Watch ‘India at a Crossroads,’ a GPS special, this Sunday at 10 a.m. & 1 p.m. ET on CNN
The United States walked into a skirmish this past week. Not with China, not with Iran…but with India.
Why are Indians so angry at America? Well, they say that the United States mistreated an Indian consular worker, who was arrested for allegedly falsifying a visa application for her live-in maid, and for paying that maid less than a third of the U.S. minimum wage.
The facts of the case continue to emerge. But the incident highlights that for all their similarities – big democracies, Asian partners – India and America are very different societies.
Despite its impressive growth, India remains quite poor. Even if the consular worker’s maid was being paid only $300 a month, she was still making two-and-a-half times the national average. Second, India has a recent history of diplomats being involved with visa fraud. This shouldn't be surprising, unfortunately. India ranks 94th in the world for transparency. You encounter corruption every day in India.
And lastly, why are Indian politicians feeding all this outrage? Well, Indian politicians have always been masters of self-righteous indignation. But also, they're up for elections next year. With some 700 million eligible voters, this will be the greatest exercise in democracy the world has ever seen.
By Katrina Lantos Swett and Mary Ann Glendon, Special to CNN
Editor’s note: Katrina Lantos Swett is Vice Chairwoman of the U.S. Commission on International Religious Freedom (USCIRF). Mary Ann Glendon is a USCIRF Commissioner. The views expressed are their own.
This month, the world’s second most populous nation has resumed its annual commemoration of end-of-year holy days. India’s Hindu population, along with Jains and Sikhs, has celebrated Diwali, the festival of lights. Muslims are marking Al Hijra, the Islamic New Year, and Ashura on November 14. Next month, Christians will celebrate Christmas.
Taken together, these holidays are a testament to India’s remarkable religious diversity. Besides its Hindu majority, India includes the world’s third largest Muslim population, 25 million Christians, and Buddhists, Sikhs, Jains, Jews, and others. As the world’s largest democracy, India officially tolerates this diversity. India’s prime minister is Sikh and the ruling Congress Party head is Catholic.
Yet on the ground, in a number of key areas across the country, there exists a second, markedly less benign India.
Pew’s Religious Restrictions Report finds that India scores “high” on government restrictions and “very high” on social hostilities indexes. In addition, a Pew survey of nations with significant Muslim populations excluded India, as local survey houses feared that questions on religious identity and belief could put interviewers’ safety at risk from local authorities or residents.
By Fareed Zakaria
“As India’s most dynamic states post rapid and sustainable growth rates, the country is rediscovering its natural fabric as a nation of strong regions. States still growing at or near double-digit rates represent India’s secret weapon for competing with the other major emerging markets, from China to Brazil, Indonesia to Mexico,” writes Ruchir Sharma in Foreign Affairs.
“The only hitch is that despite the chief ministers’ high popularity in their home states, many of them are pushing rapid development with an autocrat’s haste. Nevertheless, if India is to come back as a success story among the emerging markets, New Delhi should find ways to encourage the rise of its breakout states and the spread of their success to India’s other states.”
“It isn’t clear to me why China’s economy must deteriorate next year,” writes Jim O’Neill on Bloomberg. “China’s slowdown to its current 7.5 percent growth rate was well signposted by a sharp slowdown in leading indicators. Those measures, including monetary growth and electricity usage, are no longer flashing red. Coincident indicators such as the monthly purchasing managers’ index have picked up. Unless you believe that China is somehow doomed to fail, these signs are encouraging. They suggest that the rest of this year and the first part of 2014 might see slightly stronger growth.”
“The more resourceful pessimists next argue that the better growth signals are coming from parts of the economy where growth is unsustainable - such as the urban housing market and government-directed investment - from excessive growth of credit extended by shadow banks, and not from a broadly based expansion of consumer spending. If this were clearly the case, I’d be a pessimist, too, because a buoyant China needs consumers to take the lead.”
Back in 2001, Goldman Sachs’ Jim O’Neill coined the term BRICs to describe the key fast growing developing economies of Brazil, Russia, India and China. But a dozen years later, is the focus on the BRICs misplaced? Indeed, is the group “broken,” as Morgan Stanley’s Ruchir Sharma has suggested?
“Although the world can expect more breakout nations to emerge from the bottom income tier, at the top and the middle, the new global economic order will probably look more like the old one than most observers predict,” Sharma wrote earlier this year. “The rest may continue to rise, but they will rise more slowly and unevenly than many experts are anticipating. And precious few will ever reach the income levels of the developed world.”
