Lessons for India from Nepal’s Revolution

Lessons for India from Nepal’s Revolution

Subroto Roy

 

The Statesman, frontpage, April 26 2006

 

 

King Gyanendra of Nepal has lost legitimacy in the eyes of almost all his people. His days as a monarch are numbered. It is as inevitable as night follows day that his dynasty is over, and Nepal will sooner or later become a secular Republic. The practical questions that follow include what is to be done with him and his family, that is, which country should they seek exile in and at what pension, to whom exactly should sovereignty in Nepal pass immediately and in the long term, how may needless bloodshed, civil chaos and mayhem come to be avoided, and how soon can a viable democratic republic and a healthy economy and society emerge.

 

 

Salus populi suprema lex: the good of the people is the supreme law. And the good of the people in Nepal today requires Gyanendra to depart (that is, for exile in Britain), after abdicating in favour of his son ~ or better still his infant grandson, placing a Regent acceptable to the Seven-Party Alliance in charge of calling a Constituent Assembly as everyone and especially the Maoists have demanded.

 

 

The Government and people of India seem strangely ignorant or indifferent about what is happening right next door to us, even when that door is open. While the people of Nepal almost stormed their Bastille, we witnessed instead the bizarre televised parade of politicians and Bollywood personalities to visit another celebrity in hospital (we should be thankful they have not been allowed anywhere near him).

 

 

Our Prime Minister/foreign minister, with his “national security advisor” sitting next to him, flew off to a brief spring holiday in Europe to discuss importation of uranium and BMWs and other such posh things. The Congress Party has said the Prime Minister may have expressed “his own views” on the subject of supporting King Gyanendra’s Friday offer but that the Government of India always supported “multiparty democracy” and the Congress Party supported the government! Have people become even more detached from reality here? If it is the case the Prime Minister has become so utterly consumed by personal hubris that he is making impromptu remarks contrary to his own government’s policies, then it may be time for him to realise he has filled his quota of foreign trips and put in his papers. At the very least, MK Narayanan has been derelict in his duties by joining the Prime Minister in the European spring rather than remaining in India watching Nepal. The Prime Minister has been so negligent as his own foreign minister (for example, handing over his America policy to personal diplomacy by his favoured aide, Mr Montek Singh Ahluwalia) that he is making the country almost miss the foreign minister who had to be fired, an unfortunate thought!

 

 

In the last six months, Nepal’s non-Maoist opposition coalesced and the Maoists declared a unilateral cease-fire. India remained preoccupied with the vanities of its own petty dynasties. Why we Indians, despite our pretensions as the world’s largest democracy (in reality, the world’s largest voting public), may have been so dull and ignorant with respect to Nepal’s “trinamul” democratic movement is that we have never had any kind of revolution ourselves.

 

 

Revolution is anathema to the pompous bureaucrats of New Delhi, just as it is to the pompous generals of Islamabad. Partition was the one all-consuming trauma experienced by the Indian and Pakistani ruling classes, and they are simply unable to understand populist rebellions of the kind now being seen in Nepal or seen under Sheikh Mujib in East Pakistan almost 40 years ago. The Indira Gandhi brand of populism practised by India’s “democratic leaders” has to do with renting crowds and giving speeches while waving to the TV cameras, always making sure to fly back to air-conditioned comfort in Lutyens Delhi by the end of the day if at all possible. Lutyens Delhi is Royal India, and Royal India secretly sympathises with all Royalty and pseudo-Royalty. Ours has become a democracy upside down where it is not a question of how the interests of the people of India should be represented in New Delhi but how New Delhi’s interests can come to be projected upon the people of India.

 

 

