Tag Archives | India

Checking judicial populism & policymaking

Judges should not make policy

All manner of players moved into the space created by a combination of the extreme weakness of the Executive and the logjam of the Legislative over the past decade. In stepped ‘civil society activists’, large non-governmental organisations and the judiciary. Of these only the last has constitutional legitimacy and therefore, judicial actions deserve a lot more scrutiny by those who wish to safeguard the Indian republic.

Let’s set corruption and other malpractices aside for now. What should concern the republic is the role the judiciary sees for itself. Instead of concerning itself with its core functions: adjudicating on civil, criminal and constitutional matters, it has entered domains and taken positions that risk further damaging both constitutional balance and good policymaking.

This is about propriety of process, not merits of the outcome. For instance, it made little sense for the Supreme Court to rule that radio spectrum should always be auctioned. Sure, auctions are one of the best ways to allocate scarce national resources, but the absoluteness of a Supreme Court verdict makes it impossible for the government to say, promote innovation in the wireless industry through a different scheme of spectrum allocation. This is just an example: public policies are best made by the Executive because of the need for flexibility and discretion. When policies arise out of Supreme Court judgements, they do so at the cost of undermining democracy, federalism and quite often, common sense.

Yesterday, the Supreme Court announced that it will set up a “Social Justice” bench, for:

To mention summarily, about the release of food grains lying in stocks for the use of people living in drought affected areas; to take steps to prevent untimely death of women and children for want of nutritious food; providing hygienic mid – day meal besides issues relating to children; to provide night shelter to destitute and homeless; to provide medical facilities to all citizens irrespective of their economic conditions; to provide hygienic drinking water; to provide safety and secured living conditions for the fair gender who are forced into prostitution etc. are some of the areas where Constitutional mechanism has to play a proactive role in order to meet the goals of the Constitution. [Quoted from Bar and Bench]

This move is problematic along several dimensions. First, it is yet another “fast track court” among many fast track courts. Fast track courts sound good, but work well when there are very few of them, and used very sparingly. A lot of permanent fast track courts slow down the entire system (and according to Supreme Court’s latest figures, it has around 65,000 pending cases.)

Second, by shunting public interest litigations (PIL) onto this social justice bench, it is presuming the PILs only ought to be about social justice. Surely citizens of India must be allowed to file PILs about other important public matters, which may not concern social justice.

Third, the mandate of the special bench is a massive intrusion into policymaking and sets a particular social agenda in concrete. Even the founding fathers of the Indian Constitution were unwilling to do this, for they rightly felt that every generation must have the freedom to solve social problems in the light of their own wisdom and experience. The argument that the Preamble of the Constitution calls for social justice doesn’t wash: the preamble applies to the whole purpose of the republic, not a specific task for the Supreme Court. Moreover, going by the Court’s logic, will it now also create benches for economic justice, political justice, liberty, equality and fraternity as well, as they are all cited in the Preamble? If not, why single out social justice?

From recent comments and the announcement of this social justice bench, it appears that the Court is concerned that the Modi government is likely to reverse the social justice policies introduced by the UPA governments. Even if this impression is accurate, it is not for the Supreme Court to protect specific ideological persuasions, either its own, or of previous governments. In a famous case on Barack Obama’s healthcare policy, the US Supreme Court noted

Members of this Court are vested with the authority to interpret the law; we possess neither the expertise nor the prerogative to make policy judgments. Those decisions are entrusted to our Nation’s elected leaders, who can be thrown out of office if the people disagree with them. It is not our job to protect the people from the consequences of their political choices.[Reason]

That is a fine principle for the Supreme Court of India too.

The judiciary will fulfil its constitutional role if it performs its core functions well. This means dispensing justice, not hardcoding policy, and certainly not acting in ways that “satisfy the desire of society”. The best way to ensure justice—social, political and economic—is for it to speed up the judicial system. For all the Supreme Court’s exertions, there seems to be little by way of fixing this central problem. The Court should detail how it intends to become more efficient and effective, and demand the same of the Executive and Legislature.

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India doesn’t need SAARC

Instead of getting caught in the pointless politics of SAARC, India should create a web of bilateral relationships

India doesn’t need the South Asian Association for Region Cooperation (SAARC). India’s neighbours wanted the outfit so that they could collectively pin down their bigger neighbour, something they cannot do individually.

