunachal Pradesh and in the western sector and some nooks in the middle sector facing Uttarakhand. For China Arunachal Pradesh is "Southern Tibet", a term increasingly in use in Chinese foreign policy think tanks.
The Chinese position is premised in history. It refuses to recognize the McMahan line which was drawn up by the colonial British power. China's stance is that as a colonial subject it would not accept the McMahan line. So much so, that in the Eastern sector it does not even authenticate actual ground positions of the respective armies. There have been more than 30 incursions in Arunachal Pradesh over the last one year alone. Yet the Chinese can claim that since there is no border there are no incursions.
India had hoped that by recognizing Tibet as an "autonomous" part of China during AB Vajpayee's 1985 visit there would be a thaw in ties. If any thing the Chinese position has only hardened. Says a source in the external affairs ministry " China clearly things it is in a position of advantage. Its economic growth and military modernization as well as the issue with Taiwan call for buying time on theIndia border question. This is exactly what it is doing."
The problem for India is that China in 1962 took over the entire Arunachal Pradesh and then withdrew. It made its claim and backed off. With time, Chinese military strength will only increase – and India fears a repeated. Says CPR's Bharat Karnad , "India is in a humiliating position vis a vis the border issue. It suffers strategic myopia and more we postponed the border issue for the future more we loose ground. Time is on China's side."
To that end India has stared a massive modernization of Arunachal Pradesh. Says a member of the planning commission on the condition of anonymity "Make no mistake this is a mini marshal plan. A project to make Arunachal modern."
As in other facets of the great rivalry, China is not far behind in August 2008 the People's Republic launched two funds. One was a much talked about $ 2 billion sovereign wealth fund that took positions in US jewels like Citibank - the other was a $ 3 billion fund for Tibet. This is on top of the railway line that connects Lahsa. The fund is to support 180 projects to "modernize Tibet".
As thing stand India can no longer delay a solution to the border questions. Analysts believe that the best India can offer s a trade off between aksai chin and Arunachal Pradesh, Except China already has de fecto control in Aksai Chin and have already reached Arunachal once through display of power in 1962 when it was no where near the power it is today. The border question for India is the ultimate diplomatic log jam.
3. The military imbalance
The real asymmetry in the Sino India relationship comes out of the military imbalance between the two countries. In 2007 China boosted its defense budget by nearly 20 percent; it amounts to $45 billion and is double India's spending. What is more it is only two percent of the Chinese GDP and thus leaves room for further increase.
From India's perspective three aspects of the Chinese military modernization are of particular concern. The first is the deployment and capacity of the latest Chinese nuclear missiles, the second is the modernization of the PLA's rapid action capabilities and the massive modernization of the PLA Navy.
The Chinese have a capability leap Vis a vis India in terms of nuclear missiles. China recently became only the third country in the world to knock down a satellite in space from the ground. Its arsenal has a recent addition the dong feng 31 an ICBM with a range of 8000 kilometers. The DF 31 is a solid fueled three stage missile that can hit targets in theUnited States. For India an even greater concern is the DF 21 based in Delingha near Tibet that can strike almost all over India given its 2500 kilometer range. China has similar missiles on HaininIsland in theIndian Ocean where its missile base is coming up.
India by contrast has stumbled in its missile programme while it successfully tested Agni III a missile with a range of 3500 kilometers that can strike targets in Tibetthe missile is far from a deployment stage. What is more Indian missile carry weapon loads in kilotons when compared to the Chinese missile which have at least one megaton on each ICBM platform Indian missile are mere firecrackers.
China is rapidly building all component of rapid action special forces especially facing India in Tibet. These according to intelligence estimates are based under the 13th army of the PLA in the chongdu region. The forces include mechanized tank brigades, rapid airlift capabilities as well as paratrooper. They are boosted by the completion of theTibet railroad and augmented by the 52nd brigade in nearby Linzi. Says a General VP Mallik the ex chief of Army staff "the Chinese have rapid special forces capacity that has been significantly beefed up and when taken with the infrastructure modernization of Tibet posses a clear immediate challenge for defense planners."
