Asia

India

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  • India
    A Conversation With Tata Chairman Natarajan Chandrasekaran
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    Tata Chairman Natarajan Chandrasekaran discusses the global business, economic, and trade climate, as well as his thoughts on how governments can harness the connectivity and efficiency of artificial intelligence to build a stronger and more resilient economy for all.   GOLODRYGA: Hello, everyone. Welcome. I hope you’re enjoying your lunch, and coffee, and conversations with friends. I’m really looking forward to this conversation that I’m going to have with a new friend that I’ve just made. Natarajan Chandrasekaran is the chairman of the board at Tata Sons, and the holding company and promoter of more than one hundred Tata operating companies. You all know his background and his resume, and I don’t want to spend too much time talking about that. That’ll be a discussion in and of itself. Welcome. It’s great to have you. CHANDRASEKARAN: Thank you. GOLODRYGA: You have co-written a wonderful new book called Bridgital Nation, and I hope all of you if you haven’t picked up a copy there’s one out front. We’re going to talk a little bit about the book, we’ll talk about news of day, we’ll talk about India. And then we’ll open it up at about 1:30 for questions from the audience. Just so you know, everything here is on the record. And it’s going to be an interesting conversation. So I’m happy to be with all of you here today. My name is Bianna Golodryga, by the way. I’m with CNN News. So I want to start with some of the economic headlines out of India. And it’s going to relate to the book in the sense that India has just now surpassed the U.K. and France as the world’s fifth-largest economy, with a GDP of 2.94 trillion. And a new report, it also suggests that India continues to develop a market economy. That’s the positive news. The not-so-optimistic news, however, is India’s real GDP growth, it is expected to weaken for the third straight year from 7 ½ percent to 5 percent, an eleven-year low. And India’s unemployment rate has reached a five-year high. A lot of questions of how to marry the two, a growing economy, lots of internal problems and structural problems, and the role that technology can play in that. And that’s where this book comes in, because you really address it in a two-pronged approach. It’s twin challenge troubling India. Talk about how you address it in the book. CHANDRASEKARAN: OK. It’s a good commentary that you gave. So we can talk about the economy a bit later. Let me talk about the book in the larger context of technology, India, artificial intelligence, and the general fear that AI will take away jobs, and so on and so forth. I think if you look at India, I have been reflecting on this for a very long time because all my career I ran a tech company. So I only applied tech to solve either business problems or large-scale public sector problems, and public services delivery, and so on. I also grew up in rural India. And so I have observed so many things over the last three decades. And largely all of India’s problems, according to me, can be grouped into two categories. One category, I call it access. The second category is jobs. When I say access, it comes from the fact that we have a lack of everything. You take doctors, we are shortage. Teacher, we are shortage. And at any point of time we are shortage of four hundred thousand teachers, all you really need is forty thousand teachers. If you take doctors, it’s six hundred thousand shortage of doctors—2.5 million shortage of doctors. We are dealing with a global average, whether it is doctors or teachers, to patients a ratio—or ratio with students. And judiciary. We don’t quite have the number of judges we need for the country. I’m told that we need about seventy thousand judges and we have probably one thousand. So you take infrastructure, we have shortage. We have hospitals, we have shortage. And on the other side, we have a lot of talent. GOLODRYGA: You have ninety million people entering the workforce by 2030. CHANDRASEKARAN: Every month plus ten million people coming into the workforce, OK? And it’s going to be there for the next ten years. I think basically in the next ten years we will need about—more than one hundred million people coming into the workforce. I think if I’m right, the China number is about twenty-three, twenty-four million in the same ten years, and the U.S. is about ten million. So you see the scale. So if this is what the two problems are, you would have thought that we would have managed it in such a way that the supply and demand meet each other. There’s a lot of demand, and there’s a lot of supply—assuming that if you have the right human resources you can solve all these problems. But I think over the years we seem to be trying to solve all the problems in two different ways. So the idea of the book is how do you connect the access challenge and the job challenge together. So you solve both problems, so that they meet each other. The basic principle is that if you take the access side of thing, you cannot solve this problem by putting more capital and going into building programs which will take next ten years and twenty years. If you go on a hospital building spree or you want to educate more doctors by opening hundreds of thousands of medical colleges, it’s not going to happen. So how do you use technology? So we started about doing pilots. We did a health care pilot—multiple healthcare pilots. And to cut the long story short, some of the findings are if you take an expert, the expert doesn’t spend all his or her time on only doing the stuff that person needs to be done. Most of the time they are doing work way below their expertise. That’s because the entire middle is missing. So we have people who are low skilled or no skilled, or we have people who are super skilled. And the middle, there’s a lot of gap. So how do you use technology to augment the skill level of these people so that we can perform at a higher level. So that led to the theme that AI, and machine learning, and all the things that go with—cloud and the entire digital stack—should be for all. It should not be elitist. Then you can employ people. You need to train everybody. Nationwide we need to train twenty-five to fifty million people all on digital. And it’s much easier to train people on digital than teaching them math, and science, and counting, and reading, and writing. GOLODRYGA: So why hasn’t that happened yet, in the sense that when you talk about technology and the role that it plays in the U.S. economy—we have an aging population here in the United States. So there’s a real challenge as to people who are older, training them under certain technology, as we’ve seen advancements continue over the years. India has a very young population, about seven hundred million under the age of thirty. That’s twice the size of the United States that’s just under thirty. One would think, in theory at least, when it comes to exporting technology and training technology to a younger section of the economy and workforce, it would be easier. Why hasn’t there been any inroads made there? CHANDRASEKARAN: I think the problem—the problem is you start comparing the deployment of technology the same way with India and the U.S. That’s where the fundamental problem lies. They are two different markets; two different problems. In economies like the U.S., you have aging population. So you use technology to replace people. Your usual video is about robot walking in the snow. GOLODRYGA: Job killer, right? The AI job killer. CHANDRASEKARAN: (Laughs.) So that’s your—that’s your metaphor. And the second thing is, you use technology to drive everything. You want to drive productivity in a market which is not going, in an industry which is capped out on growth you need to take costs down, so you apply technology to take costs down. The fundamental difference in India is that the market itself is not there, because the access is not there. Normally when you create the access, the market develops. So technology should be used to develop the market in an economy like India, whereas an economy—the advanced economies it is for revenue opportunities. So there’s a fundamental disconnect. GOLODRYGA: So it’s a unique situation we’re talking about in India and developing countries. CHANDRASEKARAN: All developing—India and all developing countries the market will get created by the deployment of technology. Whereas here, the market is being developed to be efficient through the use of technology. GOLODRYGA: So what’s the barrier now, if in fact you can introduce, you know, technology on a mass scale? CHANDRASEKARAN: So, access. So how do you—how do you train all these people? How do you—one is teaching. The other one is how do you build access. So you need digital solutions. And we did a pilot and it works. We can talk about that. It does two or three things. One is that you’re able to shift the work down dramatically. So the experts have so much time that they can actually do only the expertise that they have—the level they have to apply. There’s a lot of mid-level jobs. And then we’re able to dramatically increase the skill of a lot of people with no skill and low skill. And we’re able to reach people. And we’re able to go to people in rural areas, where there is no facilities. We’re able to reach people because everything is in a cloud, everything is—you know. GOLODRYGA: Right. You talk about the disparity, and there’s a lot focused on income inequality in the U.S. It’s a big theme of the election here. It’s on a much larger scale in India, and income inequality throughout various states in the country. Is that getting worse? And how do you expect some of your suggestions and the role of technology to hopefully help overcome the disparities? CHANDRASEKARAN: Well, it’s not getting worse. In fact, I’m very positive over India. So we’ll talk about that next. I’m not negative on India. So now I think the—it’s true that the inequality is there, because our per capital income is close to $2,000, but we have a state in the south which is $9,000 and we have a state in the middle of India which is $600. So that’s the kind of disparity that we see. So but fundamentally, if you are able to train people and employ people using technology, and if you can let them know how they can use these tools, you can solve the access problem. The moment you solve the access problem, market opens up. So health care can be solved, education can be solved. We talk passionately about small and medium enterprises. All those small and medium enterprises also suffer because they are very unorganized. See, the other distinct difference that you should keep in mind is that in the U.S., you are 100 percent formal jobs. The first time you are getting used to informal jobs due to gig economy. GOLODRYGA: Gig economy, right. CHANDRASEKARAN: We are 80 percent informal jobs, OK? We are a country of people doing their own thing. And what this will do is to drive the formalization of jobs at a dramatic pace. If you formalize jobs, automatically you will see an uplift of minimum 15 percent in the benefits to people. And that will give them quality of life. That’ll give them access. That’ll increase the consumer spending. That’ll grow the economy. GOLODRYGA: Well, another challenge to the economy is getting more women into the workforce. Currently only 23 percent of eligible women are in the workforce in India. And a lot of the issues that we’ve just been talking about really can’t be addressed unless you start to see more women enter, correct? CHANDRASEKARAN: Yeah, that’s a big problem because we—if you take our economy, almost half of the people—only half of the people have secondary education. And we have about 120 million women over there who have the secondary education, but only 23 percent of them work. Also, the problem is that this ratio’s coming down. It was 27 percent and it’s come down from 23 percent. GOLODRYGA: So why is that? CHANDRASEKARAN: I think it’s there are lots of different reasons. And generally Indian women do a lot of miracle work, right? Because the facilities are not there. There are so many things that they carry. So most of them, once they get married and then decide to have children, after that they don’t come back to work. So there’s a lot of drop-out ratio. So a lot of—a lot of facilities need to be created or a policy framework needs to be created. Actually, some of the things have been done, but still the execution’s a problem. Many of our policies is right—policies are right. But then, they are not implemented the way they’re intended to be implemented. Or, they’re not adopted the way they’re supposed to be adopted. GOLODRYGA: So unintended consequences, perhaps. CHANDRASEKARAN: Unintended consequences. GOLODRYGA: I want to go back to implementing some of your ideas, and the use of technology in health care in particular. There is a chapter that you open the book with where you focus on a middleman who basically drives his car to the center of town, and people from various areas come near and far with their medical problems, and he helps facilitate them to various doctors or receive the health care that they’re looking for and in search of at the time. That seems very primitive, right, at this day in age. And when you’re talking about the introduction of technology, the need for more doctors, talk about the pilot program in Kolar and how that can sort of rectify the issues facing the country. CHANDRASEKARAN: See, Kolar is a district outside Bangalore. Most of you know Bangalore for software, but this is a district outside Bangalore. It’s about thirty-five lakh people. That’s—thirty-five lakh is 3.5 million? Yeah, 3.5 million people. And what we did was we created an AI machine learning-based software which can capture structure and sector data and created a huge healthcare platform. And we created—we took over the primary health center, spoke to the government. There’s a lot of—the primary health care is predominantly done by the government, most of it are dysfunctional in many of these states. They don’t meet the basic criteria, the work criteria, like, you know, minimum there should be two doctors, and so many nurses, and there must be four beds, and so on so forth. Many of these criteria are not met in these hospitals. So we took over the hospitals in this district, and then we operated the technology, and then we—there are low-end workers called Asah workers, who basically interface with the patients. And we kind of trained them on digital. We gave them an iPad. And then we created a middle-skilled people, we call them digital workers, and basically gave them the tools that are required and the screens that are required so that they can take—you know, whenever a patient comes, first we register the patients. And going through the entire standard operating procedure and taking all the data, so that finally when the patient is ready the patient goes to the doctor, the doctor only—the doctor has all the information in the cloud, so that appears, and the doctor actually spends minimum amount of time.  