In Nepal on the other hand, the questions now precisely have to do with the most difficult issues of sovereignty, political legitimacy and representation. The forced exile of the Shah of Iran was followed by the return of Ayatollah Khomeini from Qom and the brutality and bloodshed of the Islamic Revolution. The exile of Sihanouk of Cambodia was followed by the horrors of the Khmer Rouge. Can mass bloodshed and class war be averted if the exile of King Gyanendra is followed by a Maoist takeover in Nepal? The Maoists are indisputably led by Pushpa Kamal Dahal (Prachanda) who does not appear to be a murderous Pol Pot and has been projected as principled and statesmanlike. But will he be able to control his own creation or could he himself be swept aside? “Revolution is not a tea party” said Mao Zedong. There are at least two other proximate models that are more benign. One was the forced exile of Ferdinand Marcos and his odious family to the USA in 1986, leading to Mrs Benito Aquino becoming President of the Philippines. She and Fidel Ramos had led ordinary people to the most peaceful bloodless revolution ever seen until then, and coined the term “People Power”. Democracy has had its problems here but has survived intact ever since. Another relevant model has to do with the forced departure for Bombay of Hari Singh of Jammu and Kashmir (who pretended to “abdicate” in favour of his young son though in fact no such alternative existed in international law). Sheikh Abdullah knew his constitutional politics well enough and then led J&K to a reasonable Constituent Assembly. Our Pakistani cousins, cut from the same political cloth as ourselves, embarked haplessly saying “That the sovereignty in Pakistan belongs to God Almighty alone and that the Government of Pakistan shall administer the country as His agent”. In the words of Rashid Rida and Maulana Maududi, Islam becomes “the very antithesis of secular Western democracy. The philosophical foundation of Western democracy is the sovereignty of the people. Lawmaking is their prerogative and legislation must correspond to the mood and temper of their opinion… Islam… altogether repudiates the philosophy of popular sovereignty and rears its polity on the foundations of the sovereignty of God and the viceregency (Khilafat) of man.” Sheikh Abdullah by contrast told the J&K Constituent Assembly: “You are the sovereign authority in this State of Jammu & Kashmir; what you decide has the irrevocable force of law. The basic democratic principle of sovereignty of the nation, embodied ably in the American and French Constitutions, is once again given shape in our midst. I shall quote the famous words of Article 3 of the French Constitution of 1791: `The source of all sovereignty resides fundamentally in the nation. Sovereignty is one and indivisible, inalienable and imprescriptable. It belongs to the nation.’ We should be clear about the responsibilities that this power invests us with. In front of us li e decisions of the highest national importance which we shall be called upon to take. Upon the correctness of our decisions depends not only the happiness of our land and people now, but the fate as well of generations to come.”

 

 

The fact the young son of Hari Singh then caused or contributed to a putsch against Abdullah is among the most regrettable events contributing to the misfortunes of J&K’s recent history. Nepal is going through its own French Revolution in which Gyanendra is no longer able to claim the “Divine Right of Kings” simply because his people have permanently withdrawn their acceptance of his legitimacy.

 

In the circumstances, Nepalese of all political colours would do very well to remember that the greatest of them in the history of mankind was a Hindu prince who became the founder of Buddhism. As the Himalayan home of Hindus and Buddhists and many others, the Nepalese Revolution could be among the most exemplary in being peaceful without bloodshed. The aim of Indians and all other friends of Nepal must be to seek to ensure that.

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Indian Money and Banking

ON MONEY & BANKING

 

The deficit-finance of all public institutions flow like rivulets into the swamp that is our Public Debt, managed by the RBI

 

by

 

SUBROTO ROY

 

First published in The Sunday Statesman, Editorial Page, Special Article

April 23 2006

 

THE Reserve Bank of India, like all other public institutions, belongs to all of India’s people. There has been a tendency with every national institution, whether the ONGC or nationalised banks like SBI, or the IITs and IIMs or Air India and Indian Airlines or the Railways, Army, Navy, Air Force, IAS, IFS, Central Secretariat etc, even Parliament and State legislatures, to think that its assets, both tangible and intangible, are to serve the interests mainly of its employees, whether of Class 1, 2, 3, or 4. In fact, the assets of all such national institutions belong to all Indians: all one thousand million of us, from nameless street children and rural mendicants onwards. The body of our whole Indian citizenry own any and all such public institutions, and their employees are merely our “agents”, literally “public servants” who get paid salaries and perquisites out of public revenues. The task of managing and controlling these vast cohorts of public servants is a stupendous one of democratic politics and public administration. As a country we have never been very adept at it, indeed we often have been hopelessly incompetent. Without proper control and management, employees of national institutions have naturally tended to take over control of these assets, shifting liabilities onto the shoulders and budgets of the anonymous diffused body of citizenry who are supposed to be their masters. The public’s servants have tended to become the masters of the public’s assets and resources.

 

The RBI, as the nation’s Central Bank, has a unique position because its principal task is to establish and maintain the integrity of our money and banking system. The deficit-finance of all public institutions flow like rivulets into the swamp that is our Public Debt, managed by the RBI.