Finally India faces the Chinese Naval threat. The new Jin class nuclear missile for the first time gives the PLA navy deterrent petrol capabilities. These are nuclear armed with undersea launch JL 2 Missile and can should the boat be in the Indian littoral hit any target in India. The Chinese have also introduced a fleet of new Russian destroyers and is beefing up aircraft carrier capability by testing on two mothballed Russian ships till its own design come about. In other words the Indian strategy of blue water navy will within this decade run into a similar strategy by China.
When take with the unsolved border and the Chinese running rings around India in South Asia by providing weapons and nuclear technology to Pakistan and military capabilities to Bangladesh Myanmar and Nepalthe modernization of the Chinese military is a real and present danger that's little mention either in the Indian strategic establishment or its media. This could turn out to b a dangerous blind spot should things turn sour diplomatically.
Handling the dragon – own India should respond to China
1) Talk peace but prepare for war.
India must build more muscle. The western sector is vulnerable. The country needs to be prepared for a strategy of limited war with an ability to stand its ground. Some of this is already happening. India is raising two new mountain division. It is upgrading infrastructure in both Sikkim and Arunachal Pradesh. It has reportedly based Frontline SU 30 fighters (two squadrons) in Tezpur and is placing another one in Kashmir. The IAF will son place an order for 126 new generation fighter jets planes
The Indian Navy will acquire long range spy aircraft from theUS as well as a nuclear powered submarine from Russia over the next three years.
2) Beef up nuclear forces
Deterrence does not work without capability. India has very little by the way of a credible nuclear deterrent against China. Our Missiles as well as Fighter planes are vulnerable t a Chinese first strike. What are more outs is a declared no first use of nuclear weapons posture. Thus we are assuming at least in posture nuclear strike survivability. Without submarine based nuclear missiles and a range of 500 kilometers for out land based missiles such as Agni China is unlikely to be deterred.
3) Build an international fund of maritime democracies
India must take the diplomatic lead and create an alliance of democratic maritime powers. The systemic challenge of China is democracy. A totalitarian regime much face from pressure from theUS and India with partners like Thailand Australia and Japan through institutional mechanism s in world fora including the UN
3) Keep Tibet open
India foolishly gave in a declared that Tibet is an"autonomous" part of China when Vajpayee visited China in 2005. However there is a premise – Tibetan autonomy. No autonomy no Tibet. India has never compromised on the line that China has no historic claim on Tibet it has only recognized that as things stand Tibet is an autonomous part of China. India should keep Tibet open and a beginning can be made by not rounding up random Tibet protestors at the drop of a hat. One should bear in mind that there is energy proof to establish Chinese support for Naxals in India. And that score this needs to be settled in the long run. China is waiting for the death of the Dalai Lama India should make clear that the Daliam lama has declared that his reincarnation will not be born in Chinese occupied Tibet and as far as India is concerned the new Dalai Lama will be chosen here.
4) Learn from China
There is a lot to learn from China. Country that in 20 years has risen to prominence on an unbelievable scale. Learning can come from their manufacturing model. There emphasis on crating infrastructure first and inviting industry later. India can inculcate Their ability to execute grand projects in time. India has a lot to gain from understanding their disciplined confusion work ethic.
5) Build on theUS partnership but cautiously do not annoy China
The next big development in world affairs could be the momentum of the US India deal. This grand strategy however needs to be played out cautiously. Just as China has quietly build her diplomatic clout India needs to build on the India- US partnership. However at all points it should be made clear that China is not the bilateral reason of this relationship
6) Expose the soft power of china within Indiathe Indian left
China has a unique advantage over India. The Indian left parties have always supported China over their own motherland. This is a pattern since 1962. Politically Indian parties and people must constantly be on the vigil about this very potent fifth column within India.
