WHAT DEFINES INTERNATIONAL RELATIONS: COMMERCIAL INTERESTS OR STRATEGIC CONCERNS?

What matters more in international relations? What shapes the contours of bilateral ties in contemporary times? Certainly trade is an important factor but it is not the most important factor.

It is always about the engagement on strategic levels that defines bilateral relations between countries or the international alliances of groupings of countries, be it US-Israel or US-UK or NATO and other similar ties and alliances. They have been rock solid ties weathering varying seasons with equal fervour because the cornerstone of these relations have been strategic concerns. Historical linkages are an added advantage.

Though NATO has seen some trouble recently with US President Donald Trump raising objections over skewed funding contribution in the world’s most formidable military alliance between countries where the US is the largest contributor, NATO is still sailing smoothly with regular high level US visits to the NATO headquarters at Brussels.

In contrast, trading blocs like WTO, NAFTA, ASEAN, APEC, SCO and so on are basically about commercial engagements and though have increasingly become important in a world globalized by economy, cannot replace the ties built on strategic interests, especially in the times of crisis, like prolonged border standoffs or any aggression inimical to bilateral ties.

Also, when countries are globally important and are slated to become poles in a multi-polar world of future, like India and China are, what is going to define their diplomacy and international politics is how they cultivate their strategic ties.

Because loss of commercial interests can be met with forging other ties and alliances but there is no replacement for a strategic tie that gives a country sense of security or tools to secure its borders and skies.

That is why China doesn’t matter for India in case the ongoing border tension in the Sikkim Sector between two countries escalate to severe levels resulting in localized, limited scale military hostilities (because the two nuclear powered nations cannot afford a full-scale war).

China is basically a country engaged in trade relations with India. Relations have failed to go beyond that. There are no cultural ties and people to people contact. Defence and other strategic elements are non-existent from the table. Coupled it with the non-existent India-China bilateral trade in services. All these factors make India to easily look beyond China when it comes to suspending ties.

The bilateral trade between India and China was around $71 Billion in 2016 with a trade deficit highly skewed in Chinese favour – $47.8 Billion. India basically exports diamonds, cotton, yarn, organic chemicals, iron ore and copper worth $12 Billion (2016). Chinese export to India includes fertilizers, antibiotics, electrical machinery, equipments and organic chemicals and the 2016 worth was $59 Billion.

When we see the items of import and export, especially in the context of the stagnating Chinese economy, it is quite clear that India can easily do away with its miniscule Chinese export. But it will be difficult for China to ignore India, the world’s fastest growing large economy now for many quarters. Add to it India’s projected middle class base of around 450 million people and the country becomes a promising market for any manufacturing hub like China.

The trade deficit with China doesn’t hurt us (and won’t hurt us), at least in the near future, till the country reaches to a stage where unemployment becomes chronic and threatening for the country’s weaving; till the time we have ramped up our infrastructure to be able to make for any future contingency on our manufacturing needs. Till then, it’s like we have outsourced our manufacturing needs to countries like China (and with manufacturing bases in many other countries, we can easily find alternatives).

But China has not this advantage. It is already the manufacturing engine of the world with its majority of population engaged in those small or large factories supplying to the world. They are as dependent on the domestic Chinese consumption as the international demand.

With a slowing down economy, the domestic consumption in China is going to ease and its manufacturing hubs are going to be ever more dependent on big overseas markets and India is a big imperative there. It is important to maintain China’s social fabric with flow of jobs and gains of economy in the society and is going to be must for its behemoth economy that needs global markets to lubricate its tentacles. Just a corollary would suffice to prove the point here. Four Chinese manufactures, Xiaomi, Lenovo, Oppo and Vivo, are in top five of the Indian smartphone market. India can easily find alternative smartphone manufacturers with a strong domestic industry to fill the gaps. But these Chinese manufactures cannot find a market like India that has emerged as the world’s fastest growing smartphone market.

To continue….

©SantoshChaubey

NEW ‘RUBRIC’ OF GEOPOLITICS IN A DONALD TRUMP WORLD

The article originally appeared on India Today.
Here it is bit modified.

