ISSN 0974 - 2514 International Journal of South Asian Studies GUIDELINES FOR SUBMISSION OF MANUSCRIPTS A Biannual Journal of South Asian Studies Original papers that fall within the scope of the Journal shall be submitted by e-mail. An Abstract of the article in about 150 words must accompany the papers. The length of research papers shall be between 5000 and 7000 words. However, short notes, perspectives and lengthy papers will be published if the contents could justify. Notes should be placed at the end of the text and their Vol. 1 July – December 2008 location in the text marked by superscript Arabic Numerals. No. 2 References should be cited within the text in parenthesis. Example : (Sambandhan 2007:190) Bibliography should be placed at the end of the text and must be complete in all respects. Examples: 1. Hoffmann, Steven (1990): India and the China Crisis, Oxford University Press, Delhi. 2. Bhalla and Hazell (2003): “Rural Employment and Poverty: Strategies to Eliminate Rural Poverty within a Generation”, Economic and Political Weekly, Vol.33, No.33, August 16, pp.3473-84. All articles are, as a rule, referred to experts in the subjects concerned. Those recommended by the referees alone will be published in the Journal after appropriate editing. No article shall be sent for publication in the Journal if it is currently being reviewed by any other Journal or press or if it has already been published or will be published elsewhere. e-mail: [email protected] or [email protected]

SOCIETY FOR SOUTH ASIAN STUDIES Department of Politics & International Studies Pondicherry University Puducherry, India Contents

Making Social Capital Work in the Theory and Practice of South Asian Association for Regional Cooperation (SAARC) Regional Economic Integration and Development: - Santosh C Saha … 213 Sustaining Trans-regional Cooperation in South Asia - Sailaja Gullapalli … 352 Institutional Reforms in Water Sector: A Cross Country Perspective from South Asia Workers Managing Sick Industry: The Experience of Kamani - Satyapriya Rout … 236 Tubes Limited from Mumbai - Jose George & Manoj Kumar ... 363 The Afghanistan Crisis: Geo Politics, Issues and Perspectives - K S Pavithran … 256 Civil Society in South Asia: Nepal and Pakistan in a Comparative Perspective Indo-US Nuclear Deal and South Asian Regional Security - Anil Kumar Mohapatra ... 374 - C Vinodan … 269 Northeast India As a gateway to India’s Look East Policy Islam and Media Discourses in India: Constructing Islamophobia - Munmun Majumdar ... 391 - T Marx … 284

Challenges and Opportunities of Micro-finance for Poor Women’s Empowerment - S Vasantha & Hansa Lysander Manohar … 296

India-Pakistan Relations and Prospects of SAFTA: Political Conflict vs. Economic Cooperation - Saroj Bishoy ... 311

Mitigating Gender Inequality: Road to Development - An approach through Women Empowerment - Gautam M Pillai & Anushital ... 327

The Prospects of Economic Integration of South Asia with Regard to Intra-Regional Conflicts and Tensions - Arvind Adityaraj ... 337 Santosh C. Saha 214

Making Social Capital Work in the Theory and Practice of South human development in South Asia. Following additional view of post-modernity is to regard Asian Association for Regional Cooperation (SAARC) a postmodern approach in analysis, this study it as a form of consciousness in which argues that each culture has its own standard subjectivism replaces the prior emphasis on Santosh C. Saha for judging human development, claiming objectivity. Here the perspective conveys a that the claim for the universality of reason sense of human responsibility, the prospects Abstract is ethnocentric in that it privileges a Western for decision-making on the basis of The SAARC’s strategic social engineering, when seen in a historical context, view of the development while discounting information available, and the opportunities and examined from numerous social declarations, meetings and actual other processes. An eventual argument is for self-determination through social action. ground works, provides a pattern of development planning that appears to developed to affirm that within SAARC, the Peter Berger (1969) described the perpetual have some tangible work in various fields in human development in South principle of social justice has come to process in human behavior as involving the Asia. Following a postmodern approach in analysis, this study argues that dominate over the ideal of social protection. dual tasks of world-construction (realities each culture has its own standard for judging human development, claiming Of course, the outcomes of the current created by tools, social norms, values, and that the claim for the universality of reason is ethnocentric in that it privileges upsurge of interest in social capital are hard aspects of culture), and world maintenance a Western view of the development while discounting other processes. An to predict. What is declared is that social consists of the social supports by which eventual argument is developed to affirm that within SAARC, the principle capital will become another variable people uphold their definitions of reality in of social justice has come to dominate over the ideal of social protection. alongside physical, financial and human a given context.2 The SAARC leaders and capitals in the equations of econometricians. intellectuals claimed that in all cultures there is a basic human need to act effectively Postmodern Approach and Human within one’s culture and society and to do Introduction activities in social development of SAARC Capital Development is about the generation of social justice this, individuals need a measure of health and autonomy. Health and autonomy are In August 1983, seven South Asian leading to human capital development, Jean-Francois Lyotard’s “suspicion secured in culturally diverse ways through nations signed an agreement in New Delhi specifically two aspects — development of of meta-narratives” has been taken by Eastern the meeting of intermediate needs for shelter, establishing the South Asian Regional community spirit and individual progress, scholars since the early 1980s. We are clothing, food, lovingness, security and Cooperation (SARC), which was while examining some basic strategies and reminded that the postmodern condition education. Added to this, there is also a appropriately renamed in 1985 as the South objectives in reducing existing anomalies manifests itself in the multiplication of centres critical autonomy which would enable Asian Association for Regional Cooperation in development theme. The state was not of power as well activity and the end of the individuals not only to act effectively in their (SAARC), to generally avoid political rolling back, but the larger regional totalizing narrative which claims