Why New Delhi plays ball with this is unfathomable, for given India’s size, geography and power, it can achieve bilaterally everything that SAARC can achieve multilaterally. From freer trade to open skies, from counter-terrorism cooperation to join management of environmental resources, it is far easier for New Delhi to work out a web of bilateral arrangements than to attempt a big multilateral negotiation. It is hard to make a case for SAARC on the grounds of efficiency and effectiveness of subcontinental cooperation. [See this from the archives] Moreover, there is a lot of slack in the domestic policy environment before the neighbourhood becomes a constraint to India’s growth.

Some argue that India needs SAARC as a regional geopolitical bloc, on the lines of ASEAN or even a European Union. To accept this would be to ignore the history of the subcontinent’s political map looks the way it does. No country in the subcontinent needs regional solidarity to counter foreign powers. On the contrary, every one of India’s neighbours needs a foreign power to counter India’s influence. The dream for a ‘South Asian Union’ on the lines of the European Union is absurd, because Partition and Bangladesh were expressions of desires against being part of a liberal, democratic, secular, plural state. In fact, the EU took five decades to move towards something like the Indian Union (which is what the Republic of India is).

Prime Minister Narendra Modi was off on the right footing when he invited leaders of the subcontinent’s states to his swearing in ceremony. That was an expression of how India can unilaterally act to bring together the subcontinent. The SAARC summit, on the other hand, is at best a waste of time, and worst a perpetuation of an old mistake.

Related Links: We are not South Asian; and if Maldives is a neighbour, why isn’t Indonesia?

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NRI voting should not be made too easy

How to raise political engagement without raising moral hazards

The connectedness of the Information Age made the issue of political rights of expatriate citizens more salient. The question of “should Non-Resident Indians get the right to vote?” was the topic of endless university canteen discussions, Usenet flame wars and online discussion forums before the Representation of People (Amendment) Bill, 2010 was passed to allow Non-Resident Indians to come back and vote in their constituencies. Many NRIs came back to vote in the May 2014 elections, and many others worked in the campaigns.

There are demands for more—that NRIs should be allowed an absentee ballot, to vote from their foreign domicile. This is sometimes coupled with the demand for internet-voting, a feature request that is common to both resident and non-resident Indians. While both these demands enjoy a certain degree of popularity, few have taken a hard look at the implications of doing so.

NRIs are citizens of India, many of who have retained their citizenship despite the lure and the attraction of a foreign passport. They have ideas, knowledge, skills, perspectives, capital and human resources that add to the quality of India’s politics, policy and industry. Leaving them out of the political process is unfair and wasteful. They must have a political voice.

The Election Commission has cited logistical challenges as the reason for not setting up polling booths in foreign countries. However, the real problem is more than just logistics. Absentee ballots have a moral hazard: the absentee voter is not around in the constituency to directly benefit from or suffer the consequences of his political decision. This insulation from the direct effects of one’s own voting decision weakens both the representativeness and accountability of the democratic process. The NRI has insurance too: if he does not like the outcomes in India, he can choose to continue foreign residency or take foreign citizenship. Of course, resident Indians can emigrate too, but it’s a lot more difficult.

Empirically, Diaspora politics tends to focus on the emotional and the ideological, and is often hardline and uncompromising. [Devesh Kapur’s latest paper on the political effects of international migration puts this in perspective]. The resident population has a greater need to balance the emotional with the quotidian and the ideological with the practical, so it makes a lot of pragmatic compromises.

The 2010 amendment to election rules balances, to a certain extent, the electoral inclusion of NRIs and managing the moral hazard arising from it. In economic terms, only those NRIs whose expected value of the benefit of voting exceeds the cost of a return trip to their polling booth will vote. The height of this hurdle protects the resident electorate from the political choices of their expatriate compatriots. It also means that richer NRIs are more capable of crossing this hurdle, and therefore, more likely to affect electoral outcomes in India. This is a price that must be paid to address the moral hazard of allowing NRIs to vote.

Allowing NRIs to vote in Indian embassies and consulates abroad lowers the hurdle. Internet voting reduces the hurdle almost to zero. The moral hazard problem gets worse with overseas polling stations and very acute with internet voting. Therefore, given the nature of dynamic compromises that characterise the politics of a highly diverse, plural India, it is prudent not to consciously stir up the pot by reducing the economic cost of voting.

That’s why internet voting, even for resident voters, is a bad idea. The inconvenience of standing in a queue for the time that it takes to cast a vote ensures that only those who value their vote more than that will turn up to do so. Yes, this system disproportionately favours those who put a low value on their time (in other words, those with lower incomes), but it is fair in that there is nothing to prevent anyone who values the subjective political outcome more than his subjective cost of voting to turn up and vote.