Geopolitics has always been shaped by few global powers, especially the US so far, even if it has been an increasingly multi-polar world.

But with the recent developments that have revolved around inward looking protectionist and autocratic powers taking central position not just back homes but in the overall flow of geopolitics, the world order is increasingly going to be shaped by four countries and an event, Russia, the US, Britain leaving the European Union (EU) or Brexit and China, the new RUBRIC that will shape the flow of geopolitics in the days to come. RUBRIC with changed evaluations and definitions that would try to outsmart the existing ethos in order to impose their own.

And the rules of this new RUBRIC will be written by their leaders, Russia’s Vladimir Putin, the US’ Donald Trump, Britain’s Theresa May and China’s Xi Jinping, with new equations emerging after Donald Trump has taken over the world’s most prosperous and powerful nation.

WHY THEY MATTER

The US still wields enormous military power and if we say it remains unchallenged, especially after the demise of the Soviet Union or the USSR, it will not be exaggerating it. The US is also the world’s largest single nation economy and will remain so with its clout to greatly affect the trade blocks and negotiations.

Though the USSR is no longer there, it left behind a stockpile of nuclear arsenal that makes Russia a strong regional power that exercises considerable influence in Europe and Asia, even if it has had a volatile economy. Add to it the vast energy reserves Russia has that serves as Europe’s lifeline.

China is the world’s second largest economy and the manufacturing powerhouse of the world and is in a position to dictate trade terms with global power centres even if it derided for its one party autocratic system and poor human rights. In terms of purchasing power parity, China is already the world’s largest economy and is a growing military power with increasing clout in space, air, navy and on ground.

Britain, once the reigning colonial superpower of the world with economic and military might, has reduced to being just a small country with no influence to affect the geopolitical matters. Yes, but it remains a symbolic superpower of values that define the existing free democratic world order – free men, free markets and a freer world. And the country is still an economic superpower. Its GDP at 2.29 Trillion USD was at par with India’s GDP of 2.3 Trillion USD in 2016.

TRUMP IN THE WHITE HOUSE IS SETTING THINGS IN MOTION

China has a production model back home that is antithesis of the values that the US and major economies of the free democratic world cherish and promote but nothing stops them or the big transnational corporations from engaging with China. China has absolute protectionism and labour laws heavily tilted in the favour of businesses.

With the new US President Donald Trump’s inward looking and protectionist views that aim to seclude the US economy in domestic shackles, the Asian economic giant is trying to take a global leadership position with Xi Jinping already saying that China is ready to fill the void created by the US.

The US under Donald Trump has effectively dumped the biggest global trade deal proposed, Trans-Pacific Partnership (TPP), including 12 Pacific rim countries that already regulate the world’s 40% economic output. China would sure be happy to milk the opportunity that many including Barack Obama, the former US President, tried hard to grab and now believe that going away from it will be suicidal for America’s global dominance.

Trump’s next target is NAFTA (North American Free Trade Agreement) and no one knows what comes next. No one knows where he will stop in the name of preventing jobs and businesses from going out of the US and paying back to the countries who he believes have sucked the US wealth. Signs don’t look good. He is threatening businesses with counterproductive measures.

Military and nuclear confrontation with China already looks on the table. Trump has ratcheted up nuclear and military expansion rhetoric quoting Russia and China but while he has always been soft on Putin, hoping for ‘good deals with Russia’, he has never given such indications for Xi Jinping or China. Trump believes that ‘One China’ policy can be negotiated while China considers it blasphemous. Trump calls the Taiwanese leader breaking decades old US tradition and says it is not a big deal. The South China Sea dispute where it’s defiance is directly pitted against the whole world community is another in the series.

Russia is a big military power and big economy of its region of influence in Europe and Asia with an autocratic president in Vladimir Putin who believes in the unbridled run of power, military expansionism and has increasingly displayed a tendency to interfere in the theatres of conflicts like he is doing in Syria. And as Putin is sitting comfortably at home, crushing all the dissent, if he goes about pursuing his global designs, it will be a development that was just about to happen. The erstwhile USSR was one pole of the once bipolar world and Putin has not forgotten that.

