Wednesday, September 13, 2017

SOUTH ASIA ANALYSIS GROUP

Why Socialism-South Asian Context

Paper No. 6302                                        Dated 12-Sept-2017
By Kazi Anwarul Masud
In May 1949 Albert Einstein wrote an article titled WHY SOCIALISM? It gave indeed an insight into the philosophy of life of one the greatest human beings of the 20th century. At the end of the article Einstein declares: “I am convinced there is only one way to eliminate these grave evils, namely through the establishment of a socialist economy, accompanied by an educational system which would be oriented toward social goals. In such an economy, the means of production are owned by society itself and are utilized in a planned fashion. A planned economy, which adjusts production to the needs of the community, would distribute the work to be done among all those able to work and would guarantee a livelihood to every man, woman, and child. The education of the individual, in addition to promoting his own innate abilities, would attempt to develop in him a sense of responsibility for his fellow men in place of the glorification of power and success in our present society”.
The “evils” to Einstein is the monopolization of productive forces by a few oligopolists who have lost “inner equilibrium” who are at the same time a solitary being and also a social being craving for the love and recognition of other human beings in society. “ The individual” writes Einstein “is able to think, feel, strive, and work by himself; but he depends so much upon society—in his physical, intellectual, and emotional existence—that it is impossible to think of him, or to understand him, outside the framework of society”.
Yet some in the society constitute a huge community of producers  who  are unceasingly striving to deprive each other of the fruits of their collective labor—not by force, but on the whole in faithful compliance with legally established rules which are, even today, controlled by the elites who either directly or indirectly contribute to the framing of the rules. We have to remember that Albert Einstein in the thirties of the last century abhorred the wage given to the workers who had nothing to sell but themselves not determined by the real value of the goods he produced but by his needs and the employers bargaining power with the hordes of unemployed people willing to do the job at the minimum wage the employer agreed to pay. In Einstein’s words: the enormous power of the oligarchy is because “the members of legislative bodies are selected by political parties, largely financed or otherwise influenced by private capitalists who, for all practical purposes, separate the electorate from the legislature. The consequence is that the representatives of the people do not in fact sufficiently protect the interests of the underprivileged sections of the population”.
How 1949 Einstein’s world is any different from ours when he describes “Production is carried on for profit, not for use. There is no provision that all those able and willing to work will always be in a position to find employment; an “army of unemployed” almost always exists. The worker is constantly in fear of losing his job. Since unemployed and poorly paid workers do not provide a profitable market, the production of consumers’ goods is restricted, and great hardship is the consequence. Technological progress frequently results in more unemployment rather than in an easing of the burden of work for all. The profit motive, in conjunction with competition among capitalists, is responsible for an instability in the accumulation and utilization of capital which leads to increasingly severe depressions”.
A decade earlier Bertrand Russell In praise of idleness and other essays (1935), a self-proclaimed socialist, did not regard “Socialism as a gospel of proletarian revenge, nor even, primarily, as a means of securing economic justice. I regard it primarily as an adjustment to machine production demanded by considerations of common sense, and calculated to increase the happiness, not only of proletarians, but of all except a tiny minority of the human race”. While Bertrand Russell in defining socialism wanted economic power- as a minimum, land and minerals, capital, banking, credit and foreign trade-but political power should be democratic. Russell argued that since without popular consent production would only enrich the State and not the people their consent in a democratic manner was essential. Though it is taken for granted that exercise of voting is an integral part of British life as most recently demonstrated by Brexit which has put the European Union into a very difficult negotiation process with Britain. This contest between the EU and United Kingdom is not a battle of ideologies but one of getting the best deal for their citizens.
The world has got so used to democracy that we have forgotten that economic development is not necessarily dictated by democracy. China is an example, already the second largest economy in the world, aiming to best the US in the coming decades. Chinese economic development would get comfort from Hobbes’ (1558-1679) that democracy is inferior to monarchy and that neither the people nor the politicians are well equipped to chart out the best legislation for the benefit of the people. “Many public choice theorists in contemporary economic thought expand on these Hobbesian criticisms. They argue that citizens are not informed about politics and that they are often apathetic, which makes room for special interests to control the behavior of politicians and use the state for their own limited purposes all the while spreading the costs to everyone else. Some of them argue for giving over near complete control over society to the market, on the grounds that more extensive democracy tends to produce serious economic inefficiencies”( Stanford Encyclopedia on democracy). 
In the Indian sub-continent socialism came hand in hand with the independence movement from the British rule. Mahatma Gandhi called himself a socialist so long it was practised with non-violence. Pandit Jawaharlal Nehru, independent India’s first Prime Minister also believed in socialism. But educated as he was in England his brand of socialism was more akin to the Fabian Socialism “to promote greater equality of power, wealth and opportunity; the value of collective action and public service; an accountable, tolerant and active democracy; citizenship, liberty and human rights; sustainable development; and multilateral international cooperation” (Wikipedia). He detested Nazism and Fascism because they believed in brutality and violence and caused the Second World War. Whether Nehruvian socialism was a success story is a different issue. In fact till Dr. Manmohan Singh as Finance Minister in 1991 and then as Prime Minister for ten years propelled India to 8.5% economic growth. This fast economic growth perhaps led President George Bush to offer India a seat in the nuclear club, ending nuclear apartheid and also persuaded Barrack Obama to promise US support to India for a UN Security Council seat.  
Today Indian economy is booming, though demonetization (refuted by the government) might have slowed the pace of development. GDP (purchasing power parity) is estimated to be $8.7 trillion in 2016; growth rate is 7.6%; per capita income is $ 6700(PPP)-in GDP composition services sector leads followed by industries and agriculture. Irfan Habib, Professor Emeritus of Aligarh Muslim University in a lecture states: “It must be recognised that India is now a full-blooded capitalist country. The urban population now nearly equals, and by the Census of 2021 would probably exceed, the rural population. Peasants produce only about a sixth of gross domestic product, and much of peasant agriculture is influenced by capitalist relations, as in many areas ploughs and scythes have been replaced by tractors and harvesters employed on hire. The key industrial and communications sectors are dominated by great semi-monopolistic firms with deep links to international finance capital” ( Safdar Hashmi Memorial Trust Lecture on August 22 2017).
The basic premise with which this article started with was the growth model that countries like Bangladesh should follow to achieve middle income country status by 2021. Is the mixed economy model now being followed will take us there or the capital intensive policy that will inevitably lead to concentration of wealth in few hands and increase inequality if demographic dividend cannot be utilised by producing a techsavy workers capable to handle the demands of the foreign investors? The assumption is that the future world will be technology based making a large portion of humanity redundant bringing about a refined scenario of Uncle Tom’s Cabin of Harriet Beecher Stowe.
The world does not have to be Planet of the Apes. China, Japan and South Korea have demonstrated that rapid industrialisation and  export  oriented policies coupled with technological development can bring about “convergence” phenomenon—a tendency for less developed countries to catch up with developed economies  because rich countries have faster diminishing returns than the less developed ones. India too is a shining example.
In conclusion we should target to achieve sustainable development goals, prevent extreme concentration of wealth in too few hands, and ensure that benefits of development is fairly distributed among all the people so socialism does not become a question or an answer.

