Open infighting in BJP
THE pseudo-ideological debate in the BJP took the form of an unseemly personality clash at the two-day meeting of the national executive at Bangalore. Staunch supporters of the Prime Minister came close to naming Mr Dattopant Thengdi, the chief of the Bhartiya Mazdoor Sangh, a member of the “sangh parivar”, for targetting the party-led government at the Centre.

Nawaz under attack
FOR more than half a century now, Pakistan has been sowing seeds of terrorism in India through the ISI and other agencies. The debilitating effect on our country has been considerable. But such spread of hate is a double-edged weapon: it hurts the perpetrator also. This is an advice that we have been giving quite regularly but without results.

On scientific highway
THE Prime Minister has spoken appropriately of the prevailing global situation in the field of science in his inaugural address at the 86th annual session of the Indian Science Congress. It is necessary, indeed, to seek global collaboration and cooperation in this vital area of development. This country has been repeatedly denied technological knowhow by developed countries, particularly the USA.

Sluggish growth adds to Vajpayee Govt woes
by P. Raman
WHILE Prime Minister Atal Behari Vajpayee is under siege from his own party parivar and recalcitrant political allies, he is in the midst of a more formidable challenge on the economic front. Both will have serious consequences on his government in the next few months.

Why did new Navy chief drop surname?
THE unsavoury trail of bitterness left behind by Admiral Vishnu Bhagwat’s sacking has its share of innuendo. Soon after Admiral Sushil Kumar took charge, a story doing the round, about how Sushil Issac became Sushil Kumar during his service with the Indian Navy.

75 Years Ago

Procession and soldiers stoned
AT 9 o’clock yesterday the Assistant Commissioner managed to get hold of the maulvis of the local Durgah, and it was agreed that if the procession would pass through the Durgah Bazar without playing music it would not be molested by the Mohamedans.

DISMISSAL OF NAVAL CHIEF

Insensitivity to defence ethos
by R.S. Bedi
IN the recent military history, the sacking of General McArthur by President Truman is the only incident that one is able to recollect in the context of Admiral Bhagwat’s removal.

Time to review the system
by Pritam Bhullar
NEVER before in the history of independent India has a service chief been sacked by the government. Unfortunately, Admiral Vishnu Bhagwat happens to be the first one to meet this ominous fate.

For they are all honourable men
by Kuldip S. Ludra
FRIENDS, Indians and countrymen, lend me your ears and your hearts. I come before you today to mourn the death of my beloved country’s security.

Open infighting in BJP

THE pseudo-ideological debate in the BJP took the form of an unseemly personality clash at the two-day meeting of the national executive at Bangalore. Staunch supporters of the Prime Minister came close to naming Mr Dattopant Thengdi, the chief of the Bhartiya Mazdoor Sangh, a member of the “sangh parivar”, for targetting the party-led government at the Centre. As though to pay back in the same coin, Mr Thengdi accused the government of selling out the country’s interests, and termed “Arth Mantri” Yashwant Sinha as “anarth mantri”. He was speaking at a meeting of the Swadeshi Jagran Manch and other hardliners at Patna. The widening rift added an unintended edge to the gentle criticism of the government by the party president in his opening speech. He was merely restating his known position and that of the RSS that the government should consult the party before taking major decisions and align its policy closer to the party “ideology”. There was also a mild accusation that the government’s failure on the price front was partly responsible for the November election defeat in three states. In retrospect, it is clear that these were legitimate grouses and the national executive was the right forum to air them. But the ministerial wing viewed it in the context of the harsh criticism of the Prime Minister-led team during the “chintan baithak” held in Nagpur late last month. Mr Kushabhau Thakre was also present there. This perception spurred several members led by Mr Madan Lal Khurana to mount a sharp attack. He darkly hinted at some senior leaders wanting to destabilise the party-led government and referred to the attacks on Christians as another attempt in this direction.

This shadow boxing derailed the major concern of the meeting, which was to review the reasons for the election reverses and to discuss the economic policy. A fitful discussion on the poll defeat provoked a bitter assault on the VHP by Mr Sundarlal Patwa who also revealed that the party lost several seats because of sabotage from within. After Prime Minister Vajpayee asserted that his government’s policies have to be shaped by the requirements of coalition politics, meaning that the party can only have a recommendatory role, there was not much to examine the Patents and Insurance Bills. All this helped the Chief Ministers Keshubhai Patel and Kalyan Singh to escape with a minor rebuke. Anti-Christian violence was attributed to “wrong-doers” and the party was content to regret it. Mr Kalyan Singh expected a full-scale enquiry into the ganging-up of upper caste partymen against him, but that was postponed to a later date. Bangalore brought out the smouldering division within the party, and the Swadeshi Jagran Manch-BMS reiteration of their opposition to the two Bills shows the schism within the larger Sangh parivar. More heat will be generated in the weeks to come.