Another problem with absentee ballots is the question of constituency. Which constituency should an Indian citizen who’s lived in New York for 10 years belong to? She might have friends and relatives in one constituency—but putting her on the voters list of that constituency is against the principle of domicile-based voting. Many resident Indians live in one constituency but have family links in other constituencies, but they get on the electoral rolls of the constituency they are resident in. (Some resident voters do prefer to vote in their native constituencies, which the electoral system currently ignores.) Domicile-based electoral rolls are important for representation and accountability, and our New York-based voter might not know (or care) how bad public services are in her Indian native town are for her to hold the elected representative accountable.

Current electoral rules do not address the constituency question. One way would be to create a NRI constituency in the Rajya Sabha and the upper houses of state legislatures, and allow all NRIs to pick a representative who will voice their interests. We might need several NRI seats because different NRI populations have different needs. For a half-serious take on what might result, see why the sun does’t set on the Indian Republic.

It is important that all Indian citizens are included in India’s political system. After the 2010 amendment, a better balance has been struck. Further easing of the rules of voting is not advisable. Hurdles that impose economic costs on voters are not a bad thing—voting should not be made cheap.

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Overpopulation is not the problem

The real problem is undergovernance

People say and believe many things to explain India’s failings. The most popular is that many things are broken in India because “India is a poor country.” A discussion on this is for another day. The second most popular explanation is that India’s problems are because “India is overpopulated.” Let’s interrogate this further.

The claim that any place can be overpopulated presumes that there is a optimum level of population. Well, there isn’t. Whatever the geography, there is no ideal number of human beings. To argue that there is an optimum population would be to ignore history, geography, biology and technology.

The human population has grown, and the population at any time appears shockingly large to a person from an earlier epoch, perhaps even an earlier decade. That same person is also likely to be shocked by the advances in material well-being over time. There doesn’t seem to be an ideal population beyond which human well-being falls apart…in living memory and fossil record.

It is easy to believe, like Malthus, that human beings are outstripping the capacity of the land to provide for their food and other necessities. Educated people in the 18th century can be forgiven for believing this. Educated people in the 21st century believe this only by ignoring three centuries of empirical evidence. Current day environmentalists, like Malthusians of an earlier era, ignore or underestimate the capacity of human beings to adapt, innovate and thrive in any environmental context. Yes, the great march of human innovation can stall, ingenuity can come to a halt, and humans might take the ecosystem to a point where the species will be destroyed. One serious response to it is “so what?”. The other serious response is to put the onus of those who believe in such things to show why innovation and ingenuity should falter now, when it has not done so in living memory and fossil record.

Humans will transform the environment—driving some species to extinction, creating entirely new species, changing the physical landscape—but only those romantically wedded to any particular status quo will place a negative value judgement on this. The rest will enjoy brave new worlds day after day as we have throughout living memory. (Imagine how beautiful the countryside in Wiltshire, England would have looked before those humans put some big, ugly stones there).

So there is no ideal population size. Some of those who accept this conclusion will argue that that being so, surely overcrowding is a problem. The evidence for this argument is weak: Macau, Hong Kong, Singapore, Taiwan, South Korea and the Netherlands have higher population densities than India and few would argue that they are worse governed than India is. Yes, Indian cities have among the highest population densities in the world, but there are many cities outside India with high densities that do pretty well on the governance front.

The overpopulation argument does not hold up. That should lead us to ask what is the problem that we are describing as overpopulation. The answer is undergovernance. To say that our public institutions have the capacity to handle only so large a population is not an argument to reduce the population. It is an argument to enlarge the capacity of our public institutions. Like Procustes, we cannot chop off the legs of sleepers who were too tall to sleep on his bed. We need longer beds. Enlarging capacity is about better ideas, better technology, better people and more people engaged in governance. It is wholly wrong to attribute our failure to scale up governance to keep pace with population growth to ‘overpopulation’.

The overpopulation argument is prevalent in many democracies where the state has to perform welfare functions. It is particularly popular in India because of our history (why only history, our current reality) of being a socialist welfare state. When “mouths have to be fed” then having more mouths than the money to feed them is a problem. It is perhaps not a coincidence that the most socialist government of them all was also the one attempting the worst methods to control population growth.