 

Money as such has no “intrinsic” worth. All the paper rupees, dollars, pounds, euros, yen in the world have less “intrinsic” usefulness than a hairpin or a button or a pair of shoelaces. Hairpins, buttons and shoelaces at least keep your hair, your shirt or your shoes together ~ the paper of paper money can be at best used to roll cigarettes perhaps. Yet paper money comes to be needed and is valued by everyone in every country ~ from street children upwards to Mr Premji, Mr Gates and Mr Mittal. Everyone accepts paper money as wages in exchange for his/her work, and then plans to use that same paper to buy food, shelter, clothing and other necessities with. I.e., we accept paper money for a short time believing we can use it to acquire useful things with. It has no intrinsic worth yet it is universally valued because everyone believes it will be accepted by everyone else in exchange for real goods and services which are in fact useful and conducive to life. The use of paper money depends on a fine and invisible web of collective trust permeating throughout the economy.

 

Banks arose due to the increasing complexity of modern economies in the last six hundred years. Paper currency was then supplemented in commerce by “deposits”, so that a transaction between two persons need not involve turnover of cash but can come to be accomplished by adjustment in their respective deposits with their banks. This vastly increased the quantum of trust ordinary people placed in the system of normal transactions, since they had to now believe not just in the exchangeability of paper money but also in the viability of the banks where they had placed their deposits. Currency plus Bank Deposits constitute what is called the “Money Supply”, and its controller is the RBI.

 

Our collective trust in money and banking is in and of itself something with economic value, which commercial banks are in a unique position to exploit. Banks can usually bet that all their customers will not demand their deposits at the same time, and so they are able to lend out as loans a very large fraction of what they have received as deposits from the public. Making such loans in turn causes the recipients of the loans to make new deposits (of what they have borrowed) in yet other banks, and this in turn acts as a signal to the receiving banks to make even more loans. Hence a process of “redeposit” or “deposit multiplication” occurs in any banking system where only a fraction of deposits is legally required to be kept as reserves by the bank. A Central Bank like the RBI then has the duty to see none of this gets out of hand: that while individual banks are acting to make profitable investments on the capital risked by a bank’s owners, they are, as a collective body, creating enough but not excessive credit to meet the needs of business.

 

In India, most banks came to be nationalised decades ago by Indira Gandhi on advice of P. N. Haksar, the mentor of Dr Manmohan Singh in his career as an economic bureaucrat. Whatever original capital they have had also arises from the public exchequer, and all their employees are effectively “public servants” under the Ministry of Finance. We have not been hearing from the RBI anything about the deleterious effects of this continuing state of affairs.

 

The RBI’s functions include managing the “Public Debt”, which stands today at perhaps Rs. 30 trillion (1 trillion= 1 lakh crore), on which interest of perhaps Rs 2-3 trillion must be paid by the Union and State Governments every year to those holding the debt (mostly the nationalised banking system under duress from the RBI). Why the stock-market has been doing so “well” is because it has been like an athlete on steroids. A stock market is supposed to be risky while a debt market is supposed to be safe. Our Government’s fiscal and monetary behaviour over decades has caused the formal debt market to yield negative returns, and so the stock-market has become relatively lucrative despite its risky nature.

 

It is also the RBI’s task to manage the country’s foreign exchange “reserves”, i.e. the residual balance left after all forex outgoings from purchases of imports (like petroleum or weapons) and payments of interest on or repayment of foreign loans have been subtracted from flows of incoming forex arising from export revenues, emigrants’ remittances, and new foreign loans and investments. These “reserves” do not belong to the Government or the nation in the same way tax-revenues belong to the Consolidated Fund of India. It was a shocking conceptual error of the Manmohan Singh Government’s most prominent economic bureaucrat to fail to see this and to suggest forex reserves could be used for “infrastructure” development. For the business press to get excited about forex reserves being at this or that level is also misleading, since high reserves may or may not indicate a better financial position just as a heavily indebted man may or may not be in a bad position depending on what kind of use he has made of his debts.

 

We have not been hearing of any of these matters from the RBI under Dr Y. V. Reddy. Instead, the one definite number we have received last week is that the RBI, under behest of its master, the Ministry of Finance, has been causing the Money Supply to grow at something like 15%. The Government’s apologists would like us to believe that this gets distributed between real economic growth in the region of 10% and inflation in the region of 5%. But for all that anybody really knows, it may be that real growth is at 5% and inflation is at 10%! Ask yourself if what you bought last year for Rs 1000 costs Rs 1050 or Rs. 1100 this year. Your guess may be as good as the Government’s.