And Trump, it looks like, is giving him a chance. He has indicated that he will lift sanctions imposed on Russia after Russia invaded Ukraine and annexed Crimea. The US, so far, led in Syria peace talks but now, it is being led by Russia and Turkey with the latest round of talks between Syrian rebels and government representatives in Astana, Kazakhstan’s capital. And experts believe this may be the beginning of the process that can effectively see the US dominance, first in the Middle East and then elsewhere, diminished to a great scale, thanks to the Trump’s policies that aim to make America an island nation, away from geopolitical tumults and thus stakes, away from the values that the US has globally promoted so far, democracy, free markets and human rights.

Britain is also picking signals from Donald Trump, emboldened by his anti-EU tirade. Trump says ‘Brexit will be a great development for the UK’.

Many in Britain fought hard and championed to create the world’s largest economy as a single trading block and single, border-free zone of countries in the form of the European Union (EU) – inspiring the world to create such free zones for men or economies to flow freely. But that is not the case anymore. Britain is leaving the EU, after a bitter referendum, or Brexit, that divided the country. Brexit will make US the world’s largest economic region again. Britain’s new leader Theresa May has said that the legal process for Brexit has already begun and she is looking forward to meet the staunch EU critic and therefore her big admirer Donald Trump this Friday to negotiate trade deals, like she has done with other countries including India. Trump has also predicted, in his inimitable style, that more countries will follow Britain in leaving the EU.

So, the next few months are going to be very volatile and challenging for the existing world order and geopolitical equations. RUBRIC have set things in motion. What happens only future can tell but the flow of geopolitics is going to be dependent on the movements of these four nations and their leaders.

©SantoshChaubey

RUBRICHUS WITH PUMAXIT: BLOCK THAT IS GOING TO SHAPE GEOPOLITICS

Geopolitics is always shaped by few global powers, especially the US so far, even if it has been an increasingly multi-polar world.

But with the recent developments that have revolved around inward looking protectionist and autocratic powers taking central position not just at their homes but in the overall flow of geopolitics, the world order is increasingly going to be shaped by a block of four countries – RUBRICHUS (Russia-Britain-China-US) with their leaders – PUMAXIT (Vladimir Putin-Theresa May-Xi Jinping-Donald Trump).

The US still wields enormous military power. Russia and China are big military powers in their region.

The US is also the world’s largest economy and will remain so with its clout to greatly affect the trade blocks and negotiations.

But then autocratic China is also there with its economic might and a production model back home that is antithesis of the values that the US and major economies of the free democratic world promote.

There is absolute protectionism and labour laws heavily tilted in the favour of businesses. And with that model, China has become the world’s second largest economy. Further, with the new US President Donald Trump’s inward looking and protectionist views that aim to seclude the US economy in domestic shackles, the Asian economic giant is trying to take a global leadership position with its president Xi Jinping saying that China is ready to fill the space vacated by the US.

The US under Donald Trump has effectively dumped the biggest global trade dead proposed – Trans-Pacific Partnership (TPP) with a potential to regulate 40% of the world’s trade. Trump’s next target is NAFTA (North America Free Trade Agreement) and no one knows what comes next. No one knows where he will stop in the name of preventing jobs and businesses going out of the US. But signs are not good. He is threatening businesses with counterproductive measures

Russia is a big military power and big economy of its region of influence in Europe and Asia with an autocratic president in Vladimir Putin who believes in the unbridled run of power, military expansionism and has increasingly displayed a tendency to interfere in the theatres of conflicts like it is doing in Syria. And as Putin is sitting comfortably at home, crushing all the dissent, if he goes about pursuing his global designs, it will be a development that was about to happen. The erstwhile USSR was one pole of the once bipolar world and Putin has not forgotten that.

Britain, once the reigning colonial superpower of the world with economic and military might, has reduced to being just a small country with no influence to affect the geopolitical matters. Yes, but it remains a symbolic superpower of values that define the existing free democratic world order – free men, free markets and a freer world.

