The Waheed regime’s games

New Delhi must punish Maldives’ Waheed regime, but without playing into its hands

Mohammed Waheed Hassan’s regime seized power through dubious means. It now seeks to acquire domestic popularity and external support by reneging on an airport operations contract with India’s GMR group. Contrary to its claims, the matter is not merely an issue of the business case turning out to be different than what was previously assumed. If that were so, it would not declared that it is expelling GMR and would select a different airport operator. Renegotiating with an existing vendor is less expensive, less difficult and more reasonable course of action if the intentions were purely commercial. [This ANI report has more details about the project]

The high-level politics of this is clear. The Waheed regime seeks to bolster its ‘nationalist’ credentials by showing it can take on the big, domineering neighbour. It seeks to acquire external support by playing on the India-China contest in the Indo-Pacific. If New Delhi can be provoked to react punitively, the Waheed regime gets the space to court Chinese or other foreign companies. That it was emboldened to attempt such a move is an indicator of New Delhi’s failure of neighbourhood policy.

What should New Delhi do now? First, it should not provide the Waheed regime the excuse it seeks. Diplomatic relations, economic ties, tourism and aid must not be suspended. Second, India should bolster the democratic opposition to the Waheed regime—including Mohamed Nasheed, who happens to be the legitimately elected president—and turn the heat on its illegitimate hold on power. Third, New Delhi must encourage GMR and Axis Bank to use the Singapore courts—the jurisdiction chosen by the contracting parties—to the fullest extent.

The arbitration verdict might well have gone in favour of the Waheed regime, but the Singapore court has stayed the eviction of GMR. If the Waheed regime refused to comply with the court’s orders—as it has declared it will—GMR can seek legal recourse. Similarly Axis Bank might have a case against the Maldives government if the latter has a sovereign guarantee obligation and does not discharge it. The Maldives government has financial and fixed assets in Singapore, which can be targeted by GMR & Axis Bank’s lawyers.

New Delhi has risks to its reputation at stake. If governments of the region come to expect that expropriating Indian companies will be inexpensive and will not have bad consequences, there is a greater chance that they will engage in such behaviour. The Waheed regime must be made to incur the costs of its politics. Not bluntly, though.

The issue will take on an entirely different dimension should the Waheed regime use force against Indian nationals, or engineer or condone violence against them. In such circumstances, it is proper to keep all options on the table.

Pax Indica: Five neighbourhood paradoxes

Five neighbourhood paradoxes

You might have noticed that, relatively speaking, India’s policy towards the United States or Japan is far more coherent than towards, say, Nepal. Over the last few years, New Delhi was able to challenge the age-old dogma of the nuclear non-proliferation treaty (NPT), strike a favourable bargain with Washington and break into the international nuclear mainstream. Contrast that with the Indian government’s inability to play any palpable role in the political upheavals taking place in all the countries across its borders. The consensus, confidence and coherence that is increasingly visible in India’s dealings with the world’s powers is conspicuously missing in its dealings with its immediate neighbours. Why? Because neighbourhood policy is trapped in five paradoxes.

The paradox of proximity: While a peaceful and stable neighbourhood is conducive to India’s growth and development, domestic politics circumscribes New Delhi’s ability to intervene coherently. Look no further than the way the UPA government handled the Sri Lankan civil war. A government that names every fixed object built with public funds after Rajiv Gandhi could still not bring itself to unequivocally oppose the terrorist organisation that killed him. It’s not as if the LTTE enjoyed massive support in Tamil Nadu — it’s popularity waned after it assassinated Rajiv Gandhi in 1991 — but such was the political calculus that untrammeled support for the Sri Lankan government became impossible. This opened the gates for China to make inroads into India’s southern neighbour, the implications of which will unfold over the next few years.

It’s a similar story with Bangladesh, Pakistan and Nepal, and not always political. S D Muni, one of India’s leading authorities on international relations, says that the PWD engineers in the Indian districts adjoining Nepal have a say in New Delhi’s policy towards its Himalayan neighbour, because water-sharing is a key bilateral issue.

The paradox of power: as India’s geopolitical power has grown so has its fear of overreach. In a way, this is a reversal of the 1980s when the Rajiv Gandhi government’s ambitions were not always matched by adequate economic and military capacity. Like his mother, Rajiv Gandhi understood and was unhesitant to project power where necessary. Sending paratroopers to the Maldives to foil a coup by armed mercenaries, getting the Indian Air Force to drop relief supplies over Jaffna in defiance of the Sri Lankan government and ordering military exercises that implicitly threatened Pakistan were bold uses of power. Unfortunately, Indira Gandhi had severely damaged the domestic economic engines necessary to generate and sustain that power, ultimately resulting in the overreach in Sri Lanka. That experience so scarred India’s politicians and policymakers that the use of military force outside India’s borders has been practically renounced as a tool of statecraft.