Sunday, September 10, 2017

FINANCIAL EXPRESS 10TH SEPT 2017

Is climate change a Sisyphus block to our growth?

 Kazi Anwarul Masud |  Saturday, 9 September 2017, 12:00:00

Photo credit: Huffington Post
It is commonly believed that economically Bangladesh has done well. Over the last two decades most economic indices show improvement, be it in export, remittance, gross domestic product (GDP), infrastructure (though much remains to be done), external relations, regional connectivity, and semblance of political stability. GDP per capita in Bangladesh was last recorded at US$ 3319.40 in 2016, when adjusted by purchasing power parity (PPP). The figure averaged US$ 1985.74 from 1990 until 2016 - a record low of US$ 1287.90 in 1990 and an all-time high of US$ 3319.40 in 1990.
On the one hand, British analyst Anatol Lieven had a decade back termed Bangladesh a fragile state. On the other hand, Nasim Nicholas Taleb (The Black Swan, 2007 - described by Sunday Times as one of the twelve most influential books published since Second World War) and Gregory Traverton (Foreign Affairs-Jan/Feb 2015) posit that for countries, fragility has five principal sources: a centralised governing system, an undiversified economy, excessive debt and leverage, a lack of political variability, and no history of surviving past shocks. For Bangladesh these factors were absent. Perhaps one of the reasons Anatol Lieven emphasised on 'fragility' was Bangladesh's vulnerability to the effects of climate change. He argued that in the event of surge in water level uncontrollable number of refugees will overwhelm regional states like India, and even possibly the West. Given the fact that Bangladesh is a Muslim-majority country, its people apparently are globally unwelcome at the moment due to the war on terror waged by the West and terrorism waged by Islamic terrorists  wanting to take the Muslim community back from modernity to the "pristine" Arabian culture of the 6th century.  The terrorists of different hue have been described by journalist Christopher Hitchens as "Islamo-fascist" and by historian Niall Ferguson as "Islamo-Bolshevists" committed to revolution and reordering the world in a way that would undo modernism. Referring to hostility born of religious conflict in the contemporary world, American political scientist and author Francis Fukuyama has observed that the conflict has taken the shape of violence and intolerance. "In a world of overlapping and plural religious environments", he says "this can clearly be the case. But they fail to put religion in its broader historical context, where it was a critical factor in permitting broad social cooperation that transcended kin and friends as a source of social relationships."  (The Origins of Political Order: From Prehuman Times to the French Revolution).  However, Anatol Lieven is not alone in making dystopian prediction about Bangladesh.  According to Climate Change Vulnerability Index 2015, this country is at most risk in terms of climate change vulnerability. It faces total losses of about 3-4 per cent of GDP due to climate change. Projections see negative trends as crop production is potentially set to decline for at least one crop in each region of the country.  According to Intergovernmental Panel on Climate Change (IPCC), Bangladesh will become one of the worst-affected South Asian nations due to global warming and increase of green house gas (GHG) in atmosphere.  With rising sea levels, extreme heat, and more intense cyclones threatening food production, livelihoods and infrastructure, the warming climate will also slow the country's growth and poverty alleviation initiatives. The IPCC report added that as one of the most vulnerable countries to climate change, Bangladesh is at risk of facing food insecurity, severe illness, and increase in mortality and morbidity, loss of rural livelihood and loss of marine and coastal ecosystem. The country is also set to face scarcity of fresh water, rise in temperature, severe winter, rise in sea level, rapid increase of urban population. Naomi Klein in her controversial book, This Changes Everything: Capitalism VS Climate Change, suggested "degrowth" for the developed economies to allow the developing countries innocent of contribution to CO2 in the atmosphere to catch up with the developed world. Such a notion, despite Paris Agreement on Climate Change now abandoned by President Donald Trump, would not be politically saleable to the electorate in the Western World. For us, climate change is predicted to reduce rice production, our main crop, and increase the country's reliance on other crops and imported food grains. Crop production is potentially set to decline for at least one crop in each region. This simulated variability is projected to cost the agriculture sector US$26 billion in lost agricultural GDP during the 2005-50 period. The World Bank, however, looks at Bangladesh in a more optimistic view. While the population growth rate has declined, the workforce is growing rapidly. This can be turned into a significant demographic dividend in the coming years, if more and better jobs can be created for the growing number of job-seekers. Bangladesh aspires to be a middle-income country by 2021. This will require increasing GDP growth to 7.5 to 8.0 per cent per year based on accelerated export and remittance growth. Both public and private investment will need to increase as well. Growth will also need to be more inclusive through creation of productive employment opportunities in the domestic economy. To sustain accelerated and inclusive growth, Bangladesh will need to manage the urbanisation process more effectively, as well as prepare for adaptation to climate change impacts. Going back to Anatol Lieven's contested description of Bangladesh as a "fragile state" we can take heart from Francis Fukuyama's words "What Asia's postwar economic miracle demonstrates is that capitalism is a path toward economic development that is potentially available to all countries. No underdeveloped country in the Third World is disadvantaged simply because it began the growth process later than Europe, nor is the established industrial powers capable of blocking the development of a latecomer, provided that country plays by the rules of economic liberalism." (The End of History and the Last Man). Challenges are many.  But with determination and cooperation of the global community Bangladesh, already mentioned as a model of development, can traverse a long way.


The writer is a former Ambassador and Secretary, Government of Bangladesh.
kamasud23@gmail.com

Saturday, September 9, 2017

FINANCIAL EXPRESS 9TH SEPTEMBER 2017

Is climate change a Sisyphus block to our growth?

 Kazi Anwarul Masud |  Saturday, 9 September 2017, 12:00:00

Photo credit: Huffington Post
It is commonly believed that economically Bangladesh has done well. Over the last two decades most economic indices show improvement, be it in export, remittance, gross domestic product (GDP), infrastructure (though much remains to be done), external relations, regional connectivity, and semblance of political stability.


GDP per capita in Bangladesh was last recorded at US$ 3319.40 in 2016, when adjusted by purchasing power parity (PPP). The figure averaged US$ 1985.74 from 1990 until 2016 - a record low of US$ 1287.90 in 1990 and an all-time high of US$ 3319.40 in 1990.
On the one hand, British analyst Anatol Lieven had a decade back termed Bangladesh a fragile state. On the other hand, Nasim Nicholas Taleb (The Black Swan, 2007 - described by Sunday Times as one of the twelve most influential books published since Second World War) and Gregory Traverton (Foreign Affairs-Jan/Feb 2015) posit that for countries, fragility has five principal sources: a centralised governing system, an undiversified economy, excessive debt and leverage, a lack of political variability, and no history of surviving past shocks. For Bangladesh these factors were absent.