If the governance mindset changes to equipping people to feed themselves then the number of mouths is less of a concern. Straitjacketing human capital, limiting its ability to grow, constraining its ability to develop and then complaining that there are just too many people is an astoundingly self-defeating argument. It is time to stop indulging in it.

(This is an unedited draft. There might be typos)

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India’s position on Crimea

Don’t rush to take sides.

This was my response to a journalist’s question on what I thought of India’s position on Russia’s annexation of Crimea.

India neither has important interests nor the capability to be a useful player over Ukraine and Crimea. It is therefore sensible for New Delhi to let those with interests & capabilities play it out and deal with the outcomes. In any case, the Crimean case conclusively shows that the UN Security Council cannot be relied upon to uphold and enforce the UN Charter.

If Russia’s annexation of Crimea leads to a wider armed conflict then New Delhi will have to review its position.

The Acorn's Power Principle Matrix

Power & Principle Matrix

For context, see this post on the Power & Principle Matrix. Taking gratuitous moral positions is not a good way to conduct foreign policy. Let’s not forget that the principle of territorial integrity that the United States and European Union are invoking over Crimea was overlooked with respect to Kosovo a few years ago. A different principle—mass atrocities against the population—was invoked then. Clearly, interests determine which principle is evoked in international relations.

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This needs diplomacy

Going overboard on local law enforcement is not the way to go

There have been two broad sets of reactions in India and among Indians to the arrest of Devyani Khobragade, India’s deputy consul general in New York, on underpaying the domestic helper.

First, there has been a fierce nationalistic response, supporting retaliatory measures against US diplomats in India. This has not only staunchly backed the Indian government’s surprisingly swift actions in suspending import clearances for the US embassy’s liquor supplies and removing traffic barriers that the embassy installed outside its premises. There is a clamour among such quarters for even more.

Now, while it is important that New Delhi send strong signals to the Washington that India will not tolerate its diplomats—albeit one accused of an offence—being treated as dangerous criminals, the reactionary perspective ignores the risks to the painstakingly built bilateral relationship between the two countries.

Second, there are those who argue that Ms Khobragade is in the wrong and her absconding domestic helper is the one who is truly wronged. Some have argued that the Indian bureaucracy is too used to privilege at home and should not expect such perquisites as domestic helpers abroad, that they should “do their own dishes, like everyone else.” Furthermore, they contend, would the foreign service act with such alacrity if an ordinary citizen had been arrested?

Going by media reports there are grounds to accept that the authorities have a case against Ms Khobragade. Whether or not she enjoys diplomatic immunity, if it is established she has committed an offence, it is right that consequences should follow. NRIs and Indians might reasonably resent what they see as privilege and less reasonably use stereotypes to pronounce judgement on Ms Khobragade, but these are peripheral to the issue. The Indian government is obliged to take care of its employees abroad—not least a consular officer charged with the responsibility of taking care of citizens’ interests abroad!—just like any other employer.

Between liberal democratic rule-of-law countries like India and the United States, such matters are best handled in courts of law (see an earlier post on the case of the Italian marines). This is complicated in Ms Khobragade’s case, as both Indian and US courts are involved. Even so, letting the legal process determine a solution would have been and is still probably the best course of action. What complicated matters is the manner in which Ms Khobragade was arrested and treated by US authorities. She is a diplomat, the nature of her alleged offence is more in the nature of a breach of contract than a violent crime, and despite what is popularly claimed, the US authorities do treat different people differently (ask Prince Bandar for details).

The bigger problem with the “US enforces its laws seriously” argument is that Indian authorities can do it too. That would make things ugly indeed because there are quite a few statutes in our books whose strict interpretation could place more than a few foreign diplomats in prison, and ordinary treatment in Indian prisons is not, to put it mildly, pleasant. For instance, a senior BJP leader has demanded that the government invoke Section 377 of the Indian Penal Code—that renders illegal many quotidian sexual acts between consenting adults—against US diplomats. Even if it sounds over the top, it demonstrates that riding the legalistic high-horse won’t help. [We strongly disagree with Section 377, just as many Americans disagree with minimum wage laws.]

Therefore, diplomacy needs to kick in to make the situation conducive to a legal solution. Unless this happens, legalistic processes can escalate the matter into a situation where it becomes difficult for either side to give in or back off. Foreign relations are too important to be left to district attorneys, traffic policemen and customs officers. We can say with some confidence that no serious person in Washington or New Delhi wants Ms Khobragade’s case to undermine bilateral relations. Now that both sides have made their points, it is time for the political leaders to intervene and arrest the process.