Nawaz under attack

FOR more than half a century now, Pakistan has been sowing seeds of terrorism in India through the ISI and other agencies. The debilitating effect on our country has been considerable. But such spread of hate is a double-edged weapon: it hurts the perpetrator also. This is an advice that we have been giving quite regularly but without results. Well, the unfortunate prophecy has come true once again. The unsuccessful attempt on the life of the Pakistan Prime Minister, Mr Nawaz Sharif, is nothing but a manifestation of the law of nature. Reports about Sunday’s bomb blast, which blew up a bridge and killed several people minutes before the Prime Minister’s convoy was to pass by, are sketchy and no group has claimed responsibility at the time of writing. A Pakistan Minister’s statement that it is the work of terrorists only states the obvious. Any group detonating a bomb is bound to be a terrorist organisation and there is no dearth of these in Pakistan. Three MQM workers have been arrested in Karachi in connection with the explosion but that is purely on the basis of suspicion. The crime could also be related to the Shia-Sunni clashes. The latest broke out near Multan the very next day and claimed the lives of more than 10 Shias. Mr Sharif has won many political enemies also and they too could have been involved in the act. The point is that the culture of terrorism that Mr Sharif and his predecessors have been propounding and exporting has got institutionalised within the country as well and it would be very difficult to get rid of it. As it is, Pakistan has a rather violent society and semi-official — if not fully official — backing to the bloodletting has worsened the situation.

It is a cliche to say so but the stability of Pakistan is very much in the interest of India. Unsettled conditions in the neighbourhood are bound to have a negative fallout on India. That is why there is a lot of concern over the turn of events. Pakistan has a long history of political murders. It is fortunate that Mr Sharif has survived the assassination attempt. Any harm to his person could have led to chaos in Pakistan because of the unstable conditions there. Gun culture has increased to unbearable limits. And there is no leader on the horizon who can take control if Mr Sharif has to move away from the centrestage even temporarily. Mr Sharif has not let any other leader in his party gain enough stature to be able to step into his shoes. His Chief Minister brother has rendered himself highly unpopular and it will be almost impossible for him to gain acceptability all over the country. And the attacks on the PPP have been so concerted and successful that Ms Benazir Bhutto today is not even a pale shadow of her former self. Economy is a shambles. In other words, the country is at razor’s edge. Under such circumstances, any political upheaval will be calamitous, with undesirable consequences even for India. Despite that, Islamabad’s track record being what it is, there is every apprehension that one leader or the other might insinuate that India had something to do with the attempt to destabilise Pakistan. If at all such accusations are made, these should be taken in one’s stride without getting provoked. Since Pakistan has tried every trick to weaken Indian democracy, it might not be possible for it to appreciate that a democratic Pakistan is very much in the interest of India but the fact remains that Delhi has refrained from trying to repay it in kind.

On scientific highway

THE Prime Minister has spoken appropriately of the prevailing global situation in the field of science in his inaugural address at the 86th annual session of the Indian Science Congress. It is necessary, indeed, to seek global collaboration and cooperation in this vital area of development. This country has been repeatedly denied technological knowhow by developed countries, particularly the USA. But scientists like Dr A.P.J. Abdul Kalam have emphasised the value of indigenisation and produced spectacular results. Our progress in the realm of technology has been noteworthy. We have enough technical knowhow in all the areas of science and we are able to look at the universe — from atoms to stars. In this grand march, we have emerged as a power, leaving behind our status as a pawn. Scientists are ready to “deliver the goods”. They refuse to get themselves armtwisted. They know the difference between opportunity and opportunism and they are using every possible opportunity keeping in view the needs of the nation and the citizen. Politicians, more than scientists, go on harping on the success achieved at Pokhran. But the story of Indian science is a tale of thrilling technological progress. The Head of Government has pointed to the crucial areas of national growth. These are food security, water management, quality and material conservation, low-cost housing, environment protection, the maximising of exports by achieving cost and quality competitiveness in the markets of the world and high-quality technical education, leading to self-employment. Then there is the need for intense research in the basic sciences. Human resource development is the “mantra” of growth and our scientists are applying their minds to the results it can produce.