Perhaps one of the reasons Anatol Lieven emphasised on 'fragility' was Bangladesh's vulnerability to the effects of climate change. He argued that in the event of surge in water level uncontrollable number of refugees will overwhelm regional states like India, and even possibly the West. Given the fact that Bangladesh is a Muslim-majority country, its people apparently are globally unwelcome at the moment due to the war on terror waged by the West and terrorism waged by Islamic terrorists  wanting to take the Muslim community back from modernity to the "pristine" Arabian culture of the 6th century.  The terrorists of different hue have been described by journalist Christopher Hitchens as "Islamo-fascist" and by historian Niall Ferguson as "Islamo-Bolshevists" committed to revolution and reordering the world in a way that would undo modernism.


Referring to hostility born of religious conflict in the contemporary world, American political scientist and author Francis Fukuyama has observed that the conflict has taken the shape of violence and intolerance. "In a world of overlapping and plural religious environments", he says "this can clearly be the case. But they fail to put religion in its broader historical context, where it was a critical factor in permitting broad social cooperation that transcended kin and friends as a source of social relationships."  (The Origins of Political Order: From Prehuman Times to the French Revolution). 



However, Anatol Lieven is not alone in making dystopian prediction about Bangladesh.  According to Climate Change Vulnerability Index 2015, this country is at most risk in terms of climate change vulnerability. It faces total losses of about 3-4 per cent of GDP due to climate change. Projections see negative trends as crop production is potentially set to decline for at least one crop in each region of the country.  According to Intergovernmental Panel on Climate Change (IPCC), Bangladesh will become one of the worst-affected South Asian nations due to global warming and increase of green house gas (GHG) in atmosphere.  With rising sea levels, extreme heat, and more intense cyclones threatening food production, livelihoods and infrastructure, the warming climate will also slow the country's growth and poverty alleviation initiatives. The IPCC report added that as one of the most vulnerable countries to climate change, Bangladesh is at risk of facing food insecurity, severe illness, and increase in mortality and morbidity, loss of rural livelihood and loss of marine and coastal ecosystem. The country is also set to face scarcity of fresh water, rise in temperature, severe winter, rise in sea level, rapid increase of urban population. Naomi Klein in her controversial book, This Changes Everything: Capitalism VS Climate Change, suggested "degrowth" for the developed economies to allow the developing countries innocent of contribution to CO2 in the atmosphere to catch up with the developed world. Such a notion, despite Paris Agreement on Climate Change now abandoned by President Donald Trump, would not be politically saleable to the electorate in the Western World.


For us, climate change is predicted to reduce rice production, our main crop, and increase the country's reliance on other crops and imported food grains. Crop production is potentially set to decline for at least one crop in each region. This simulated variability is projected to cost the agriculture sector US$26 billion in lost agricultural GDP during the 2005-50 period.


The World Bank, however, looks at Bangladesh in a more optimistic view. While the population growth rate has declined, the workforce is growing rapidly. This can be turned into a significant demographic dividend in the coming years, if more and better jobs can be created for the growing number of job-seekers.


Bangladesh aspires to be a middle-income country by 2021. This will require increasing GDP growth to 7.5 to 8.0 per cent per year based on accelerated export and remittance growth. Both public and private investment will need to increase as well. Growth will also need to be more inclusive through creation of productive employment opportunities in the domestic economy. To sustain accelerated and inclusive growth, Bangladesh will need to manage the urbanisation process more effectively, as well as prepare for adaptation to climate change impacts.


Going back to Anatol Lieven's contested description of Bangladesh as a "fragile state" we can take heart from Francis Fukuyama's words "What Asia's postwar economic miracle demonstrates is that capitalism is a path toward economic development that is potentially available to all countries. No underdeveloped country in the Third World is disadvantaged simply because it began the growth process later than Europe, nor is the established industrial powers capable of blocking the development of a latecomer, provided that country plays by the rules of economic liberalism." (The End of History and the Last Man).


Challenges are many.  But with determination and cooperation of the global community Bangladesh, already mentioned as a model of development, can traverse a long way.


The writer is a former Ambassador and Secretary, Government of Bangladesh.
kamasud23@gmail.com

Wednesday, September 6, 2017

THE FINANCIAL EXPRESS 6TH SEPTEMBER 2017

he ignored plight of the Rohingyas

 Kazi Anwarul Masud |  Tuesday, 5 September 2017

Image credit: New York Times
UN Secretary-General Ban Ki-moon and world leaders praised Senior General Than Shwe in 2011 for "his vision, leadership, and courage to put Myanmar on the path to change." In 2012, Foreign Policy magazine named him Thinker of the Year. Being a military man it was a great feat for him to try to do away with the brutal army rule imposed by General Ne Win in 1962 that reduced a promising country of potential wealth to poverty.


Direct military rule finally ended in Myanmar when the victory of Aung San Su Kyi and her party National Democratic League in the 2015 general election ushered in pseudo-democratic rule in the country. But Ethnic Persecution remains a State Policy of Myanmar. The most persecuted minority in the world are the Rohingyas. Though they have been living in Rakhine State for centuries, the Myanmar government categorises them as 'settlers' from Bangladesh and denies them citizenship.


The Rohingyas are predominantly Muslims while their persecutors are Buddhists. Of the more than 1.33 million Rohingyas in Myanmar, all but 40,000 are forced to be stateless because of the country's 1982 Citizenship Law, which provides full citizenship only to certain groups that can demonstrate that they lived in the country before the beginning of British colonial rule in 1823.


At all levels of the administration, the Myanmar government routinely refer to the Rohingyas as "illegal" intruders from Bangladesh, even though they have been born and brought up in Myanmar and their forefathers lived in the country for hundreds of years - long before the 1823 deadline for citizenship.


The Rohingyas are denied the basic rights enjoyed by the people all over the world. For example, a 2005 order from local Rakhine State authorities requires Rohingyas "who have permission to marry" to "limit the number of children, in order to control the birth rate so that there is enough food and shelter." This order is imposed as a strict two-child limit that also prohibits Rohingya from having children out of wedlock. 


A few years earlier Michael Green wrote "Burma has gone from being an anti-democratic embarrassment and humanitarian disaster to being a serious threat to its neighbours. The international community must change its approach to the country's junta". Even among the most detestable authoritarian regimes remaining in the world today-North Korea, Zimbabwe and a few others where the ruling party or the leader gets regularly elected by huge margin of votes in the "elections" until their death or senility---the military leaders of Myanmar had been repressing the people since 1962 when they first seized power. The UN Security Council's earlier sanctions on Myanmar had little effect as the ASEAN and neighbouring countries maintained normal diplomatic and trade relations with that country. Persecution by the military forced thousands to flee to Bangladesh, Thailand and China.