Many in Britain fought hard and championed to create the world’s largest economy and single, border-free zone of countries in the European Union (EU) – inspiring the world to create such free zones for men and economies to flow freely. But that is not the case anymore. Britain, under its new leader Theresa May, in a bitterly fought referendum that divided the country, has said that it will exit from the EU and the legal process has already begun.

What happens to RUBRICHUS and PUMAXIT, only future can tell but the flow of geopolitics is going to be dependent on their movements.

©SantoshChaubey

THE TRUMP QUESTIONS

SO FAR.. 

As @realDonaldTrump is being inaugurated, the world looks even more volatile now. He may prove disastrous, for the US foreign policy and for the world.

Immediate @realDonaldTrump threats:
Nuclear proliferation
South China Sea dispute
Israel-Palestine and the prospects of two state solution
Protectionism and trade wars
Xenophobia, bias against immigrants and racial minorities, the Mexico prejudice
Taiwan and One China policy

As @realDonaldTrump is being inaugurated, people are obviously asking when he is going to be impeached?

What is the main problem with @realDonaldTrump?
Too straight?
Foul mouthed?
Too casual?
Too shallow?

Is @realDonaldTrump really real? How real he is? His time begins now. Soon we will know.

Going by the state of affairs, in the US and the world, @realDonaldTrump has an extremely narrow window.
80% he is going to fail.
He has just 20% to make it.

Repealing Obamacare will unravel @realDonaldTrump. He simply can’t give what he has promised – universal healthcare!
Beginning of the end?

Which US President before @realDonaldTrump had seen so much protests? Probably none.

Will @realDonaldTrump make the US another island nation in isolation? Is that what people cheering him have in mind?
This @POTUS is going to be ‘make or break’ for the US.

Will @realDonaldTrump as the @POTUS will be the beginning of the end for Trump and American global prominence/dominance as we know it?

If @realDonaldTrump and @POTUS become synonymous, what would be the long term communication and branding consequences?

Does @realDonaldTrump/@POTUS have time, liberty and scope to go ‘trial and error’ in running the US and handling geopolitics?

©SantoshChaubey

TRUMP ERA BEGINS NOW: WORLD WILL CLOSELY WATCH HOW HE HANDLES THESE FIVE ISSUES

The article originally appeared on India Today.

US President-elect Donald J. Trump is now the US President Donald Trump. He was sworn in this afternoon as the 45th US President, taking over from his predecessor Barack Obama. He is one of the most controversial people in the US history to move the White House because of his background and the values that he looks to espouse.

He looks comfortable in his skin, a flamboyant but controversial businessman, be it his divisive and derogatory campaign rhetoric or his days since November 8, 2016 when he stunned not just America but the whole world by registering an impressive victory over his Democratic rival Hillary Clinton, former First Lady and the US Secretary of State.

His campaign rhetoric and post-election remarks have stirred the whole world and people the world over are waiting to see how he is going to handle his Presidency once he settles in the White House, because creating a mess around any of the issues that he has so casually talked or tweeted about can turn the whole world or a large section of it upside down.

NUCLEAR PROLIFERATION

Donald Trump has ratcheted up war and nuclear rhetoric to newer heights. US is considered the big daddy when it comes to enforcing international non-proliferation and disarmament measures but Trump’s campaign rhetoric and his post election words have instilled a fear that the world could see a renewed race for arms among the most powerful nuclear nations of the world, especially the US and Russia.

The world cannot easily forget the ominous tweet by Donald Trump post his victory in the US presidential polls where he asserted that “the United States must greatly strengthen and expand its nuclear capability until such time as the world comes to its senses regarding nukes”.

TAIWAN AND ONE CHINA POLICY

Like his victory, this signature Trump decision made the global headlines when he chose to talk to the Taiwanese President Tsai Ing-wen post his election victory. It was a first for any US President or President-elect to speak to the Taiwanese President since 1979 when the US had closed its embassy in Taipei and severed its diplomatic ties recognizing the Mainland China as the sole Chinese voice.