A Modern Military

A Modern Military
First published in The Statesman Editorial Page Special Article April 16 2006. www.thestatesman.net

by

Subroto Roy

THE first line of defence in a major modern war is the air force, and any air force is only as good as its pilots. A small number of determined pilots once beat Goering’s Nazi armada in the skies over the English Channel. The good, indeed excellent, news for Indians is that our air force’s fighter pilots and frontline military aircraft now have been internationally benchmarked and are being recognised as first-class. Objective assessments are becoming available of the joint exercises the IAF held with the United States Air Force in 2004 and 2005 in Alaska, Gwalior and Kalaikunda. Though there were mixed Indo-US teams during several exercises, on balance the Americans admitted being surprised and even defeated by the IAF’s aircraft, technical skills and tactics. The IAF literally “defeated” the USAF in the sense Indian “gun cameras” shot pictures of their opponents far more often than vice-versa thus indicating “hits”; and the IAF certainly destroyed for all time all the expectations the Americans may have had about exercising with an inferior fighting force. To be sure, American apologists have made several political and technical points since then. One of the cheapest is that the American squadrons sent were not top frontline squadrons whereas the IAF had sent its best. Another has been that the USAF literally wished to “throw” a fight because they have wanted American legislators to fund the super-advanced F-22, and one way to help do that was by getting the IAF’s Russian aircraft to “beat” American F-16s. Of more substance is the point that the IAF imposed a requirement of “old-fashioned dogfights”, which in this missile age means aircraft being within “visual range” of one another. Current USAF strategy relies more on “Beyond Visual Range” (BVR) capabilities where aircraft never get to see the enemy but launch their air-to-air weapons based on instructions, for example from advanced on-board instrumentation or from airborne controllers in Airborne Warning and Control (AWAC) aircraft. The Americans also use “fire-and-forget” missiles in this BVR warfare which they did not bring to the joint exercises with India. Lastly, American AWACs did operate in the Indo-US exercises but as a neutral party assigning targets to pilots from both air forces; this was the first experience Indian pilots had of working with AWACs and by American accounts they outperformed their counterparts despite lack of familiarity with the technology. However, in an actual war, the AWACs and other devices would have been used to jam or destroy an adversary’s communications, and India has no capability in that.

Even so, in most encounters between the USAF’s F-16s and F-15 C/D Eagles, and the IAF’s Sukhoi-30 MKIs, MiG-27s, MiG-29s, and even the refurbished MiG-21 Bisons, Indian pilots apparently came out winners. One American commander said: “We try to replicate how these aircraft perform in the air, and I think we’re good at doing that in our Air Force, but what we can’t replicate is what’s going on in their minds. They’ve challenged our traditional way of thinking on how an adversary, from whichever country, would fight.” And the USAF’s Chief of Air Combat Command, General Hal M. Hornburg told USA Today that as a result of defeats in the mock combat exercises with the Indians he felt: “We may not be as far ahead of the rest of the world as we thought we were”. As in case of the Bofors gun, despite the corruption scams surrounding the deal-making, the Sukhoi-30 has apparently been a sound military purchase.