The incessant flow of newspaper and Human Rights Organisations' reports  on organised murder, rapes and shooting of unarmed Rohingyas  by Government troops has given rise to the possibility of Genocide being committed by the Myanmar government.


The Malaysian government and activists accuse Myanmar of committing genocide against Rohingya Muslims. Myanmar, of course, rejects these claims. 


KOFI ANNAN COMMISSION: Members of Kofi Annan Commission held talks most recently with some 1,100 politicians, village leaders, monks, Muslim imams, businessmen and the internally displaced persons, despite  opposition from some key players in the country. The commission also met with high-level representatives from Bangladesh, Indonesia, China, Malaysia and Thailand. In its report, the commission concluded that Rakhine was experiencing a threefold crisis related to development, human rights and security. Referring to the majority Arakanese Buddhist group and the minority Rohingya, the report says that if these challenges are not addressed immediately, there is a danger of further radicalisation among both groups. The commission recommended improvement in areas of economic and social development, citizenship, health care and cultural cooperation.


Referring to over a million Rohingyas living in Rakhine, the Commission stressed that their "stateless" status excludes them from political and social participation. The commission specifically recommends the revision of the 1982 citizens' rights law, because the classification of a citizen in it is complicated and often tied to ethnicity.


OVERBURDENED BANGLADESH: Prime Minister Sheikh Hasina has requested US President Donald Trump to put pressure on Myanmar to stop the exodus of Rohingyas into Bangladesh.
  
Bangladesh has been hosting three hundred thousand Rohingya refugees for several decades.
  
GLOBAL SCENARIO: United Nations Secretary General has already expressed concern. Given the continuous exodus of refugees fleeing to Europe the barbarism of the Islamic radicals, refugees fleeing violence from South Sudan has reached four million, according the Guardian (May 06, 2017). The threat of violence from new and ongoing conflicts displaced 11 million people inside their own countries in 2014, bringing the total number of internally displaced people (IDPs) worldwide to 38 million. Conflicts in Iraq, South Sudan and Syria forced more than 4.5 million people from their homes last year, fuelling an estimated 15 per cent surge in the total number of IDPs by the Norwegian Refugee Council (NRC) and the Internal Displacement Monitoring Centre (IDMC),


It is, thus, uncertain how much attention the international community will give to the Rohingya refugees. Our endeavour should be to ensure that they do not become a forgotten people and Bangladesh is compelled to carry a burden it can ill afford.


The writer is a former Ambassador and Secretary, Government of Bangladesh.
kamasud23@gmail.com

Monday, September 4, 2017

SOUTH ASIA ANALYSIS GROUP

Pen Picture of Trump’s Foreign Policy

Paper No. 6296                    Dated 1-Sept-2017
 
By Kazi Anwarul Masud
 
Odd Arne Westadt of Harvard Kennedy School of Government (The Cold War and America’s Delusion of Victory RED CENTURY AUG. 28, 2017) is of the opinion that America’s post-Cold War triumphalism came in two versions-one of Bill Clinton’s emphasis on prosperity while the other was George W Bush’s emphasis on predominance.
 
It is debatable if the terrorist attacks of 9/11 on New York and Washington D.C. had not happened then “neo-Sovereigntists” and supporters of “American Exceptionalism” who got berths in Bush jr’s kitchen cabinet would have been able to take America to continue to predominate the world politics and global hegemony . Bush’s Afghanistan attack widely supported by the Americans and the world at large was necessitated by the vacuum created by Soviet withdrawal from Afghanistan in late 1980s that plunged the country into chaos and finally in it’s the occupation by Taliban. Bush also faced the challenge   of the rise of China and India reducing US unipolarity to a fleeting episode in world history. 
 
Westadt lamented “Both the West and Russia would have been considerably more secure today if the chance for Russia to join the European Union, and possibly even NATO, had at least been kept open in the 1990s.Instead, their exclusion has given Russians the sense of being outcasts and victims — which, in turn, has given credence to embittered jingoists like President Vladimir Putin, who see all the disasters that have befallen the country over the past generation as an American plot to reduce and isolate it.” Barak Obama’s Presidency saw a period of multilateralism where American cooperation was extended and division and discrimination was not sheltered. In Obama’s Cairo speech he told the Muslims that the fight against the terrorists was not a fight against Islam totally contradicting Samuel Huntington’s observation that Islam was the problem.
 
Recently when Donald Trump mused on CNN: 'I think Islam hates us,' he was expressing a common sentiment among many Americans.  It’s not about Islamic extremism anymore – it’s a general prejudice against anything associated with Islam. New York Times early this year thought that this worldview borrows from the “clash of civilizations” thesis of Huntington, and combines straightforward warnings about extremist violence with broad-brush critiques of Islam. It sometimes conflates terrorist groups like Al Qaeda and the Islamic State with largely nonviolent groups such as the Muslim Brotherhood and its offshoots and, at times, with the 1.7 billion Muslims around the world. In its more extreme forms, this view promotes conspiracies about government infiltration and the danger that Shariah, the legal code of Islam, may take over in the United States. Those espousing such views present Islam as an inherently hostile ideology whose adherents are enemies of Christianity and Judaism and seek to conquer nonbelievers either by violence or through a sort of stealthy brainwashing. 
In contrast despite Barak Obama’s partiality like most American politicians in favor of Israel persisted he sent his Secretary of State John Kerry for Middle East mission. Things dramatically changed not only with the ban on Muslims entering the US with the election of Donald Trump as President he scrapped the Transatlantic Alliance and consequent abandonment of US security coverage to China who aspires to become the wealthiest nation in the world.
 
It is difficult to predict the course of global event. Many would differ with the idea that the US has abandoned Asia. Profesor Joseph Nye jr writes that China’s size and high rate of economic growth will almost certainly increase its strength in relation to the United States. But even when China becomes the world’s largest economy, it will lag decades behind the United States in per-capita income, which is a better measure of an economy’s sophistication. Moreover, given our energy resources, the U.S. economy will be less vulnerable than the Chinese economy to external shocks. Growth will bring China closer to the United States in power resources, but as Singapore’s former Prime Minister Lee Kwan Yew has noted, that does not necessarily mean that China will surpass the United States as the world’s most powerful country. Even if China suffers no major domestic political setbacks, projections based on growth in gross domestic product alone ignore U.S. military and “soft power” advantages as well as China’s geopolitical disadvantages in the Asian balance of power.The U.S. culture of openness and innovation will keep this country central in an information age in which networks supplement, if not fully replace, hierarchical power.( AMERICA IN THE 21ST CENTURY WILL BE DEFINED BY THE RISE OF THE REST-JOSEPH NYE JR-2013).
 
Who then could contest American supremacy? Surely not North Korea despite Kim Jong-Un’s nonsensical nuclear threats. Can it be Russo-China détente? But as  Odd Arne Westadt says “Russia and China, unlike the Soviet Union, are not likely to seek isolation or global confrontation. They will attempt to nibble away at American interests and dominate their regions. But neither China nor Russia is willing or able to mount a global ideological challenge backed by military power. Rivalries may lead to conflicts, or even local wars, but not of the systemic Cold War kind…..What did not change with the end of the Cold War were the conflicts between the haves and the have-nots in international affairs”. 
 