We were able to increase the productivity of the doctors by more than 50 percent. And we were able to register all the people in that district into the system because we would proactively reach out, everybody to come into the—come into the registration. And the most important thing is, because these primary hospitals are not functional currently, most of these people end up going to either prayer clinics or go to the tehsil hospitals. So the tehsil hospitals are all over. But what we’re able to find is that most of those people that come there have a basic fever, or a viral, or, you know, they just needed to be spoken to half the time. So— GOLODRYGA: Not an emergency. CHANDRASEKARAN: Not an emergency. So a huge drop off upstream. GOLODRYGA: And could this program be scalable? CHANDRASEKARAN: Yeah, absolutely. Absolutely. I think the whole program can be scalable. All we need is—we imagine a situation where all these primary health care centers are beautifully connected. And there are many different ways it can be implemented, but the point is the health care is a state subject. So we will deal with every state. So there are implementation issues, and there are regulatory issues. So what can be done by technology? What can be done by technology? You have to be a qualified doctor to do certain things. So when you go into the details, I’m pretty sure there are more things we’ll find out. But those things can be overcome. And two, three things will be achieved. We have extrapolated the number of doctors that we will need by 2030. What is the shortage? Eighty percent of the shortage will be met if you implement this, without adding more doctors into the system. What I think is that we will dramatically decrease the gap in the ratio between patients to doctors, because many of this—many of these problems will be take care of by the lower-level people. And we will additionally create one million jobs, only in this sector. GOLODRYGA: That’s very promising. CHANDRASEKARAN: Yeah. GOLODRYGA: I wanted to ask you, one of the questions I had here—this is one of the benefits of having time beforehand to chat, because I was going to ask the role that some of Modi’s policies have played in some of the visions that you have going ahead and recommendations in the book, and his views on some of the recommendations you discussed with him. You had a conversation with him about this book. And he seemed to sign off on everything. CHANDRASEKARAN: Well, I think, you know, it was a development meeting. And at the end of it, I presented him with the book. And I spoke about the themes. He bought into the whole idea. And then immediately he agreed to run through the book. In fact, he was kind enough to run through the book at his house. I think he fully gets it, that most of our problems can be solved only by bringing technology. What we are saying is pure technology for the sake of technology will not work. Technology and humans, AI and human have to work together. And there is a way it can be done. And the fundamental difference is that digital will enhance the productivity of people, it will create new jobs, and it will provide access to people, to thinks that in other ways they have been deprived of for ages, and it will take a long time to provide. And he gets the concept. He appreciates it. In fact, I would say that I was quite fascinated how he spoke about the concept in the launch. GOLODRYGA: He interpreted it in a way that you couldn’t even—right? CHANDRASEKARAN: He interpreted it—yeah, yeah. Because he was more coming from practical social angle, and how it would impact different sectors. And he spoke extremely well. It’s there on YouTube, so. GOLODRYGA: And I want to ask a few more questions about Modi, and sort of the current dynamics at play within India right now. But before we get to that, there’s been a lot of renewed focus—and I want to say one of the themes recently at Davos—has been the talk of stakeholder capitalism. And that’s happening both in the U.S., and you have the Business Roundtable, people like Larry Fink really addressing that. From your perspective, as somebody who’s been embracing this for a long time within the company, what does it mean and how sustainable is it? Because it all sounds great on paper, but it’s the implementation that— CHANDRASEKARAN: I think—I think for us this is the only way we have functioned as a group. Our group has done so many things for the last one hundred years—more than one hundred years, one hundred fifty years. In fact, the eight-hour workday was introduced by Tata Group in 1914. Maternity leave was introduced in 1915-17, something like that. Employee insurance was introduced in—around the same time. And then creche for bringing children for working women was introduced in part of our company in 1910. So there are so many things, the social policies were introduced. And the group is known for the stakeholder capitalism, like, from the word “go.” In fact, the famous story that I would say is that in—I think it’s 1946, our then-chairman was standing in the Munich railway station. And this German company called Krauss Maffei saw the board member was there, they approached him, and then said: You know, we have all these engineers and they don’t have any work here due to the war. Can you take them with you? You just give them some good work, and they will be very happy, and you’ll be—you don’t have to do any other—any other thing. And then in 1948, post-independence, they got a letter from—(inaudible)—saying that now that we can pay you, how much we should, you know? GOLODRYGA: (Laughs.) CHANDRASEKARAN: So I think the responsibility, and commitments, and being fair—when I say stakeholder capitalism, this not only—not only implies the society is—but even beyond that, doing the right thing has been—has been in the group. And I don’t think it’s difficult to do. I feel that if you do it that way, actually it’s cheaper, because always you’re fighting all the time. In fact, you get better goodwill and it’s not—see, in India, we have a law now, 2 percent. Every company has to—has to contribute 2 percent of pre-tax profits. GOLODRYGA: That’s something that’s being discussed, at least. We’ll see if it’s implemented to that degree— CHANDRASEKARAN: No, it’s implemented in India. GOLODRYGA: No, no, I’m talking about around the world and in other companies. We have a visit planned between President Trump and Modi this weekend I believe. And I grew up in Houston, so I covered Modi’s trip to Houston—the Howdy Modi trip that they really seemed to embrace him wholeheartedly in Texas. And the two leaders were holding hands. Now we’ve got round two with Namaste Trump. What do you envision coming out of this meeting? The president clearly wants some sort of trade deal announced. There have been tensions between the two countries over trade for the past couple of years. Do you envision a trade deal of sorts? CHANDRASEKARAN: I think the president has said that the trade deal is going to happen post elections. (Laughs.) GOLODRYGA: Well, we’ll see. We’ll see. It’s just a matter of whatever he’s tweeted. Yes. CHANDRASEKARAN: So I’m not expecting much. Not much expecting much. GOLODRYGA: Not expecting much. As far as some of the— CHANDRASEKARAN: There may be some sort of a trade deal, but not the whole length. GOLODRYGA: Not the whole length? Something on paper, something he can tweet about. CHANDRASEKARAN: Maybe some quick things, maybe. GOLODRYGA: Is the—well, Modi has already promised to buy some aerospace equipment from the U.S. So maybe that’s something that the president can anticipate and be happy about. How is the country prepared for the coronavirus? You talk about the deficiencies that you currently see in health care. For a pandemic—it’s not been labeled a pandemic officially yet, but it looks like we may get there at some point—is India prepared? CHANDRASEKARAN: My view on this is, you know, lucky for us, we’re not impacted. We have two or three cases reported in Kerala. Let me say this, if it is coming from outside, we’re pretty good and handling the borders. We are fine with that. We know how to check, how to quarantine, and all of that. If something like this had happened internally, I’m not so sure how we would handle it, you know what I mean? If something had broken within India, there would be a much, much, much different problem. GOLODRYGA: Right. If this wasn’t in Wuhan, if this had come originally from India. CHANDRASEKARAN: Something like that in India, then it would have been extremely difficult. GOLODRYGA: But from now, in anticipation or—right. CHANDRASEKARAN: From things—yeah, coming from outside they’re pretty good and handling the borders. GOLODRYGA: Because it’s interesting that the neighboring Pakistan has told those residents that are in China right now to stay there, because they are not equipped to handle— CHANDRASEKARAN: But they brought—they brought—India brought home— GOLODRYGA: Yeah, brought your—the residents home. CHANDRASEKARAN: And they have got facilities, and those things, yeah. GOLODRYGA: And last question before we open it up to the audience. I know this is a sensitive topic, but it’s about internal domestic turmoil within the country now. We spend a lot of time talking about the economy, but it would be remiss to bring up some of the nationalism that this party, BJP party and the president, is accused of fanning throughout the country, whether it be anti-Muslim, whether it be what’s taking place in Kashmir, some of the laws that are being introduced. From your perspective, is it worrisome? Are you seeing an increase in nationalism tendencies from the administration? And as a business leaders and as a citizen, does that bother you? CHANDRASEKARAN: Increasing nationalism is everywhere. It’s not only India. GOLODRYGA: Yes, definitely. It’s a global problem. CHANDRASEKARAN: Yeah, so. But the way I look at it is there are two or three tacks I take on this one. First is as a businessman, there are always these kind of things going on, OK? I mean, if you take the—when I was running TCS, there would always be something on the H-1B visa. And probably the maximum number of questions I used to answer, I’ve ever answered in my life, is what’s going to happen to you when you go down because of the H-1B visa. The maximum times I’ve answered a question. So similarly, all these issues will have their own implications, which as businesspeople we’ve got to handle it in such a way that our employees, our other stakeholders, everybody’s interests is going to be protected. That’s one set of things. The second answer I have for you is that if you take any one of these issues, all of these issues are mixed issues in India. They’ve been there for a very long time. We are a very diverse country. We are a very complex country. The whole Kashmir Article 370 has been there—has been an issue since independence. And BJP’s position on this has always been clear, that they will repeal it. It’s not the first time they’ve said it. They would have done in 2004 when they were in power. So similarly, if you take the Ayodhya Temple, which has been talked about, the Supreme Court came of it a judgement. It has been there, I think, I don’t know, 1500s, maybe? It’s been there for a very, very long time. And their position has been known. So if you take any one of these issues, there are three or four tricky issues which are the issues that need resolution, but nobody—everybody was kicking the ball down the can. And these guys are going the direction saying that this is what we will do. GOLODRYGA: So you don’t see it bubbling to some point of— CHANDRASEKARAN: OK, so that’s the way they are handling it at the end of the day. So if you take a Kashmir thing, there’ll be always two schools of thought. There’ll be people who say that the way they have gone—some people will say—three views. Three views, actually. Some people will say it was wrong to repeal Article 370. But what’s the alternative? They won’t say. I’m not taking for or against, but I guess what I’m saying is that this one, what it does is puts it very much part of India. It’s not like there’s a special status. So there is other side of view. The second aspect if you look at the same 370, some people say what they did is right, but they could have done it differently. This kind of criticisms go on. But my point is that if these issues can be resolved—and every country wants to secure its border. So the third implementation is all about securing borders, securing a border, saying who is your citizen who is not your citizen. It is a very complex affair in each one of these different points of view. I think my view is that as long as these things are done in a way that everybody is carried along—because there is never going to be a situation in all these issues where you’re going to have consensus. But from my point of view, where I stand I’m not for or against each one of these, but I’m more interested in ensuring that my ecosystem— GOLODRYGA: Remains stable. CHANDRASEKARAN: Remains stable. GOLODRYGA: And you, from a forward-looking perspective, you envision that it will? CHANDRASEKARAN: Yeah. Yeah. GOLODRYGA: One final question before I open it up, sorry. And that’s just about technology and obviously the embrace of it. And you’re proposing more of it being implemented throughout the country as a necessity. There was just the new law that was proposed, the first law of its kind, a data protection law. And this raising the question of who owns the data, AI facial recognition technology, something that’s being discussed in China as well, and other countries. Does that concern you at all, about data privacy and the role— CHANDRASEKARAN: Not actually. I think, you know, we are unnecessarily trying to solve this problem in a very simplistic way. There are two kinds of problems. One, the physical problem. Another one is the digital problem. The physical problem, everybody knows that who can come in, who cannot come in, visa, what visa, you know, all kinds of stuff. So the whole production is around the movement of people. The second one is a digital problem, which is a data problem. And data has got three problems. One is the data privacy, data localization, and data resiliency. And we cannot follow it in a uniform manner because the trust levels between countries are different. The same way as your movement of people. And there are nations between whom we have clear agreement, we believe, common goal. There are nations where we don’t have that comfort. The same situation with data. And it’s going to be very hard for companies, because companies would like to have a database, single cloud. And it’s not going to happen. GOLODRYGA: So get over it? CHANDRASEKARAN: Yeah. Because it is the same problem. It’ll be very good for me, with a U.S. passport probably you can travel to so many countries. But I’ve had situations where I’ve admitted U.S. guest, they forget the fact that they need a visa in India, and they land in India and find out that they don’t have a visa and they cannot enter the country, because they’re not used to that. Whereas, with Indian passport, we travel to most of the world with a visa, right? The same way, the data situation is going to be difficult because with some countries we will not trust, so you won’t actually have the data. GOLODRYGA: Well, for those in New York may not have global entry access either, so I mean— CHANDRASEKARAN: Yeah, yeah. So this is—this is— GOLODRYGA: Different approaches. (Laughter.) CHANDRASEKARAN: So this has to be solved. This can be solved. But we will recognize the fact that data privacy can be reformed. It think it will—Europe has got a very—taken the lead, actually. And some countries, they are behind, I feel. I think the European model— GOLODRYGA: You like the European model? CHANDRASEKARAN: Whether I liked it—see, in the business world the question is not what you like. You want stability. I’m just saying, tell me what it is. GOLODRYGA: Yeah, right. Or what works. And what works. CHANDRASEKARAN: Yeah, what works. Tell me what it is, and this is what is allowed, and this is what is not allowed. That’s fine. I’ll deal with it. The problem is when you don’t take a position, you just keep going. And so data privacy will get sorted. And data localization and data resiliency, there’ll be multiple implementations. GOLODRYGA: OK. On that, let’s open it up for questions. Over here, this gentleman. Q: Thank you, sir. I’m David Braunschvig. The title you chose for you book is reminiscent of the book that by far was the most successful one published by the Council on Foreign Relations, Startup Nation. Having read cover to cover to your book just before this session started, I understand, also based on your comments, that your focus is very different from that of Dan Senor. It’s much broader. Yet, the question of radical innovation and what does it take to foster radical innovation is well-posited in Dan Senor’s book. In Israel, in California, and to some extent in Cambridge, England, you have an agglomeration of people from different horizons, speaking different languages, immigrating from different countries. And according to the consensus, if you want innovation—which is not necessarily the topic of your book, I understand—you need to attract talent from different parts, different cultures, different languages. My question is, do you feel that India is doing enough for that? And what would it take for India to create ecosystems of different people