If the competence of our pilots and their aircraft is the good news, the bad news has been their failure of morale. The IAF’s pilots in droves have wished to quit because of “poor working and living conditions”, family-separation, and a “culture of sycophancy” promoted by the top brass which has made it difficult for them to work or even to stay motivated. In 2002-2004, 263 pilots were allowed to seek premature retirement; in 2005, only 8 out of some 200 have been allowed (one of whom got an MP to support him). The High Court has ruled in favour of the Air Force that when the nation spends untold millions in each pilot’s training, he/she is required to fulfil his/her obligations in turn. Premature retirement cannot be given by the Air Force on “compassionate grounds” to everyone who might ask for it. The new commercial airlines also seem very alluring to both young pilots and older commanders Perhaps an exit strategy needs to be devised whereby Air Force pilots wanting to quit and join the private sector may be allowed to do so ~ once they have agreed to repay the Air Force a reasonable fraction of the millions that have been invested by the country in their training. If we extrapolate these kinds of facts in different directions, a modern picture of desirable Indian weaponry, armed forces and doctrine can begin to be sketched. The first step must be an objective assessment of military threats faced by the country. We have only one declared adversary with aggressive intent against us, and that is the military and political elite that has ruled over Pakistan for almost 60 years. For sake of argument, let us ask if we have any other identifiable external enemies. We might imagine China to be an enemy because of the border war decades ago but there is in fact no plausible war scenario with China today. There may be conceivable threats but hardly any large ones from Bangladesh, Nepal, Burma, the Tamil Tigers, Indonesia, or Iran. As for Afghanistan, we have our Pakistani cousins to thank for having unwittingly buffered us from the turmoil there over three decades, although of course the Pakistani establishment tried to use that chaos to its advantage against India. There are some traditional threats of a special nature from insurgencies in the North-east but these too are amenable to political and diplomatic resolution. If we are vulnerable anywhere from an unknown quarter it is to a modern air-sea attack of the kind launched against Iraq twice recently and being threatened upon Iran now. Indeed our new American friends had themselves “gamed” a scenario as early as 1990-1991 of such an air-sea assault taking place upon India. Assuming we come to resolve our difficulties with Pakistan over Jammu & Kashmir reasonably (cf. Solving Kashmir, The Statesman 1-3 Dec. 2005 republished here), what India comes to need from a military standpoint is a compact, first-rate airforce, a defensive naval capacity based on nuclear-powered and nuclear-armed submarines (the era of grandiose vulnerable aircraft carrier battle groups is over), and some short and intermediate-range missile capacity of the kind we have in fact been developing. Jungle warfare, counterinsurgency and counter-terrorism may be the new specialised areas required from ground troops, though of course traditional artillery and armoured corps will likely have to be developed and retained indefinitely until such a time as Pakistan becomes a peaceful and healthy nation-state, which may be a long time yet.

Most important of all though, we need a supply of young fighter pilots of the kind who defeated the Americans in the war-games, young submariners willing to go to sea for ever, young soldiers like Batra, Hanifuddin, Kalia and the other heroes of Kargil who are prepared to dedicate their minds, bodies and souls for their compatriots if the need ever arises. For that to happen, the Army, Navy and Air Force must not merely cut all the corruption, sycophancy, fat, waste and moral turpitude in the senior ranks of their organisational structures, but political statesmen must arise to lead and motivate the whole polity itself with an inspiring yet realistic vision of India’s future, and one which remains consistent with our national ethos of ahimsa. A paradox has come to be revealed in our young warriors being excellent and yet their morale and motivation being low. The fault lies not with them but with those who purport to lead them.

Iran’s Nationalism

IRAN’S NATIONALISM

 

Is America close to breaking its pledged word?

First published in The Statesman Editorial Page, 6 April 2006

by

Subroto Roy

Ayatollah Khomeini was the Ho Chi Minh of Iran. Ho was both a communist and a Vietnamese nationalist, but America’s Presidents from Eisenhower to Nixon failed to see the latter. Khomeini was both a devout Shia Muslim and an Iranian nationalist yet America’s Presidents from Carter to W. Bush refused to see his Revolution being as much about Iranian nationalism as about creating an Islamic Republic. As a general rule, Western countries allow for nationalism among other Western countries but not among non-Western countries. Immanuel Kant’s dictum of treating everyone as an end in himself/herself and not as a means towards one’s own ends, is applied in intra-Western international relations but often not when the West deals with others. But Indians did not have to be communists to sympathise with Vietnam’s struggle against first France and then America, and Indians do not have to be Shia Muslims to sympathise with Iran’s struggle against an impending Anglo-American aggression. The opaque Manmohan- Montek deal-making with America on behalf of India’s people may need to be set aside in such a context — while it might benefit several dozen businesses on both sides and several hundred bureaucrats may become even fatter with bribes, it may have next to nothing to do with any dimension of India’s national interests.