My colleague V Anantha Nageswaran noted that the speed and force with which New Delhi acted against the United States on a minor issue like this stands out against the reluctance the Indian government demonstrates while handling Chinese or Pakistani transgressions. Of course, grandstanding against the West comes naturally to New Delhi but could it also be that the bilateral relationship is on such a footing today that our foreign policy establishment presumes that this won’t affect the big picture?

Even so, the UPA government and the Obama administration will be jointly responsible if this incident is any more than a temporary irritant in the bilateral relationship.

Related Link: An ugly diplomatic exchange — My storified comments on Twitter.

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Rackets, threats and good sense

Handling the Nigerian kerfuffle in Goa

Only the credulous will be surprised that there are a number of organised criminal groups involved in the drug trafficking business in Goa. Russian, Israeli, Nigerian, Chinese and presumably local syndicates have carved out the market geographically, in terms of the drugs peddled and so on. Again, only the credulous will believe that this state of affairs can exist without connivance of the local politicians and law enforcement authorities. As Mayabhushan Nagvenkar reported in FirstPost last month, a report tabled in the state legislative assembly says as much.

It is in this context that we must see the murder of a Nigerian and the subsequent events it triggered. To be sure, not all Nigerians in Goa are involved in drug smuggling, just as not all Goans are anti-Nigerian racists. Yet the existence of Nigerian criminals, crooked cops, corrupt politicians and racist Goans is undeniable in this case.

On Thursday, a mob of over 200 irate Nigerians, who police allege are part of a narcotics gang, blocked a national highway for several hours and attacked locals and policemen, protesting the murder of their compatriot, allegedly by a local rival gang operating from Chapora, a coastal village and “hub” for the drug trade.

What followed the blockade was a bloody and sordid episode where one Nigerian was nearly beaten to death in police presence and a sustained outpouring of racist tripe against the ebony-skinned Africans on the social media network, the mainstream media as well as the public at-large.[Nagvenkar/DNA]

Policing in India is not known for its sensitivity or, well, discrimination. After the state government ordered a ‘crackdown’, police have been out and about the place looking for foreigners and verifying their papers. Now, because there are a number of foreigners — of several nationalities — in Goa without proper documentation, the business of police verification has caused, as of now, something bigger than a kerfuffle and smaller than an upheaval.

It is a diplomat’s job to be concerned about the well-being of a country’s citizens in foreign lands. Given the consular problems concerning Nigerians in India — from undertrials to deportees –, accusations of maltreatment by Indian authorities and further accusations of racist attitudes, it is fair for the Nigerian consular officials to take a proactive role in managing the tensions in Goa.

What Jacob Nwadidia, reportedly a Nigerian consular attache in India, said transgresses all norms of civilised diplomacy. If the Goa state government’s crackdown does not stop in 24 hours, he threatened, “that hundreds of thousands of Indians will be thrown out on the streets in Nigeria.”

If you have heard of the order of the authorities, especially Michael Lobo who is the MLA of Calangute, I am giving him 24 hours from tonight to cancel his ‘order’ that Nigerians should be thrown out on to the streets. If he does not cancel (it), I am telling you that hundreds of thousands of Indians will be thrown out on the streets in Nigeria. And I’m serious about it. India is five hours ahead of Nigeria. There is still enough time to reach my headquarters and tell the Nigerian government that Nigerians in Goa have been thrown out on the street,” he said.

“If Michael Lobo does not cancel that ‘order’ I am telling you that news will come that Indians in Nigeria have been thrown out on the street. That’s what I’m telling you and I mean what I’ve said,” he told Herald. Referring to the ongoing police verification drive in Parra and surrounding areas, he added: “Police should stop from going house to house to eject and evict Nigerians. If that does not stop in 24 hours then Indians should bear responsibility for what happens in Nigeria,” he said.

“There are only 50,000 Nigerians in India but over one million Indians live in Nigeria. Several thousand Indians will be on the streets if forcible eviction of Nigerians in Goa does not stop,” Jacob Nwadidia is reported to have said.[Herald]

If Mr Nwadidia indeed made the threats as several media reports indicate, New Delhi should declare him persona non grata and expel him. Diplomats don’t threaten mass violence against innocent people. Thugs do. The Nigerian High Commission in New Delhi would do well to repudiate the comments made by one of its officials.

Mr Nwadidia was not only wrong in form but also wrong on facts. According to the Indian High Commission in Abuja, the size of the Indian community in Nigeria is around 35,000 persons, of which 25,000 are Indian citizens and the remaining persons of Indian origin. India has demonstrated that it can evacuate such numbers of its nationals if the need arises.