After a growing global debate and Chinese displeasure, Trump’s transition team issued clarification that it was just a courtesy call. But nothing is seen as casual or ‘by-chance’ in geopolitics. The rift has deepened further with Trump’s recent statement that the One China Policy is open for negotiation.

ISRAEL-PALESTINE

Jerusalem is contentious. Both Israelis and Palestinians consider in their capital. Though it is where Israel’s power corridors are, no embassies are here but in Tel Aviv because doing so would compromise the peace process and would damage the prospects of the ‘two state’ solution beyond repair. Moving the US Embassy to Jerusalem has been a campaign rhetoric in the US Presidential polls. It never went beyond that.

Now, like his Taiwan move, Trump says he doesn’t break promises and will move the US Embassy in Israel from Tel Aviv to Jerusalem. Protests have begun against it and if Trump’s designs materialize, it will force an entire region in flames again, something that even many Israelis are not in favour of, even if the Israeli leadership is encouraging it. A New York Times report writes, “It would only set off new fighting with the Palestinians as well as the rest of the Arab world, a big price tag for a symbolic change that would hardly move the ball on the broader conflict”.

ETHNIC DIVIDE

Trump’s campaign and his transition team have been harsh on immigrants and minorities. He has not desisted from issuing offensive statements against immigrants including Muslims, Black Americans and racial minorities. They talked of creating a Muslim Registry to humiliate them even further. His election saw protests not just in America but in many other parts of the world. Before and after his election, Trump has made clear his intention to build a wall along the Mexican border using choicest of words for Mexican immigrants.

The world had never seen society in the US so divided, at least in decades, since the days of segregation and counterculture. Okay, there is always this division, a group chooses this, the other one goes for that, but this all is at an electoral level. What happened in the US after Donald Trump’s victory is suggestive of deep fissures in the US society that Trump likes to flare up even if he talked of a united US society today – of Black, Brown and White Americans. After Trump, people are fearful of rising White supremacist tendencies in the US society.

If things really go out of control as the scenario looks now, its repercussions would be seen across the world because US has been a cosmos of ethnicities from across the world.

TRADE WARS

The World Economic Forum’s annual meeting was held in Davos from January 17 to 20. China tried to make a big presence there this time but the whole Chinese focus revolved around sending Trump a message that protectionist approach would lead to trade wars which would hurt everyone. Targetting increasing anti-globalisation, Chinese President Xi Jinping reminded Donald Trump and the world that “no one will emerge as a winner from fighting a trade war” and that China would pitch in to counter Trump’s moves.

Donald Trump has threatened to create protective barriers to stop businesses and jobs moving out of the US. He has been a harsh critic of outsourcing and the US under him would potentially see a much declined numbers of professionals heading towards the US. He has vowed to impose tariff barriers to check inflow and outflow of goods in the US.

Trump’s plans to go ahead with his promises took a large part of his inaugural address today. He said, “We have spent trillions and trillions of dollars overseas while America’s infrastructure has fallen into disrepair and decay. We’ve made other countries rich, while the wealth, strength and confidence of our country has dissipated over the horizon. But that is the past. And now, we are looking only to the future. Every decision on trade, on taxes, on immigration, on foreign affairs will be made to benefit American workers and American families. We must protect our borders from the ravages of other countries making our products, stealing our companies and destroying our jobs. Protection will lead to great prosperity and strength. I will fight for you with every breath in my body and I will never ever let you down”.

The Trump era begins now. He is officially now the most powerful person on the Earth. Let’s see where his domestic and geopolitical priorities take us. Trump says “the time for empty talk is over. Now arrives the hour of action”. Indeed!

trumpinaugural-whyoutube

©SantoshChaubey

Featured Image Courtesy: Donald Trump delivering his inaugural speech – The White House’s YouTube screen-grab

WHY THE INDIAN SUBCONTINENT IS NOT THE NEXT WORST CRISIS HOTBED!