US pledge 1981, policy 2006

On January 19 1981, the Government of the United States signed what came to be called the Algiers Accord, the first point of which stated: “Non-Intervention in Iranian Affairs: The United States pledges that it is and from now on will be the policy of the United States not to intervene, directly or indirectly, politically or militarily, in Iran’s internal affairs.” This was part of a comprehensive truce between Khomeini’s Iran and the USA in regard to the war-like conditions then prevailing between them. That pledge now seems about to be broken. British newspapers reported on April 2 2006 that the Blair Government is holding “secret talks” with its own Chief of Defence Staff, Chief of Defence Intelligence and others to discuss “an American-led attack, designed to destroy Iran’s ability to develop a nuclear bomb… if Tehran’s leaders fail to comply with United Nations demands to freeze their uranium enrichment programme.” This is despite the British foreign minister saying last month “that a military attack against Iran was ‘inconceivable’”. America’s “National Security Strategy” dated March 16 2006 states the policy clearly: “We may face no greater challenge from a single country than from Iran. For almost 20 years, the Iranian regime hid many of its key nuclear efforts from the international community. Yet the regime continues to claim that it does not seek to develop nuclear weapons. The Iranian regime’s true intentions are clearly revealed by the regime’s refusal to negotiate in good faith; its refusal to come into compliance with its international obligations by providing the IAEA access to nuclear sites and resolving troubling questions; and the aggressive statements of its President calling for Israel to ‘be wiped off the face of the earth’. The United States has joined with our EU partners and Russia to pressure Iran to meet its international obligations and provide objective guarantees that its nuclear program is only for peaceful purposes. This diplomatic effort must succeed if confrontation is to be avoided. As important as are these nuclear issues, the United States has broader concerns regarding Iran. The Iranian regime sponsors terrorism; threatens Israel; seeks to thwart Middle East peace; disrupts democracy in Iraq; and denies the aspirations of its people for freedom. The nuclear issue and our other concerns can ultimately be resolved only if the Iranian regime makes the strategic decision to change these policies, open up its political system, and afford freedom to its people. This is the ultimate goal of U.S. policy. In the interim, we will continue to take all necessary measures to protect our national and economic security against the adverse effects of their bad conduct. The problems lie with the illicit behavior and dangerous ambition of the Iranian regime, not the legitimate aspirations and interests of the Iranian people. Our strategy is to block the threats posed by the regime while expanding our engagement and outreach to the people the regime is oppressing.“

Attack scenario

In one scenario, America will make a surprise cruise-missile attack on Iranian buildings “suspected” of producing biological weapons. If the Iranians respond in any way other than total submission, it will be sufficient to launch a major bombing of Iran’s military facilities using B-2 bombers based in Diego Garcia, England and other American bases, possibly using nuclear “earth penetrating” weapons to attack underground facilities. Of course it is not impossible the British and Americans are merely setting up a bluff to scare the Iranians into complying without a fight, but the existence of aggressive war plans and preparations cannot be doubted.

Now it is possible the Americans will say they are not bound by the pledge made in the Algiers Accord in January 1981 to not intervene in Iran’s affairs. In breach of all diplomatic law, 66 Americans had been taken captive by Iranians seizing the American Embassy on November 4 1979. Six others escaped with the help of the Canadian and Swedish embassies. Of the 66, 13 women and black Americans were released two weeks later; one man was released due to ill-health in July 1980. The remaining 52 including two women and one black American were released on January 20 1981 by the terms of the Algiers Accord just before Ronald Reagan took over as President of the United States. Eight American military personnel were killed on April 25 1980 in a failed attempt to rescue them. The official designations of the 52 (who had been held captive for 444 days) included 10 military attachés; 6 “communications and electronics specialists”; 8 political and administrative officers, and 12 diplomatic/consular staff. In addition there were 12 guards and 4 others. Even if the US Embassy in Tehran was a den of spies as the Iranians claimed, the Revolutionary Government could have ordered them all to leave and to have ended diplomatic relations in accordance with international law. What explained Iranians’ anger for them to have violated international law so brazenly? That was the age before terrorism, and nor was Iran a player in the conflict between Israel and the Arabs.

Iran’s anger stemmed from having felt being used by Britain, America and Soviet Russia for half a century before the 1979 Khomeini Revolution – from having been merely means towards their ends in violation of the Kantian dictum. It was almost as if Britain and America had said to Iran and the entire Middle East, “We invented the internal combustion engine and the automobile which uses it, and we also discovered the petroleum that runs it; the mere fact you happen to sit on this petroleum does not make you own it; we own it too and we will take it by force whenever necessary.” During the Cold War, the USSR followed suit, and now after the Cold War has ended, the new Russia is a Western ally in the same kind of attempted domination over non-Western countries like Iran (or Pakistan and India, who get sold a lot of useless weapons to fight each other with).