The threat is especially dangerous because of Nigeria’s deteriorating security situation. In January this year, the Indian mission issued a security advisory noting that “Indians living in Nigeria came under unprecedented level of insecurity and were, occasionally, unfortunate victims” and calling upon nationals to take precautions.

In a subsequent advisory issued in May it said

“(in the recent past), security situation in some parts of Nigeria has deteriorated. There have been violent incidents in the north, north-centre and north-east of the country. A sharp increase in cases of kidnappings in coastal belt, particularly by pirates in the Gulf of Guinea, has also been noted. These instances of insecurity have occasionally involved Indian nationals as unfortunate victims. While in most cases they were passive victims of a situation or a criminal conspiracy, there are cases when they were specifically targeted for kidnapping or physical harm.”[IHC Abuja]

India is among Nigeria’s top trading partners, not least due to oil and gas imports. Indian companies are increasing their investments in West Africa and Nigeria is a big recipient of Indian investment. Last year, 40,000 Nigerians received visas to visit India. The nature of bilateral relations indicates that there is a lot that the two countries have to lose if irresponsible talk leads to violence on the ground. If memories of Idi Amin’s actions against ethnic Indians are brought up to scare the Indian government, the Nigerian government can’t be unaware of the more proximate example of Robert Mugabe’s ruinous policies in Zimbabwe.

It is unclear if the Goa government is committed to a clean-up of the criminal activity in the state. If so, expect more such kerfuffles involving other foreigners. Given the international effects, the government ought to employ a lot more sophistication in its law enforcement activities. Beyond that, it would be out of place for one of India’s most open-minded and cosmopolitan states to allow racist sentiments to dominate the public discourse over this issue.

For New Delhi’s part, action against the errant Mr Nwadidia ought to signal its rejection of the suggestion that Nigeria is holding Indian nationals hostage. That should get saner heads into the equation.

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The internet is freest in US hands

Internationalising internet governance will abridge liberty and restrict free speech

Edward Snowden’s revelations have strengthened demands for “extricating the internet from US control.” This is not a new phenomenon. Ever since Jon Postel died in 1998, governments and non-government organisations have been engaged in a long, complex and meandering process of somehow taking control over the internet. However, while outfits like ICANN and assorted United Nations forums have gotten into the act of “internet governance”, much of the internet remains in US hands. China might well be the country that has more internet users, but it has locked its citizens behind the Great Firewall and effectively created its own national intranet.

Mr Snowden’s revelations are grave, but shouldn’t surprise anyone familiar with national security issues or the communications infrastructure business. So while a lot of international reaction is properly in the Captain Renault (“I’m shocked, shocked to find that gambling is going on in here!”) category, there are some attempts by governments to secure greater control over internet. China, Russia and Brazil are expected to raise the pitch in the coming months.

It would be terrible thing if they succeed. Whatever the imperfections, whatever the US government’s transgressions, we are better off with as much of the internet coming under the US Constitution than the UN Charter.

Why so? Because there is no better political system—the constitution, separation of powers, civil society and citizens—than the United States today that can protect liberty and free speech. Start with Mr Snowden. Where is Russia’s Snowden? Where is China’s Snowden? Where is Brazil’s Snowden? The United States has strong and vocal free speech and privacy advocates who can hold their government accountable without fear of harm. It has a judicial system that is sufficiently independent as to overrule the executive if found violating the US constitution. Despite what cynics in the United States and detractors around the world say, the US system works. To the extent that it does, it protects everyone’s liberties (albeit to a lesser degree than it protects the liberties of US citizens).

For those who contend that this isn’t good enough, consider the alternative. The vast United Nations system that is accountable to exactly no one. The General Assembly has almost two hundred nation-states as members with varying degrees of commitment to upholding liberty. The Security Council reflects the balance of interests its permanent members, where such paragons of free speech as Russia and China have a veto. Let’s say that the UN creates a brand new UN Internet Governance Council to sit at the helm of internet governance. What is to prevent it from going the way of the UN Human Rights Council, where you don’t need any commitment to human rights to be a member, and where you can rule that free speech shouldn’t defame religion.

Now, those who argue that national governments must control the internet because they must exercise their sovereignty over their ‘territory’ of cyberspace have a logical argument when they call for the internationalisation of internet governance. However, it is unfathomable why proponents of free speech and liberty would want the world’s authoritarian regimes to have a say on how the internet is governed.