This brings us to Donald Trump’s Afghanistan policy statement of 21st August 2017. This is of direct importance for South Asia. In his speech he speaks of three fundamental conclusions about America’s core interest. First, is an honorable exit from Afghanistan. After all 17 years have passed since the Americans went in and spent billions of dollars in a chaotic and corrupt country half of which is under the control of the Taliban. .Second, Trump is aware of predictable and unacceptable consequences of a rapid exit from Afghanistan. The vacuum created would be quickly filled by ISIS and Taliban terrorists.  Third, and finally, he concluded that the security threats faced in Afghanistan and the broader region are immense.
 
Today, 20 U.S.-designated foreign terrorist organizations are active in Afghanistan and Pakistan, the highest concentration in any region anywhere in the world. For its part, Pakistan often gives safe haven to agents of chaos, violence and terror. The threat is worse because Pakistan and India are two nuclear-armed states whose tense relations threaten to spiral into conflict. Repeatedly Donald Trump refers to shelter given to terrorists who are fighting the US and Afghan soldiers. “We can no longer be silent about Pakistan’s safe havens for terrorist organizations, the Taliban and other groups that pose a threat to the region and beyond”.   Pakistan has much to gain from partnering with our effort in Afghanistan. It has much to lose by continuing to harbor criminals and terrorists…..But Pakistan has also sheltered the same organizations that try every single day to kill our people. We have been paying Pakistan billions and billions of dollars at the same time they are housing the very terrorists that we are fighting. But that will have to change. And that will change immediately. No partnership can survive a country’s harboring of militants and terrorists who target U.S. service members and officials. It is time for Pakistan to demonstrate its commitment to civilization, order and to peace”. 
Pakistan naturally denied the accusation of providing shelter to the terrorists and called upon the US to work with Pakistan to eradicate terrorism.
 
India on the other hand  welcomed President Trump’s call on Pakistan to immediately dismantle the shelters used by the terrorists. In Afghanistan there was universal positive reception from the Afghan leadership to Trump’s comments. Afghan President Ashraf Ghani welcomed the “enduring commitment” through the new strategy which he indicated “increases capacity in the Resolute Support Mission. There is, however, skepticism that despite punishment that may be given by Trump administration Pakistan will mend its ways. After all giving shelter to terrorists (Osama bin Laden comes to mind) is structurally embedded in Pakistan’s security establishment. ."
 
It's nothing new for US leaders to vow to get Pakistan to change its ways," said  Michael Kugelman, a senior associate for South Asia at the Washington-based Woodrow Wilson Centre. "What remains to be seen is how Trump intends to compel Pakistan to alter its behavior."He added: "In all likelihood, Pakistan is unlikely to change its ways regardless of what threat or punishment Trump comes out with." (Strait Times  Singapore  With Chinese support, Pakistan can ignore Donald Trump on Afghanistan AUG 24, 2017) quotes Harsh Pant of King’s College London that With more than US$50 billion  in planned infrastructure projects and strong diplomatic support for its positions, American threats to withdraw billions in military aid are becoming less worrying for the powerful army, which dominates foreign policy.."China is the shield now behind which Pakistan can be expected to continue to play its double game…. The more aid America will cut, Pakistan will be expecting China to fill the vacuum."Pakistan has long denied it harbours terrorists. But despite rising frustration from US lawmakers over designated terrorist groups such as the Haqqani Network - who strike Afghanistan allegedly from inside Pakistan - China's support for its ally means Pakistan does not need to alter course”. No less a greater  shock came again with Donald Trump’s decision to withdraw from Climate Change Agreement signed in Paris after years of negotiations.
 
Professor Jeffrey Sachs described President Trump’s decision on global warming as ‘sociopathic, paranoid and malevolent’; He added Trump’s utterances as “utterly delusional, deeply cynical, or profoundly ignorant. Probably all three. And they should be recognized as such.” In reality scientists from all over the world are unanimous on the catastrophic consequences of climate change. An international team of experts who issue  annual report on carbon emission in its  report for 2013 announced that global carbon emission was 2.3% triggering a fresh warning that “that even a ‘moderate’ warming of 2°C stands a strong chance of provoking drought and storm responses that could challenge civilized society.” The gravity of the situation can be understood by the fact of the general consensus among scientists that aggregate emissions since industrialization began in the mid-eighteenth century must be held to a trillion metric tons. Almost 600 billion of those tons have already been emitted. If current trends continue, it will burn through the rest in the next twenty-five years. Thus, what is essential to preserving the possibility of 2 degrees is reversing these trends, and doing so immediately. The way to achieve the goal of 2% carbon emission is for the major emitters to decide on drastically limiting their emission while the victims of emission to be compensated for the acts of the emitters. Despite all these incontrovertible facts President Trump has withdrawn his country from the Paris accord.
 
According The New York Times the effects of climate change are already having an impact on the U.S., after average temperatures have risen dramatically over the last four decades..  The "U.S. Global Change Research Program Climate Science Special Report," compiled by a group of scientists from 13 federal agencies, found with high confidence that it was "extremely likely that more than half of the global mean temperature increase since 1951 was caused by human influence on climate.  "The report is part of the National Climate Assessment, which has been congressionally mandated to be conducted at least every four years since 1990. A National Academies of Science committee reviewed the study and agreed with its accuracy.  The report contradicts claims by President Donald Trumph and some members of his administration, who have disputed the connection between greenhouse gas emissions and climate change. 
 
This tour d’orgin of Donald Trump’s foreign policy is only a faint picture of a world to be unfurled in future. For now it can only be a kaleidoscope of the real world we live in.
 
(The writer is a retired Secretary and Ambassador of Bangladesh)
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Tuesday, August 29, 2017