coming to India for innovation? CHANDRASEKARAN: I think—I don’t think that’s the problem. The problem is not that we’re—if at all there is one place that is most diverse, it’s India. I mean, the diversity is just so huge. Even within the country, it’s so huge. And attracting people from different parts of the world, from a legal perspective I don’t see a problem. The problem is whether we have the enabling infrastructure. So our problem is execution. I keep saying it. We can’t solve our problems through policy. Our problem is the execution. Even on a very clear-cut policy we have so many interpretations on execution. It’s all about execution, and we’ve got to execute better. That is my view. And also, we have this huge gap. And so many people need to be skilled, and so on and so forth. If we can do skilling in a grand scale, and we can digital to people, rather bridgital to people, innovation will happen. See we did another pilot—we have a pilot. Do you know Kumbh Mela? Have you heard of Kumbh Mela? So about five, six years ago there was a Kumbh Mela in Nashik. This Kumbh Mela is a festival where people come and take a holy dip in the river. During the period of Kumbh Mela in this one place, thirty million people come in. So we created a small innovation center called Digital Impact Square. We thought we will foster innovation with the local community, partnered with MIT Media Lab. So we got MIT Media Lab and some places in India, but all the people who build the app and the solutions for the Kumbh Mela were all people from the local community. So in preparation for that, we were able to teach them some skills. You won’t believe the number of apps that they built to solve problems. They came up with some wonderful, wonderful solutions. For example, if an area is going to be covered, they will put a map with some (ID ?). So they will count number of people crossing, and they would—using cellphone towers to identify the area which is populated. I was just fascinated with the number of apps that people were able to build. So I think innovation will come. But our innovation is—innovation is—it’s not that it is not happening because there is not diversity of talent. It’s more the infrastructure is not there. And in fact, we got to the extent of saying that innovation should not only happen in IT industry and tech industry. We need that ecosystem for small and medium enterprises. We have—we need innovation clusters. We need it for textile, we need it for every single industry. And there are pockets in India, there are different zones where these—(inaudible)—are there. But they all have infrastructure problems. They don’t have access to capital. They’re, like, we need a small amount of money. We need about ten—I mean, sixty, course, what, I don’t know, $1,000 or $10,000, or something like that. Or $10 million or something like that.  But the point is that he can’t get the loan because the doesn’t have the papers. And without getting the loan, he can’t get the papers. I mean, it’s so many—we talk about that, that particular case, the example of a guy called Amit (ph). We talk about it in the book. So our problem is slightly different. We just need to execute. The policy is there, the money is there, but it doesn’t reach the right people. So we need to execute with that. GOLODRYGA: Right up here, Frank. Q: Chairman, thank you, sir, for a very, very interesting—a very interesting presentation. And those of us who have not had a chance to read the book have a treat in front of us. I’m really pleased you’re here, not only to present the book but as the representative of the great company of Tata. Your reputation proceeds you, in as much as Tata has always stood for values—human values. And you’ve described them today in your opening—or, in the last question you were asked. But you’ve also stood for an open, competitive Indian economy in which private enterprise is in the front row, and in which India competes and brings—and you’ve incubated foreign enterprises over the years and brought them to the Indian table when that was not fashionable. So where is India today? Is India a nation that is going to continue to open its economy? Is it going to retreat from or enter into international trading arrangements? Is India going to maintain a heavy state-dominated industrial and service system? Where is India going? What is Tata perspective? CHANDRASEKARAN: A great question, Ambassador. I think from an opening of the economy perspective I think it’s we are—we are on a road that we cannot go back. I think it will just get increasingly more open and more open. That’s the way it will happen. I don’t think there is any move to retreat on any step. They will open up more sectors. Some sectors, obviously there will be a lot of sensitivity. We can talk about any specific sector, to the extent I know I’ll be open enough to answer. But I think the—I believe in India for many reasons. I think our cities are—our country’s urbanizing. Our consumer class is growing. We contributed only about 5 percent of the world’s middle class. And we will contribute to be one third of the world’s middle class by 2030. So a lot of statistics to back up, a lot of data to back up. But there will always be situations where the growth is not going to be like this. There are always going to be years which are bad, due to any number of reasons. Even now the current situation where there’s a lot of criticism about the growth dropping. Some are due to issues that we really needed to solve. You find lots of issues in terms of leverage, and these things have to be corrected. And first time you have a policy to correct it, like the bankruptcy court. Previously we didn’t even have a situation to curb these things. But could it have been corrected faster? The answer is yes. Are we moving at the pace at which we should be moving? The answer is no. Can we do things better? Yes. GST is a great vehicle? Yes. Has it been implemented smoothly? No. So I think if you take our recent history, I would say the direction is right. Sometimes the velocity is frustrating. OK? So I am of the view that the trends are absolutely irreversible. So there will be a lot of growth. Whether it will all be uniform, whether it will jump to 8 percent, 9 percent, 10 percent, I mean, I cannot say. We’ve got to execute better. We’ve got to execute better. I keep saying this—execute, execute, execute. If we can bring a lot more execution, and certain banks maybe we are doing things faster, in certain areas we got to go slower, because you can’t—it’s a big machine. You can’t do too many things at the same time. So that’s what we are doing. Q: Steve Hellman, Mobility Impact Partners. As we look forward in the twenty-first century, obviously India’s going to play a significant role. Do you see specific areas where India can actually take a world-leading role in emerging technologies, especially coming from your own personal perspective? The twenty-first century’s all going to be about artificial intelligence, or machine learning, or health care innovation, or industry 4.0. Are there areas where you see India emerging as a global leader to define the technology path forward on some of these different sectors? CHANDRASEKARAN: Absolutely. I think there are tremendous possibilities because if you really see—it’s not that we cannot execute. We have done some of the most fantastic programs. Our income-tax filing, if you see how the income tax have been completely digitized, techified, it’s just one of the fantastic platforms. Our—(inaudible)—how it has been drawn up. These are all very complex programs, large-scale programs. I mean, in fact, whole elections are conducted. (Laughter.) So there are many things we do well. It’s not that we don’t do well. Then we have a lot of programs, public programs, which we have been able to implement very well. But we don’t seem to have a consistency. Sometimes we don’t execute well. I think with all the skills we have in technology we have to recognize two or three basic facts. One is if all our problems are going to be solved, it’s going to be solved only using technology. We neither have the resources nor the time on our side to do it any other way. We have to go all out, whether it is health care, whether it is banking, whether it is tourism. Everywhere, the ecosystems are developed using tech. Everybody has to adopt technology. And they got to believe that adopting AI, machine learning, and all the technologies, you in fact create a productive dealing, in fact create jobs, and we should not fall prey to this question that we create fear in people so that the unions get very worked up—tech will come out, jobs will go. That mindset should be completely eliminated. The third thing is that we have shortage of everything. So you’ve got to get the utilization of sweating off everything that we have to the maximum. We cannot afford to waste anything. So if you take many of our sectors, because of disputes and because of NPAs, many of our assets are not functioning. We cannot have this situation. We’ve got to solve these issues fast, and we’ve got to get every asset to perform. So these are some of the things that we got to do. But whether or not we can take leadership, I think it is all a leadership problem. You have a problem in this country, OK? I don’t think that you are going a very easy way. So whether it is the West or whether it is on developing countries, India can produce a model. Education, many of these sectors, we can create technology-based solutions, which are very, very forward looking, because that one thing we have is that we don’t have an existing legacy in many of these place. Or, even if we have, it’s really too old a legacy. If it is a legacy that is functioning, then you have a problem. You cannot leapfrog. GOLODRYGA: Yeah, we should use some help with some of our apps here, as we’ve learned over the past couple of months. I think there was—right here. Q: My name is P.J. Juvekar from Citigroup. So my question is on the U.S.-China trade war. Although the phase one was signed, it looks like there’s going to be trade tensions for many years to come. So can India take advantage of that? What can India do? And secondly, related to that, you know, how is the Make in India program going, that campaign that Modi started, in your view? CHANDRASEKARAN: I think some of these things—(inaudible)—but none of these advantages are going to be one-month and two-month cycles, OK? For example, this whole coronavirus thing has impacted our pharmaceutical sector in a big way. I understand that some raw material that’s required for producing—(inaudible)—it’s only source in China, globally. There are certain medicines in India have go about 40 percent, 50 percent, 70 percent in the last one month because if the stock runs out—I was talking to all the pharmaceutical companies. They told me that, you know. They just sort of stop, because you cannot source it from anywhere else. All over the world they depend on China. So there are—there are things like that which, you know, India can take advantage of. But none of these can happen in three months’ time. OK, there is a trade war, so what can we do in 2020? It cannot be. You’ve got to have a plan. The world will recognize that it’s not good to be dependent on one nation, like China. So if you have a value proposition, absolutely you can create an industry in manufacturing, in pharmaceuticals, and every other industry. But I believe that there is a huge domestic market in India. I think we’ve got to address that, even if you take tourism, right? We get ten million people. Hawaii gets fourteen million people. Come on, right? So a huge opportunity. The tourism need not be from international travelers. I can be from domestic travelers. But there are lots and lots of opportunities for the stragglers. But we got to stay with it and we got to implement. GOLODRYGA: To the trade question, do you envision that the U.S. and India— CHANDRASEKARAN: It’s going to be a long, drawn process. GOLODRYGA: And the preferred trade nation status? Do you think—how significant is that for the U.S.? The preferred trade nation status that was taken away by the U.S. Do you envision that in whatever deal comes out of Trump’s trip to India— CHANDRASEKARAN: It probably depends on the—depends on the details, right? It probably depends on the detail. I know the top issues are India was wondering what— GOLODRYGA: It’s part of the China problem too, right, the details? (Laughs.) CHANDRASEKARAN: Well, you know, the top issues cannot be solved in one day. So we got to figure out a way of doing ten other things work. We have a very good U.S.-India CEO forum. I tell India side. So the businesspeople from both sides want to make a lot of things happen, and we meet informally also. So I think there’s a lot that can happen with India and China—or, India and the United States. Because the people like each other, people work with each other very comfortably. So it’s not different at all. But there is always going to be always one or two extra issues. So we shouldn’t bring those extra issues as the number one on the table. Then we don’t make progress. GOLODRYGA: Baby steps. Better than nothing at all, right? CHANDRASEKARAN: Yeah, yeah. Get everything done. On the big issues keep it a long way. That’s the only way. GOLODRYGA: Question. Q: Thanks very much, Mr. Chairman. Nat Keohane from Environmental Defense Fund. I have a question that touches on many of these issues around access and leapfrogging legacy, and it’s energy—and specifically energy in the context of climate and air quality. I’m curious about your thoughts on applying technology, thinking about access and so on, to meeting India’s energy access challenge, and doing in the context of the global crisis on climate change, which is something that India has not contributed to, but which it will face significant impacts from. Thanks very much. CHANDRASEKARAN: The thing on energy it’s a big thing, a big factor. And at least I can—I can say that the—there’s a lot of policy push towards the new form of energy, the green energy. And fully recognizing that sustainable—(inaudible)—issues, India is not—India is not debating or questioning whether it’s needed. It’s a very important issue. India wants to do everything it can. But obviously, it will negotiate a timeframe, negotiate—I mean, again, the devil is in the detail, OK? And on the power sector, we have totally 330 gigawatts of power. And you know, our incremental additions on renewable has been tremendous. People will always say, no, prime minister said 175 megawatts and they have done—gigawatts—and they have done a hundred gigawatts. Hundred is not a bad number. How many have so much of (thermal power ?). So it’s a big push that’s happening. At the Tata Group level, we are also shifting all our growth to renewable. And more importantly, we are also trying to do certain new types of solutions. We have come up with a renewable-based microgrid solution, which will produce from thirty kilowatts to one megawatt. And it can solve a particular village—the electricity needs of a village sort of with a fixed number of households with some small and medium enterprises. If you’re able to—we are doing it in a village in Bihar. I would say partner. And it’s operational. But you’re trying to include the cost structure, quality, everything we’re watching, then we want to scale it up. We’re partnering with the Rockefeller Foundation on this initiative. On the electric cars, we have taken the lead. We have created an electric vehicle ecosystem. So we are going soup to nuts, and we are slowly expanding. So we believe that these are bets we’ve got to make and we’ve got to solve. India won’t grow otherwise, because we have three million vehicles or four million vehicles, now to go to ten million, fifteen million. So if you don’t get in early, I don’t know how many of you know, this, in 2000 India had more vehicles than China. India had one million vehicles, China had six hundred thousand vehicles. China had— GOLODRYGA: You’re about to have more people too. CHANDRASEKARAN: Huh? GOLODRYGA: You’re about to have more people too. CHANDRASEKARAN: China has twenty-four million vehicles now, and we are hardly three or four million. So the good thing is that that expansion has not happened, positive way of looking at it. So if you can get the electric vehicles in, we’ll cast the growth up. So— GOLODRYGA: So this is—go ahead. Well, this is an issue you as a company are addressing head on, and other companies around the world continue to. I’m curious, with President Trump taking a step back, and removing the U.S. from the Paris climate accord, given the amount of energy and effort that the Obama administration put in to having India join, have you seen any impact on the effort that the government has on prioritizing climate change in India. CHANDRASEKARAN: In India? No, no. GOLODRYGA: Regardless of whether the U.S. is participating? CHANDRASEKARAN: No, no. The Indian situation is that India is very committed, regardless of the U.S. And we will convince the U.S. GOLODRYGA: Any last question? Right up here in the front. Q: This is Niyaste (ph) from TCS. Given that technology is going to drive the future, not only for India but every country, do you think that the education system has to be completely revamped? And will the group do something on this? CHANDRASEKARAN: I don’t know what we will do, but I think that we’ve got to teach the whole digital skills and our twenty-first century skills. We believe that digital collaboration, creativity, these kind of skills have to be taught early in life. And we have to revamp our whole education system at every level—at the basic level, entry level, and even at college level. I think everybody wants to get a tertiary education. I believe that it will have to be given different carrier parts, a lot of vocational have to be, and a lot of digital-based vocational training have to come in. So a lot of revamp is required for the education system. And I don’t know what we will do on that. GOLODRYGA: The conversation we’re having here in the United States as well, maybe not to the degree as India needs, but it’s definitely a conversation we’re having here. OK, well, thank you. This has been a wonderful conversation. I appreciate it. It’s a wonderful book. Roopa is your co-author there. All of you, if you haven’t picked up a copy there’s one outside. You’ll love the book. It’s been a pleasure being with you. Thank you so much. Enjoy the rest of your day. (Applause.) CHANDRASEKARAN: Thank you. GOLODRYGA: Thank you. That was great. Thank you. (END)