to govern the own culture but also critically challenge it matters and shun strictly bilateral issues, association could possibly create flexible complex field of social activity. In the or opt out of it.3 Therefore different countries providing avenues for the human human development both at the regional postmodernist vein, Ashis Nandy, Rajni Kotari, might have different set cultural goals in development theme, an area largely level and personal field. The SAARC’s Veena Das, and others have argued for the health care. SAARC societies work within neglected by individual countries. Since strategic social engineering, when seen in a development of civilizational ethos. A defence different paradigms and cannot agree on inception, SAARC played a positive role, historical context, and examined from of local knowledge against rationalization and certain things in health care. In slave-owning some real and some potential, in social and numerous social declarations, meetings and secularization underlies some theories of society the welfare of slaves did not human development through means such as actual ground works, provides a pattern of subaltern studies, which have found a contribute to aggregate welfare. In Islamic prevention of child labor or stopping of development planning that appears to have worldwide following through the writings of Republic of Pakistan and Muslim state of traffic in women. My current analysis of the some tangible work in various fields in Partha Chatterjee, Gayatri Spivak, Homi Maldives, the health care of women counts Bhabha, Dipesh Chakrabarty and others. for less than that of men. It may be concluded Their attempts have given rise to regional that rationalist paradigm of health may differ movements for social justice, environmental from that of secular India, or even semi- Dr Santhosh C Saha is a Professor of History at Mount Union College in Ohio. He is on the Editorial Board of protection and women’s rights, which are also secular Bangladesh. Journal of Asian Studies. traditional left-wing liberal causes.1 An

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If post-modernity stands against the (b) as a source of family support; and (c) as legal and institutional environment); and the (A) SAARC’s General Strategies in Social met-narrative, SAARC’s social capital calls a source of benefits through extra-familial synergy view (synergy between government Capital for local discourse and work in human networks.8 For our current purpose, and citizen action is based on “complementarity development field. A meaningful Coleman’s stipulation is helpful. He argues and embeddings”). Michael Woolcock, a social Recently during the 15th SAARC conjunction is being traced in this study that social capital is defined by its function. scientist with the World Bank argued that many Summit in Colombo, a declaration said, between post-modernity and the ideal It is a variety of different entities, having of the key contributions of the book, Bowling “SAARC needs to be brought to the level of involved in “social capital,” which is about two characteristics in common: they all Alone, by Putnam, failed to make a proper the people,” indirectly admitting that SAARC the values of civil society, a central consist of some aspects of a social structure, distinction between different types of social has failed to “develop a strong constituency” argument of Robert Putnam, who launched and they facilitate certain actions of capital.13 However, these two authors are within the civic groups.19 SAARC has realized social capital as a popular focus for both individuals who are within the structure. In cautious to declare that the framework on that the lower strata and the higher strata in research and policy discussion. Social short, social capital is not just the sum of analysis is not “to announce the arrival of a society differ only in the fact that they are capital has also been upheld by the World the institutions which underpin a society new paradigm,” because there are some forced to choose different values. One Bank as a useful organizing idea. The bank because it is the glue that holds them problems associated with the paradigm.14 For plausible reason is that the SAARC nations argues that “increasing evidence shows that together.9 Usha Sharma, women’s empowerment in have borrowed the Western ways at random social cohesion is critical for societies to Nepal, Bhutan, and Bangladesh, etc., is not at many levels believing that an introduction prosper economically and for development In sum, as post-modernity holds only an external process, but a process that of economic development can hopefully raise to be sustainable.”4 On another occasion, that reductionist abstraction based on has to bring about the intrinsic changes, not the level of human accomplishment. The Putnam defines social capital as the norms Western rational discourse may not provide only in women but in men also.15 Jitendra oriental cultural values are greatly of reciprocity and trustworthiness that arise us with totality of “human subjects.” Some Kumar Sharma, referring to institutional compromised in order to bring success in from social connections among individuals.5 Neo-Weberian theorists construct social environment, posits that the policy makers in several human development matters. The Coleman, being more specific, argues that capital as the combination of ties and norms rural development should develop specific typical Western view of modernization, which three forms of social capital need to be binding individuals within constituent instrumentalities in response to specific encompasses ideas on civil liberty, freedom 10 examined for assessment, obligations and elements of larger organizations, or linking situations, and adapt these to new situations.16 of speech and multi-party democracy, is 11 expectations, information channels, and them across different institutional realms, A. Ranga Reddy finds in South Asian partially challenged by SAARC leaders. They social norms.6 Two other sources of social whereas others regard social capital as a ecological development “complimentararity,” seek to devise a more communal and equitable capital exist that fit the consummatory moral resource such as trust, or a cultural a paradigm in which women’s development in form of development. It is a desire to reinstate versus instrumental dichotomy, but in a mechanism used to reinforce the borders of South Asia is dependent on NGOs as well,17 the best of the old ways in the face of different way. The first refers to Marx’s groups. This leaves unresolved whether thereby implicitly affirming that “excessive controversial rapid globalization. Francis class consciousness, which is the product social capital is the infrastructure or the dependence” on the state