A scientist needs adequate education, and training and research facilities, to establish himself as a professional. But once he starts his career, he must not lend his brain to anybody who can just offer him better salary and perquisites. As Dr D.K. Mishra has pointed out, as a true scientist-patriot with the gift of genius, each researcher of consequence has tried in his own way to give his country a place on the scientific map of the world. He has realised that science is meant for society and, therefore, there should be adequate communication between him and the community. The government controls the purse-string. Our expenditure on scientific projects remains low. This is a worrisome matter. Science should not be politicised; but it must be privatised with the idea of bringing in as much non-governmental help as possible. The USA’s scientific development is largely dependent upon the labours of our young scientists. President Bill Clinton has acknowledged this fact on behalf of his country. We do not need testimonials. We are responsive to challenges and, therefore, the future is ours. Self-reliant India needs the strength of original scientific and technological breakthroughs. The Prime Minister has laid ample stress on humanising scientific programmes. The deliberations at Chennai will focus the attention of the government, path-finding scientists and the ultimate users of the results of new discoveries on biodiversity. Our approach is holistic. If physics can be upgraded as metaphysics, politics can be transformed into metapolitics. If a firm political will helps the nation’s scientific temper, tomorrow will be ours in a glorious way. Remember Nobel laureate in physics, Dr Max Born? “I believe”, he said, “there is no philosophical high road in science with epistemological signposts. No, we are in a jungle and find our way by trial and error, building our roads behind us as we proceed.” The nation is eagerly waiting for the views of the great galaxy of scientists who have congregated at Chennai.

DISMISSAL OF NAVAL CHIEF

Insensitivity to defence ethos
by R.S. Bedi

IN the recent military history, the sacking of General McArthur by President Truman is the only incident that one is able to recollect in the context of Admiral Bhagwat’s removal. In itself it was an unprecedented act but not quite so perhaps when viewed in the light of the ongoing Korean war, for the US President could ill-afford to have a General defying the nation’s war policy from foreign soil. However, when General McArthur reached home from Japan, he was already a national hero. His sacking created a furore that divided the American nation.

Admiral Bhagwat was the Chief of Naval Staff (CNS). He did not defy any national policy nor did he, for that matter, defy the Appointment Committee of the Cabinet (ACC). The Prime Minister’s reference to national security implications is hardly tenable. The nation has the right to know if there was anything of that nature. Here a question arises: did the Defence Secretary provide all the inputs to the ACC? Did he inform the ACC of the hostile relations that existed between the CNS and Vice-Admiral Harinder Singh? Many such inputs that ought to have been given to the ACC were withheld by the Ministry of Defence (MoD). Otherwise, the ACC would not have been as insensitive to the matter as it has been made out. The bureaucratic machinations have unfortunately made the ACC a party to this imbroglio.

Sacking a service chief is fraught with dangers. The service chief heads an institution and not a mere organisation. It is an institution that operates on the basis of tradition, loyalty and morale. It has its own ethos too. The best of the armies come a cropper because of low morale and doubtful loyalty. It is hard for the civilians to fathom this ethos and culture, and the repercussions of denting such traits. This institution also happens to be an integral part of the national security apparatus.

The Navy will never be the same for some time to come. Admiral Bhagwat will soon get elevated to a high pedestal within the Navy. Any sacrifice is viewed by the services with tremendous reverence. After all, they are brought up on the principle of “service before self”.

The government has displayed total insensitivity to the culture and ethos of the armed forces by resorting to this unprecedented action against the Naval Chief. Surely, softer options were available to the government. The CNS could have been moved out laterally within the government, giving him some other assignment. Or at least he could have been given the option to resign quietly. Ill-considered action of the government has created ripples within the country and caused tremendous harm to the morale of the services in general and the Navy in particular. It will be no mean job for the new CNS to take out the Navy from the abyss in which it has fallen.

View the sacking of the CNS in the light of General Thimayya’s resignation which jolted Prime Minister Nehru. He literally beseached Thimayya to withdraw his resignation, knowing fully well the consequences. And here is a government that acts first and thinks later, a propensity shown by it on a number of occasions.