  • India
    Tracking Trade Tensions With India
    President Donald J. Trump heads to India at the end of the month— this week the White House formally announced the trip for February 24 and 25, with Ahmedabad, Gujarat, and New Delhi the main stops. Trump will help inaugurate a new stadium in Ahmedabad along with Prime Minister Narendra Modi, in a Houston-style event dubbed #KemChhoTrump (“How are you Trump?” in Gujarati). For weeks, press speculation has picked up where it left off last fall regarding progress toward some kind of a trade package, albeit still undetermined. India has one of the world’s largest economies and is a top ten trading partner for the United States—in fact, it’s number eight in goods and services, which means that the U.S.-India trade volume is now larger than that between the United States and France. But a growth in trade tensions has accompanied the growth in trade ties. In advance of the president’s visit, we put together a guide to some of the U.S.-India trade tensions that have persisted despite efforts to overcome them. Some of these issues are far more complex than they appear at first blush. The “Field Guide to U.S.-India Trade Tensions” provides references and links to primary documents for those interested—policy documents like U.S. National Trade Estimates, the Special 301 report, notices for hearings on the Generalized System of Preferences, Indian customs notifications, filings with the World Trade Organization, and others. Take a look here: A Field Guide to U.S.-India Trade Tensions Thank you to Erik Fliegauf for his assistance on the field guide, especially on the data and graphics.
  • India
    A Field Guide to U.S.-India Trade Tensions
    India has become an important trading partner for the United States over the past two decades, but the relationship has been marred by long-standing disagreements on everything from dairy products to intellectual property rights protections.
  • India
    South Asia Reads: February 6, 2020
    The annual budget in India and Chinese investments in Pakistan were two major opportunities to reverse declining economic fortunes in South Asia. This week's articles explain how both fell short of expectations. Plus: climate refugees in Afghanistan, weightlifters in northeast India, and more.
  • India
    South Asia Reads: January 27, 2020
    As 2019 came to a close, annual reports showed just how nations' economies and governments measured up—and how countries in South Asia slid backward on many metrics. Plus: an island settlement for Rohingya refugees that leaves questions unanswered, continued protests in India, and a new approach to counter poaching in Nepal.
  • Cybersecurity
    Cyber Week in Review: January 17, 2020
    National Security Agency reveals major vulnerability in Microsoft Windows 10; Senators urge $1 billion plan to loosen China’s grip on 5G; India to ease some internet restrictions in Kashmir; Federal Reserve Bank of New York warns a cyberattack on banks could cause major disruption; and Amnesty International suit against NSO Group heads to court.
  • India
    Scale Without Power: Global Cities in the World's Largest Democracy
    This piece was originally published in the Diplomatic Courier as part of a collaboration with the Great Powers and Urbanization Project. It was adapted from the Workshop on Cities, Geopolitics, and the International Legal Order held at the University of Pennsylvania’s Perry World House in September, 2019. It was made possible, in part, by a grant from Carnegie Corporation of New York. Over the past 25 years, two defining trends in foreign policy have gained momentum. The first, and most obvious, has been the gradual shift from the post-Cold War moment to an increasingly multipolar system, with a great shift to Asia driven by rising powers China and—to a lesser extent—India. The second trend has been the diffusion of international power and initiative from national governments to other groups—whether corporations, international organizations, nonprofits, or subnational governments. Few actors have been as busy as cities. Urban entities have stepped up their international pursuits, including in networks that resemble multilateral organizations but with cities as their constituent members. The earliest networks driven by cities themselves—as distinct from country-to-country consultations on urban agendas—emerged first in the already-urbanized, developed West, but they have expanded to include the global South. These global city networks represent a horizontal and vertical decentralization that brings both prevailing foreign policy trends together. Scholars attentive to the emergence of subnational diplomacy have noted the legal and other questions that arise with “global city” interactions unmediated by the nation-state. Unlike national-level diplomatic interactions focused on negotiating treaties or other broad agreements, city multilateral networks more often resemble peer-to-peer knowledge exchanges. They offer a forum for technology transfer and collaboration in the form of best practices on solutions to 21st century challenges like the Sustainable Development Goals (SDGs) and tackling climate change. But what happens when the power to take decisions and devise urban best practices does not reside fully with municipal authorities? As we consider the impact of city multilateral networks—often seen as a framework for action where national-level progress has been more difficult—we should bear in mind the asymmetries among constituent cities. Some, as in the case of India, enjoy substantially less power and autonomy than their global peers, and thus cannot act in similar ways. So as the movement of city networks grows, we should give thought to whether and how the asymmetries affect the functions of these networks—as well as how they shape the nature of national power in a world where countries increasingly lead with their cities on the world stage. GLOBAL CITIES IN THE WORLD’S LARGEST DEMOCRACY India is part of the larger story of a power shift toward Asia. While comparatively poor in per capita terms, in the bottom third globally, the Indian economy briefly grew larger in 2019 than those of France and the United Kingdom using market exchange rates (per IMF data). India possesses the world’s third largest military by personnel strength, and fifth largest defense budget. It is a strategic partner of the United States, and one of the four partners in the “Quad” consultation (Australia, India, Japan, and the United States) among major Indo-Pacific democracies. India is also extremely active in the United Nations, in virtually all its agencies, and in the World Bank, International Monetary Fund, and World Trade Organization. India participates actively in the East Asia Summit and the ASEAN Regional Forum, and has also invested heavily in the creation and development of new multilateral organizations like the Asian Infrastructure Investment Bank, the Brazil-Russia-India-China-South Africa grouping (BRICS), the New Development Bank (the development bank formed by the BRICS), and others, even while it pushes for a larger role in the older institutions of global governance set up in the 20th century. This rise to prominence—both economically and diplomatically—occurred while India remained, for the most part, predominantly rural. During this same period—the second half of the 20th century—large developing economies like Brazil, China, and Indonesia urbanized rapidly; by 2011 all were more than 50% urban. India’s intensive urban transition, meanwhile, is happening now. Between now and 2050, just three countries, India, China, and Nigeria, will account for around a third of the world’s growth in urban residents: India will add more than 400 million urban residents, China more than 250 million, and Nigeria nearly 190 million. In spite of India’s tremendous urban population growth, municipal governance remains the last horizon in devolution of power within the federal structure. India’s constitutional division of power allocates authority to the federal government over some issues (like defense and foreign policy), and others to the state level (such as health, law and order, and local government). The federal and state levels share authority on other matters (contracts and forest management, for example). In 1992, the 74th amendment to India’s constitution sought to devolve some authority to “urban local bodies”—but nearly three decades on, implementation of this amendment remains uneven and incomplete across the country. Indian cities, as local governments, generally receive their budgets from state-level allocations, and to add to that, municipal commissioners rather than elected mayors generally hold executive authority. These municipal commissioners are typically career civil servants employed by the national Indian Administrative Service, serving a time-limited state-level rotation in a city-level post. While some cities do have elected mayors, as well as “corporators” or other local elected leaders, the typical structure of urban governance leaves elected city leaders without the executive power their counterparts elsewhere in the world enjoy. Due to India’s global standing, and the size and importance of many Indian megacities, some of the newer city multilateral networks include Indian cities as members. Take C40 Cities, a network of nearly 100 cities focused on climate change. The participation of five Indian cities in the C40 illustrates their relevance to getting climate change right. The Indian C40 cities’ decisions in theory affect lives on the scale of a major European country: together, Delhi (National Capital Territory), Bengaluru, Chennai, Kolkata, and Jaipur are home to more than 72 million residents. For comparison, Germany’s entire population is around 83 million (all data from the UN World Urbanization Prospects estimates.) As a voluntary network the C40 creates a forum for exchange of data, best practices, and solutions on issues like urban flooding, building efficiency, mass transit, and others. City-level exchange like this, unmediated by national governments, represents a “frontier” of international policy engagement. But the C40 announcement of a new air quality network, co-led by Bengaluru and London, illustrates precisely the fault line in India’s system. Announced during London Mayor Sadiq Khan’s 2017 visit to India, the air quality network’s first workshop took place in July 2018 in Bengaluru. That gathering featured the mayor of Bengaluru, but also the chief and deputy chief ministers of Karnataka (Bengaluru’s home state), and the municipal commissioner of Bengaluru (a career Indian Administrative Service official in a state-level rotation with the city-level post). City leaders cannot act on their own even in contexts involving their global counterparts. Equally perplexing, in October 2019 the Indian government denied permission (required in the Indian system) for Delhi’s chief minister to attend a C40 gathering in Denmark. The explanation offered to reporters? That the meeting consisted of mayors, so Delhi’s chief minister was “overqualified.” These episodes underscore the governance constraints on the international activities of Indian cities, even in a context nominally showcasing a leadership role for the city of Bengaluru, and the important example of Delhi as it battles a worsening air pollution emergency. URBAN TRANSITION IN A GLOBAL ERA As India continues to become more prominent on the world stage, as India continues to urbanize, and as India’s cities continue to grow and interact with counterparts around the world, the federal, state, and municipal levels will continue to face challenges of coordination. Indian cities have become centers of innovation, leading the country’s services economy, and therefore exert an outsize economic effect. But the costs of their inability to direct their own growth and development are readily apparent in traffic, water and sanitation, insufficient housing, and myriad other familiar problems of rapid growth. As Isher Ahluwalia succinctly puts it, “the cost of unplanned urbanization is borne by not only the cities but the whole economy.” Experts working on urbanization in India have long recognized the mismatch between the importance of cities to India’s economy, not to mention national civic and cultural life, and their level of autonomy. Some of the most creative research, policy thinking, and training on urbanization issues is coming from India, like the work of the Indian Institute for Human Settlements. Calls for greater devolution of power to cities are gaining steam, such as those offered by the IDFC Institute’s Reforming Urban India report released in July, or the Indian National Congress earlier this year in their national campaign platform. Both these sets of recommendations press for devolution of political as well as fiscal power to the municipal level. But as long as such devolution remains incomplete, Indian megacities involved in international city networks will be constrained by their governance context. They will need state- and national-level colleagues to enact programs even in their own municipalities, and will likely miss out on innovative strategies implemented elsewhere. We may find that the participation in city multilateral networks provides a norm-setting push for governance reform within India, just as involvement with global trade agreements (the GATT and the World Trade Organization) has prompted economic reforms. But this will not likely happen quickly, nor evenly. And for some years ahead, city diplomacy with the world’s largest democracy will most likely continue to require national and state involvement. In this sense, the present structure of authority in Indian cities does not allow the diplomatic decentralization inherent to the promise of city multilaterals. For the time being, this means that including the cities from world’s largest democracy in urban multilateral networks will require adjustments in procedure, in scope, and most likely in ambition.