for every lead in Fukuyama sees social capital as the glue that 12 of a common fate. The second refers to content of social relations, or is it both? social development has curtailed initiatives on holds the otherwise centrifugal structures of identification with one’s own group, sect, Matters are complicated further when social the part of the people in Nepal.18 the market together.20 Scholars have not or community.7 The final source of social capital is classified as a public good that is differentiated the borders of national capital finds its origins in Durkheim’s theory under-produced by society. Michael In the following pages, I will examine development and those of human of social integration. A member of an ethnic Woolcock and Deepa Narayan have three elements in SAARC’s social capital development. It is wrong to confuse the group may give scholarships for young co- examined the social capital issue under four development, under the rubric of Coleman’s progress in high literacy rate, for instance, in ethnic students, thereby expecting not distinct perspectives: the communitarian thesis of coordination between the community Sri Lanka or Kerala state in India with the repayment from recipients but rather view (clubs, civic groups, and associations); and the individuals, an integrated approach, work of SAARC. Two areas are taken up approval and status in the “collectivity.” In the networks view (intercommunity ties that which obviously may have deficiencies. These for our discussion. First, SAARC has the ultimate analysis, three basic functions provides a sense of identity and common are: (A) General strategies; (B) Community attempted, with modest success, in developing of social capital are applicable in a variety purpose); the institutional view (the vitality spirit and work, and (C) Individual progress. the concept of group or community solidarity. of contexts: (a) as a source of social control; of community work depends on political, Community initiatives, for instance, included

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 217 Making Social Capital Work in the Theory and Practice of SAARC Santosh C. Saha 218 self-employment and wage employment term social capital simply recaptures an collective good. Putnam and Pharr describe Development Index (HDI) has the virtue of programs in rural areas, like Integrated Rural insight present since the very beginnings of these collective effects as “rainmaker incorporating human choices other than Development Programme and Jawahar the discipline.22 A comparison with other effects.”24 The collective identity sense is still income. Life expectancy is not only an Rozger Yojana. Bangladesh’s provision of models is helpful. East Asian Tigers’ growth loose among SAARC nations and as such its indicator of the quantity of life, but of its micro-credit by Grameen Bank (rural places priority upon economic progress strategy has been a slow process, mostly for quality as well. Increases in longevity reflect banks) along with other NGOs helped 8.8 instead of social development because of the political reasons. The European Union seeks progress along multiple fronts, including the million people in 1998. Keynesian economics explicit presumption that individual social to develop into an integrated whole including incomes and earnings of people and the dealt a blow to laissez faire; SAARC has rights are meaningless in the absence of basic politics and economic but SAARC is prevention of diseases.27 In the same vein thus intervened in social welfare. South Asia material well-being. In East Asia, it is been concerned with regional human development, and in confronting the older emphasis on the remains a largely informal society based on assumed that there is a positive correlation rather than full integration. No doubt, both in eventual trickling down of the general kinship and patronage. This impeded between reformed better policies, higher letter and spirit, SAARC is a cultural, economic development, a new ideological development of institutions and also, rules in growth, and higher human development. But economic, and commercial association, aimed framework in the 1970s of the U.N. favor of discretion and decisions made on there poverty level is not so acute and as at creating a free zone, which may turn into a conferences offered the “Basic Needs the basis of political connections. Incomes such SAARC has to take a different route. unified geographical zone like the European Approach” that considered that health and are not treated in South Asia uniformly for The SAARC nations follow the guide lines Union, but SAARC’s social goals have a education are motors for productivity. The tax purposes; there is no equity and of the World Bank. In 1991, after priority for cultural reasons as well. noted Pakistani economist Mahbub ul Haq efficiency. Large part of the subsidies has considerable international debate, the Bank (1997) also argues that SAARC region has little impact on poverty reduction. Working acknowledged that investing in people Thus, for SAARC, the emphasis in been sinking fast into a quagmire of human under these unique adverse conditions, provides the firmest foundation for lasting development has moved from macro deprivation and despair, emerging as the SAARC has made progress toward the development. This meant in principle better economic prosperity to specifics in literacy most deprived region in the world, and as generation of social capital that is not easy education, higher standards of health and and eradication of poverty, and, more such meaningful development must include to observe and measure. Both national nutrition, less poverty, a cleaner environment generally, “human development.” The progress in individual empowerment, governmental and regional associational and more equality of opportunity. Therefore, concepts of human development and although he, like Sen, legitimately finds a institutions strongly affect the level and type SAARC decided to spend fewer resources economic progress are now considered as connecting link between macro economy of social capital available to groups and more efficiently in social services, shifting different because each of various human and human development. SAARC has been individuals to pursue long-term development spending priorities. SAARC realized that development factors independently carries working in promoting regional cooperation efforts. In this sense, there is there are clear complementarities between considerable weight.25 In order to highlight the in the context of post-sovereign international “complimentarity” between the two. state and non-government organizations. In importance of social development in literacy, system, but its work in social development Empirical evidence derived from a study