Some analysts, including a recent opinion piece in Al Jazeera, predict that South Asia (or more specifically the Indian Subcontinent) is poised to be the next worst crisis hotbed of the world – with the region having three belligerent nuclear power nations who are also neighbours – India, China and Pakistan – with historical border disputes and the enmity thereof that has given rise to many wars and consistent rush of skirmishes.

Well, to clear things first, India and China have had historical enmity and border disputes but both countries are now big enough economies to engage in a full scale bilateral war – China’s is the world’s second largest economy and India is the third largest. They cannot and they should not afford even the border skirmishes now and the recent developments indicate that.

Yes, there are problems but these are now basically rhetorical in nature as China’s authoritarian regime needs some tough posturing to send home the message. Ideally, in the prevailing circumstances, when China is now more of a ‘capitalist’ communist state, things should not go beyond that. And it should be seen in the context of India’s space and military prowess that can harm China enough to come to the negotiating table in case of a full blown war.

The sanctity of China’s authoritarian regime lies in how it manages and grows its economy. The nation certainly cannot afford a Tiananmen now.

And with Pakistan, though China is the country’s historical ally, it is not going to the extent to support Pakistan in case of any hostility with India – coupled with the fact the US is now there to support India against China. Also, China is facing Muslim insurgency in its Muslim dominated regions that gets lifeline from Pakistan.

Any military confrontation between India and China is damaging for the economies of both of the nations and they will not risk it – let alone the spectre of full scale war.

And if a military confrontation will be damaging for India, it will be annihilating for Pakistan. A blown out hostility or a full scale war with a bigger country that is many times you militarily and economically will be like inviting ‘the end of days’ for its all ‘powerful’ military that now stands nowhere near to India.

The future of the Indian Subcontinent will be driven by these ground-based realities – and the spectre of an economic meltdown thereof – and not by the incessant war rhetoric of Pakistan – and not by the toughly-worded posturing by India and China.

So, where are the next real crisis hotbeds – the conflict theatres so volatile that they can send the world upside down – a world bound by a globalized economy – the Korean Peninsula – or the South China Sea?

The ‘capitalist’ communist logic with China applies even here. But, certainly, we all need to be worried about North Korea and its young, obese, morose but mercurial dictator who is also insane.

©/IPR: Santosh Chaubey – https://santoshchaubey.wordpress.com/

US-CUBA EMBASSIES REOPEN, UN ENDORSES IRAN NUCLEAR DEAL, BANKS IN GREECE REOPEN: JULY 20, 2015 IS A SIGNIFICANT DAY

July 20 is the big symbolic day for a globalized world.

Three big international events had their formal start today, on this Monday.

The events that were in making for a long time and finally saw the final bottlenecks overcame in recent days, had their functional beginning today.

After 54 years, the United States of America and Cuba opened their embassies in each other’s territories. After decades of mistrust, they upgraded their diplomatic missions in their respective countries to the status of full-fledged functional embassies.

Today, on July 20, the United Nations endorsed the historical nuclear deal between Iran and six major powers of the world (America, Britain, Russia, France, Germany, China). The deal prevents Iran from occupying nuclear weapons for at least 10 next years, thus keeping in check the nuclear race in the Middle-East where oil money of dictators flows freely to keep many monarchies safe and running at any cost.

The UN endorsement paves the way for a sanction-free world for Iran where it can engage in economic activities to work on national finances. Lifting of sanctions will also results in hundreds of billions on dollars in frozen assets now available to the Iranian policymakers. Being a major oil producer, lifting of sanctions will also mean cheaper oil for countries that largely depend on oil imports to meet their demands.

Today, on a July Monday, banks in Greece were reopened again, after three weeks. The European nation reached at a bailout deal after defaulting on June 30 on International Monetary Fund loan. Greece has seen intense protests over the terms on this deal that many says are humiliating. The IMF says Greece needs much more than the deal proposes.

But, ultimately, for the time being, the deal is in. IMF said today the country is ‘no longer in arrears to the IMF’. With borrowed money, Greece started paying loans of the European Central Bank (ECB) and the IMF. With borrowed lease of life to stay in the Eurozone, Greece again started on the process to save its economy from a complete breakdown.