Each day this week, a leading analyst will assess the prospects of a BRIC nation and weigh in on whether it still deserves its place in a group of economic high flyers. Today, Madhav Nalapat, holds the UNESCO Peace Chair at Manipal University, looks at the prospects for India.
By Robert M. Hathaway, Special to CNN
Editor’s note: Robert M. Hathaway directs the Asia Program at the Woodrow Wilson International Center for Scholars. He is co-editor of New Security Challenges in Asia. The views expressed are his own.
Archenemies India and Pakistan, South Asia’s two nuclear-armed powers, are once again trading fire, taking casualties, and hurling accusations. Recent hopes for better relations between these long-time foes have been set back. Unfortunately, we have seen this movie before – and we know it doesn’t have a happy ending.
The latest crisis erupted earlier this month when five Indian soldiers stationed along the disputed Kashmir border were ambushed and killed. India’s defense minister asserted that Pakistani commandoes were directly involved in the attack. Islamabad denied any role and countered that Indian shelling across the “line of control” separating the two parts of Kashmir had killed an elderly Pakistani civilian.
In the days since, a flurry of accusations and denials has roiled the two countries. Indian protestors demonstrated outside the Pakistani embassy in New Delhi. The Pakistani foreign office summoned an Indian diplomat to lodge a formal complaint. The Indian foreign ministry warned that unprovoked incidents along the line of control “naturally have consequences” for bilateral relations. The Pakistani finance minister announced that his government had shelved the idea of granting India the most-favored-nation status that had been in the works. Previously planned diplomatic talks are on hold.
With a vast – and, just as importantly, youthful – population, India and its billion-plus potential consumers is on the minds of many Western companies. But will India be able to meet its potential? Ravi Venkatesan, a former chairman of Microsoft India and author of the new book Conquering the Chaos, answers GPS readers’ questions on this and other issues.
Indians want better education, health care and infrastructure, but the government is failing to provide these, writes “Sachin Patil” on Facebook. How confident are you that the government will carry out the reforms needed to make progress on these issues?
We have a real crisis. Despite India’s economic achievements, 66 years after independence, India ranks 136 out of 200 countries in terms of the human development index. A billion people live on less than $4/day. On many social indicators including infant mortality and lifespan, we lag even our neighbor Bangladesh. Half of all homes lack a toilet. Infrastructure investments are simply happening too slowly. India remains a ferociously tough place to do business, ranked #132 out of 200 countries in terms of ease of doing business by the World Bank. It’s hard to see a scenario when India can sustain its progress without addressing these issues.
It all simply boils down to governance. Governance in India is broken. Key institutions such as the judiciary, law enforcement, and the civil service haven’t been reformed and strengthened to keep pace with India’s development. But most of all, the levels of fragmentation, corruption and self-interest amongst leaders at the national, state and local government levels is stunningly high. This doesn’t augur well for reforms and progress. The base case appears to be one of a few more years of drift unless there is a black swan event that throws up competent leadership in the coming election.
By Global Public Square staff
Washington’s efforts to broker Middle East peace have given this age-old conflict a high profile and raised expectations once again. But there is another decades-old dispute, thousands of miles away, that is getting very little attention. And for the first time in many years, there are reasons to be optimistic about its prospects: We’re talking about India and Pakistan.
Yes, the two countries have fought three full-scale wars and are locked in a nuclear arms race. They have frequent skirmishes over disputed territory in Jammu and Kashmir, as they did once again this week when five Indian soldiers were killed in an ambush.
But if you take a step back from Kashmir and examine the broader political climate in the region – India, Pakistan, and also Afghanistan – there are reasons for cautious optimism.
With a vast – and, just as importantly, youthful – population, India and its billion-plus potential consumers is on the minds of many Western companies. But will India be able to meet its potential? And what are some of the challenges that companies face when doing business in the country?
Ravi Venkatesan, a former chairman of Microsoft India and author of the new book Conquering the Chaos, will be answering GPS readers’ questions on these and other issues. Please leave your questions below.
By Milan Vaishnav, Special to CNN
Editor’s note: Milan Vaishnav is an associate with the South Asia program at the Carnegie Endowment for International Peace. You can follow him @MilanV. The views expressed are his own.
The Bharatiya Janata Party has announced that its controversial son, Narendra Modi, will lead the opposition party into India’s national election next year. Modi has led the BJP to three consecutive election victories in the western state of Gujarat, earning notoriety both for his efficient governance as well as his controversial role in the state’s 2002 Hindu-Muslim riots. The question now is whether he can revitalize the main opposition party’s fortunes.
Modi’s detractors believe that Modi either connived to incite the anti-Muslim pogrom that claimed hundreds of lives, or at the very least condoned the bloodshed (although to date he has not been directly implicated by a court). Either way, although the BJP’s move stops short of formally projecting Modi as the party’s prime ministerial candidate, it effectively cements his position as “first among equals” within the party.