Calls for “extricating the internet from US control” are effectively facades for authoritarian states to further abridge the liberties of the world’s citizens. That is why they must be resisted. Indians are much better off putting their faith in their freedom-loving American counterparts than participating in grandiose international internet governance schemes.

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How the government will keep its entitlement commitments

You won’t like any of them

No one really knows how much the Food Security Bill (or Act, if it becomes law) will cost the exchequer. Given the way the legislation is framed, it is impossible to make an accurate assessment of its costs. That doesn’t mean we are short of proponents who argue that it should be (or, worse, normatively must be) affordable. We also have a few opponents who argue that it’s more expensive that what the proponents suggest. We’re talking about numbers whose order of magnitude is in the range of single-digit percentages of GDP.

The scheme is open-ended: there’s no expiry date, no sunset clause. It covers around two-thirds of the population—even those who are not really needy. This means that the outlays will have to increase as the population grows.

Obviously, finding the money to keep this scheme going year after year will be a big problem. There’s worse news though—this programme is over and above other open-ended spending commitments like the NREGA, fuel and fertiliser subsidies which are in the vicinity of 2%-3% of GDP. These are the explicit subsidies. We will not even attempt to calculate the implicit subsidies and opportunity costs in this post.

Many of these schemes work such that the subsidy load will increase when growth slows down. In other words, at such times, subsidies as a fraction of GDP will increase—tightening the government’s budget constraints and reducing its fiscal space.

The nature of these schemes is such that governments will be scared to cut them during times of distress, forget ending them altogether. So how will the Indian government finance the gargantuan entitlement economy and what might be the consequences?

First, through new and higher taxes. This has already happened. Didn’t you notice the ‘education cess’? Didn’t you notice the higher marginal taxes on high income earners? Expect more of the ‘Good Cause Cesses/Surcharges’, a fiscal sleight of hand to raise new taxes by citing a plausible good cause. (See this post on education cess for more). As the economic and fiscal situation gets worse, expect higher tax rates lower down the income pyramid. Corporate profits are also an easy target—so they too will be taxed in increasingly creative and extortionary ways.

The consequence of higher taxes are lower investments and higher tax evasion. Lower investment means lower growth. Higher taxes when you are already in a low growth phase is a recipe to stay in the low growth phase longer than otherwise.

The second way for the government to raise resources is through borrowing. It can borrow money abroad (and incur foreign debt) and borrow money from the domestic market. The former puts the Indian government at the mercy of its foreign lenders to the extent of its borrowings. If you do not recall the days of the 1960s-80s, when India was mired in foreign debt, ask someone who does.

The Indian government can borrow from Indian citizens and corporates through the bond market and other instruments (a new -Vikas Patra can be invented quite easily). While it transfers money into the government’s budget, it crowds out the private sector. Interest rates will rise because of the large government demand for funds, making it harder for entrepreneurs and businesses to raise funds to expand their economic activity. This too puts the brakes on economic growth. Higher interest rates during an economic slowdown will prolong it.

The third way for the government to raise resources is to get the Reserve Bank of India to print more money. This has the effect of increasing inflation and depreciating the value of the rupee vis-a-vis other currencies. Higher inflation makes people poorer. It makes poorer people even more poorer (because they do not own assets like real estate, shares or foreign exchange that can weather inflation). A drop in the value of the rupee will make it tougher to service foreign debt, both for the government and for private firms. If the rise in exports on the account of a cheaper currency does not outpace the higher cost of imports, the current account deficit will grow. It could even result in a balance of payments crisis, like the one seen in 1991.

The fourth way is what is termed an “austerity drive”—for the government to cut expenses. Because politics will not allow cutting back on salaries, pensions, subsidies and entitlements, the government will cut two things: office expenses and capital expenditure. So you’ll probably get to see ministers photographed coming to work on bicycles and civil servants working without air-conditioning. Other than schadenfreude, these measures achieve nothing substantial. Cutting down on capital expenditure—roads, power plants, defence equipment—does create fiscal space, but at the cost of future growth.

Where does this leave us? Well, at the edge of a vicious cycle of low growth, high inflation, low investment, higher unemployment, higher taxes, greater evasion and higher out-migration of talented individuals and firms. We’ve been there before. It’s unconscionable that we are being taken there again.

The only way to avoid this vicious cycle is to suspend entitlements and rekindle growth. It is unlikely that growth can be rekindled without sustained pro-growth measures: greater liberalisation, simpler taxation and coherent economic governance. The Delhi Straitjacket must be dismantled.

