Western Foreign Policy and Narendra Modi

A great many media outlets have been highlighting the recent decision of the British government in reconsidering it's position vis a vis Narendra Modi, the reigning Chief Minister in Gujrat for more than a decade. View the recent write up in the Economist or this one at IAT .

The facts why this development is being viewed as an extremely significant move has multiple reasons -

Gujarat Chief Minister Narendra Modi

• Narendra Modi is currently the longest serving Chief Minister, of ANY state in India, during the past 20years.
• Modi is also the longest serving Chief Minister of the State of Gujrat, having completed 11 years.
• Modi is also up for re-election next month.
• Modi is one of the most prominent figures from the single largest opposition party in India the BJP, as well as part of the alliance national opposition parties in the central government.
• Modi is quite often projected as a the future leader - Prime Minister of India.
• India is scheduled for national elections in the Spring of 2014, though the possibility of a mid-term election being forced on the people is looming large due to a very fragile and splintered UPA-2 Alliance.   

The Indian political scene is currently in a state of turmoil on the national level with key individuals from the ruling Gandhi clan led Congress-UPA-??? combine being accused, investigated, and indicted for billions of dollars worth of corruption and fraud of taxpayer money and even foreign aid  involving arms deals, allocation of natural resources, real estate development deals, telecommunication licenses, financial sector irregularity, tax evasion, etc. You name it and there is documented evidence of widespread corruption and bribery anywhere and everywhere you look!

It is against this backdrop that Narendra Modi's supposed rehabilitation by western governments, against a backdrop of alleged human rights violations in 2002, becomes all the more poignant. This after vilifying Modi personally as well as his administration for almost a decade. Western governments including the US have revoked his privilege to enter their countries by denying him entry visas, as a means to bully him. They have knowingly and / or unknowingly become pawns of the Congress led UPA combine in India to declare him persona-non-grata against popular and overwhelming support of him across the world.

Anyway, the announcement by the British Foreign Office and a leak from a senior high ranking US diplomat to review their governments status about their one sided and contentious relationship with Narendra Modi, his administration, as well as his political ideology has been welcomed by Indian-Americans, Global-Indians, and the Indian public. They are rejoicing at this opportunity as well as looking to celebrate "the victory" of Modi having prevailed after all these years.

However, in my opinion it is too premature to even think of celebrating, my reasons are listed as follows. My analysis is mainly US centric since that is where I am based, yet it clearly reflects the basic tenets of Western foreign policy vis a vis the rest of the world.

Regardless of the political party in power in the US - President / Senate / House, the basic tenets of US foreign policy are unwavering. Unless the US is looking to dump the Gandhi family led Congress-UPA-? combine the status quo will not change. The Jasmine Revolution which was the precursor to the Arab spring has brought more than anticipated and acceptable anarchy to the MENA region. Europe and US will not allow that to happen again especially in India which is geo-politically and economically more than a keystone in the global context now.

Let's not get myopic and ignore reality from the historical past in the South-Asian region, before we start to gloat. In Pakistan Musharraf was dumped. Benazir Bhutto (the nurturer of the Taliban) was brought in, but then was assassinated and a puppet regime headed by her widower Asif Ali Zardari (who is the defacto leader of Bhutto's PPP) has been in place since. 

Just because there is widespread unrest against the Gandhi clan and it's supporters right now doesn't mean that Narendra Modi is in the good books of the Western interests now. Don't forget the AB Vajpayee govt. was disposed of as soon as it asserted it's independence on various issues including nuclear proliferation. Even after the Arab Spring and the change at the top in Pakistan the behind the scene players remain the same in those places with continued support from Europe & US.

 
One more thing to always keep in mind US economic interests have never been sidelined despite whatever political ideology has been in place at the policy making level as long as American companies profit! The sad part is we equate popular sentiment to the official stance of overt and behind the scenes position US policy should reflect. This has never been the case. Cases in point American business interests and trade with Communist China, oil purchases from Venezuela, trade with Putin's Russia, aid to Pakistan etc. Or take the unwavering US support for Taiwan despite enormous risk in strategic and crucial bi-lateral relationships with China. There is already quite a bit trade of activity with Gujrat notwithstanding Narendra Modi. So dropping an unpopular public stance to placate a vast majority of Indian-Americans / Global-Indians is really not a big deal. I strongly believe that Narendra Modi does not need to be vetted by European or American policy makers.

Let's keep our eye on the big picture! Indians deserve more importantly a reliable pan-India organization with integrity which needs to have the overwhelming trust of the Indian electorate. That will be the tipping point for global policy makers to align their interests with the Indian middle class instead of just viewing them as an economic and profit making opportunity!