So, Greece is no longer a defaulter country – for the time being. But the deal has come with many austerity measures for the country that are binding and Greece has to meet the terms (as dictated).

These three events have global ramifications for international economy and associated global politics – irrespective of the way they go.

It will take time to assess the impact of the measures taken.

It will be years before the US-Cuba ties can reach to a normal bilateral level.

Iran and the world community have to progress patiently for years to realize the objectives of the nuclear deal.

And no one can say anything about Greece as of now. Every analysis points towards negative indicators on the future outcome of the deal. But, as of now, we can say a start to an effort (yet another effort) has been made.

©/IPR: Santosh Chaubey – https://santoshchaubey.wordpress.com/

STABLE GROWTH MOMENTUM FOR INDIA, JAPAN AND GERMANY

OECD (The Organisation for Economic Cooperation and Development)’s finding today reaffirmed the healthy picture for Indian economy.

The report is based on the assessment of Composite leading indicators (CLIs). Leading Indicators indicate about the direction an economy is changing to. OECD says CLIs provide ‘turning point in business cycles’ – calculating variations in output – its highs and its lows.

The report says the growth momentum is Japan, Germany and India is stable – or the indicators say so. Statistical indicators of the report may look confusing to a layman but the text is clear.

India has already become the world’s fastest growing economy. It is already the world’s third largest economy on ‘purchasing power party’ (PPP). On gross indicators, it is projected to become the world’s third largest economy by 2030. By then, it will have the largest middle class as a Harvard study finds. That means the biggest marketplace for global companies (including China’s).

The report says growth is ‘easing down’ in the US, the UK, Canada and China. That translates to slowdown in economies. So, the other major powerhouse, that has been the leading growth engine of the world economy for decades, China, is slowing down, as has been projected and is being analytically projected.

The OECD report also puts questions on economies of another two BRICS block countries, i.e., Russia and Brazil. While Russia’s positive growth is ‘driven by tentative signs’, Brazil has seen ‘loss in its growth momentum’. Though the dictator in Vladimir Putin will see it an overall positive sign for his presidency.

The report is also positive about economies in Japan, Germany and Euro area.

Japan, the world’s fourth largest economy, has seen a consistent rough patch and it coming back to the stable track is a good sign for the markers the world over. Germany is already the central point of Europe’s economy and the report see stable growth momentum here. And when it is seen in parallel with a ‘firming up’ growth in the Euro area (emphasizing on France and Italy), we find reasons to believe in the reports that Greece would remain in the Eurozone with a common currency.

OECD is a Paris based major global economic block of 34 countries, mainly European. The US, Canada, Japan, Australia, South Korea, Turkey and others joined it later on.

The report released on July 8 is based on data from 33 OECD member countries and six non-member countries.

©/IPR: Santosh Chaubey – https://santoshchaubey.wordpress.com/

WELL, GREECE COLLECTIVELY SAID NO!

Alexander the Great is one of the heroes of the childhood days. Our staple diet of childhood curiosities had him as a constant figure – in our history textbooks, in story books, on television and on cinema screen.

And we especially loved him in India with his larger than life act that began with his largesse after he won the battle with King Porus. We loved him because Alexander was driven to act so by honesty and heroics of King Porus.

And our childhood had this image of Greece – as we saw Alexander the Great.

History was not a subject during formative years in college, so there was not much development on this front, about any country’s history fuelling imaginations of a lore, but Greece, whenever it was mentioned in passing references, during cultural engagements, was seen as a country producing people like Alexander the Great who created one of the largest empires of the ancient world and he just 30 after he had done so.

Growing up had more realistic thoughts of the country in changing times – in the contemporary age. Greece was a developed country. But it was always a small, sidelined country in Europe that didn’t matter much for geopolitical affairs in a globalized world.

And its global outreach was still shadowed by its historical legacy – a legacy of being the cradle of the Western Civilization – Alexander the Great and his overreaching empire, Greek philosophy (and Western philosophy), literature, cultural influence, literature and yes, the Olympics.