  • India
    Global Cities in the World’s Largest Democracy
    Over the past 25 years, two defining trends in foreign policy have gained momentum. The first, and most obvious, has been the gradual shift from the post-Cold War moment to an increasingly multipolar system, with a great shift to Asia driven by rising powers China and—to a lesser extent—India. The second trend has been the diffusion of international power and initiative from national governments to other groups—whether corporations, international organizations, nonprofits, or subnational governments. Few actors have been as busy as cities. Urban entities have stepped up their international pursuits, including in networks that resemble multilateral organizations but with cities as their constituent members. The earliest networks driven by cities themselves—as distinct from country-to-country consultations on urban agendas—emerged first in the already-urbanized, developed West, but they have expanded to include the global South. These global city networks represent a horizontal and vertical decentralization that brings both prevailing foreign policy trends together. Scholars attentive to the emergence of subnational diplomacy have noted the legal and other questions that arise with “global city” interactions unmediated by the nation-state. Unlike national-level diplomatic interactions focused on negotiating treaties or other broad agreements, city multilateral networks more often resemble peer-to-peer knowledge exchanges. They offer a forum for technology transfer and collaboration in the form of best practices on solutions to 21st century challenges like the Sustainable Development Goals (SDGs) and tackling climate change. To learn more about global city networks and the role of Indian cities, read the rest of this article in the Diplomatic Courier, here.
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    Cyber Week in Review: Dec 20, 2019
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  • Kashmir
    The Future of Kashmir
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    Panelists discuss recent political and military developments in Jammu and Kashmir, India’s domestic politics and democratic future, and U.S. policies in the region. ASTILL: Well, hello, everybody. Yeah, we have some sound. I’m James Astill. I’m the bureau chief of the Economist here in D.C. I have a bit of a background in South Asia. I’ve lived and written about both Pakistan—lived in and written about both Pakistan and India. I was in Delhi from 2007 to 2011. I’m sure you all know why we’re here. On August the 4th, the Modi government in Delhi revoked the special status, the limited autonomy of Jammu and Kashmir on a political argument that it was high time Kashmiris had no more rights and powers than any other Indian citizen. Of course, this was something that was coming down the line the instant the BJP won its strong majority in the last Lok Sabha election. It was an election manifesto item of the BJP’s. But in the event, Kashmiris have ended up with rather less than most Indian citizens because they have not only lost their limited autonomy—much-eroded limited autonomy; the crucial component was probably the inability of outsiders to buy land in the valley—but nonetheless, they lost those small autonomies, and they also lost statehood. So Jammu and Kashmir, that fibral part of India, the trigger for two major wars between India and Pakistan and a smaller war—an incident that many would call a war—lost its autonomy, lost its statehood, has been split into two parts. The remote somewhat Buddhist—45, 50 percent Buddhist—region of Ladakh will be separately run and controlled by the central government in Delhi, and Jammu and Kashmir together as a larger halved-off entity will also be run by the central government in Delhi. As things stand, through some impressive political legerdemain the Modi government has executed this strategy. They have a democratic mandate of sorts for what they—for what they chose to do, though that is to be tested yet in the Supreme Court. We will discuss this enormously involved topic, I think, with sort of three areas of focus. One is very much internally to India what this—what this grab by the central government means in terms of India’s institutions and how the Supreme Court responds. It’s taking its time to respond, but how it eventually responds, as it must, to this grab will be an acid test of what this means for India’s institutions and the potential repercussions of that for other parts of India, especially the periphery, of course. The status of parts of the northeast are already topics of conversation as a consequence of this—of this event. We’ll also talk a little bit about security, militancy in the valley, and the cross-border dimension to that, what this means in terms of the security of Kashmir and beyond. And thirdly, we will try—insofar as we have to do all of this, we’ll look a bit more specifically at the consequences for the Indo-Pak relationship and further beyond the foreign policy/international relations dimensions to this. And broadly speaking, we have three tremendously accomplished experts to do those three parts of this conversation. Ashutosh Varshney, Brown University, will—to my immediate right—will start off, I think, by looking at this intra-India dimension. Stephen Tankel from American University will give us his sort of throat-clearing opening thoughts on militancy and security in the Valley of Kashmir and what this might mean. And Aparna Pande will muse, thirdly, on the regional international dimensions of this. So, with that, enough from me. Ashu, what does this mean institutionally and constitutionally for India? Where are we in—you know, in even trying to answer that question? VARSHNEY: So the constitutional validity of New Delhi’s move is to be determined by the Supreme Court. And there are basically three issues there, and all will have a serious bearing on how democracy now evolves in India. One, whether revocation of Article 370, which gave Kashmir, legally at least, a lot of autonomy—politically, some—rather the revocation requires a simple legislative majority or required a constitutional amendment, which is a—which, in turn, requires supermajorities and a special process. Second, which is— ASTILL: Why don’t you—just in case some of us need a refresher, why don’t you just walk us through very briefly how the government got round that so far and what—what is its argument for avoiding a constitutional amendment? What has it done? VARSHNEY: It was not even raised, actually, in parliament. ASTILL: That’s one way of getting around it. VARSHNEY: It was not even raised in parliament. It was proposed to parliament as a simple legislative matter which will require an ordinary majority. But for scholars of democracy and for legal—(inaudible)—and scholars and lawyers, the issue is not simply rather it required a legislative majority or a special majority—which an amendment normally requires. The second part of the constitutionality is whether a state can be turned into a union territory. Can a—can a state of Indian Federation lose its status? ASTILL: Something that has never happened before, right? VARSHNEY: This has never happened before. Under Article 3 of India’s constitution, a state can—a state’s boundaries can be changed by Delhi but a state cannot be demoted to a union territory. That we have not heard. So that is—whether it’s a constitutional issue or just a simply legislative matter is also in front of the court. And the third thing in front of the court is the jailing of hundreds of leaders without a habeas corpus ruling. So why has the judiciary still not commissioned or scheduled hearings on habeas corpus or the constitutionality of the two-way change is something we will know more about in the—in the next few months. But the very fact that even habeas corpus hearings have not been scheduled is a matter of deep concern. And if they’re not, then we would have to say that the—that judicial review, which is in principle based on a counter-majoritarian idea, since the legislature and the executive are supposed to represent electoral majorities, judiciary, we are—judicial review, in all constitutional arguments, in all political arguments, is supposed to represent not the majority but the minority. So it’s a counter-majoritarian institution. And look after individual rights as well. Therefore, if the judiciary doesn’t even schedule hearings or pushes them for—towards June or July or so, we would have to sadly conclude that India’s judiciary is not standing up to the majoritarian impulses of the executive and the legislature, which is really not its job. The job of the judiciary is not to enhance executive power or legislative power; the job of the judiciary is to constrain executive and legislative power if some lines have been crossed. ASTILL: And again, just for the broadest context on this, this doesn’t come in a vacuum. This testing of the court doesn’t come in a vacuum. It comes at a time when there are considerable concerns about the rule of law and the independence of institutions in India, exacerbated, we may say, by the recent ruling on Ayodhya, where it appears ultimately that the court bent towards a Hindu nationalist lobby. VARSHNEY: Right. So not for the first time, but certainly not as ferociously ever before, an argument has emerged in Indian polity that elections are the only source of power; that our constitutionally designed independent institutions that do not depend on elections for their power must play a secondary role or tertiary role—electorally enabled power should not be challenged. Now, the judiciary is supposed to actually, in almost all political/constitutional doctrines that I have read and that I am—that my friends, who are legal—(inaudible)—who would testify to—the judiciary is supposed to knock down this argument. The central banks are supposed to knock down this argument. Some other institutions we can think of. The press is not supposed to be governed by this either. But all of these institutions, which do not derive their legitimacy or power from elections, are in a state of siege. And Indian democracy, which was—at this point there’s no doubt it’s electorally vibrant, very vibrant, but the liberal dimensions of democracy, which have been weaker in the past also than its electoral aspects, are certainly in a state—are being attacked as only once before. That was during the Emergency. ASTILL: Sobering thought, which we can return to. Stephen, let’s switch to the kind of related but quite distinct, actually, area of security and militancy. What would you—so we have, as Ashu mentioned, a great suppression of the citizens of the valley right now, including their leadership, including their media. But there will be, as Ashu says, a degree of decompression. Things will return somehow somewhat to normal soon. What would you expect to see then? TANKEL: Sure. I think—I mean, first, I think it’s safe to—it’s a safe bet to say that this has clearly fed grievances that were already, you know, quite robust, especially in the valley. Talking to security forces and officials there for a number of years, I mean, it’s been—it’s been articulated clearly to researchers and scholars the sense that it’s a lack of weapons and it’s a securitized climate that is sort of keeping the lid on more than ability to address, you know, underlying risk factors that are going to lead to militancy there. And India as been, I think, you know, on guard against the formation of new organizations and infiltration of terrorist groups, although we still get a couple hundred militants crossing the Line of Control annually. So there’s been this—you know, there’s already—it’s already a very securitized situation. The situation has been further securitized. And I think what’s going to be a challenge for India is as it sort of does try to decompress, how it does that in a way that continues to keep the lid on to the degree that they’ve done. And I think that in part goes to the way in which militancy has been evolving in the region. I mean, a big part of this is, obviously, the activities of Pakistan-supported groups, most notably Lashkar-e-Taiba, Jaish-e-Mohammed, Hizbul Mujahideen. And those groups, beginning around—I guess in probably 2012/2013, began trying to ramp back up their activities. And we saw higher-profile attacks beginning around 2015, and we’ve seen at least one a year more or less, and sometimes two or three of year, several of which that have spurred responses from India against Pakistan. But alongside that has been growing protest movements for a number of years—nonviolent, also involving stone-throwing, things of that nature—that at times some of these groups have fed by providing money or try to stoke resentment, but are almost entirely indigenous, really, at the end of the day. And the suppression of these protest movements and of individuals has further stoked militancy, and I think the Pulwama attack earlier this year is a very, very good example of that—suicide bombing that killed over forty people done by a Kashmiri Muslim who, if memory serves, I think had been arrested five different times by the authorities, right? And so it’s the potential for militant organizations—in this case it as Jaish-e-Mohammed—to leverage these individuals who are becoming radicalized by this process. But at the same time, I think there are two other developments that I would briefly point to. One is the cooperation and competition that exists between these different organizations. And so although one organization may claim credit or one might be out front, behind the scenes I think there’s been a pooling of resources at times between LeT, JeM. For a little while they were pushing Hizbul Mujahideen out front because it was seen as more indigenous, and so that gave the sense that this was an entirely indigenous event. But simultaneously competition among them, and that can lead to outbidding. And that highlights, I think, the other development that’s worth noting, which is that among some Kashmiri youth who are radicalized or prone to radicalization, there is I think frustration or lack of confidence in these organizations because they are seen as having failed over time. That on the one hand opens the door potentially for groups like al-Qaida and the Islamic State, although I think we shouldn’t make too much of that at this stage. On the other hand it also means that there’s the potential for more disorganized violence, which nevertheless may get laid at the feet of these Pakistan-supported organizations. And so, you know, that has ramifications not only for the security situation in Kashmir, but also for relations between India and Pakistan. ASTILL: So, to try to kind of summarize what’s complicated, it’s a tangled knot. There are for sure, when we see violence—and perhaps logically we may expect an uptick in violence in the valley—in Delhi they will scream that it’s all Pakistan’s doing, that it’s all cross-border. Actually, it may be. It need not be. It’s perfectly possible that internal grievance and actually organized groups alone and currently on the ground in Kashmir are adequate to drive a degree of protest—violent protest, insurgency even, but there will probably be enough foreign involvement for Delhi to be able to plausibly claim that the Pakistanis are involved somehow. TANKEL: Yeah. I think it’s also notable that at the very least it appears that at this stage Pakistan has been restraining its