Until individuals and organizations, both in India and abroad, can grasp the above sentiment and are able to put behind their petty personal grudges to unite and come together on a common platform to help the majority of Indian people they are merely pontificating in the air to bring about change... a la someone else we know from the recent and immediate past from the American political scene! ;-) 

By the way here is a recent presentation of the socio-economic accomplishments of Narendra Modi and his administration over the years. GUJRAT PRESENTATION.

Politics... taking the plunge!

Entering the political arena requires you to be ready to bare not only your deepest darkest secrets, but also your soul! Speak nothing of being under constant scrutiny even if trimming your toe nails. Also, entails very, very long hours and finally walking the talk you preach... I guess that is why people are terrified of politics...

So in the end it's ... hard to like what you are afraid of, which is why I believe politics is despised so much.

Sometimes I think where and how these folks get the energy to continue from early morning to late night on a regular basis.
 

I guess the best analogy it to think of it like getting into a warm mud bath at a spa-salon, first you have to cleanse yourself by taking a shower, stay naked and get into the warm mud, seems so yucky!!! ... but they say it has therapeutic value and as you get used to the warm mud so don't want to get out of it as it seems so relaxing and comfortable!

If ever you think you want to come out the mud bath then imagine you look like a pig wallowing naked and caked in mud, and by then staying in the mud bath seems more enticing than getting clean and going about your normal business!

How can the next president better help small business and entrepreneurs thrive?

Ravi Deva wrote: On 9/20/07 11:27 AM, Ravi Deva wrote: -------------------- Thank you for your personal response. I wasn't expecting any kind of acknowledgment from anyone, but it gives me a glimmer of hope that quite possibly some is at-least willing reach out and hear the opinions of the masses in an uncontrolled setting. Who knows I might even vote for Mr.Obama, he seems to be the most viable candidate out there right now in the Democratic party, plus he represents Illinois my home state. Thank you, Ravi On 9/20/07 10:56 AM, Barack Obama wrote: -------------------- Thanks for participating in Barack's question on LinkedIn Answers – we apologize for the delay in response. We received an incredible number of thoughtful answers, and our campaign will continue to review all of these answers in the days ahead. Barack is committed to helping small businesses and believes they are at the heart of the American economy. He is committed to expanding opportunities and easing the everyday pressures so many businesses face by cutting their health care costs, improving access to capital, and investing in innovation and development. He plans to fix our health care crisis and enable more small businesses to provide affordable care to their employees. He will expand loan programs for small businesses and create a national network of public-private business incubators. He also will invest in women-owned businesses, increase minority access to capital, increase supports for businesses in rural areas, and work to close the digital divide that limits the growth potential of many urban and rural small businesses. We appreciate immensely your willingness to share your insights and suggestions on these issues and your help in achieving these goals. For more information on Barack ideas for improving America visit: www.barackobama.com/issues Thanks, Scott & Becky @ Obama HQ On 9/13/07 9:41 AM, Ravi Deva wrote: -------------------- For small business to truly survive - create a level playing field for all entrepreneurs and businesses. Just because big business has the deep pockets to hire lobbyists and propel their agenda through the executive branch is the biggest impediment for the survival of small business. Create an environment where there is oversight in the real sense for "MEGA" corporations so that they cannot create barriers for free and fair competition with their smaller rivals with the help of big government. Small business does not require sops and platitudes, most of the people who start small businesses do so not because big business is incapable of providing new services, but because it will "NOT" provide new services in a reasonable manner and also because it is too busy trying to protect its turf. Fix the Financial System and Commerce Policy! We are the world's biggest economy, but our fiscal and commerce policy is worse than that of the under-developed nations, not because we do not have the resources, but because we do not have the will to do the right thing. We have been lurching from one financial disaster since almost the last 25years - the S&L crisis, Stock market crash '87, business downturn and internet bubble '90's, and now the real estate and mortgage crisis. What gives? You really don't expect us to believe that big government didn't see this coming to prevent it from happening. Not that I want big government to interfere in everything, but it still does so for the most useless of scenarios so it might as well do so in things that matter! Stop the outsourcing and off shoring of everything otherwise in the long term the entire country will be a hollow shell with no economic activity. How can a small business thrive in the this country when it has to abide by the laws on the this state against a business that thrives in an environment of chaos overseas, without any regard to US protections for safety, environment, respect for personal dignity, etc. That is not fair competition. What will large corporations do next when the cost for off shoring and outsourcing to China and India become sky-high. Move those services and manufacturing to the poverty stricken African continent or some other low cost place because they can do it for cheaper than the Indians or Chinese? Think of the long term when making decisions not just for the duration of your - Presidential Term! Ravi Question Details: -------------------- How can the next president better help small business and entrepreneurs thrive?