of this view, social development is both a adult education, health, poverty alleviation, appears to have eroded some of the state’s 150 irrigation systems in Nepal supports this prerequisite and a consequence of economic and other related elements, Amartya Sen has absolute authority for the greater good of the conclusion.21 growth.23 drawn a contrast between Kerala in South greater number of people.28 India (a state with highest literacy rate in That practical involvement and While admitting that the SAARC India) and North India (low literacy rate), In sum, current investment in active participation in groups can have does not necessarily socialize citizens (as arguing that literacy and communal violence welfare infrastructure which is appreciated positive results for the individual and the effectively as the European Union) in the are related, and that improved literacy is likely in SAARC countries contrasts sharply with community is a “staple notion,” dating back community into different attitudes and values, to lead to lower communal violence.26 The the welfare burden mentality generally to Durkheim’s emphasis on group life as an it has given a sense of connection through implicit idea is that social development adds associated with liberalism, or so-called antidote to anomie and self-destruction and loose networks as well as efficacy. to an all-round progress of a country. Even “compassionate conservatism” in the US. Marx’s distinction between an atomized Researchers indicate that there is a sense though the concept of human development is “class-in-itself” and a mobilized and that social capital works best at the collective larger than the measure, the Human effective “class-for-itself.” In this sense, the level and thus should be understood as a

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(B) Community Spirit and Actual Work: ideology of the South Asian countries, many meaningful relevance to our present analysis. activities should have immediate impact on Cutting across Nationhood policies, designed to implement that He argues that for the fundamental liberties the lives of the people, which is the primary ideology, are still in the planning stage, and of the person, the social and economic policies objective of the charter.33 Additionally, each Putnam uses a set of indicators that hence a debate about the well being of the are aimed at maximization of the long-term member of SAARC has so far launched can be readily adopted in discourse – majority of population needs our attention. expectations of the least advantaged locals social development programs in its own way indicators, such as community organizations, There is a consensus that social under conditions of fair equality of and assessed also its performance in its own clubs, civic organizations, public and group 31 development, i.e. development of the opportunity. The key feature of social justice way. The Social Charter goals now impinge projects beyond the pale of national citizens, should be understood as a broad is that it facilitates coordination and on each nation to move toward the regional economy. Perhaps the best expression of phenomenon, one which includes social and cooperation for the mutual benefit of the goals and make assessment of their community organizing document of SAARC welfare services, progress in tackling members of the associations. Associations performance also against the regional is its social charter, which is still a quest. unemployment, poverty, drug uses, child provide a framework for sharing information, standards. There are now the South Asian SAARC’s “Social Charter” imitated many welfare, and women’s status, etc. This coordinating activities, and making collective regional newer paradigms, as designed in the other international charters but has its own development has long-range implications. decisions. Building and utilizing physical, social charter, in planning, implementations focus on poverty, food security, drug The ability to achieve satisfactory health human, and social capital are analytically and evaluations. trafficking, and governmental relief to the and educational goals, for instance, “at separable, but closely intertwined in reality,32 disabled, and above all community spirit. relatively low incomes,” has great and culture acts as a cementing force. People In sum, although SAARC social Unlike the Western charters, SAARC does implications for the welfare of local who keep their cultural identities face difficult charter lacks a coercive power, it has become not include components like human rights, communities living in poor rural areas.30 The dilemmas in the face of invasive globalization, an increasingly useful reference point for the workers’ rights, industrial relations because process of social development appears to but at least they tend to compromise community development as well as it is designed to be different from European be in the case of South Asia not a “middle themselves in more creative ways for social individual growth. Reference by socially Social Charter of 1961 which was revised in path” in which the state is central to progress. minded social activists to the obligations of 1996. Effective cooperation in the field of economic and social development, not as the charter has frequently been used as a trade has been one of the major concerns of the sole provider of growth but as a partner “The Coalition for Action on South means of opposing a laissez faire attitude of the member states of SAARC, and therefore and facilitator, as in the case of East Asian Asian Cooperation” (CASAC), a non- some member states. most scholars are engaged in the discourse means of eradication of poverty. In South governmental organization with regional about macro growth for regional Asia, the governmental role is very chapters in all South Asian countries, made a (C) Individual Improvements and advancement. Dutta (1999), Khan (1999), significant and this aspect has been good start as per the recommendations of the SAARC and Hassan (2000) provide an extensive highlighted without paying attention to social charter. CASAC’s attempts resulted in overview of SAARC as well as regional and parallel social and cultural movements in establishing a high-level group called the (1) Health multilateral benefits of trade in the South rural communities in SAARC countries. In “Citizens Commission of South Asia.” The 29 SAARC has taken up several issues Asian area. But regional cooperation in short, other factors such as economy and commission was composed of noted such as health, education etc. to improve social development or human resource politics have unduly attracted more personalities of South Asia to deliver upon individuals and these issues can be development has not been institutionalized