organizations and trying to make its play in the diplomatic sphere. It’s questionable how long that restraint lasts on the Pakistani side. But again, it’s also questionable whether that restraint really matters. If, you know, locals in Kashmir are able to source explosives or get their hands on other weapons, they can act largely on their own, potentially, you know, only in name of another organization across the border. And to the degree to which these organizations are able to maintain an infrastructure in Indian-administered Kashmir and provide assistance, you know, it’s not as though during the height of the insurgency every attack that was taking place was being supported or directed from across the border. And you know, this—what’s happening now creates the potential for, you know—for more Pulwamas, as it were. At the same time, I think, you know, the other—the other point I would make is it’s a heavily securitized situation, and so the potential to keep a lid on attacks is still there. But what India will need to do to keep a lid on those attacks runs counter to their underlying rationale for revoking 370 and 35A. If the whole point was to develop, you know, Jammu and Kashmir and integrate them more into India, and you need to continue to securitize the environment in order to avoid an uptick in attacks, it’s going to be very, very difficult to accomplish both of those things simultaneously. Which I would argue has been a large part of the problem all along, is that when India has talked about normalizing the situation, to normalize the situation would mean to give voice to what people on the ground actually want. And New Delhi has not had any desire to do that for years. I don’t see that changing now. ASTILL: When you say—and I understand that you caveated this—but when you—when you say that the degree of grievance and the degree of disaffection with those same militant groups that have been on the ground for a long time in Kashmir is such that you might have conditions welcoming to Islamic State or al-Qaida, the distinction you made between Islamic State/al-Qaida and Jaish or Lashkar-e-Taiba is that they have a more internationalist vision or that they’re more ruthless? Or what’s the distinction that you’re making there? TANKEL: More of a global vision. ASTILL: Yeah. TANKEL: Fewer ties to the Pakistani state. And this sense of—you know, I mean, when—to the degree that individuals—and one wants to be very, very careful about painting with too broad a brush. But to the degree to which more globally oriented organizations have been able to find purchase, it has at times been because individuals on the ground cease to become—you know, they no longer see value in sort of their—you know, a national or regional identity, and it’s much more of a—of a global identity. Or because these entities are seen as having credibility in that they have no ties to any state, they’re not beholden to local politics, they’re good online, what have you. And this is something that has repeated itself in various places. We’re here to talk about Kashmir, so I don’t want to talk about other regions around the world. But you know, I—Kenya primarily faces an al-Shabaab problem, but there are individuals who are, you know, radicalizing online, disconnected from Shabaab and motivated by Islamic State. Same thing—we’ve seen that in Afghanistan. So that—it opens the door for that type of issue as well, which is—which is separate. It is a—it is not the same problem as a Lashkar-e-Taiba, Jaish-e-Mohammed problem. And it has an impact on how LeT and JeM and Hizbul Mujahideen may behave. ASTILL: Yeah. Let’s leave that there just to lay down a marker, Ashu. I want to move on to Aparna, but we’ll come back to this. I am particularly interested in the kind of—the internal political optics of this. You know, the Modi government has just worked out how to win stonking great electoral majorities by being as belligerent as you like against Pakistan. And it will present an argument that it’s done the right thing in Kashmir, that it’s justified by whatever cross-border its own actions have elicited. If the violent, we may expect, protests that erupt in Kashmir—we may expect; there may not—come to seem far more domestic, I think the politics shifts internally in India in a potentially interesting way. Aparna, can you—can you kind of widen the focus for us? What is—what’s going on in Pakistan? What does it mean for the regional relations and beyond? PANDE: Thanks, James. I’d like to thank CFR. So both countries have actually looked at Kashmir through a slightly different lens, and the way they portray it to the international community is also different. For India, Kashmir has for decades remained what they see as a bilateral or internal matter; whereas, for Pakistan, the aim has always been to internationalize the issue as much as possible. So India’s argument is it is Indian territory, the instrument of accession, and elections mean the people want to stay with India. Pakistan’s argument is that a plebiscite should be conducted as per the U.N. Security resolution—which actually the last one was passed in ’57, which is before a large number of us were born in this room, and so you may need a newer resolution. Till quite recently India used to say that the Simla Agreement of 1972 is the one by which the two countries should discuss. In recent, actually, months, India has started to say that when India says Kashmir and discuss Kashmir with Pakistan, it only means the Pakistani part of Kashmir, and there’s no discussion on Indian Jammu and Kashmir. Pakistan, however, treats the Simla Agreement as something that was imposed, and therefore does not believe it needs to abide by that. What has happened in recent months is I’ll sort of go along with Stephen and say that Pakistan’s dichotomy today is that on the one hand it would like more pressure on India which is internal and from domestic jihadi groups. However, as of now, any jihadi attack or attack inside India—inside Indian Kashmir will be the first explosion will come on Pakistan. And when Pakistan faces international pressure at FATF, IMF, and the international community, it would not want an attack which can be traced back to Pakistan. However, no attack and no pressure on India domestically also does not suit the Pakistani military establishment. So it is caught between trying to push for a diplomatic pressure on Pakistan through the international community and not wanting—and ideally not wanting any attack inside India, and yet that may not actually happen because it’s most likely that a terror attack will happen sooner or later inside Indian Kashmir. One point I’d like to make—like to push here is that India believes it has resolved the issue, according to New Delhi, and it has presented the world with what it sees as a fait accompli, and that India’s friends should give it the benefit of doubt and allow it time to restore the situation. India is fortunate that as of now Pakistan’s attempts to raise the matter at the U.N. Security Council have not succeeded, and there is by and large an international consensus that terrorism is not acceptable. However, there have been growing concerns in the last few months. The U.S. State Department, German Chancellor Angela Merkel, the French president have reiterated that India needs to do more, especially with respect to the situation inside the valley, and that the situation is not sustainable. India has sought—has—to avoid internationalization. However, I would argue that the recent move has actually resulted in the exact opposite. This is the first time since the 1990s that there have been two hearings on Kashmir on the Hill, and that people are actually talking about Kashmir and domestic situation of Kashmir, which India would not have wanted. And nobody’s pushing for a resolution of Kashmir right now, but the issue will—till the time that you actually resolve the issue legally and properly in the eyes of some, it will remain something that New Delhi will have to deal with. A different American, French, German, or British leader can bring the issue back to the U.N. Security Council. China will always support Pakistan. What India needs to be concerned about is how do the others—other countries, which are Indian friends and partners, how do they view India’s policies, and how long can India hope that the international community will give India the benefit of doubt. ASTILL: Thank you, Aparna. I think you may have explained to us why India didn’t leap at President Trump’s offered meetings— PANDE: Yes. (Laughter.) ASTILL: —on this issue. Let me—let me briefly—and then I’d like to turn it over to you, the audience, so you’ve all got a decent opportunity to ask your questions—let me just briefly try to play devil’s advocate here. We know that the—that the highly damaging Pakistani (4G ?) state, the military state, has been—has lived on this fantasy of an Indian threat entirely based around the uncertain status of the Valley of Kashmir, and that, you know, Pakistani (4Gs ?) especially will cite you chapter and verse of long-ago Security Council resolutions and, you know, sort of storied dreams of plebiscites, things that have never looked remotely feasible for decades now. Is there in any way a realist/pragmatic argument that one could attach any credibility to that India has in a brutal way dispelled some of that fantasy; has made the status of Kashmir entirely no longer a subject for international debate; and though we are living through an illiberal, undemocratic, and reprehensible moment in India, it need not have negative consequences for the region? Could you attach any hope to that—(inaudible)—the valiant devil’s advocacy argument? PANDE: Sure. VARSHNEY: Illiberal moment for sure, but not undemocratic. Electoral democracy is thriving in India. Illiberal for sure. So I think we’ll have to draw a distinction between the— ASTILL: I think—I think Kashmiris might take issue with that. PANDE: (Laughs.) So, yes, I mean, I do believe that New Delhi views it just as you explained it, that sort of let us try and sort of present the world with the option that sort of, you know, Jammu and Kashmir— ASTILL: That it’s a fait accompli, yeah. Yeah, yeah. PANDE: Yeah, it’s fait accompli, try and avoid intervention. Sort of if we recall a few months ago, President Trump did offer in July of this year to mediate. India is concerned that the American withdrawal from Afghanistan could lead to pressure on India as a quid pro quo for Pakistan helping in Afghanistan, so try and remove the options which come in the quid pro quo in case Kashmir is one of those. So present the world, present Pakistan, and then see how the world reacts. I mean, the only part I would add to it is this sort of—this could work out if in the next few months/years there’s actual democracy and development in the valley. But if in the next few months/years we are sort of—we see just a repetition of what’s happening right now, then I think they will have a—New Delhi will have a problem in selling it. ASTILL: I mean, to both of you, because both of your comments touched on this—all three of you, actually—do you feel that the valley is winnable by Delhi? Do you think that there are things from this base that the central government could do to mollify public opinion in Kashmir? PANDE: Yes, but they would have to do things which they may or may not be very comfortable with, which is sort of trying to sort of, first, release the politicians, try and restore a sense of normalcy in the valley, because without that you cannot bring in the money and the development that you seek to bring into that region. And try and make the valley feel that it is part of India, not a territory which you need to keep under your control. ASTILL: Yeah. Thanks, Aparna. Could I just have a brief show of hands, who might like to ask a question in the next thirty minutes? Just a fluttering of arms in the air. OK, fine. (Laughter.) Well, then let’s start with some. Gentleman here. If you’d just tell us your name and address a short, brief, pointed question to whoever you— Q: Yes. My name is Islam Siddiqui. I’m former undersecretary of agriculture in USDA. I have been at—I’m part of the Indian diaspora and a very strong supporter of secular and democratic India. I think what—events in Kashmir, I have a question for—especially, Aparna, for you. And you mentioned that the last three—India’s relationship with—New Delhi especially—with Kashmir has been very tense from the very beginning, 1948. Now these actions of August 4 or 5, they are creating new, you know, dynamics for—if we want to make Kashmiris to feel more Indian, what Mr. Modi has done is just the opposite what he should have done. And now my question is, how do we put the genie back? Because I would like to see the situation becomes what had existed before August 4. Thank you. ASTILL: Let me—let me add something to that question because I think it’s the question I just asked now. So of course, you know, the central government will always say development is the answer; these people just need economic development. It’s the standard response in this kind of situation. How sufficient would economic development—which has never come to the valley—be? Or do people feel that their sovereignty has been removed from them, and they will not be mollified unless they’re given some greater freedoms than Delhi imagines them enjoying? So certainly perhaps a return to statehood, and perhaps something more. Do you want to comment on that, Ashu? VARSHNEY: Yeah. So this is certainly not a way to win hearts and minds, it should be clear. Delhi could in principle—and Jaishankar—Foreign Minister Jaishankar has made this argument in a couple of interviews that we need time to slide back to normalcy. But that argument—if the argument only is that development will deliver Kashmiri hearts and minds to India, then first of all that argument is wrong in principle because it’s democracy and development which might do it, as opposed to only development. Secondly, if the—if the security situation remains tricky, it’s not clear why private investors would go into the valley. Private investors will go into Jammu, and there is enough money to be made in Jammu. And now you can legally buy land there if you’re a non-Kashmiri. You can buy land for whatever you have to do. So they will do it in Jammu. Why would they go to the valley, where there might be attacks on their—on their business installations? So I think—I don’t see how development alone, were it to happen, would do it, right? There has to be some that turn to democracies, you know, however wish to conceptualize it, that important experience of life. ASTILL: And on that, just to touch where I started, how important is statehood, do you think? VARSHNEY: It seems to me if Mr. Modi loses the next election—and as of now we can’t say anything about that, whether he’d win or he’d lose—and it seems to me if the Supreme Court allows simply a legislative change, then the next government can change the special status, through its control over the two houses. So I—if it’s simply a legislative matter, then Kashmir’s older status can return. If it’s a constitutional matter, then we—then we’re in very different political— ASTILL: But are you—when you say that they need not only development but more democracy, is it possible to—Steve, I’ll come to you—is it possible to envisage that without a return to either statehood or even super-statehood? VARSHNEY: Mr. Modi’s proposal is that as a