To sum up, Greece has had a grand history, like few in the world – through ages. And among many things, we can be sure of once element – the character of its people. A history like the history Greece has requires ‘dignity’ as the underlying support of the character of the nation and that directly corresponds to the character of the people.

And dignity has in-built sub-character of logical defiance when it comes to the questions of self-respect.

That was on display this July 5 when Greece vehemently rejected the bailout conditions during a nationwide referendum. The government there has already defaulted on its international debts with the IMF deadline passing on June 30. The lenders posed strict austerity measures for the Eurozone country to finance its further requirements.

Well, its citizens collectively said ‘no’.

There are various possible repercussions of it – for Greece, for people of Greece, for Germany, for Euro, for Eurozone, for European Union, for European Central Bank, for Europe – and for global economy.

And they are being debated intensely – in Europe – and throughout the world.

With words and hashtags like #Oxi and its different mood-specific variants, #GreeceReferendum, #GreeceCrisis, Greece Referendum, Greece Crisis, Grexit and so on!

©/IPR: Santosh Chaubey – https://santoshchaubey.wordpress.com/

CLOSER ECONOMIC TIES BETWEEN INDIA AND CHINA MAKE SENSE

They are the world’s two most populous nations.

They are poised to be the world’s second and third largest economies.

They are the world’s biggest markets.

One has grown at around 10% for 30 years.

The other has grown around 6% for 20 years.

And as China, the one with an average growth rate of 10%, is slowing down, India is slated to become the fastest growing economy of the world.

And it is in process. India, that has grown at around 6% for past two decades, is expected to grow at 7.5% this year compared to China’s 6.8%, as the International Monetary Fund (IMF) reports.

According to a report by the Harvard University, the projections say India will grow annually at 7.9% for eight years till 2023 while the average annual growth rate for China for the same period is expected to be 4.6%.

India is poised to become the world’s youngest nation by 2020.

India has 65% of its population under 35 years of age – that corresponds to over 81 crores (810 million) of India’s population of 1.25 billion.

When its prime minister, Narendra Modi, who started his first official tour of China today, talks of a demographic dividend, he has reasons to say so.

India is poised to have the world’s largest middle class surpassing China by 2030. The criteria used by the BBC for this projection was an earning potential of US$ 10 to US$ 100 per day. The study projects India’s middle class to be 475 million strong by 2030.

According to a study by the World Bank, United States was at the top of the middle class consumption pecking order in 2009 with 21% global share (US$ 4377 billion). In 2020, China is projected to be at the top with 13% market share worth US$ 4468 billion. India will make a grand entry there with projected market share of 23% worth whopping US$ 12777 billion.

China’s is a manufacturing powerhouse and India is trying to be the one with the Bhartiya Janata Party (BJP) led government’s ‘Make In India’ campaign.

Global companies are vying for Chinese and Indian markets and India and China are eyeing for each other’s market as well.

And closer economic ties between the two giants, the projected second and the third largest economies of the world, the two largest middle classes, the two Asian superpowers and the two neighbours, make sense.

Right now, China is ahead of India in every comparable aspect – in social sphere, in military technology, in infrastructure and in economy – China’s economy is over four times the Indian economy.

But India is the world’s largest democracy and is slowly adopting the features of a free market economy while the Communist China with a one-party system did it very fast.

Now, China is stagnating and is coming around a sustainable growth rate.

And India is poised to take up – at least for a decade to come.

And the two counties together make the largest marketplace of the world – with 24% of the middle class consumption by 2020 that is slated to go up by 17% to become 41% by 2030.

India and China, the world’s two fastest growing economies, are home to over 2.6 billion people now – that is around 30% of the world.

And they are big markets for every country – including themselves.

Xi Jinping’s India visit last year and Narendra Modi’s China visit this year should be seen in this context only – two large economies that see gains in mutual cooperation – even if it means pushing back the contentious issues – including the border issue.

©/IPR: Santosh Chaubey – https://santoshchaubey.wordpress.com/