attention. the critical issues of development and and as such political scientists and historians personal security. The Citizen’s Commission considered as elements in social capital. have virtually ignored the issue as a prime Within the SAARC, it seems that held its first session in December 2000 at Putnam’s Bowling Alone argues that social theme. the principle of social justice has come to Kathmandu to begin a process in which capital has important consequences for the dominate over the ideal of social various segments of the civil society would health of a nation. This inclusion of health Social development arises from protection. To Plato, justice means “just” be mobilized to work together to reinforce into sphere of social capital contradicts his complex factors, including social policies (right); to John Rawls, justice involves and strengthen the official and non-official stance taken in his book, Making Democracy initiated by the various governments, which morally approved “liberty,” to Aristotle, it framework for regional cooperation in the Work. In this book, Putnam considered health are often in conflict with some other policies. is “fairness” that treat people spirit of the social charter. The commission as an input rather than output of social Despite an egalitarian community based proportionately. Rawls’ paradigm has some emphasized that to be relevant, SAARC capital. Perhaps the acceptance of the idea

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 221 Making Social Capital Work in the Theory and Practice of SAARC Santosh C. Saha 222 of social capital by health researchers diseases and one of the worst indicators for system, herbal medicine, yoga, and meditation collaboration with the Government of India, convinced Putnam to consider how social reproductive health in the world. Market have become powerful modalities for Bharati Vidyapeeth, and Community Aid capital might affect health. He wrote, “Of failures and a concern for equity call for providing some remedies to the poor and ailing and Sponsorship Programme (CASP) in all the domains in which I have traced the some government financing of health and population in the region. Second, a coordinated Pune, India, during August 17-19, 2001. At consequences of social capital, in none is nutrition services. One type of market failure strategy on drug trafficking has been in place the meeting, a secretary of the Social Welfare the importance of social connectedness as is the under-provision of services to prevent with the SAARC Convention on Narcotic Ministry of Bangladesh reported that the well-established as in the case of health and or treat individual illness that spill over to Drugs and Psychotropic Substances, signed elderly population was losing the safety net well-being.”34 For SAARC, the right to the general populace. Another is the during Male meeting in 1990. The convention of family support. He submitted names of health, if it exists at all, is plainly a social and breakdown in insurance and credit markets, was ratified in 1993 by members. A Drug organizations supporting the elderly – Shanti institutional right, and not a political right. improvising people. Unlike East Asia, Offences Monitoring Desk (SDOMD) was Nibas (old age home), abosar (a hospice). The social welfare function governs the SAARC countries do not have any clear established in Colombo to collate, analyze and The national government, he concluded, distribution of the vast range of goods that health policy. In South Asia, poor people are disseminate information of drug uses. Policies offered allowances for the old, elderly people want once their essential needs have pushed further into poverty due to ill health of media and community mobilization against widows, distressed and deserted women. been satisfied. In any decent society these and they are excluded from support drug abuses, preventive education, school There was a plan to provide medicare and rights can generally be taken for granted so networks that enhance the social and curriculum development, treatment and geriatric health care services. The Sri Lankan that the burden of economic and political economic benefits of good health. Policy relapse prevention and exchange of representative, in the same vein, announced concern would relate to the residual goods makers need to be accountable for health information on indigenous and innovative that the government had incorporated several like health care. The health care principle is outcomes – which means greater methods of treatment have been stressed.37 social security schemes such as pension, then concerned with the ethical values and investment in monitoring and evaluation provident fund, gratuity, and public assistance moral principles. It forms part of principle mechanisms that capture disparities in Third, efforts have been underway to the destitute, leprosy and cancer patients. enunciated by the Jeremy Bentham (1780) health. It is now very well realized that to forge partnerships with various private As against this, the Nepalese delegate Ritu – the greatest happiness of the greatest economic development is not the quickest sectors in the health care system. Non- Raj Bhandari, an under secretary, argued that number; in this sense good health is the way to better health for all. governmental organizations like “Heart-file” Nepalese predominantly lived in extended source of individual happiness. There with regional health mandates and links with joint families where traditionally the elders appears to be a strong relationship between Since the inception of the government have in the past played a part in were respected. The problem of Maldives the possession of social capital and better organization, the SAARC declared that the health initiatives under SAARC framework.38 was highlighted by assistant director who health. Putnam writes, “If you belong to no primary health care would be a prime target Even in relatively low priority area of indicated that elderly were left behind as groups but decide to join one, you cut your area. In some instances, the policy population ageing, SAARC is not silent. The people migrated to urban areas for risk of dying over the next year in half. If initiatives were taken in areas of adequate nature, extent, impact, and experience of employment. Since the problem was not you smoke and belong to no groups, it’s a food, safe water, family planning, ageing seem quite varied in different countries acute in Bhutan, the government had no toss-up statistically whether you should stop immunization, and the provision of of the world. The issue received recognition formal policy but the government would soon smoking or start joining.”35 essential drugs and the treatment of illness. as an international challenge in 1882, when have to address