Mossadeq the democrat

Specifically, if the January 1981 Algiers Accord was signed by the USA under duress, the Iranians could say that Iran had been cheated into signing the 25 year agreement of September 1954 with an international oil consortium led by the Anglo-Iranian Oil Company. Iran would receive 50% profit on all Iranian oil exported, after paying the AIOC ₤25 million in compensation for having nationalised it in 1951 under the democratic government of Mohammad Mossadeq which had broken off diplomatic relations with Britain. Mossadeq was overthrown by an Anglo-American coup détat in August 1953, and replaced by the compliant General Fazlollah Zahedi and Shah Mohammad Reza Pahlavi. Arthur Millspaugh, an American invited by the Iranians to help their public finances, once wrote: “Persia cannot be left to herself, even if the Russians were to keep their hands off politically. …Persia has never yet proved its capacity for independent self-government.” Millspaugh’s 1925 book titled America’s Task in Persia seems to have remained the handbook of Western policy towards Iran. Khomeini’s Revolution was its antithesis.

Towards an Energy Policy

Note:  This article  may have initiated the public debate on the economics of the Indo-US nuclear deal.  It was published as a Special Article on the Editorial Page of The Sunday Statesman of April 2 2006 but it failed to be uploaded at the website http://www.thestatesman.net because there had been a fire on March 31 2006.  The politicians who led the  parliamentary debate  in 2006 subsequently made reference to it.

 

 

See also  republished elsewhere here e.g. “India’s Energy Interests”, “India and Energy Security”, “Need for Clarity”/”From Confusion to Clarity”, “Against Quackery”, “Jimmy Carter and the Indo-US Nuclear Deal””, NuksaanFaida Analysis”.

 

 

“Towards an Energy Policy”

 

by Subroto Roy

 

First published in

The Sunday Statesman, Editorial Page Special Article 2 April 2006

 

When was the last time we heard a thorough, well informed debate in Parliament about India’s long-term energy needs and policy-alternatives? The answer is never. Just as Pakistan tends to be run by Islamabad’s generals, we tend to be run by New Delhi’s bureaucrats; both are a legacy of the Raj which was run by small numbers of pompous civil servants and soldiers. Bureaucrats keep as much decision-making information as they can to themselves, give it to Parliament only under duress and then too in garbled opaque form, and share it voluntarily with the public never at all. A bureaucrat of conscience who shares vital information transparently becomes a “whistleblower”, and may risk his/her life and career because assorted mafias invariably surround all government contracting, and, like vampire bats, cannot stand the light of day shed upon them.

 

The problem with the Manmohan/Montek deal-making with the USA on behalf of India’s people has less to do with rational assessments not having been made of the relative costs and benefits of e.g. nuclear/fossil fuel/renewable energy, as it has to do with the fact it reflects the same lack of transparency (and is accompanied by the same politically correct propaganda) as has existed in other policy-making – like the $12 billion worth of commercial aircraft from Boeing and Airbus bought for our bankrupt nationalized airlines, or spending untold billions of borrowed dollars on new weapons from France, Russia, Britain or whomever to fight unknown enemies in unimagined wars, or throwing newly printed paper-money at every government project that any fool or knave cares to mention.

 

To be fair, the UPA/Communist dispensation of the public’s largesse is no worse than that of the NDA/RSS. Both are part of New Delhi’s own “Inside-the-Beltway” syndrome, and turn up at the same celebrity wedding-receptions and iftehar parties. Neither minds too much when the other is in power so long as they can keep their government accommodation. Our fundamental political problem may be the absence of any serious party of Left or of Right which is secular, scientific, liberal, nationalist, clean, law-abiding, and fiscally prudent.

 

Since no national debate on energy-policy has been offered by New Delhi, ordinary citizens will have to create such a debate for themselves. What follows constitutes a few of the barest facts needed to start such an analysis of India’s alternative energy scenarios and their respective costs.