The bureaucracy that keeps bungling over and over again gets away lightly, whether it is distorting the directions of the Supreme Court as in the case of formation of the CVC or checking the security antecedents of the CAS, Air Chief Marshal Sareen, prior to the commanders conference. Why has the Defence Secretary been spared whose culpability is much too obvious? Why could the CNS also not be moved elsewhere within the government? The defence forces are the only institution that is not yet sullied, and the only one that keeps the integrity of the nation intact. They certainly deserve better treatment from the nation. Pushing things hard can only result in crossing the threshold. The armed forces of India may not perhaps revolt as they did in 1857 and 1946, but let us also not forget the 1997 Air Force revolt that was no less than a mutiny.

Was the President, the supreme commander of the armed forces, consulted or informed in this regard? And if so, why did he not advise the government appropriately on the issue?

It is a serious matter that is likely to effect the national security in the long run because of its implications on the morale of the services. The government must intensify the damage control exercise immediately to revive the sagging morale and pacify the simmering discontent within the services. The government must view the after-effects objectively and address them adequately instead of denying them repeatedly. It must not consider sacking of the CNS as the end of it all. The problem has, in fact, just started. The government has to ensure that this incident does not create a sense of insecurity among the services. The feeling that the chiefs can be dispensed with easily can have a devastating effect on the rank and file. The realisation that the chiefs who stand up for a cause can be sacked so unceremoniously can affect the very functioning of the higher hierarchy in the armed forces which is neither good for the government nor for the services.

The very fact that the public and the political parties have reacted sharply speaks for the gravity of the matter. It deserves to be looked into with all seriousness at the highest level. The nation has the right to know why Admiral Bhagwat was sacked in this unceremonious manner. Was there no other softer option available to the government? Why did the President, the supreme commander of the armed forces, not intervene to avoid this unsavoury situation? If sacking was the considered view of the government, why could not the Admiral be given an opportunity to resign gracefully. Generals are known to have been given options to choose between death and disgrace, and they had the courage to opt for death. Why not Admiral Bhagwat?

(The author, a retired Air Marshal, is a former Director-General, Defence Planning Staff.)

DISMISSAL OF NAVAL CHIEF

Time to review the system
by Pritam Bhullar

NEVER before in the history of independent India has a service chief been sacked by the government. Unfortunately, Admiral Vishnu Bhagwat happens to be the first one to meet this ominous fate. His sacking for “deliberate defiance” raises two pertinent questions. One, can a country have a service chief who disobeys the government’s orders, irrespective of the fact whether such orders are right or wrong? Two, having defied the orders, what was the Admiral waiting for?

Granted that the appointments of officers of the rank of Captain and above, as per the Navy Act, should be made on the recommendations of the Naval Chief. But the discretion to accept or reject the recommendation is that of the government which, in the case of the appointment of Deputy Chief, rejected Admiral Bhagwat’s recommendation and appointed Vice-Admiral Harinder Singh, who was at daggers drawn with the former.

Let us accept for a moment that the government orders were wrong. But, then, could Admiral Bhagwat disobey these orders and yet continue to be the Naval Chief? Would any government, irrespective of its credentials, tolerate such insubordination?

Now think of a service officer who, despite showing wilful defiance to the orders of his superior officer, is allowed to continue in the same post. If such cases of wayward behaviour are ignored, the armed forces would turn into an unruly organisation. Can a country think of going to war with such an Army?

What was Admiral Bhagwat waiting for after defying the government orders? The answer to this question leaves little doubt in one’s mind that the Admiral did not expect the government to act strongly. In all probability, it seems he thought that the powers-that-be would bow to his wishes.

This is not to say that a soldier should not protest when he gets a raw deal. But having done so, Admiral Bhagwat should have either accepted the government decision gracefully or put in his papers. The latter option would have been more rational, for the government orders left little doubt in anyone’s mind that it had lost faith in the Admiral.

We have examples of Gen K.S. Thimayya and Lieut-Gen S.K. Sinha. The former resigned when differences arose between him and the then Defence Minister, Krishna Menon. It was a different matter that he took his resignation back on the advice of the then Prime Minister, Jawaharlal Nehru. When General Sinha, who was a highly capable and upright officer, was superseded by Gen A.S. Vaidya, the former resigned without any hassles.

Incidentally, before Admiral Bhagwat was appointed Naval Chief in 1996, so much unhealthy controversy was generated over his appointment that an English daily called the officers who were writing letters to the national newspapers “officers but not gentlemen”.