the issue.39 As a regional instrument, SAARC has both the first World Assembly on Ageing was The SAARC region has one of the the mission and mandate to facilitate convened in Vienna to adopt the “Vienna Plan Fourth, UNAIDS and SAARC poorest health indicators in the world. A mechanisms that can contribute to of Action.” The primary concern was to signed, in Kathmandu in April 2004, a doctor in India treats 2440 people while in achieving sustainable health outcomes and strengthen the capacities of governments and memorandum of understanding to “mutually Sri Lanka the number is 7,143. Most provides a practical platform for strategic the civil society to deal effectively with the cooperate” to assist member states in SAARC countries house the largest number actions. The environment for regional ageing of populations and to address the supporting HIV/AIDS prevention and care of people with micronutrient deficiencies cooperation appears to be conducive.36 developmental potentials and dependency efforts providing support for HIV-positive and diabetes. The region as a whole carries needs of older persons. The SAARC people and others affected by the disease.40 40% of the world’s tuberculosis burden, and First, the expert knowledge of local consultation on ageing was hosted by The agreement addressed stigma, treatment has a high burden of cardio-vascular individuals is encouraged. The unani International Federation on Ageing (IFA) in and prevention services, which were

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“significantly lacking” in the SAARC adolescent girls must not be neglected, and entry points that are relevant to the everyday over 350,000 households in six countries. In countries. India alone had four million HIV- corrective measures must be taken up in needs of the lives of the people. Measures May 2001, a ministerial level consultation positive people and predicted that the number advance. A “Work Shop on Girl Child” was have been taken to run irrigational channel to committee stipulated that priorities should be could reach to 25 million by 2010.41 UNAIDS held in Delhi on September 19-23 in 1988; the lands of the members of the group or a given to the poorest by giving access to credit. Executive Director Peter Piot said, “By women’s trafficking and girl child featured proper drainage work that is needed by a village At the same time, the committee was quite making AIDS a top priority, the partnership prominently.45 community. The UNDP provided some conscious of the larger strategy: the national agreement between SAARC and UNAIDS financial assistance to local communities in pro-poor plan was to be harmonized with the marks another turning point in South Asia’s (3) Poverty Reduction certain countries.46 Although governments did open economy and globalized structural response to the epidemic.” 42 SAARC has take the initiative, the real work responsibility adjustment strategies for economic reforms. A post-modernist presumption is reached out away from the “introverted, was given to the local communities. In asking The objective was to link economic statist, cautious position.” It has effectively that human subject is “emergent, the local communities to be directly involved, liberalization with local designs to empower contingent and revisable,” and this human built up sincere cooperative institutional links “The South Asian Poverty Alleviation individuals and families.48 An intricate subject fails to contribute if there are “risk with Japan, the venue of the U.N. University Programme” took this approach as an anti- mechanism was designed to reduce poverty. Conference on the U.N.O and South Asia. factors” such as poverty, as Putnam dote to the normal, not very effective, top-down The ISACPA’s (1991) concept of “Daal suggests. SAARC social and political The SAARC/Japan Special Fund has method. Some results have been noted in Bhaat” (simple staple food but with right leaderships argue that poverty arises from supported many SAARC’s technical “Village Development Council of Syangia nutrition) could not be realized without an activities. Canada has provided support for a domestic institution that discriminates both District in Nepal,” which exchanged inter-locking system of management. The structurally and systematically against the T.B. center in Kathmandu.43 information in two sub-sectors - agriculture Eighth SAARC Summit in New Delhi, 1995, poor. Thus, it has been assumed that the and animal husbandry. approved a plan of action with a three-tier (2) Child Development: Girl Child basic responsibility laid with the seven mechanism to provide not only basic food governments, whatever the configuration Such policy logic is different from the but also to help economic growth. (A) The Putnam’s assessment of the benefits of their economic systems. SAARC structuralist argument that fundamental first-tier would engage the government of what he calls social capital remains an governments have placed poverty reduction changes, such as land reform, as was done in secretaries to design a plan for social important reference point. He argues that program high on the social agenda since West Bengal state in India, in the relations development. (B) The second-tier would child development is powerfully shaped by the Sixth SAARC Summit in Colombo in between classes resulting from the nature and comprise of Finance and Planning secretaries social capital. Trust, networks and norms 1991, which commissioned an Independent mode of production, are a pre-condition for to scrutinize development schemes in within a child’s family, school, and South Asian Commission on Poverty poverty reduction. On the other hand, it is respective countries. (C) The third-tier would educational achievement have impact on Alleviation (ISACPA), consisting of distinguished from the new-classical approach comprise of the Finance and Planning their behavior and development.44 The Year “eminent persons” from member states to that believes in enlarging the resource base Ministers. By January 1996, the first round 1990 was the SAARC Year of the Girl Child. conduct an in-depth study of the diverse and productivity to improve the level of of the three-tiers was done. By April 2002, Two girls from each country, 8-12 years, experiences of member states and report welfare. The implicit idea behind the SAARC the second round of such meeting was would call on heads of respective their recommendations on the poverty approach is that while productivity completed. The third round of the meetings governments to deliver a message of hope alleviation to the summit. More enhancement is independently pursued, rural began in July 2003 in Colombo.49 and confidence for the “Girl Child,” to depict specifically, a reinforced action plan was poverty can be attacked by