Instead of a careful projection of power within India’s (much greater) capacity today, we have strategy by bureaucracy. When you hear policy-makers say ”we will only send troops under the UN flag” you wonder whether our armed forces exist to serve our interests or those of the United Nations. This is not an argument for a trigger-happy policy. Rather, that India is incapable of protecting its interests without rethinking its policy on overseas military deployments.

The paradox of engagement: New Delhi talks to the powerless but can’t talk to those in power, or vice versa. It’s most obvious in Pakistan. General Ashfaq Kayani is the man calling the shots. India has no direct channel of communication with him. The people New Delhi does talk to — the likes of President Asif Zardari and Prime Minister Yusuf Raza Gilani — have little say in the subjects that New Delhi talks to them about. This creates an illusion of movement in bilateral relations when, fundamentally, there is none. To be fair, the fact that Pakistan has such a complicated political structure (I’m being charitable here) is not India’s fault. But if the Americans can rejig their foreign policy apparatus such that some people talk to the generals while others talk to the politicians, surely, so can we.

It’s somewhat similar in Nepal, where we don’t properly talk to the Maoists. It’s the opposite in Myanmar, where we speak only to the generals and have so ignored the beleagured democratic opposition that, in the event that there is a change in circumstances in that benighted country, New Delhi will find itself needing to make new friends fast. Yes, circumstances are unlikely to change, but that’s no excuse to not hedge your bets.

The paradox of process: we are relying on processes that are only feasible when they achieve the outcomes they seek. In simple English, that’s called putting the cart before the horse. That absurd game of dossiers & lawsuits with Pakistan is a case in point. It would have been meaningful to use legal processes if India and Pakistan enjoyed the kind of normal relations that exist, say, between Malaysia and Thailand. But since they don’t, and Pakistan’s legal system is a joke (I’m not being charitable this time) dossiers & lawsuits is not only ridiculous. It is counterproductive, because anyone who reads newspapers will be put off by Islamabad’s shifty, brazen, too-clever-by-half attitude.

And finally, there’s the paradox of neighbourhood—we can’t choose our neighbours, but we have. For centuries, Gujaratis have been neighbours with East Africans. Keralites are neighbours of the Gulf Arabs, Tamils of Malaysia and Singapore. New Delhi doesn’t consider these countries neighbours. Yet they are. Treating them as if they are not has trapped us into a mindset of living in a troubled, unstable neighbourhood. This is one unfortunate fallout of the faulty conceptualisation of “South Asia” as being limited to the countries of the subcontinent. Once you see the neighbourhood as what it is, and includes East Africa, the Gulf, and South East Asia, you’ll find it full of opportunities, not vexed problems.

The first of these paradoxes might well be structural — foreign policy problems are more difficult to solve when entangled with domestic politics. But the other paradoxes are those of agency — we might be able to escape them if we want to. If we want to.

(This is the unedited version of my column in Yahoo! India)

Maldivians in any other place

The plan to move a nation

Upon his election, Mohamed Nasheed, the new president of Maldives suggested that his government will “divert a portion of the…annual tourist revenue into buying a new homeland—as an insurance policy against climate change.” While this prompted the Economist to engage in some levity—it proposed that Maldivian government buy Iceland or Wales—Mr Nasheed has something of a good idea.

Investing a portion of short-term revenues to address long-term, inter-generational problems is sound public policy. But there are practical challenges. The principal challenge is whether the destination country will accept a whole nation—even if this is a mere 370,000 people—to set up a homeland within its borders. Three precedents from the previous century come to mind: the Jewish settlement in Palestine, the Nationalist Chinese settlement on Taiwan and the Tibetan settlement in Dharamsala, India. The Jewish settlement became an independent state, and caused a high level of friction with the local population that exists to this day. The Nationalist Chinese settlement became a semi-independent state/renegade province (take your pick) and the local population got marginalised. In the Tibetan case, the refugee settlement is self-governing, but not independent, and there is little friction with the local population.

What this suggests is that if the Maldivians are transplanted into settings more or less similar to the society they leave behind, things might just work out. Such a place could be India, but it is unlikely that the religious factors involved will make this option feasible. It could be Sri Lanka or even one of Gulf states. Even so, resettling an entire nation as a political entity can have destabilising effects on the destination country.

But there is another approach—although it would mean a dissolution of the Maldivian nation-state. Instead of the Maldivian government purchasing land to house its people, it could just assign a fixed portion of the national resettlement fund to each citizen. Maldivians could then—individually or in groups—purchase land wherever they like (and are permitted to). Societies are likely to be more receptive to the idea of accepting Maldivian immigrants rather than importing a whole nation. Perhaps Mr Nasheed could implement Overseas Resettlement Vouchers, redeemable against purchase of real estate in foreign countries.

Yet the most economically efficient approach would be to simply pay the Maldivian citizens hard cash and let them spend it the way they want. Some might buy property in Kochi, Colombo or Reykjavik. Others might spend it on getting a decent education. Still others might drink themselves to death. There still is good reason to say to each his or her own.

Related Link: Over at Global Dashboard Charlie Edwards links to a map of countries buying land in other countries.