What happens to Vice-Admiral Harinder Singh after he has washed all the “dirty naval linen” in public is still to be seen. The public gaze is on him now.

Why are more and more officers rushing to courts these days? The reason is simple. They have lost confidence in their system of delivering justice. This trend among the officers is doing an incalculable harm to the armed forces. The only way to call a halt to this pernicious trend is to make the system more transparent and fair.

With this kind of a system where even genuine grievances are not redressed, officers have no option but to knock at the doors of a civil court. Taking a cue from the officers, even JCOs and other ranks have also started going to courts.

All said and done, Admiral Vishnu Bhagwat’s sacking, because he did not resign at the right time, has brought a stigma to him. And with him the prestige of the armed forces has also gone down. The top priority of the government at this stage should be to re-examine the system of promotions and appointments at the highest level. The Ministry of Defence (MoD) should be restrained from exerting its influence in making senior-level appointments in the three services.

Should the mere transfer of two mandarins of the MoD who played a key role in bringing things to an unhealthy pass be considered enough? This will not go well with the members of the armed forces who are already piqued over this soft handling. There is no reason why these functionaries should not meet the fate Admiral Bhagwat has met.

(The author, a retired Colonel, is a defence columnist.)

DISMISSAL OF NAVAL CHIEF

For they are all honourable men
by Kuldip S. Ludra
(With apologies to Shakespeare and Mark Antony)

FRIENDS, Indians and countrymen, lend me your ears and your hearts. I come before you today to mourn the death of my beloved country’s security. I do not talk of the superiority in character and dedication of the men in uniform over their civilian counterparts, obvious though it may be. The evil and the damage done to the nation’s well-being and national security is going to haunt India for generations, even as Jai Chand’s and Mir Jaffer’s perfidy haunted the motherland for the next 800 years and 200 years, respectively. Any good that they may have done is dead, gone and buried. Nobody knows about it. Nobody talks of it.

Prime Minister Vajpayee has said that Vishnu Bhagwat was and is a security threat, and he is an honourable man. By George, wasn’t it he who had saved the nation’s civilian supremacy from the jackboots when he harangued against Rodrigues’ demand for good governance, from the civilian government. How dare he! How can a mere man in uniform dare to demand that the nation’s civilian regime deliver, what they have been elected for. After all, as elected men, they are above the law!

And today lies Vishnu Bhagwat on the road side, thrown out by the machinations of another of these honourable men. For, he dared to threaten directly their 15 per cent cut from the purchase of armaments by targeting the armament lobbies. How dare he interfere with the ways which ensured the bread and butter for the politico-bureaucratic combine. After all, the pay that the government gives is sufficient to feed only their dogs. Who pays for their mistresses and their peccadilloes?

These honourable men, through the last 50 years have talked of civilian supremacy against the ambitions of the jackboots. Their preceptor, their guru, talked of the police being enough to meet the nation’s security needs. The result has been that the paramilitary forces today number more than five lakhs and the state police more than double that figure. In furtherance of the concept of this guru of peace and ahimsa, India has lost a mere 78,114 square kilometres, in Jammu and Kashmir to Pakistan and just 37,555 square kilometres in Aksai Chin to China. Of course, peace is so much more important that India never developed enough strength to even think, leave alone act, to recover this loss. More important, the successors of this savant of peace have given the impression to the world that her frontiers are negotiable. The people of that region are of no concern. They are just statistics.

The immediate, intimate and most faithful followers of this savant of peace introduced sycophancy as the principle, and the principal means of evaluating the fitness of the officer cadre for advancement. That this resulted in an ill-clad, ill-quipped and ill-fed force to face up to the Chinese hordes was and still is no skin the nose of the politico-bureaucratic combine. For being honourable men, they did not have either any relation, or have anything to do with the jackboots. It was irrelevant for them that the man in uniform died fighting for the integrity of the nation. As said earlier, they were mere figures, awkward statistics, but still just statistics. There was no personal involvement. Since it did not affect their noble task of working for the rake off of moolah, such mundane acts of working for the integrity of the nation are below their dignity.

(The writer is a retired Lieut-Colonel.)

Sluggish growth adds to Vajpayee Govt woes

by P. Raman

WHILE Prime Minister Atal Behari Vajpayee is under siege from his own party parivar and recalcitrant political allies, he is in the midst of a more formidable challenge on the economic front. Both will have serious consequences on his government in the next few months. After the last assembly elections, no political party can afford to treat economic issues as an exclusive concern of the corporate sector and foreign investors. They will now have to bother about popular responses as well.