 

Hydroelectric power does not involve burning any fuels. Instead, the gravitational force of the movement of water from the mountains to the oceans is harnessed to generate electricity. But hydroelectric projects (like the Narmada Dam) can displace people, who must be then compensated and resettled. Burning of organic “fossil fuels” like coal, gas and oil, causes atmospheric oxygen to turn into carbon dioxide, which may affect climate in unknown ways. In 2004, the International Energy Agency’s estimated the new energy capacity worldwide required by rising economic growth in the year 2020 will derive 1400 GW from burning coal (half of it in China and India), 470 GW from burning oil, 430GW from hydro, and 400 GW from renewable sources (like solar or wind power). On the Agency’s assumptions, gas prices will remain low, making construction of new nuclear plants for electricity uneconomical. By 2030, new energy expected to be required worldwide is 4700GW, of which only 150GW is expected from new nuclear plants — which will be replacing existing nuclear plants due to be retired. (Such is the scenario before any new nuclear plants were going to be exported by e.g. USA to India).

 

Now the fission of an atom of uranium produces perhaps 10 million times the energy produced by combustion of an atom of carbon from coal. Gas and fossil fuels may be cheap and in plentiful supply worldwide for generations to come but the potential for cheap energy from nuclear sources seems practically infinite. Nuclear power can arise from fission of radioactive uranium, plutonium or thorium. India has perhaps 8 million tonnes of monazite deposits along the seacoast of which half may be mined, to yield 225,000 tonnes of thorium metal; we have one innovatively designed thorium reactor under construction. But almost all nuclear energy worldwide today arises from uranium, and there are practically unlimited reserves of that. There is so much uranium in sea water that mankind’s total electricity needs can be satisfied for 7 million years. There is more energy in the uranium impurity present in coal than can arise from actually burning the coal. There is plenty of uranium in granite. None of these sources will become profitable for centuries because there is so much cheap uranium possible to be extracted from conventional ores. In 2001, uranium cost about US$20 per kg or so, translating to US$0.0004 per kwh of electricity. The known reserves of uranium that can be profitably sold at $120 per kg are enough for at least a hundred years. Design improvements in reactors will also improve productivity; e.g. “fast breeder” reactors “breed” more fissile material than they use, and may get 100 times as much energy from a kilogram of uranium as existing reactors do. India has about 95,000 tonnes of uranium metal which may be mined to yield about 61,000 tonnes net for power generation.

Natural uranium is 99.3 percent of the U-238 isotope and 0.7 percent of the radioactive U-235 isotope. Nuclear power requires “enriched uranium” or “yellow cake” in which U-235 has been increased from 0.7 percent to 4 to 5 percent, and that “separation” process is expensive. (Nuclear bombs require highly enriched uranium with more than 90% of U-235). Yellow cake is broken into small pieces, put in metal rods placed in bundles, which are then bombarded by neutrons causing fission. In nuclear bombs, the fission occurs in a small space, and the blast that results kills all life for miles around it by sucking up all the atmospheric oxygen, besides causing firestorms, shock waves and radioactivity. In a civilian reactor, the energy released turns water into steam, which moves turbines powering the generation of electricity. However, while there is no carbon dioxide “waste” as in burning fossil fuels, the “spent” rods of nuclear fuel and other products constitute grave radioactive waste, which is hard if not impossible to dispose of. Many countries like the USA just bury their nuclear waste in remote thinly populated desert areas.

Rational choice between energy sources depends on costs determined by history and geography. France has 59 of the 441 or so civilian nuclear reactors in the world, and generates 78% of its electricity from them, 22% from hydroelectricity. Japan has 54 reactors and generates 34% of its electricity from them. The USA has 104 reactors but generates only 20% of its electricity from them, principally because it has vast alternative sources of energy. In India, installed power generating capacity as of 2003 was 107,533.3MW, of which 71% was from burning fossil fuels. Hydroelectric potential is 150,000MWe. In 2003, total installed hydro capacity with utilities was 26,910MWe (about 18% of the potential). More than 70% of India’s hydroelectric potential is in the North and NorthEast regions put together.


India’s 14 nuclear reactors produce less than 4% of the total electricity being consumed in the country. Even if all other sources of electricity remained constant, and our civilian nuclear capacity alone was made to grow by 100% under the Manmohan-Montek deal with the USA, that would mean less than 8% of total Indian electricity produced. So the first question India’s citizens must ask is why such a fuss has been created about the Manmohan-Montek deal with America. Clearly, the Government of India must come wholly clean with all the facts and analysis it has available on the whole problem of India’s energy future in all its complexity and detail. If and when it does so, we may simply find that the fault lies not in the stars but in ourselves. Whether the US-India nuclear deal stands or falls, it will have scant effect in satisfying the country’s energy needs.