The bulls may come marching in Ninad Dhirubhai Sheth On the Richter scale, the victory of the Manmohan Singh lead UPA government, can only be described as super seismic. As if on cue, the stock market went ballistic, rising 2110.79 points and shattering the circuit in 60 seconds. This is the fastest ever single day rise of the Bombay sensitive index, indeed it is the fastest single day rise anywhere in the world. Although it was all over in just a minute - it added a phenomenal 566,881 crore in investor wealth. So will the party last of are there enough structural issues that will ensure that a bear grip stays on the stock market? Says Vikas Seth, director of my money securities, an investment firm, “The rally is real, however for it to be sustainable, two factors will be crucial, the first is fiscal deficit. Even at these levels it is posing a threat to the system as it accentuates government borrowing and crowds out private investment. The other thing to keep an eye on is the appetite that the new government will have for disinvestment of government owned public sector companies. On a positive side, the stability of this government will give it confidence for a bold budget and that will in itself provide a boost to the markets.” The disinvestment plan of this government, according to finance ministry sources, is likely to be aggressive. It will aim at generating over 100,000 crore from the markets. There are 26 profit making PSU’s that could be on the block over the next few years. Says a Mumbai based banker, “Bombay is certainly bullish, and there is a lot of momentum expected on the disinvestment front. If the budget comes out with some bold reforms, and if, as is expected, the monsoons are good we may be looking at a major rally on the stock markets this year.” One concern is that in two days the BSE listed stocks price earnings ratio shot up from 16.61 on may 15 to 19.48 on may 20th giving it a distinct casino feel. Says Ajay Parmar, head of equity research, at Enkay securities, a brokerage in Bombay,“The PE ratio will come down. While the mood is bullish one needs to wait for sequential policy measures to have an impact on the ground. Till then it would be a mistake to go euphoric at the rally. Wait is still the watch word. “ The prediction from various stock broking houses is looking optimistic. There is a momentum in the market and some believe that the market could reach as high as 20,000 by December. The consensus looks like the sensex reaching 16,000 levels. Just as India enters a new period of stability, so the markets look set for a new phase of bullish activity. The time it appears is right for investing, not withstanding that some doubts remain on the fiscal front. Get set for what looks like the beginning of a new bull run on the Sensex. For the retail investor however it is important to add a dash of rationality to the exuberance on display.
airbase at Yalahanka is punctured by a deafening roar, as the FA 18 super hornet, performs a stunning rolling loop. The fighter jet is on the Indian air force's shopping list. And it is not just another list going. In these times of recession, $10 billion spells a massive business opportunity. That is the cost of acquiring 126 multi role combat aircraft that India needs for upgrading the air force to the next level. The whole world is lining up to sell, aircraft firms turning up in full strength at the bi- annual air event in Bangalore which kicked of the marketing process. The Indian air force is looking for solutions to a crisis of quality and quantity in its force preparedness. Where as the force needs a minimum contingent of 40 squadrons, currently the force is able to field only 33 squadrons.Says Air vice marshal(rtd) Kapil Kak, additional director of center for air power studies a new Delhi based think tank " This is the biggest ever IAF contract. The winner will need to have three essential attributes. It will have to be a true multi role fighting capability, that includes air to air and air to ground superiority. It will need a powerful AESA radar that can simultaneously track 400 targets and engage at least fifty. Thirdly any air craft will need to have technological modular upgradeability which will allow the IAF to develop it over the years technically. There are many reasons for this depletion in airpower. The first is age of the existing IAF fleet. The IAF has not introduced any new fighter planes over the last decade with the exception of 40 top of the line SU 30 MKI fighter jets from Russia. In the same time, it has had to retire the Mig - 23 fighter bomber as well as the MIg 25 supersonic fighter reconnaissance aircraft. The other major culprit has been air crashes. The IAF has lost more then 200 fighter jets over the last decade. These include all types of aircraft but the largest number has been the ageing fleet of its mainstay – the Mig 21.To get over the resultant shortage of fighter planes India has floated the request for Information, official speak for an tender, to acquire 126 fighter jets that will