union territory, Kashmir—Jammu and Kashmir can vote in elections because they can have their own legislative assembly. That assembly will be reporting to Delhi, right? But a legislative assembly can come about as soon as the situation is normal, or somewhat normal. I don’t see how the Valley of Kashmir will accept their argument. The Valley of Kashmir at the very least would like the special status back. ASTILL: Yeah. VARSHNEY: And if you want to say that special status was bogus and had been substantially politically attenuated in any case, well, its symbolic importance remains. Its symbolic importance remains. ASTILL: The land issue is—was quite a substantial difference, right? VARSHNEY: It may be that they’re able to get the special status back, but they may not be able to hold on to Article 35A. There was something obviously very troubling about the fact that non-Kashmiris could not buy land in Kashmir at all. ASTILL: Yeah. VARSHNEY: There was something—it’s not clear that even—from either liberal or democratic perspective would support that. There was something terrible about that. ASTILL: Steve. Let me— TANKEL: Yeah, I just wanted to add a couple points. One, I agree with Ashu that development alone is not going to solve this problem. I think that the attempt to sort of overlook the sentiments of a whole lot of Kashmiris in terms of their desires for greater autonomy is—seems very, very naïve to me. But I would also add to that that when it comes to sort of the question of democracy and politics, that it’s not—there’s these macro questions about what happens with 370, but it’s also the fact that for a long time the politics in India-administered Kashmir didn’t work particularly well. There was a fair amount of meddling and patronage and everything else and the sense that New Delhi was involved in negative, not positive, ways in the politics of the region. And unless that changes as well, I think it’s very, very hard to see how the government accomplishes what it wants to. I would also, just to reinforce Ashu’s point and expand on it, I think there’s this question of development for whom? Right now development has taken a step backwards. Terrorism is down, investment is down, it’s very, very hard to see how it’s going to come anytime soon. But when it does, I think there’s real questions about who that development is going to benefit in J&K. And then finally I would just circle back and expand on the point that I was making earlier, which is that all of this idea of normalcy presumes a future in which there are not hundreds of thousands of Indian forces on the ground trying to keep a lid on the situation. And this idea that development is going to magically, for all the reasons I and Ashu and others have laid out, wipe away all of these grievances is again, I think, hopelessly naïve. And so as long as New Delhi is concerned about the security situation and has all of these forces on the ground, I think it’s very, very hard to see how the type of integration that is envisaged actually occurs. ASTILL: Yeah. Yeah. PANDE: Just a brief point, brief. ASTILL: Just briefly, Aparna. PANDE: One, for the last seven decades the aspiration of a large number of people in India has been to acquire statehood, not to be deprived of statehood. So I just thought of—you know, it’s like—so to say that, you know, you don’t care whether you are a state, you should ask Telangana or the—I mean, the Bodo still demand. So there are parts of India which still demand statehood. So reversing it is something very contrary for the last seven decades. Quick, a small point, Article 35A may seem unnatural, but we must not forget that there are many parts of India where outsiders cannot buy land. I come from Uttarackhand. I can buy land there, other Indians cannot. So Helian tribal areas in India do get special status and outsiders are not allowed to buy land unless you are a domicile of that area. It’s not sort of—so it’s—there are many other states which have that as well. ASTILL: It’s not so unusual, yeah, yeah. Let’s kick it back to the audience. The gentleman at the back there. Q: Hi. Puneet Talwar, a former government official. If you were to construct a back channel between—involving Pakistan, India, Kashmiris, who would you have in the room in that back channel? Secondly, should the United States play a more aggressive role? And if so, what would that look like? ASTILL: Aparna, do you want to respond to that? PANDE: Actually, there have been a lot of track twos, track one-point-five, track threes over the last few decades, and they haven’t really gone anywhere. And part of the reason is that it’s the same people who come from both sides. From the Pakistani side you find the military establishment and its approved people who come. And till you—till that is changed, I don’t—and from the Indian side again, sort of a set number of people. So till the composition changes, which it will not because each government does arrogate to itself, especially the Pakistanis side, who goes to these track twos, I don’t believe these track twos will make any difference. Secondly, with the change that India has undertaken right now, the Indian government will sort of—till it is—till the issue of Kashmir, Article 370, the repercussions is settled, I don’t really see any track two, track 2.5 going anywhere except people will have an opportunity to meet in really nice places around the world. Wait, the second part of your—yeah, the U.S. I sort of—I do believe the United States, both the government as well as the legislature, have sort of—have expressed their views. I don’t believe sort of saying more than that will make a difference to anybody right now, but I do believe that what is being done should not be stopped either. I do believe as friends you’re supposed to tell your friend when you don’t agree or when you believe they are—they’re doing something which you don’t agree with or you don’t think looks good. That’s my take. VARSHNEY: If there’s a Democratic administration—if I may?—next year, will that change America’s—Washington’s position? PANDE: Official, I don’t think so. I mean, President Trump did offer to mediate and the pushback immediately came that said that, you know, we are happy to mediate if and when both India and Pakistan ask us to do so. So I don’t think that part will change. Will the number of hearings? Let’s say we are in the same situation one year from now and Kashmir is—continues the way it is today, then yes, the hearings on the Hill and the statements will be worse. But I don’t believe— ASTILL: And broadly the continuity in U.S.-India relations, the idea that there’s a bigger prize out there than Indo-Pak relations and piddling Kashmir, it is now pretty bipartisan and conventional wisdom in this city, I think. TANKEL: I remember asking somebody at the Embassy a while ago in Delhi, every time I would go I’d say how often are you visiting Srinagar or the valley, and over the years the number of times that people were going up there was declining because it was becoming less and less of an issue in the bilateral relationship. ASTILL: And then only to ski. TANKEL: So my, just for what it’s worth, I think there’s—right, it’s also important to distinguish between whether the U.S. position on how India and Pakistan and the Kashmiris sort out that—the final status versus raising the—to Aparna’s point, the question of human rights and repressive policies. Those are, I think, potentially two different issues for a Democratic administration, and I think there’ll be continuity on the former, but more focus on the latter. ASTILL: Yeah. Yeah. VARSNEY: Aparna, do you agree with the claim often made that Democratic administrations in Washington tend to care more about human rights than the Republican administrations? Do you think that that particular argument is supportable at all? PANDE: I don’t, actually. I sort of—let me brief this way, that for the last two decades, ever since President Clinton and the improvement in the deepening of the economic and strategic aspect of the India-U.S relationship, there has been a sort of change, or let’s say a reluctance by either side to push the other on issues, which may have sort of happened more in the ’70s and ’80s. So India will not talk about a foreign hand and the U.S. will sort of, except for—let’s leave out the nuclear tests of the late 1990s—the U.S. does not sort of again talk about mediation in Kashmir. So there has been a change and I don’t believe that will change, irrespective of who the president is next November. President Obama, it did not change. So President Bush, President Obama, even President Trump to some extent, there has been a continuity you can see. And I believe that the last two hearings in the last one month are not because of any change in how the current administration views India. It has more to do with what is happening in Kashmir. So it’s not a narrative which India needs to change. ASTILL: A bit of muscle memory—a bit of muscle memory on the Hill. PANDE: Yeah. So it’s not a question that India—the narrative India needs to change in this is that India needs to do more on the ground in order to—in order for things to move ahead in this city. ASTILL: Let’s look for other questions. Any women? (Laughter.) Alyssa (sp)? Yes. TANKEL: There you go. (Laughter.) Q: Hi, guys. I’ve got a couple of things, I guess. First of all, I actually spoke—oh, sorry. Uscerf Ausli (ph) from OSD Policy. I actually spoke on the Hill last week about Kashmir and I feel like there’s a couple of things being said today that don’t really align with kind of ground realities—one being this development, kind of like a BJP state-line narrative that development in Kashmir is the issue for why India entered and changed its status. But if you look at all the economic indicators for Kashmir, it’s not in the lowest of India; it’s pretty middling. It’s—and considering the fact that it’s been very heavily militarized, very heavily not-tourist-friendly, it’s actually not like—this economic development argument doesn’t hold a lot. The reason people haven’t come in—like last month a congressman was denied entry—is because so many human rights observers and impartial observers aren’t allowed into Kashmir. So it’s kind of a communications black box. For the last four months the internet has been off. Landlines got turned on maybe like a month ago, texting is off, cell phones are off. So it’s very much—it’s not just that they took away special status; they took away a lot of human rights and a lot of just regular daily activities from people. So I just feel like—I guess I’m having a hard time with this conversation. I think—I actually have a question, which is my understanding was that—and again, because of the communications blackout, I think it’s hard to know what’s happening on the ground right now—is that in Jammu the government had thought people would be very, very happy about this change of status, and that people weren’t happy and they took away the internet in Jammu. And I was wondering if you guys could speak to that, because I really don’t know. ASTILL: So your question is how is this going down in Jammu? Q: Yes. That’s my question. ASTILL: Ashu? VARSHNEY: Well, historically, as well as in more recent times, there’s no doubt Jammu, which is roughly 44 percent of the state and is in the majority. A lot of you know, but perhaps all don’t know that it’s in the majority part of the region of the state—65 percent, roughly 65 percent, now I think 63. But anyway, 63 to 65 percent Hindu and 32 to 35 percent Muslim has been Jammu’s demographic makeup. And Jammu has never gone with the valley. Never. At no point. And even recent—we have some recent survey data to show that Jammu’s identification with India is not the issue. Jammu seriously identifies with India. Ladakh also identifies with India. The problem is the valley, which is where 55 percent of the state’s population lives currently, and it’s 96 percent Muslim. ASTILL: To the extent—and we were discussing this in the green room earlier—that in Jammu they’re perfectly happy to be controlled by Delhi, to be reporting to Delhi, because they’re no longer being bullied by the Muslims up the road, as they—as they may say. VARSHNEY: Yeah, so both Ladakh and Jammu have—there’ve been movements also, at least in Jammu there have been movements. Ladakh is—Ladakh is sort of a Sleeping Beauty, right? So it’s not—not too much happens there unless there’s a—like Wales. Sleeping Beauty. You know, as they were telling me, it was for Wales as opposed to Scotland. ASTILL: I’ve never heard that before. (Laughter.) I like it a lot. VARSHNEY: In national literature that’s what Wales is called when you compare Wales and Scotland. (Laughter.) Anyway, the point is—the point is that Jammu and Ladakh have felt the domination of Kashmiris and the valley acutely. And that’s 45 percent of the state. Fifty-five percent is in the valley. So that complicates the internal political situation immeasurably, if you will. And they have no trouble being ruled by Delhi because they are not going to be ruled by the valley now. Historically the attempt of Sheikh Abdullah’s party was to be a party of all parts of Jammu and Kashmir. To some extent they succeeded for a little bit of time, but they didn’t on the whole, and also Sheikh Abdullah was incarcerated for such a long time. So you don’t have a meeting of minds or merging of hearts here between Jammu, Ladakh and Kashmir. They have resented Kashmiri dominance of the state. ASTILL: Yes. Well, thank you for that. Another question or two. Gentleman here? Yes? The gentleman here with the beard, actually. Q: We both have questions. (Laughter.) ASTILL: Oh, of course. Twin brothers sitting there with their hands up at the same time. Thanks, guys. One after the other then. Q: Hi. My name is Razi Hashmi. I’m a Term member and also with the State Department. So with both the legislative and executive branches being denied access, the communications blockade, the closing of the mosque in Srinagar, how do we expect to hear voices of the Kashmiris to be elevated on what they truly want? So I know that’s kind of similar to Uscerf’s (ph) question, but I really—I do honestly want to know how are we supposed to hear from Kashmiris if we can’t hear from Kashmiris? ASTILL: Who would like to— VARSHNEY: So I think the government’s argument is clear, whether you believe it is a separate issue. Government’s argument is that as soon as we are near normalcy there will be elections. The elections will be for the state assembly, which would report to Delhi. Right? Their argument is very clear on this, that there will be elections at an appropriate time. Now, they think it should happen sooner than later. We don’t know when that’ll happen. We absolutely do not know when that’ll happen. And if the idea in an election that you should be in control of your destiny and not be ruled by Delhi, that’s off the table and sadly, one element of democratic aspirations will not be part of even that election. ASTILL: Do you think Kashmiris would boycott an election? VARSHNEY: Most probably the valley will boycott the elections. ASTILL: Aparna? PANDE: Just like to add on that from the government’s perspective, they have started to ease the restrictions to the extent that they can control them. So they have restored some of the landlines, some of the cell phones, but only those which they can control. They have sort of—they’ve also sort of had those local body elections. So you may or may not believe