Related: INI9 Conversation with V Anantha Nageswaran on the falling Indian Rupee.

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Book chapter: On humanitarian intervention & democracy promotion

India’s middle path

shapingtheemergingworld2x3_2x3I have contributed one chapter in “Shaping the Emerging World – India and the Multilateral Order“, a book edited by WPS Sidhu, Pratap Bhanu Mehta and Bruce Jones, and published by Brookings. According to the promotional material, it is, for “…anyone interested in the future of India’s burgeoning economy, twenty-two scholars have developed one of the most comprehensive volumes to date on India…” The list of authors has such stars as Shyam Saran, C Raja Mohan, Sanjaya Baru, Devesh Kapur, David Malone, Christophe Jaffrelot, Srinath Raghavan and Kanti Bajpai.

I’m sure the editors must have had something in mind when they tapped me to write a chapter on India and international norms: Responsibility to Protect (R2P), genocide prevention, human rights and democracy, as they must surely have been aware of my scepticism towards such norms and value promotion agendas. I wrote the chapter at an interesting time, when India had been on the UN Security Council and a number of countries in North Africa and the Middle East went into a wave of political transformation. Given that I was a critic of some of India’s positions at the UNSC during that period, the result is a chapter that is almost entirely devoid of romance. (That’s a good thing, in case you were thinking otherwise).

Here are a couple of excerpts from my chapter:

INTRODUCTION
The doctrine of Responsibility to Protect (R2P), India’s Permanent Representative to the United Nations declared in speech in October 2012, “is the most important challenge that the international community, anchored in the United Nations, is going to face.”1 Arguing that the initial suspicion of many developing countries towards the newest norm in international relations was misplaced, he supported the need for a “collective response by the international community to ensure that mass atrocities like genocide, ethnic cleansing, crimes against humanity do not take place.” Explaining why India had abstained in a United Nations Security Council (UNSC) resolution authorising military intervention in the Libyan civil war of 2011, he judged the implementation of the doctrine “gives R2P a bad name.”

The Indian diplomat’s arguments are a good example of India’s attitude towards international norms infringing on state sovereignty in furtherance of human security, human rights or liberal democratic goals. This chapter argues that India takes a middle path, supporting the evolution of human rights and democratic norms, but exercising caution in the manner of their implementation. It delves into the foundations of India’s policy approach towards two sets of norms: those concerning human security and those pertaining to liberal democracy. It interrogates these norms as they have evolved and examines them from an Indian perspective. It concludes by exploring how Indian foreign policy in the context of these norms might change as it emerges into a more powerful player in international politics.

THE MIDDLE PATH
Constitutional values, a democratic political culture and a diverse, plural society make India generally supportive of defending the world’s people from oppression, promoting human rights and democracy. New Delhi’s foreign policy orientation is at the very least consistent with a rules-based international order and is underpinned by liberal democratic values. The Indian republic’s subscription of liberal international norms, however, has been tempered both by competing norms and by reservations on the nature of international interventions. The result is a foreign policy that treads a middle path.

CONCLUSION
Even as Indian foreign policy made the transition from Nehru’s utopianism to the pragmatic realism of the post-Cold War governments, it never abandoned commitment to values. Normatively, New Delhi strikes a middle path. India is committed to genocide prevention, R2P, human rights and liberal democracy in principle, but has serious reservations regarding their practical implementation. The commitment is born out of its own national values. The reservations are borne out by its experience too.

India has been supporting multilateral efforts – or has acted unilaterally, on occasion – in response to international emergencies. It has been less enthusiastic in enterprises promoting liberal democratic norms, for it is a state primarily concerned with maintaining its own national unity, social transformation and economic development.

To what extent will India deviate from the middle path if it comes a bigger power in the international system? This chapter contends that the answer depends on whether the UN reforms itself to better reflect contemporary global balance of power, on the nature of India’s geopolitical footprint and on the extent of internationalism in Indian civil society. Broad trends indicate that it is likely that the Indian nation will become increasingly global-minded and internationalist, even if at a pace that is sometimes frustrating and other other times exhilarating. So the chances of the Indian republic becoming a rule-taker in the international system will improve to the extent that it is better accommodating into the rule-making circles of a reformed UN. A richer, more powerful India may yet be a stronger defender of human security around the world, if not simultaneously a champion of liberal democracy. [Shaping the Emerging World]

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