This aspect of the last election campaign has so far not been subjected to closer scrutiny. Whether one likes it or not, the onion not only represented shortages and price rise but “appeasement of the rich”. Incidentally, even the BJP campaigners had contributed to this widespread feeling among voters by charging the Congress regime with forcing a pro-elite policy, which, they were only compelled to continue. The business writers had only strengthened such perceptions by totally excluding the common man from their concerns. Fall in textile exports is seen as a foreign exchange problem, not as the plight of thousands of women who lost their jobs in Delhi’s garment units.

This change in popular perception of the reform measures is so widespread. It is sort of a disillusionment and cynicism shared even by the middle classes who had initially nursed great hopes in reform. The new tendency among large sections of the people is to view every hardship or problem from the “appeasement” angle and blame the government for it. Therefore, the worsening economic crisis in India should be equally disastrous for the Vajpayee Government. Recently, the Prime Minister had announced a series of economic decisions, set up high level committees and called review meetings.

Thus the shifting of economic decision-making from North Block to the PMO will make Vajpayee personally answerable for the simmering crisis. Unlike middle-level BJP leaders or the RSS outfits, he cannot get away by blaming the Manmohan Singh or Chidambaram dispensations for all problems. The situation is really alarming. Every economic indicator reveals this precarious position. The fiscal deficit has already crossed the original target of 5.6 per cent of the gross domestic product with all its consequences on inflation. Predictions by independent economists and the industry put it at 7 per cent. Together with the deficit of the state governments, it is going to be as high as 10 per cent of the GDP.

The government may try to paper over this by resorting to more disinvestment and drawing from the oil pool account. But that will not conceal several hard facts of the economy which the fiscal deficit reveals. Apart from the galloping government expenditure and sharp fall in revenue, it highlights the sluggish growth of the economy and growing industrial sickness. According to the RBI’s recent report on currency and finance, in the first seven months of 1998-99 fiscal, tax revenue recorded a tardy growth of 8.6 per cent, less than half of the 17.8 per cent projected in the Union Budget. Customs collections were almost stagnant and excise improved only marginally.

There has been a sharp rise of 28.5 per cent revenue expenditure while the growth in revenue receipts was only 11.7 per cent. The huge revenue deficit at Rs 30,590 crore in the first seven months has forced the government to resort to higher RBI credit and rampant market borrowing — something governments world over dread to go in for. Apart from unduly enhancing the demand in the debt market and boosting rate of interest and thus edging out the corporates, such reckless borrowings boosts inflation. This is precisely what is happening now. The inflation, if measured on the basis of the consumer price index, is as high as 16 per cent.

Moreover, the money being borrowed by the government is mostly used for non-productive purposes. Has it been for setting up new units or boosting production, the damage might have been less. Since spending money for non-productive purposes increases demand without creating supply, it is essentially inflationary. The industrial scene reveals a more dismal picture. The rate of production has plummeted from 6.2 per cent during same period last year to 3.6 per cent in the first half of the financial year. With the overall scenario still worsening, there is little scope for an improvement in production during the rest of the period this year.

All this has invariably put the stock market in a mess. The way banks and small investment are attracting much of the money from the public indicates the investors’ mistrust of the stock market. Contrary to Manmohan Singh’s much-quoted bravado of 1991, the retail investor seems to view equity with awe and suspicion. The fall in the new issues coming into the market establishes this fact. In the recent past, thousands had lost in stocks. They now want to play safe. This has forced the companies to increasingly go in for private placement. The unprecedented rush for gold has been another symptom of the same malaise. Gold imports have now gone up to $ 2,118 million from $ 587 million earlier. Gold has once again emerged as a safer investment.

Under the new dictum, foreign trade is considered central to globalisation and exports the basis of growth. But it is here that our performance is most dismal. This year, the trade deficit crossed the unprecedented $ 5.8-billion mark. Even the tourist inflow has been dwindling. On ‘payment’ basis, it will be even more. Independent estimates put the final figure for the year to cross $ 10 billion. If the defence purchases are included, it may reach as high as $ 22 billion on the trade account.