be the striking arm of the IAF for decades to come.THE F A 18 Super hornet – the front runnerThe super hornet is a formidable aircraft. It is a fifth generation fighter planes and a front runner for the contract. The fighter is designed for air dominance and has Day/night strikes capabilities in all weather. Says Dr Vivek Lall, VP and country head Boeing Integrated Defense Systems, "The Super Hornet will provide the Indian Air Force with a tactically superior and combat proven multi-role combat capability. This is further enhanced by its renowned reliability, ease of maintenance, and exceptional operational availability - all of which contribute to its low Life Cycle Cost." However two factors could hold back this fighter from winning the IAF contract. The first is the issue of defense off sets. The United States has traditionally not shared technology with client states where as India has a stated policy that requires fifty percent of all defense building work to be done within India. Another hurdle is that the US rules will make it difficult for India to have this fighter plane tweaked to make it capable of delivering nuclear weapons. The US has stringent end user agreements for their aircraft and India may not be open to intrusive inspection of their air craft once the fighter joins the force. The proven choice F - 16 super viperAmong those who fly the f 16 is a legend. Across the world in war time sorties it has a 72-0 kill ratio. That is, it has shot down 72 fighters but has never itself been shot down in combat. Its remarkable measurability and proven superiority in wars such as the US attack on Iraq and the Israeli attack on the osirak nuclear reactor have made it the best fighter plane of its generation. Although without question a superb machine there is problem. The Pakistan air force has older version the fighting falcon and that would mean that they would be in a far better position to asses what the technical specifications and operational performance of this fighter plane would be,. This is something that may make it difficult for the super viper. However aviations experts say that the F 16 being offered to India is a block 60 variant and complete in a different advanced category then the one that the Pakistan Air force flies. The Dark Horse - MIg 35The Mig 35 is a dramatic improvement on the Mig 29 which the IAF has flown for many decades. At the Bangalore air show the unofficial consensus among those who watched was that the plane style a long march among rivals when it came to aerial acrobatics. The Mig 35 is a multi role fighter. Although heavier then the competition it has some unique abilities. Says Mikhail T Globenko, regional director for marketing Russian aircraft corporation, " The IAF has a requirement for am modern multi role fighter that can deliver an air superiority platform and the MiG 35 is the ideal choice and it can also be a compatible platform given that the Mig 29 is already ins service with the IAF." The MiG 35 has a powerful Zhuk active electronically scanning array (AESA) radar and can fire a greet range of missiles and bombs. However the Indian relationship with Russian weapons delivery has been rocky with terms of trade changing mid way and thus the trust factor of the delivery schedule and pricing as has happened from with the Indian purchase of the air craft carrier admiral Ghroshkov where the Russians have reportedly hiked prices three fold from the contracted one billion dollars to nearly three billion. The competitor - Euro fighter typhoonThe Euro fighter has an edge in this competition since it is the most modern of the fighter planes on offer and has great strengths in air to air and air to ground roles. The EADS Company has worked with India before as well and is likely to be more flexible with off sets and end user agreements then the Americans. This is likely to be an aircraft that will be the real competitor for this tender. The aircraft has sold over 300 planes to several countries including 72 on order from the Royal Saudi Arabian air force. The challenger RafaleIs a exciting new fighter from Dassault aviation which already supplies the IAF with the Mirage 2000 and the Jaguar fighters. The Rafale stands out in its abilities at air superiority role as well as its advanced avionics and abilities to launch multi role missions. The air force will also be looking keenly at the fact that the firm has a record of working with India on off sets. The air craft is also known to have a very low Radar signature that makes detecting it tough - and can be a critical advantage in combat. The outside chance - SAAB GripenThis Swedish beauty is the last in the race but it too has the modern attributes of a multi role fighter aircraft and is a very new aircraft. The bird is well known for speed and maneuverability and can reach the speed of up to Mach 1.2 without afterburners. It also has a powerful radars and advanced avionics suits. So as the world places its bets and the fighter's role may the best bird win the chance to fly the IAF blues.