endowing the poor a positive image of the girl. SAARC designed at the Seventh SAARC Summit with the productive assets and inputs that will Empowering mechanisms has been established the Farm School Projects/ in Dhaka in 1993, with a declaration that result in their self-employment. Where this can based on a model of partnership among four Agricultural Training Centres to improve the there must be a planned social mobilization, be achieved, the government-sponsored wage major actors of the polity: government, skills and competence of the rural “girl decentralized agricultural development employment schemes would supplement the NGOs, private sector, and local communities. child.” SAARC set up a “Women’s Cell” in and small-scale labor-intensive self-employment programs.47 Partnership in management implies different SAARC secretariat for coordination of industrialization and human development to responsibilities for each partner, based on the various measures in child misuse prevention. reduce individual poverty. Social In accordance with the ISACPA’s different roles and strengths of each It was agreed that female children and mobilization in this case means adopting directives, the SAPAP began working with collaborative and keen partner. There are

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 225 Making Social Capital Work in the Theory and Practice of SAARC Santosh C. Saha 226 already non-governmental organizations remained stagnant at 42 percent between by 2010. The focus on children and the girl of the national governments. National policies such as the Food-for-Work (FFW), 1990 and 1993.51 child, in particular, emerged as one of the are often extended to other countries, taking Employment Guarantee Scheme (EGS), strongest features of SAARC’s concern for into consideration local social and cultural Nutritional Program in Tamil Nadu, Credit National poverty alleviation human development. Targets seem to be practices. These policies are systemic. support scheme like the Grameen Banks for programs are being implemented in impressive. The progress made so far up to the poor in Bangladesh. Former Prime accordance with specific domestic priorities 1997 indicates that with the exception of Sri First, teachers’ education was Minister of Bangladesh recalled in and hence a single plan to fit the region has Lanka, no one achieved the target for 2002. emphasized to train teachers for modernized November 2002 that in line with the principles not been feasible. Yet, several common plans The target for 2000 is having the rates of infant educational system. The three-day council enshrined in the SAARC charter, a program have already been designed: (a) Linking mortality and child mortality that prevailed in meeting in the Nepalese capital Kathmandu of poverty reduction through five basics – decentralization to poverty eradication by 1990, but Pakistan shows 95 for infant on April 18, 2002 asked the Teachers’ food, clothing, shelter, education, and providing the poor access to financial credit; mortality and 136 for child mortality. Nepal Federation to work out a program for action medicine, had been in place. She added that (b) developing alliances to forge ahead by has a combination of high mortality and high in training. The main objectives of the at the initiative of SAARC and because of deepening the social mobilization process; fertility, the lowest rate of literacy and the workshop there were to promote the concept, the actual program, the human poverty index, (c) translating lessons from grass roots lowest per capita income. Maldives has the spirit, and principles in teachers’ training. A which was 41 in 1995-97, had come down activities into viable macro-policy options, highest fertility rate in the region, as well as declaration said, “Teachers must take upon to 32 percent in 2001.50 and synergy with other social mobilization; the highest adult literacy, including female national duty, promote national thinking; there and (d) emphasizing the linkage between literacy. SAARC thus exhibited a committed is great expectation from teachers because Poverty in SAARC nations is not economic liberalization within the region and priority in human development in accordance our society still suffers from structuralism, just economic, it is total. Poverty means poor poverty alleviation so that poorer and more with the ability and culture of each member.54 many children in our rural areas are still out health because one cannot afford sufficient vulnerable sections of the people are not of school.”56 An emphasis has been placed calories or proper nutrition; it means disease adversely affected by current liberalization (4) Education on education with local flavor, i.e., character and little access to modern medicine. and globalization.52 However, a link between building or moral missions in life. According to the UNDP Report in 1999, free trade program and the development of For Coleman, education represented South Asia has nearly half of the world’s a social program is clear from the SAARC the strongest expression of the resources At the same time, the SAVE, very poor. The average life expectancy is policy statement. It declared “While seeking generated by the relationships, values, and “SAARC Audio Visual Exchange 77.7 in the developed world, whereas in to evolve a regional strategy on poverty trust that constitute social capital. He explicitly Programme,” founded in 1987 was designed South Asia it is 62.7 years. An individual in alleviation, emphasis is expected to be given seeks to establish a direct and causal to work closely with the Technical South Asia survives on less than U.S. $1.00 to the linkage between economic connection between social capital and human Committee on Education so as to produce a day. Of course, the poverty level varies liberalization within the region and poverty capital. But he wrongly downplays the ways programs of common interest to the member from region to region. Ninety percent of alleviation, so that the poorer and more in which social capital may also serve to countries in the field of modern technical rural Bhutanese live below poverty line. vulnerable sections of the people are not underpin social hierarchies and create new areas. A SAARC Youth Programme Again, within a country, Bihar is very low in adversely affected by liberalization.”53 sources of inequality. On the other hand, (SYVOP) would enable young people to income while Kerala state in the south has Bourdieu’s work downplays how social capital work in member countries in the agriculture high average income. Sri Lanka’s “public Realistic rather than rhetorical can indeed contribute to greater social and forestry sectors training. The action” and high individual income has approaches to hunger issues at the regional equity.55 