SOUTH ASIA ANALYSIS GROUP 

India and South Asia

Paper No. 6295                                     Dated 28-Aug-2017                            
 By Kazi Anwarul Masud
Why, one may ask, despite common cultural heritage and long bonds of history and added to these factors was Indian humanitarian intervention during  the Bangladesh Liberation War    Indo-Bangladesh relations, notwithstanding public diplomacy by the authorities of the two countries, a portion of the people of Bangladesh do not like  India’s “hegemonic” attitude towards this country.
Lacking the resources of Pew Research Center Polls it is difficult to find out the degree of anti-Indianism in Bangladesh. The ascendency of BJP in India (democratically elected and an entirely internal matter for the Indian people) it is difficult to remain indifferent  about political developments in a country that affects others’  life and no less almost every facet of the economy. Bangladesh cannot afford American “new sovereigntists” or “American exceptionalism” (neither could the USA in today’s multipolarism with the rising of the rest, particularly emerging economies of China and India).
Harish Khare, a former Media Advisor of the Indian Prime Minister who remained in Prime Minister's Office from June 2009 to January 2012).  wrote (“A Dangerous Arrogance of Power Is Setting on 14/07/2017) As democratic institutions – cabinet, bureaucracy, media, presidency and judiciary – weaken, the Modi establishment is riding high on overconfidence. This is bad news for the Indian polity.... Never before was such a convergence of timidity and opportunism seen as now among these three institutions; there seems to be a veritable race to reduce them to the role of a spear-carrier for the prime minister.” Another critic Promod K Nayar (University of Hyderabad- The Signs of a Dystopian Democracy Are All around Us  25/07/2017) writes: “Two possible forms of the dystopian turn are visible now. In one form, there is an enhanced emphasis on homogenisation and cultural standardisation in the ‘larger interests of the nation’.
This immediately brings to the fore the so-called problem of cultural differences. Ethnic, racial and cultural identities are constitutive of the very humanity of the members of those groups.... In another form, dystopian democracy is marked not by the fear of an across-the-border ‘other’, which would be the well-recognised xenophobia of all nationalisms. Rather, it is marked by what can only be thought of, clumsily, as endo-xenophobia, the cultivated and constructed fear of those citizens increasingly seen as ‘foreign’ by virtue of their diet, their taste in sporting teams or their preference for film stars and films of certain nationalities/ethnicities”.
Veteran Indian journalist Prem Shsankar Jha sees in Prime Minister Narendar Modi’s “grandiose” speeches a camouflage for  the creation of a state “ that  will confront, not accommodate, its neighbours; this state will not tolerate cultural heterogeneity, but seek to replace it with a single homogenised culture that Modi mistakenly believes to be Hindutva. Muslims, and other minorities, will be tolerated in this entity so long as they know their place. Religious pluralism will be tolerated (but not accepted), as former vice president Hamid Ansari pointed out in Banglalore but cultural pluralism will not. For the minorities, the path to success will be through cultural assimilation. In sum, Modi is intent upon changing the very idea of nationhood upon which India’s political identity has been based not just for the past 70, but the past 2,000 years.”  Jha adds that Narendra Modi is  leading India into deadly peril. If he continues down this road, India’s failure as a state is guaranteed (THE WIRE Modi Is Taking India to a Dangerous Place by Prem Shankar Jha on 17/08/2017). Should one assume that Bangladesh being a predominantly Muslim majority country Indian policy in South Asia will change (Nepal is predominantly Hindu and Bhutan is Buddhist while Pakistan and Afghanistan have Muslim population)? Public diplomacy does not give any credence that religion will have any impact on Indo-Bangladesh relations.
Could religion be an impediment in cementing Bangladesh- India relations? German philosopher Jurgen Habermas to the surprise of many has recently emphasized both religions’ prominence in the contemporary public sphere and its potential contributions to critical thought. Habermas argues that the once widely accepted hypothesis of progressive secularization fails to account for the multiple trajectories of modernization in the contemporary world. He calls attention to the contemporary significance of "post metaphysical" thought and "post secular" consciousness - even in Western societies that have embraced a rationalistic understanding of public reason. (November 2013).
In the Indian sub-continent one could try to trace the history of India since 7th century when Islam entered in the then India with the conquest of Sindh by Mohammed bin Quasem. While early Muslim rule was from 1206 to 1398 the Mughal era was from 1526 to 1857 when the first war on independence against the British ended in defeat. Despite protestation to the contrary Indo-Bangladesh relations can only be better.
For the critics or believers in ultra-nationalism/ (Islamist terrorists) the question facing Bangladesh authorities, irrespective of the fact whichever party remains in power, is whether Bangladesh can afford to follow an anti-India policy without thwarting its socio-economic development?  One can always argue that national interest should guide national policy even if the policy goes contrary to the policy of a powerful neighbor. It is easier said than done. In the case of Brexit almost half of the British people voted against the Brexit while the other half voted to remain. Each voter had the primacy of national interest in mind. Henry Kissinger defended his policy on Vietnam War as national interest dictated to him at that time. Henry Morgenthau described national interest as survival—the protection of physical, political and cultural identity against encroachments by other nation-states. Equally Brookings Institution defined national interest as “What a nation feels to be necessary to its security and well being … National interest reflects the general and continuing ends for which a nation acts.” In the ultimate analysis national interest may be defined as the policy adopted by the ruling elites at a particular time given a particular context.  
After Pakistan’s breakup consequent upon the liberation of Bangladesh India emerged as the leading power in South Asia and it has been most acutely felt by her immediate neighbors.  The argument proffered that Indian intervention was not totally altruistic but to deal a death blow to its greatest enemy can be explained in terms of “realism” in that India was never so scrupulous in honoring the sovereignty of others when its vital interests were involved. But then it is the nature of both established and emerging powers to flex their muscles as the US has done since the enunciation of Monroe Doctrine.  If diplomacy requires deceit and use of force or hard power as defined by Joseph Nye jr then India has been an able follower of Chanakya in her dealings with neighbors.
Disquiet in India’s relations with Bangladesh had begun with the non-implementation of  1974 Mujib-Indira agreement that was further aggravated by the construction of Farakka Barrage turning a significant part of Bangladesh into a desert, affecting navigation, agriculture, environmental degradation, and hurting the livelihood of millions of people. Farakka’s adverse effects have made a section of Bangladeshis suspicious of the proposed Tipaimukh Dam to be built on the river Barak in Manipur state of India. The proposed construction is controversial in both India and Bangladesh.  Many people were put off by huge imbalance in trade favoring India partly due to para- tariff and non-tariff barrier erected by India on exports from Bangladesh.   It is also believed that Indian bureaucracy is reluctant to open Indian market to Bangladeshi products. Non-demarcation of maritime boundary with India that had been taken to arbitration by Bangladesh has been resolved to the satisfaction of both the parties.
Many other agreements concluded recently have contributed to the strengthening of bilateral relations. A few mentionable are:
1. Framework Agreement on Cooperation for Development Agreement lays down a framework for enhancing bilateral cooperation, including trade, investment and economic cooperation; connectivity; water resources; management of natural disasters; generation, transmission and distribution of power, scientific, educational and cultural cooperation; people to people exchanges; environmental protection; sub regional cooperation in the power sector, water resources management, physical connectivity, environment and sustainable development.
2. Protocol to the 1974 Land Boundary Agreement
3. Facilitating Overland Transit Traffic between Bangladesh and Nepal 4. MOU on Fisheries and MOU in Renewable energy 5. MOU in Renewable energy.
Globalization in any case has forced even introvert nations to come out in the open. If  the main driver of the Arab Spring has been securing citizens political rights the civilianization of  reclusive Myanmar appears to be an admission that no nation in the globalized world can remain an island- be it one of plenty or underdeveloped. Changing nature of security threats from traditional to non-traditional ones makes it imperative for nations of the world to unite. Hence it has become necessary, more so now with the Western economies in deep trouble, to have G-20 nations to have summits and high level contacts to smooth out the wrinkles in global politics and economy. 