Confidence is the key. In cricket, when you are low on that critical element, the same shot that got you those spectacular no one moves boundaries result in inglorious caught behinds. The Indian economy is somewhat a similar mood spell. Fundamentals are intact. On almost all parameters including saving rates, investment rates and domestic spending the country is better placed then the US Japan and Germany the three economies which have fallen into a recession. Yet the mood is one of fear. Look around and you see a country low on confidence. The economic crisis globally has induced a scare in India. It is amazing that so many are worried so much by the global crisis even as the economy itself grows apace. It is as if we are determined to talk ourselves into a recession. Go to the ministry of finance and you see nervous bureaucrats scurrying around trying to understand the impact of the global crisis. In Mumbai big firms - the Tata's included - are communicating with staff asking for belt tightening, giants like L&T are cutting back on grand ship building and realty projects. And the airlines, well that's too well documented to be detailed. Thus the fear of recession is writ large in today's corporate India. But is there really a recession? For one thing the classic definition of recession a - shrinking economy for two consequent quarters – simply does not imply to India. The economy grew the last two quarters - albeit at a marginally slower pace. Comments Surjit Bhalla, Chairman, Oxus investments, a noted economist, "We do not have a recession in India. Sure, the global recession will lead to a growth downturn however it cannot be called a classic recession. Look at the realities, inflation is back in single digits and oil prices have halved. Thus we have more elbow room now. " A Standards and Poor's report recently commented that countries like India are less likely to be impacted by the global downturn since their exposure to global trade is marginal when compared to their domestic consumption.Says Pavan Jain CMD, of safexpress, a logistics firm, "There certainly is an economic slowdown, but to call it a recession would be a statement made too soon. As compared to what the other countries are facing we are still in a better position as our banking structure is not as influenced as the western countries. We can call it a spill over effects of the global financial meltdown. More liquidity is coming in to the system and this will help we need to reduce fuel taxes and bring the price of petrol down and lastly the domestic consumption is still a growth story so overall I think we should just concentrate on the basis and results will come." The first bright spot for the Indian economy is the foreign exchange cushion. With nearly $255 billion put the country in a far better position when it comes to measures such as recapitalization of banks and providing support to the rupee. The Software sector that is depended on the external markets is still very much in vogue due to economic arbitrage being in India's favor. With the recent fall in the rupee the InfoTech sector has remained competitive. Firms with size, such as Wipro and Infosys can bet on bigger contracts since the pattern in the rich world is to outsource more - not less - in a down turn. The three large Indian IT firms together hold in access of $500 million in cash reserves. This will allow not only for adjustment s during the downturn - but also overseas acquisitions at the right price since firms in the west are looking good at current valuations. Agrees Raman Roy BPO veteran and chairman of Quattro an IT consultancy based in Gurgaon, "India is a part of the solution of the global crisis not a part of the problem. The US cost structure in a recession predicates further outsourcing. They have to cut costs there not add them. As for India, our dependence on the US market while significant is not absolute. In India there is a growth slowdown that can not be termed as a recession. " A report brought out in October 2008 by Everest, an IT consultancy points out that in fact this quarter and the next will see robust outsourcing orders for larger Indian IT firms from the US should Indian firms manage their cost structures in a correct manner. The state of Indian banks is the third redeeming factor in India's favor Vis a vis the global slowdown. The health of Indian banks is also much better in comparison to their global counterparts. What the US is now doing by taking stakes in big banks, is a matter of course in India. This has helped develop buoyancy. It was reported by the Reserve Bank of India that as much a half a billion dollars came into the NRI bank receipts in September 2008 alone. While some sectors such as banking and export firms have fired a record number of people it is not a sea of pink slips out there. Says Ashutosh Khanna, Partner Korn Ferry, a leading global recruiter "Look, jobs are out there for many sectors. Look at Unilever they grew by 16% last quarter. Sectors such as telecom and consumer durables have picked up and there is robust demand for quality professionals in these. Entertainment too is growing bear in mind that