what they are doing, but from their point of view they are easing it and controlling it. And they would ideally like political leaders—and I’ll draw on what Stephen mentioned earlier, they would like political leaders who are not the old political leaders. They would like a new political class to emerge. Will that emerge? I don’t know. We’ll have to wait and see. Because at the end of the day, Kashmiris would like to be governed by people they believe will represent them. And so if this experiment succeeds, then there will be democracy and development. Otherwise, there may be a bigger challenge on their hands six months from now. TANKEL: Yeah, could I just say I think, taking on board what both of my colleagues on the panel have said, I think the answer to your question is it’s very hard to hear from Kashmiris right now because of the present situation. And it is entirely unclear when all of these restrictions are going to ease and it’s not clear to me at least—maybe it is to somebody else—whether this is proceeding along the timeline of what New Delhi had actually envisioned or not. My sense is that this is dragging on considerably longer than they might have anticipated, based on conversations that I had when I was in Delhi, when this was going down initially. Although that may have been the interlocutors with whom I was speaking in the government, and others may have had other ideas. But I think in answer to your question and to the—to other questions about how do we know what is happening on the ground? I just—it’s incredibly frustrating, but I think the answer is to a large extent we don’t, and that is a major part of the problem. ASTILL: I guess just a brief point of information from you, Ashu, that the Supreme Court has taken a habeas corpus petition, right? And so— VARSHNEY: Not yet. ASTILL: It has not? VARSHNEY: No, no, sorry. Petitions have been admitted, but hearings have not— ASTILL: Hearings— VARSHNEY: I’m sorry. I’m sorry. Habeas corpus petitions have not been admitted. On habeas corpus. ASTILL: Is that right? VARSHNEY: But on Article 370 and—petitions have been admitted. ASTILL: Right. OK, thank you. Other gentleman with a beard at the same stable. VARSHNEY: But the habeas corpus hearings have to be scheduled very quickly, right? Twenty-four hours, forty-eight hours. ASTILL: Yeah. Yeah. VARSHNEY: No, the petitions have not been admitted. ASTILL: Yeah. OK. My mistake, thank you. Q: Hi. Samir Alwani from the Simpson Center. I’m just wondering a little bit about in the grand scheme of things, these actions that India has taken, do they give any of its partners, including the United States, pause about whether this is an aberration, sort of a one-off, Kashmir is sort of the unique situation, or whether this presages sort of a more illiberal turn generally, and then what that means for future relationships, partners which are the community of Western democracies. ASTILL: I feel we’ve been dancing around that a little bit. Aparna, do you want to kind of give a succinct response? PANDE: Sure. I’ll try. The second part of your question, no, I don’t think that most countries choose their friends or allies or their partners based on norms. They by and large do it based on strategic interests. So India still remains important on the economic and strategic front and as long as it remains important on that, I don’t believe any of the Western or non-Western countries will start to change their views on whether or not India is a partner. On the first, yes. I mean, there are those who believe that there’s a trend, but then it’s a global trend. So at some level the argument can be made that there’s a rise in nationalism, populism, illiberal democracy, all around the world. And India is not the only country which is experiencing it. So if there’s a global trend, then you are more willing to give countries benefit of the doubt and wait, especially countries which have only had institutions for seven decades, unlike many others which have gone through two hundred, three hundred years and still are facing challenges on the democratic front. ASTILL: We’ve got five minutes left, so let’s go back to the audience. Yes, here. Gentleman here. Q: Steve Kaplan. It sounds from what the panel’s been saying that at best this is a barely manageable, barely controllable issue for the next ten or twenty years, because of the difficulties in winning the hearts and minds, if not the impossibility of that, of the 55 percent in particular. And secondly, what hasn’t been talked about that much, the issue of whether Pakistan, the Pakistani military, could ever accept even a mollified 55 percent. Comments? ASTILL: Show of hands. I mean, do you accept that characterization? Does anybody think this is going to end well in the next decade or two? PANDE: No. No. No. TANKEL: No. VARSHNEY: But the Pakistani— ASTILL: Stephen, you want to give a more articulated answer, it seemed to— TANKEL: Well, I mean, I think it’s also right, important to recognize that for the last couple decades, that for a long time India has been the status quo power in the India-Pakistan dynamic, and that India now has attempted to change the status quo to its advantage, and that for several decades now it has managed to sort of weather the storm and ride this out to a point that now it has made this move. And I guess another way of asking that question is, is India prepared to just keep a lid on this and weather the storm for another ten or twenty years, if that shifts the status quo in a way that suits it sort of at the very least domestically? And my sense is probably yes. Would Pakistan—will Pakistan accept that? No. I mean, that is very, very hard to imagine. ASTILL: Aparna, do you want to add to that? PANDE: I just wanted to add on to Steve that the Pakistani military establishment will never accept Kashmir unless Kashmir forms part of Pakistan. So till the time that they change their view, that isn’t changing. ASTILL: I think we have time for one more question. Yes. Q: I’m Jennifer Hendrickson, White House Foreign Affairs Committee, and thank you so much for this conversation. I was wondering if you could comment a little bit about another significant power that is proximate to this situation, China, and how developments might impact their thinking about the region and other territorial disputes that they have with India and, frankly, other neighbors? ASTILL: Sure. Aparna again? PANDE: So on Kashmir, actually China’s stance has been very clear for the last three, four decades. China is the country that supports Pakistan on Kashmir. China is the country which brings Kashmir if possible to the U.N. Security Council whenever required. And China has part of what India claims on—as Kashmir, which is the Aksai Chin area, that China controls it. And so—and so when India undertook the recent move, China was one of the first few countries to object to it, saying that it impinges on Chinese security. So China will remain involved and will continue to support Pakistan, not India, on the Kashmiri dispute internationally. ASTILL: What is the potential, actually, for this to exacerbate Indo-Chinese border disputes? PANDE: So India-China relations are more likely to exacerbate on the other side, because this side China more or less has Aksai Chin, so that—so it’s going to be on the Arunachal— ASTILL: On— PANDE: —the northeast side. ASTILL: Yeah, the northeast side. PANDE: That is where the— VARSHNEY: Arunachal. ASTILL: Arunachal. Arunachal. PANDE: Arunachal. That is where Tawang and that area that the India-China border tensions will take place, not on this side of the border. Or maritime. ASTILL: And the dynamics of those disputes will—China is a—is a more calculating power than— PANDE: Much more calculating, and I mean, militarily and economically more capable and powerful. ASTILL: Yes. Yes. Let me give you all a final word. What is the thing that you are looking for now on your—on your thread of this conversation or another? VARSHNEY: What is it that you would like—you would want to happen, or what is it that is likely to happen? Which. ASTILL: Are you asking me or that’s what you’re asking yourself? VARSHNEY: I’m asking you which of—those two are different— ASTILL: So the gentleman characterized this conversation very well. There is a degree of concern on multiple fronts. There is no discernible optimism from any of you that this is going to unpick the knot that Kashmir has been in in Indian domestic politics and regional geopolitics for considerable time. What is the thing that most worries you, I guess, or what is the thing that would reassure you somewhat in the— VARSHNEY: Jammu Ladakh will surge ahead and Kashmir will remain deadlocked, the valley will remain deadlocked. And that, to some, may be a matter of considerable comfort if two parts of the state surge ahead, which I think they will. But I—but the fact remains that the valley is politically central to—or central to Indian politics in the way the other two units are not. I’m not saying they shouldn’t be, but purely empirically speaking. Therefore, the likelihood of continuing deadlocked in Kashmir Valley is to me a matter of great concern. ASTILL: Thank you for that. Steve and then Aparna, thirty seconds each, no more. TANKEL: Two points. One, I think we’re unlikely to see a return to the levels of conflict that we saw during the 1990s or early 2000s, but the security situation has arguably become more unpredictable, so even if India can weather that storm I think that unpredictability in that neighborhood is cause for concern. And then to respond to Samir’s point, or question, while I would agree with Aparna that this probably doesn’t change the trajectory of the U.S.-India relationship, I think it does undercut one of the sort of key arguments that has been made for that relationship, and that’s problematic. ASTILL: That it’s a liberal democracy? TANKEL: That it’s—yeah. I mean, a lot of this has been discussion of common values. Now, I understand we are sitting in a very, very glass house here in the United States right now, but nevertheless, I think this is potentially problematic down the road. ASTILL: Thanks, Steve. Aparna. PANDE: Two. One, what is Pakistan going to do and how will it affect not just Kashmir, but even Pakistan? Because the Pakistani military establishment cannot keep quiet for so long on what is happening inside Kashmir and the steps it takes, any actions by the jihadi groups or Pakistan’s diplomatic actions in the next few months. We need to see both for Kashmir and for Pakistan. Second, I do agree with Steve. I mean, there has been a hit to India’s image in the world and the question is, do they have a plan in the next few months or are we going to see a continuation of this for the next six months to eight months? I guess what I’m interested in seeing what is their blueprint for the next six to eight months. ASTILL: Thank you all. Thank you all very much, and please join with me in thanking our three tremendous panelists, Aparna, Stephen, Ashu. (Applause.) Thank you very much. (END)
  • India
    India Says No to Trade Bloc. Will It Ever Say Yes to Tough Reforms?
    It shouldn’t really surprise that in the end, after seven long years of deliberation, India decided against joining the Regional Comprehensive Economic Partnership (RCEP). The Narendra Modi government, despite a platform of economic growth that brought it to power in 2014, has revealed itself over the years to be skeptical about trade openness. A series of tariff increases, rumblings that current trade agreements have not benefited India, and concerns about the mounting trade deficit with China have all suggested that New Delhi would sign onto RCEP only reluctantly. And ultimately, the answer was no—at least for now. The Modi government apparently felt that it could not get enough of a reprieve on tariffs, nor enough of an opening for its services professionals, to join RCEP. This is precisely what India’s long-standing trade position has been: reluctance to reduce its own tariffs, while seeking greater services market access from other countries. I wrote about this negotiating posture in my book, citing a 2016 speech by former Minister of Commerce and Industry Nirmala Sitharaman (now finance minister) as the prime example: Commerce Minister Nirmala Sitharaman unwittingly offered a good example. Sitharaman said that blame for delays in completing trade pacts with the EU, Australia, and the Regional Comprehensive Economic Partnership grouping should not fall on India, and other countries’ attempts to cast India as “obstructionist” was like trash-talk in sports. To the contrary, she said, India’s negotiating partners had rejected its “ambitious” proposals to ease restrictions on movement of persons. She added, apparently without irony, that trading partners sought for India to reduce tariffs on goods like wheat and autos—but that “India will not yield” to pressure. Indian officials will need to strategize for an economic world in which their concerns for market access abroad align with what they permit at home. As the saying goes, you can’t have it both ways. It is certainly true that China has become a trade powerhouse, and India’s concerns about its trade deficit with China and a desire to prevent further “flooding” of the Indian market with Chinese goods resemble those of the Trump administration toward trade with China. But it is hard to see where India is headed: the prime minister wants to increase manufacturing in India, yet by staying out of a regional trade pact, India runs the risk of missing out on trade with parties now inside the RCEP tent. In an era in which manufacturing requires the ability to become more—not less—integrated into global supply chains, this decision appears for the moment to make it harder to boost manufacturing in India. But more to the point, the central issue for the Indian government isn’t in the wording of a trade deal, but in the competitiveness of the Indian economy. Will Indian political leaders use this time outside the RCEP to take the tough decisions needed to make the Indian economy more globally competitive—and therefore an economy that does not need protection from its own region? Asia has become, according to the World Economic Forum (WEF)’s Global Competitiveness Report, the “most competitive [region] in the world.” Singapore tops the WEF list, and all of the RCEP countries except Laos and Cambodia beat India, at number sixty-eight (Myanmar does not appear). It’s understandable that with recent news of slowing growth and rising unemployment, the Modi government was unwilling to take steps that could result in further short-term economic pain and political backlash. Farmers are protesting, the anti-trade right-wingers never wanted trade openness anyway, and the Congress party has been making anti-RCEP noises. But for the current and future prosperity of the Indian economy, someone will have to explain why further reforms will be needed for India to become a more globally competitive economy. So far, it doesn’t look like anyone’s ready to stand up to make this case.
  • Cybersecurity
    Cyber Week in Review: November 1, 2019
    Russia targets African countries on Facebook with new disinformation tactics; WhatsApp sues NSO Group after 1,400 users compromised with spyware; China throws support behind blockchain with digital yuan on the horizon; Georgia hit with largest cyberattack since 2008 Russia breach; and India confirms cyberattack on nuclear power plant by North Korean threat group.