Irrational Exuberance or Stupidity! Part - 2

Last week as I started to write about a - bubble of various sorts, forming across the entire gamut of the Indian economy the – sub-prime mortgage mess started to unravel in the US.

Media outlets and various financial organizations expressed shock and disbelief at the ramifications of the situation here in the US. It is interesting that none of them decided to interview the mastermind of the current fiscal mess his holiness - Mr. Alan Greenspan, under whose watchful eye the entire current sub-prime fiasco has it's genesis!

Yes, Mr.Greenspan is a very erudite and knowledgeable person; he is also the architect of this current mess. Mr.Greenspan had the knowledge and the tools at his disposal to prevent this situation in the sub-prime mortgage market as well as the deeper credit crunch that is making ripples across the globe. In fact if memory serves me and possibly other folks correctly this is not the first time Mr.Greenspan can be faulted for his acts of fiscal omissions - The Great Internet Bubble of the 20th Century also happened on his watch!

Now in India we have Prime Minister - Dr. Man Mohan Singh, who also is a very erudite fellow as well as an economist like Mr.Greenspan. Again if my memory serves me correctly the last time India as a country was almost at the doorstep of financial insolvency, this same Dr. Singh was at the head of the finance portfolio. Wonder if this is just a coincidence or fate as they say in India?

Lets look at some other interesting parallels.

Things that happened on Alan Greenspan's watch.

Black Monday 1987.

Internet pump and dump.

Beginning and end of Real-estate boom.

Super hot and sizzling economy, followed by busts and boom.

Overall decline in manufacturing economy!

Things that happened when Man Mohan Singh was lead Economic Advisor to PM, was FM, or PM himself.

India close to financial insolvency 1990.

Indian stock market pump and dump 1991/92.

Indian real-estate market becomes super hot.

Super hot and sizzling economy, followed by busts and boom.

Over all decline in manufacturing economy.

What happens next in India?

Every time I talk of the above scenario I am told to stop being a naysayer, and look at the rapid strides the service sector economy has made and the growth of employment etc. that will eventually create a trickle down effect that will uplift the Indian masses. Everyone tells me about the transition of global economies, from being agrarian to industrial manufacturing to eventually service driven.

TO WHICH I SAY CRAP! STOP THIS NONSENSE, FUELED BY PSEUDO-INTELLECTUAL DRIVEL!

SHOW ME ONE, ONLY ONE ECOMOMY THAT HAS SUSTAINED ITSELF ON A SERVICE ECONOMY WITH A GROWING POPULATION!

World War I & II saved the British Empire from being a footnote in history 50years ago. Japan has seen it's best days behind it. The Asian Tigers on the Pacific Rim are barely managing to keep their heads above water from the onslaught of the Chinese Tsunami. Countries on the African and South American continent barely register on any economic indicator or can hope to do so in the near future. Argentina and Brazil have never lived up to their potential despite the billions of dollars pumped into them in the past. Except for South Africa which has some economic activity the rest of the African continent it seems will be battling a human medical catastrophe.

Granted some of my predictions are a little extreme, but with a looming global recession, it would not take much for those predictions to come true!

Lets not forget about the nature of the Internet and electronic specialty service economy which moves at the speed of light is also susceptible to an equally rapid transformation into a commodity service that tends to flatten and remove various hierarchical barriers to entry for most service businesses. This not only reduces margins it automates and eliminates various functions that may have been essential earlier, and in turn may have been a source of wide scale employment.

The speed of the service economy is very rapid and by nature disruptive; it has a cannibalizing effect on general business and society as a whole. This is due to the constant search for greater economies of scale and optimization of efficiencies. We have witnessed this on a wide scale level during the dotcom meltdown. The same happens and has happened in an agrarian and industrialized economy, but at a much slower pace. When this reduction in economic activity does happen there is already enough ancillary business activity that has been created that it smoothes out the usual and periodic cyclical business and economic ups and downs.

My next post will touch on the immediate and near term ramifications of this service economy.

Irrational Exuberance or Stupidity? Part - I

For an individual that has been closely associated with the two business sectors in the US - IT Enabled Services and Retail, that have or are about to take off in the Southeast Asia region, especially India I sometimes find myself having a feeling of deja vu when reading excerpts of the astounding economic growth happening there. I have used the terms ITES in the US context because just as in India they were part of the IT growth boom in the US also.

This sense of deja vu is not of the same optimistic kind promoted and shared by a lot of other evangelists of developing world growth patterns.