when times are bad sectors such as the liquor industry and entertainment have historically done well. We see a continuing trend of growth in these sectors of the economy." So while there may be a roll back on those fat pay checks the spa as a fringe benefit may not be on offer if you are good enough jobs are still around in many sectors. It's all about Money Globally the crisis is about sourcing money to fund the running of business and supporting business expansion. Here India is on a sounder footing. The RBI is expected to cut lending rates by at least 2 percentage points in the current quarter. This will see an infusion of nearly 80,000 crore of liquidity into the Indian market. What that does is restore confidence among lenders, among entrepreneurs and among corporations - the holy trinity that drives the Indian growth story. With the infusion of cash will also come the peripheral advantages such as new projects and strengthen infrastructure spending on new roads, electricity plants, ports and so forth. This can have the crucial multiplayer effect for the economy. The lending rate is the catalyst to pull a country out of the bad times. Says Ajay Relan of CX partners, an Investment Bank," A dramatic rate cut will certainly help in kick starting the economy, bringing it back on track. However India cannot afford to be complacent. India needs to channels its record level of savings into productive assets. We can no longer afford the ghastly cost overruns in infrastructure projects and so forth." Clearly to ride out the storm India needs to ensure that its tardy abilities at project execution are replaced by a vigorous new approach. We may create new money but it is much harder to create opportunities where that money is spending productively. Taken together, domestic consumption, easier lending rates, entrepreneur culture and robust foreign exchanges can come together to lift us out of what are bad - but not horrid times. As in Cricket so for the Indian economy – stick around this could yet be fun.
The proven choice F - 16 super viperAmong those who fly the f 16 is a legend. Across the world in war time sorties it has a 72-0 kill ratio. That is, it has shot down 72 fighters but has never itself been shot down in combat. Its remarkable measurability and proven superiority in wars such as the US attack on Iraq and the Israeli attack on the osirak nuclear reactor have made it the best fighter plane of its generation. Although without question a superb machine there is problem. The Pakistan air force has older version the fighting falcon and that would mean that they would be in a far better position to asses what the technical specifications and operational performance of this fighter plane would be,. This is something that may make it difficult for the super viper. However aviations experts say that the F 16 being offered to India is a block 60 variant and complete in a different advanced category then the one that the Pakistan Air force flies. The Dark Horse - MIg 35The Mig 35 is a dramatic improvement on the Mig 29 which the IAF has flown for many decades. At the Bangalore air show the unofficial consensus among those who watched was that the plane style a long march among rivals when it came to aerial acrobatics. The Mig 35 is a multi role fighter. Although heavier then the competition it has some unique abilities. Says Mikhail T Globenko, regional director for marketing Russian aircraft corporation, " The IAF has a requirement for am modern multi role fighter that can deliver an air superiority platform and the MiG 35 is the ideal choice and it can also be a compatible platform given that the Mig 29 is already ins service with the IAF." The MiG 35 has a powerful Zhuk active electronically scanning array (AESA) radar and can fire a greet range of missiles and bombs. However the Indian relationship with Russian weapons delivery has been rocky with terms of trade changing mid way and thus the trust factor of the delivery schedule and pricing as has happened from with the Indian purchase of the air craft carrier admiral Ghroshkov where the Russians have reportedly hiked prices three fold from the contracted one billion dollars to nearly three billion. The competitor - Euro fighter typhoonThe Euro fighter has an edge in this competition since it is the most modern of the fighter planes on offer and has great strengths in air to air and air to ground roles. The EADS Company has worked with India before as well and is likely to be more flexible with off sets and end user agreements then the Americans. This is likely to be an aircraft that will be the real competitor for this tender. The aircraft has sold over 300 planes to several countries including 72 on order from the Royal Saudi Arabian air force. The challenger RafaleIs a exciting new fighter from Dassault aviation which already supplies the IAF with the Mirage 2000 and the Jaguar fighters. The Rafale stands out in its abilities at air superiority role as well as its advanced avionics and abilities to launch multi role missions. The air force will also be looking keenly at the fact that the firm has a record of working with India on off sets.