Luckily for the government, after reform, NRI deposits, external commercial borrowings, foreign investments, etc, have been relatively easy. However, these sources also can have a reverse effect when things begin to go wrong as shrewd foreigners will try to prudently withdraw money. Apart from this, the very dependability of our relatively comfortable foreign exchange reserves is in doubt. A third of the present reserves — apart from gold — are of portfolio investment by foreign institutional operators and another one-third NRI deposits. The rest is made of trade, credit, etc. The FIIs have a notorious tradition of withdrawing from the scene as they had done with deadly effect elsewhere. But the only restraint will be the losses they would suffer in distress sales of shares. All dream of exports miracles remain shattered.

Many of our exporters have lost markets due to the Asian crisis and cut-throat pressure. In the first seven months, exports of readymade garments, textile fabrics and yarn fell by 22 per cent. They account for one-third of our exports. Similar is the case with electronics, plastic, leather and chemicals. The seriousness of the crisis can be gauged from the reluctance on the part of the corporate sector to borrow from the international market.

For instance, of the $ 8.5 billion set apart for foreign borrowing, the effective approval is only for $ 2.5 billion by Indian private business. Apparently, they fear that when rupee falls due to inflation, it will make repayment of nightmare as they will have to spend more rupees for the same dollar value. It has been the sudden rise in repayment amount to foreign debtors that had brought doom to the “Asian tigers”. Anticipation of a fall in rupee has been a major reason for the hesitation on the part of the foreign investors as well. If the rupee depreciates, as is expected, in the coming months, they will lose that much in dollar terms.

The very concept of growth through greater trade liberalisation has not been universally a success. Similarly, it is yet to be settled whether global recession is the outcome of the volatile international capital or the other way round. In India, after seven years of reform, even the most ardent preachers of globalisation seem to have lost much of their earlier conviction. Few offer convincing remedies for the poor exports other than blaming world recession and the Asian “meltdown”. There is so much confusion that their only prescription for all those ailments discussed above, is more reform.

The hope that the IRA and patent Bills will bring forth a flood of instant foreign investment does not look different from Manmohan Singh’s assertion of 1991 that removal of licencing would lead to sprouting of industries all over India. Their shifting postures speak volumes of the losing conviction in the dogma. Until the collapse of the “Asian tigers”, the globalisers have been depicting full convertibility of the rupee as a panacea for foreign investment and export earnings. Now the same experts express relief at the fact that India escaped devastation but for refusing to do so.

Even the World Bank has begun cautioning against the unchecked flow of short-term portfolio funds, something which we were earlier told to do as part of the reform. Some of those who had consistently run down the PSUs, now find more productive investment by the government as a solution to the sluggish growth. At one time, existence of authoritarian governments was found more conducive to effective enforcement of the reform and faster economic growth. The same experts now blame lack of democracy for the collapse of the “Asian tigers”.

Indian politicians even while pressing for the IRA and patent Bills shifted blame for it on each other. The BJP leaders claimed that the Rao regime had forced them into the WTO. Now, they say, they cannot get out of it. Even Pranab Mukherjee, the one who had signed the final draft, takes shelter under ‘international commitment’. The tendency on the part of the politician is to project oneself as not ‘guilty’ of such measures. Such expression of helplessness reflects the politician’s fear of increasing public disapproval of such measures.

Why did new Navy chief drop surname?

THE unsavoury trail of bitterness left behind by Admiral Vishnu Bhagwat’s sacking has its share of innuendo. Soon after Admiral Sushil Kumar took charge, a story doing the round, about how Sushil Issac became Sushil Kumar during his service with the Indian Navy. It was alleged in the game of innuendo that the surname “Issac” had been dropped as a matter of inconvenience. There were communal undertones in the campaign.

True, the full name of the present Chief of Naval Staff, when he joined service in 1961 contained the surname “Issac”. He was not the first member of his family to don the white uniform — his elder brother Sudhir was already in service.

Everything went well for the first decade. In the seventies, when both brothers enjoyed the rank of Commander (the equivalent of a Major in the Army) the posting order of the elder brother, also known as S.K. Issac, was delivered to Sushil Kumar, and he dutifully reported to a warship and the Captain of the ship assigned him duties in the weapons control system.

Sushil, whose specialisation is hydrography and amphibious warfare, was aghast. He pointed out to his boss that he had no experience whatsoever in the field of weapons control system.