I rejoice at the phenomenal growth that has and is continuing to happen in India; however I keep waiting to see some measure of hardcore economic activity in the development of physical infrastructure take place. Even when any activity to shore up physical infrastructure has / does happen it is only in response to an ancillary investment in islands of economic boom in places where there is already an ITES infrastructure.

Let's not forget what the acronym ITES stands for - Information Technology Enabled Services, in the majority of cases this is nothing but once again a fancy term for low end backroom processing support work that has been offshored to India from the more developed nations.

Support activity can only happen if there is primary business activity to be supported, if we keep on creating and encouraging an environment where home grown physical industries are decimated and discouraged we will face the same consequences that the US is currently facing.

The home grown US economy is already frayed at the edges and is starting to tear apart due to the lack of regular investments in in the physical infrastructure for almost the last 30years. Let's not forget even the robust internet era of the 1990's in the US could not keep the economy going for long.

I understand all investments follow the money trail, but you cannot have isolated islands of economic prosperity and growth in a land of 1.2billion people, not have some kind of equitable balance being maintained without having nasty repercussions. We have seen the former USSR implode and explode over ten years ago, which had similar kind of isolated pockets of growth. Granted India does have a wider base of business, but we have already seen the erosion and extinction of numerous small scale businesses and industries all over India, especially in areas far from these Special Economic Zones - SEZs.

At the time when I was moving to the US in the early '90s, major trans-national consumer (hard and soft goods) corporations were making a beeline to India to capitalize on the spending power of the - emerging Indian middle class. Many of them lost their shirts in the ensuing years and some have barely managed to stay around profitably even after all these years. This despite all the years of boom activity.

There is risk in all activity, however when people lose sight of rationality in understanding and accepting risk, it is politely termed - Irrational Exuberance, or in layman terms - Stupidity!

The Indian stock market has been growing at a double digit rates for the past few years, the real-estate situation is even worse prices are going up in triple digits and the lay people are lapping it up in the name of growth, being led around by organized opportunists - like rats dancing to the tune of the Pied Piper!

My opinions may seem harsh to many, but I have my reasons and will elaborate on them going forward.

Sample of my musings on Linked In - 2

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Ralph Nader. Friend or Foe?


“Ralph... who???”

Non-Corporate Indian Brands - 1

Recently, one of my friends in India asked for my views on Non-corporate Indian brands that have had global impact.

His question was -

What is your take on these global brand concepts from India. How does world see it? Do they have momentum of their own which could turn them into a big global phenomenon?

This started me thinking and the result is printed here... as an ongoing series...

In my opinion and observation, the biggest, most recognized, with the most impact, and one of most visible non-corporate brands is definitely - "IIT". The mere mention "IIT" in almost any forum draws an immediate response of admiration. IIT Alumni having been having a tremendous impact in the US, especially since the 1990's, leading upto the highly visible pre-dot.com success and subsequent bust of various start-ups fronted by various IIT Alumni.

Brand "IIT" has given a majority of the Indian Diaspora a great deal of visibility, material well being, and an extremely powerful lobbying platform in the US. Caused upheavals in the US immigration rules for H1-B, L-visa categories, caused a huge and ongoing economic & IT/BPO boom in India, and a perceived negative on impact on the US economy and employment.

Brand "IIT" has given the Indian education system credibility and respectability, which was severely lacking before the dot.com success of various IIT Alumni - Entrepreneurs and Venture Capitalists.

Though the Indian Medical Community was quite successful in the US, they did not belong to a single monolithic establishment where they were groomed for future success.

Earlier success by Indians in the US was usually termed as a individual and fleeting moment to celebrate.

Brand "IIT" currently has the momentum and should continue gathering momentum as highly visible force in the future, if it does not fall victim to it's own success.

That being -

1. The growing perception among various US employers, and even major Outsourcers, is that the current crop of IITians and graduates of other Tech schools from India are starting to act like mercenaries. Running after the money without having the genuine skills and experience to plod through some of the basic task oriented stuff that needs to be done on a daily basis. A process through which prior IIT alumni went through before breaking out and achieving their visible success.

2. A perception and a possible move towards the dilution of the core IIT curriculum in a manner to reflect and be able to integrate easily with the US higher education standards.

3. As mentioned in point -1, higher turnover from the IITians in the corporate world leading to a disruption in corporate growth due to the re-assignment of multiple individuals to the same project, resulting in lower productivity. A pattern that is being commonly encountered by various US companies off-shoring work to India.

4. The above would lead industry to look to alternatives outside of India, which would greatly inhibit any further growth on brand "IIT". Schools have impact, but ultimately it is industry that employs them and provides them a platform to excel and gain recognition.