Ever since the end of the Cold War and fleeting US unipolar moment various scenarios are being constructed for the next world order. One such scenario urges Washington, Beijing and New Delhi to consider, if a war happens in the 21st century, it will be America-China or China-India. According to this scenario NATO intervention in Libya has shown lack of coherence of Western alliance that had   served the stability of the post-Second World War world. Besides neoconservatives like Robert Kagan are convinced of Europe’s lack of centrality in global politics if not the soft power that is essential for global peace. This school of thought considers China and India to be globalization’s lead integrating agents. Russia and Japan are not considered to be serious first tier candidates for global power. In this equation Europe too is discounted as is Brazil among the BRIC nations.
But the shining China may face impediment as in two decades or so China will lose considerable number of workers who will join the aging senior group of citizens. By contrast America will add few dozen million workers and India are expected to add 100 million to the workforce. In terms of per capita income by 2030 that of the US is expected to be $ 60000/- while that of China will be $ 20000/- and that of India is expected to be $ 10000/-. The US despite its indebtedness (US Federal Gross Debt to GDP ratio updated in August 2017 was 106.10) GDP   will reign over the others because both China and India will remain tethered to the proverbial ball and chain of impoverished rural poor.
Besides China may face developmental impediments in the forms of environmental damage, resource constraint, demographic aging, inequitable distribution of income among different sectors of the society, better standard of living leading people to demand greater voice in governance translated into weaker hold of the Communist Party over the people.
In case of India fractious domestic politics and inequitable division of the developmental benefit among the growing population may stay the rate of development of the economy. The inequity in the distribution of income can be gauged by the fact that both in China and India increase in per capita income has been flat between 1820 to 1950 but it increased by 68% by 1973 and 245% by 2002 and continues to grow despite global financial difficulties.  The situation has been no different if we take the case of the US where between 2002 and 2007 65% of all income growth went to the top 1% of the population. The world has virtually been divided into two classes--plutocrats and the rest.  Despite such skewed rich and poor equation demonstrated by occupy the Wall Street march in New York the policy makers in the Game Room of the powerful countries would be working on inclusion of China and India along with the US as future arbiters of global fate and guarantor of peace than the old alliances with Europe and Japan.
Zbigniew Brezinski and Fred Bergsten (Petersen Institute for International Economics) had advocated formation of G-2 with the US and China (The United State and China: a G-2 in the making Brookings-Oct 2011). The essence of the proposal is that these two biggest economies working together can provide global public good that the world required. The convergence between the two at present appears to be difficult because China saves too much and the US consumes too much creating disequilibrium in their economies and imbalance in trade. China uses its surplus cash to buy US Treasury bonds thus increasing American indebtedness. Unless the trade surplus countries like China starts buying and consuming more US made products the equilibrium will not be achieved. Politically and militarily G-2 appears to be a distant proposition because a rising power has the tendency to expand its influence, often through hard power, that an established power like the US would have to acquiesce in though such expansion may impinge on the areas of influence of the established power.  So far Chinese use of influence in global affairs has not caused any ripples in the world. But there can be no guarantee that with the passage of time power transition will remain smooth.
For example in the case of North Korea the verbal exchange going on between President Trump and Kim Jung-un using nuclear vocabulary has introduced a grave security concern for the world.  Besides disputed Spratly Islands remain unresolved and the world is not certain yet how the Chinese would finally react to the claims by other countries’ sovereignty over the Islands. Consequently as the established power cannot be sure of the real intent of the rising power it is likely to hedge its bet by roping in-In this case, countries like India, Japan, South Korea and Vietnam to counter China.
Relations with Bangladesh was bedevilled in the past with problems relating to maritime boundary demarcation ( now resolved through International Arbitration), land boundary disputes (resolved through exchange of enclaves in adverse possession), trade imbalance in favor of India and impediment imposed by India on Bangladeshi exports through para-tariff and non-tariff barrier, border killings of Bangladeshi nationals by Indian Border Security Force, Indian allegation of illegal Bangladeshi nationals entry and stay in India etc. Relations have taken a turn for the better after the assumption of power in Bangladesh by Awami League led combine of political parties. Relations with Nepal had been strained after the assumption of power as Prime Minister 2006-2009 and again 2016-2017 by Maoist leader Pushpa Kumar Dahal who openly blamed Indian machination for the downfall of his short lived government and subsequent failure to form a government. In a party conference he even urged his followers to free Nepal from Indian domination. Current Prime Minister Sher Bahadur Deuba maintains good relations with India.  In early August Nepal’s Deputy Prime Minister and Foreign Minister has categorically said that Nepal would not take side on the China-India-Bhutan Doklam border dispute. He told the media that Prime Minister Sher Bahadur Deuba will visit India from August 23-August 27 while Chinese Vice Premier will come to Nepal on August 14 on an official visit. It is not known if the Doklam issue would be discussed in Delhi or in Kathmandu. Meanwhile Bhutan has protested to China, saying the area belonged to it and accused Beijing of violating agreements that aim to maintain the status quo until the boundary dispute is resolved. India says the Chinese action to lay the road was unilateral and changes the status quo. It fears the road would allow China to cut off India’s access to its north eastern states. Nepal, a landlocked country, is virtually dominated by India commercially where Indian currency can be used in the markets.
Bhutan, another landlocked country, is also heavily dependent on India but the people are ferociously independent minded and refuses to integrate with the globalized world and believe in Gross Domestic Happiness instead of GDP as is understood throughout the world. Bhutan, a country with seven hundred people, has extremely cordial relationship with India.
With Afghanistan India has developed special relationship much to the chagrin of Pakistan though it is believed that Indian efforts are directed to counter Chinese influence and not to contain Pakistani influence in Kabul. At the moment Pak-Afghan relations are going through rough waters as both the Afghan and the US government is highly critical of the safe heaven enjoyed by the Haqqani group in Pakistan from where the terrorists launch their operations. This issue was mentioned by President Trump during the recent visit to the US by the Indian Prime Minister.
It would, therefore, appear that that it would serve Indian interest to mend her fences with her neighbors enabling the US efforts to prop up India as a counter to China as would Indian ambition for a permanent seat in the UNSC. Though not at the same economic level India could  try to play the role in South Asia as Germany is playing in  helping out European countries i.e. Greece to get the country out of the economic difficulties she is facing at the moment. Use of hard power by India in South Asia is going to be counterproductive if she thinks the smaller neighbors have little option but to bow down to Indian dictates. The net result may be to push the South Asian countries into the arms of China as a hedge to counter Indian efforts to dominate the region. Indian policy planners may wish to consider that Indian democratic structure is more attractive to her South Asian neighbors for establishing fruitful bilateral relations with India than with China, albeit a rising power, but with an authoritarian system of governance China yet   remains inscrutable   to many countries having liberal political system. In the ultimate analysis the scenario of an India countering China in Asia may be a more theoretical than a realistic proposition US wish notwithstanding. The people in South Asia would prefer both giants to have complimentary than a competitive relationship that would help millions of people of this area to get out of the poverty trap and leave  a prosperous life  for their children and grand children.