So, what has prompted the BJP to pick such a controversial figure to lead them into battle against the ruling Congress-led coalition? For a start, Modi’s rise represents a generational shift within the party – at 62, he is considered a youngster in India’s geriatric politics. But the party is also making a strategic bet that Modi’s popularity among the rank-and-file, his economic record in Gujarat, and the country’s desire for change will outweigh his potential downsides.
For more What in the World, watch GPS, Sundays at 10 a.m. and 1 p.m. ET on CNN
By Global Public Square staff
Watching countries from around the world grow and prosper, we tend to assume that global poverty is falling. And in fact, the World Bank says that in 1981 nearly half of the world's citizens were impoverished, that is, they lived on less than $1.25 a day. And today, less than a fifth of the world's population lives in poverty. In raw numbers, that translates to a 40 percent drop from about 2 billion to 1.2 billion people.
But when we dig deeper, it’s clear the picture is more murky. Put simply, most of the reduction in global poverty has to do with one country – China. Take it out of the equation and the numbers look very different.
Let's go back to 1981. Back then, China accounted for 43 percent of the world's poor. The other major contributors were South Asia, with 29 percent, and sub-Saharan Africa, with 11 percent. Fast forward just a decade, and you'll see that China's share of the world's poor began to drop. The trend continues through the 2000s. By 2010, China accounted for only 13 percent of the world's impoverished population. South Asia's share had jumped to 42 percent, while sub-Saharan Africa's share tripled, to 34 percent.
"Fareed Zakaria GPS," Sundays at 10 a.m. and 1 p.m. ET on CNN
Fareed speaks with Ratan Tata, who until recently ran the Tata Group – India’s largest conglomerate – about ethics in business.
When you make these determinations, and as you say, it's part of the culture at Tatas that you won't get bribes, often you weren't asked, but was it difficult to institute that among all your managers, all your chief executives, because there must have been ambitious ones who wanted to get ahead at any cost?
Yes. We have 450,000 employees and I am quite open in the statement that I can't guarantee the integrity of every one of them. What we do, when somebody breaks that code, how we deal with that person, I think, is the true index of what we will do. And when we have had a major rogue officer or director, we’ve actually prosecuted that person and the person has actually gone to jail. So, I think we have walked the talk in terms of what we have advocated, we have practiced what we have preached, as a matter of fact.
Tata Sons, the holding company that governs the entire Tata group, is two-thirds owned by charitable trusts, is that right?
Which means that two-thirds of the income that comes from this enormous industrial and services empire goes to charity.
Has that changed the way in which, you know, does that change your perspective on how and why you’re running it?
Yes, it has. First of all, you know, it runs counter to the general perception that Tatas are a family company and that the proceeds of these industrial operations go to the Tata family. It does not. The family owns about two percent, collectively, of Tata Sons. And the 60s, 65 percent that goes to charity has always been seen as a noble usage of the wealth we have created from our companies, it goes back into education, medical, elevation of poverty or rural development. So, in a manner of speaking, it has always been our driving force that what we’re doing is really for plowing it back to the people of India.
"Fareed Zakaria GPS," Sundays at 10 a.m. and 1 p.m. ET on CNN
Fareed speaks with Mukesh Ambani, the richest man in India and chairman of India's largest company, Reliance Industries, about the state of the global economy. To see the full interview, download the show at iTunes.
You are very bullish about the United States, probably more bullish than a lot of Americans. What about the other key drivers of the world economy? Because a lot of people say, look, China is slowing down, Brazil has slowed down, India has slowed down? What do you think of the emerging markets story?
I think that China is maintaining steady growth. It’s not decelerating. Europe has found its own transition path. And they will transgress through the financial system in an orderly way, India has had some slow growth, but I am really very optimistic on India.
Why is that? Because when people look at India today, they see growth is at 5.5 percent now. You talk to foreign investors and they say the infrastructure is terrible, the government doesn't do enough reform, it’s very difficult to operate in India. You look at all that and you're still bullish?
Well, I'm very bullish on India because it’s really the aspirations of a billion people. And ours is a country where all the billion count. There are some countries in the world where one person counts. There are some countries where the Politburo of 12 people count. The beauty of India is that all our billion people count. And they have aspirations. And it is really a bottom-up story. It’s not a top-down story. So, yes, we will, adjust with what happens in the rest of the world, but we are on a long-term growth trajectory. And this is just not growth in terms of GDP numbers, right. This really is for the wellbeing of each and every Indian. And that’s the aspiration.