This triggered off a query and it was found that the posting order of Sudhir had mistakenly been delivered to Sushil. The naval administration then suggested to the younger brother that he should call himself “S.K. Issac Jr,” (Junior). This happened long before Sushil Kumar could think of being elevated to the Admirality. After Commander, an officer rises to the rank of Captain and then he has to serve as a Commodore (equivalent of a Brigadier) before he can become a Rear Admiral, and join the rat race for the top job in the service.

The story going around in the Capital on New Year’s Eve was that Sushil had dropped his Christian name to ensure that religion did not stand in the way of his path to the top. Commander S.K. Issac Jr may have been a dreamer, but to think that he had dropped “Issac” in a long term game when he was serving two slabs below the Admirality seems somewhat farfetched. Incidentally, the elder brother, Sudhir, didn’t rise in service. He retired as Commander S.K. Issac a few years after the posting order swapping incident.

Thrice unlucky

Sri Lankan President, Chandrika Kumaratunga, who was in New Delhi last week, gave a harrowing time for the External Affairs Ministry’s protocol section. The reason: she was late for a majority of official engagements scheduled during her visit. This trend caused considerable harassment to various Indian VIPs who were supposed to meet her including Union Home Minister L.K. Advani. Protocol officials tried to fix up a meeting between the Sri Lankan President and Mr Advani on at least three occasions. On two subsequent days, Mrs Kumaratunga, who was late for all her appointments, kept Mr Advani waiting and the meeting never took place. Just when it appeared that the meeting would never take place, the Sri Lankan President delayed her departure to Colombo by a day raising hopes among the protocol officials about finalising the aborted meeting. A new appointment was fixed a few hours before Mrs Kumaratunga was scheduled to take her flight to Colombo.

As it turned out, the third appointment also did not take place. While Mr Advani’s supporters claimed that the third meeting had been cancelled at the behest of the Home Minister, records with the security people showed that this meeting too did not take place due to the non-arrival of the Sri Lankan President.

Jute replaces wood

Jute, which is often considered the poor man’s textile and is popularly used for making ‘bori’ (sacks), has a new reputation. Thanks to the national jute development programme, launched by the Union Government in 1992, with $ 20 million aid from the UNDP, India has achieved a major breakthrough in developing new end-uses of jute and in providing jute-based eco-friendly and bio-degradable alternatives to various synthetic products.

The programme has helped in developing new technologies, processes and value-added products in the non-textile field by developing jute-based substitutes for wood products such as decorative boards and laminates for railway coaches, brake linings, clutches and other related friction materials for automobiles and other vehicles.

Indian jute has got a major boost with leading car manufacturers such as Mercedes Benz and Opel Astra switching over to jute door panels, replacing conventional materials like steel or aluminium. So next time you see jute, remember you are sharing something common with a Mercedes owner.

Even minister doubted

The Government’s decision to extend the period for filing declarations under the Kar Vivad Samadhan Scheme by a month till January 31, left many assessees harassed. The reason: the official notification extending the scheme came late on December 31, the day it was supposed to end.

Thousands of corporate houses who had filed declarations and were waiting to clear their disputed sums on the last day of the scheme decided to postpone their payments to take advantage of the extension.

However, with no official word coming till the last hour, these corporates were a worried lot. What if the proposed extension did not come was uppermost on everyone’s mind.

Though nobody less than a Minister of State for Finance had made the announcement about the extension, the corporates were keen to see the official notification. The reason, they said, was that the ministers in the BJP-led Government had no credibility. The ministers say something and the government does something entirely different was their contention. So much for the government’s credibility.

(Contributed by T.V. Lakshminarayan, Girja Shankar Kaura and P.N. Andley.)

75 YEARS AGO

Procession and soldiers stoned

AT 9 o’clock yesterday the Assistant Commissioner managed to get hold of the maulvis of the local Durgah, and it was agreed that if the procession would pass through the Durgah Bazar without playing music it would not be molested by the Mohamedans.

The procession then started again, and the lead passed along without incident. But as the last cart passed, it was held up on its way by a shower of stones from the Durgah. This caused a stampede and the procession bolted down the Main Bazar.

Nos 1 and 2 platoons following in the rear were also bombarded with stones and were fired on from the Durgah.

A few shots were fired by the platoon near the Durgah and also by the No 1 platoon, which was still behind in the narrow street, and was threatened by large crowds in front and rear.

As the chief point of danger was from the direction of the Durgah, one platoon accompanied the procession and four remained in the Durgah Bazar until 9.30 when the procession got out of the danger zone.