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Sunday, August 27, 2017

FINANCIAL EXPRESS 27TH AUGUST 2017

Hoping for a prosperous Bangladesh

 Kazi Anwarul Masud |  August 26, 2017 19:24:11

As I was being driven by I looked through the car window and saw an evidently traumatised boy of indeterminate age (due to malnutrition perhaps) entering the confines of iron spiked  barricaded (terkata ghera) space in the middle of the road and fearfully eating some leftovers from a nearby dustbin. His fear was palpable as if someone would snatch away the "dog's food" he was relishing.


In newspapers and television programmes we   read and hear how Bangladesh has  become a model of development for many developing countries. World Bank, IMF, Pricewaterhouse Cooper have applauded our growth and have predicted that Bangladesh would be one of the countries to be watched. PwC reports that Bangladesh will be among the top three fastest growing economies by moving up to the 28th spot among the world's most powerful economies by 2030.The economic output of Bangladesh could grow from $628 billion in 2016 to $1.3 trillion in 2030, says  PricewaterhouseCoopers (PwC). The report ranked 32 countries by their projected global gross domestic product (GDP) by purchasing power parity (PPP). PPP estimates of GDP adjust for price level differences across countries, providing a better measure of the volume of goods and services produced by an economy as compared to GDP at current market exchange rates, which is a measure of value. Bangladesh ranked 31st among the world's 32 largest economies in 2016, that together account for around 85 per cent of global GDP. Findings by the PWC, one of the world's largest professional-services firms, show that China, India and the US would be at the top of the table.


In a speech to the Metropolitan Chamber of Commerce in February last year a senior Bangladeshi bureaucrat brought out the strength of the Bangladesh economy. According to him, Bangladesh is a stable state with pluralistic democracy with politically conscious people and the economy running on a stable path. Bangladesh is least volatile among regional powers, receding poverty level (25 per cent in 2015) and increasing per capita income $1314 (2015). Apart from the strength of Bangladesh economy, he  had correctly identified the challenges that Bangladesh economy would face in the future by climate change, terrorism and violent extremism, limitations in adopting to rapid economic changes as well as evolving international norms, ethics and practices.


While all these may come to pass and Bangladesh may have an impressive GDP, it would be difficult to achieve any of such goals without institutional reforms. Geoffrey Sachs while reviewing the book by Daron Acemoglu and James Robinson-Why Nations Fail-wrote, "Their causal logic runs something like this: economic development depends on new inventions (such as the steam engine, which helped kick-start the Industrial Revolution), and inventions need to be researched, developed, and widely distributed. Those activities happen only when inventors can expect to reap the economic benefits of their work. The profit motive also drives division, as companies compete to spread the benefit of an invention to a wider population. The biggest obstacle to this process is vested interests, such as despotic rulers, who fear that a prosperous middle class could undermine their power, or owners of existing technologies, who want to stay in business. Often, these two groups belong to the same clique".


Economists generally agree that political centralisation is one of the main drivers of economic growth. China is a shining example of rapid economic growth. (Here is a comparison between China and India. The Chinese economy advanced 6.9 per cent year-on-year in the second quarter of 2017, the same pace as in the previous period while markets expected a 6.8 per cent expansion. Growth remained at its strongest level since the third quarter of 2015, as industrial output and retail sales picked up while fixed-asset investment remained strong. For 2017, the Chinese government expects the economy to grow by around 6.5 per cent, slightly below last year's 26-year low of 6.7 per cent. The Indian economy advanced 6.1 per cent year-on-year in the first quarter of 2017, slowing sharply from a 7.0 per cent expansion in the previous period.  It is the lowest growth rate since the last quarter of 2014, due to a slowdown in consumer spending and a drop in investment, following the demonetisation programme started in November of 2016 that removed 86 per cent of India's currency in circulation. GDP annual growth rate in India averaged 6.12 per cent from 1951 until 2017, reaching an all-time high of 11.40 per cent in the first quarter of 2010 and a record low of 5.20 per cent in the fourth quarter of 1979.)


If our target is to increase GDP then it is possible to achieve the target mentioned earlier. But if the authorities aim for fair distribution of increased wealth then political centralization, which in the final analysis breeds corruption of the elites, democracy appears to be more attractive option.  Many have mistaken Chinese rise due to the authoritarian character of the regime discarding the fact that "China did not take off because it was authoritarian. Rather, it took off because the liberal political reforms of the 1980s made the country less authoritarian. One of the first acts by the reformist leaders was to signal an improving environment for private property… The reformist leaders also began to embark on meaningful political changes. As scholar Minxin Pei has noted, every single important political reform-such as the mandatory retirement of government officials, the strengthening of the National People's Congress, legal reforms, experiments in rural self-government and loosening control of civil society groups-was instituted in the 1980s. The Chinese media became freer in the early reform era. The timing here is critical. This "directional liberalism" of China's politics either preceded or accompanied China's economic growth."  (Does democracy help or hurt economic growth?  CPE blog posted on June 30, 2008 by Anna Nadgrodkiewicz, Director Multiregional Programme at Wshington-based Centre for International Private Enterprise).


It is incontrovertible that infusion of foreign investment is absolutely necessary for the growth of an economy. Historically bulk of foreign investment is done by the developed countries in other developed countries mainly because of similar regulatory frameworks and beliefs and democratic ideals. Besides, similar skills they share with one another make it easier for them to trade in high-end products. It has been happening despite Raul Prebisch's scepticism about accretion of national wealth through foreign investment that often has high social cost.


The developing world is now confused whether in view of global meltdown Adam Smith's theory of minimalist role by the government can lead a country "to the highest degree of opulence from lowest degree of barbarism" is not now outdated. 


Advocates of capitalism ignored that perfect marriage between demand and supply is a theoretical concept, particularly in places where few firms forming syndicates control the supply and price  of commodities. In economies like ours often captains of industry and commerce dictate state economic policies either as pressure groups on the political authority or on their election as members of parliament. With the withering away of idealistic politics and the advent of commerce-based politics and expensive elections politicians in both the developed and developing worlds have increasingly become dependent on donations from industrialists to finance their elections. Donations being hardly given for altruistic reasons, the donors expect returns on their "investment". Such concentric relationship invariably leads to inequity and social stratification in terms of wealth and power.


One, nevertheless, hopes that in the case of Bangladesh the spirit of liberation war and people's abiding faith in democratic ideals would lead the country to prosperity as promised by our leaders.


The writer is a former Ambassador and Secretary
  
kamasud23@gmail.com