Concern for equity has been a goal Programme was for intra-regional become a test case in poverty reduction. level are emerging. The Ministerial among SAARC members. The SAARC exchanges and contact for various training. Mahbub ul Haq constructed the Poverty of Conference on Children in Rawalpindi city activities in the field of education covered A Youth Awards Scheme to reward Opportunity Index (POPI).The most striking in 1996, which agreed on two sets of targets many areas including the primary education, outstanding achievements by young people gap between POPI and income poverty covering mortality, fertility, education, literacy programs, continuing education, was inaugurated in 1996. SAVE gave exists in Pakistan. Even if poverty rates nutrition, health, water, sanitation and gender educational research and science and broadcasts in radio and television for social declined in India, the total proportion of the equality – one sets of targets to be achieved technical education. It is difficult to separate and cultural progress. They were cast to all country’s population living in poverty has by 2000, and the second set to be achieved out the SAARC educational policy from that member countries, twice a month, in order

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 227 Making Social Capital Work in the Theory and Practice of SAARC Santosh C. Saha 228 to disseminate information about SAARC and in recent years” but India and Pakistan shifts toward political Islamization. Mir affirms between adult female migration for the its members’ social obligations for education continued to be high on rhetoric but low on that President Zia was responsible for the purposes of prostitution and trafficking of girls training and preparedness. For further performance. These two countries emerged, institutionalization of women’s poor societal who are used as prostitutes is a fine one. In education, the SAARC Consortium of Open it was argued, as the least gender status. In South Asia, women are virtually the some contexts the distinction may not be and Distance Learning were established in sensitive.60 property of the fathers or older brothers and useful. But it is the second group with whom 2002.57 Publication of an Anthology of South then of their husbands.62 The UNDP has we are concerned – the sizable number of Asian Poetry has been completed and many Fourth, although all SAARC nations introduced a Gender-related Index (GDI) girls and young women who are sold, or short stories were already prepared for have subscribed to the ideal of universal which concentrates on the same variables as given in bogus marriage, to become cultural satisfaction. The meaning of further primary education, and have adopted the HDI but focuses on both the inequality prostitutes without their knowledge or education was thus expanded. measures to achieve this objective by between men and women as well as on the consent. Even when the girls know that they specified dates, actual progress has been average achievement of all people taken are going to work in Bombay, they often do Second, for human development, a modest. With nearly about 95 percent in together. In other words, the GDI is the not understand the conditions in which they Workshop on Agriculture Extension, held in schools, India and Sri Lanka have virtually adjusted for gender equality.63 In this vein, will work, or the risks that they run. The girls Dhaka on July 17-18, 1988, was opened by succeeded in achieving the goal of universal the status of women refers to the position have the virtual status of slave workers.66 the wife of Bangladeshi President, who laid primary education. But with more than 35 women are granted as individuals in the social down a condition that women would help to percent of primary school-age children not structure, defined by their designated rights Policy declarations point out to right achieve food “autarky” in South Asia. 17 enrolled in schools, Bangladesh, Bhutan, and obligations. Usually, analysts explore the directions. A South Asian Workshop on women delegates from six SAARC countries Nepal and Pakistan have a long way to go status in terms of a role, or the position in “Trafficking in Women and Children: except Bhutan participated in the to achieve universal primary education. In society as a daughter, a wife, a mother, and a Formulating Strategies for Resistance” was held empowerment conference on education. all these four countries, the enrolment of girls career woman. In this section, I will explore in Tangail in Bangladesh during October 1996 lags behind that of boys. Drop out among the status and plight in terms of trafficking by SAARC. The ground rules were set to Third, a strong connection of 67 females are greater both in the rural and of helpless women and the intervention by develop a more comprehensive convention. education for women with lower fertility has 61 urban areas. SAARC into trafficking. Thus, the Technical Committee on Social become increasingly apparent in nearly all Development, meeting in Kathmandu in March developing countries, although the precise Last, the prevailing idea still is that Trafficking of women in South Asia 2002, proposed convention on preventing and mechanisms are less clear.58 The basic educational development, especially for the is one of the major inter-regional trafficking combating Trafficking in Women and Children argument is that education often opens other majority people, is secondary to other markets. According to a report published by and an immediate formation of an opportunities besides motherhood, which may developmental issues which are regarded UNICEF and SAARC, on average 4,500 “Autonomous Advocacy Group of Prominent lead to further reduction in poverty. Careful more critical as a foundation for sustainable women and children from Bangladesh are Women Personalities” (SAWAG). Earlier, analysis leads to the conclusion that the key development. Once corrective measures are smuggled to Pakistan alone in one year.64 SAARC Women and Development Committee factor in the fertility drops is connected with taken in development, then basic education Causes for women’s trafficking are varied and in New Delhi in 1986 had asked the Chairman female literacy. A High level of female literacy and health care can be improved. Good complex. First, Studies have shown that to prepare a format to deal with trafficking. A is also associated with improvement in a series education has thus suffered due to other farmers driven to despair, either because of guide book was planned to develop a program of social indicators of family well-being, priorities in military and basic infrastructures. mechanization of agriculture, use of bio- of action for consistency, compatability of including health and nutritional status, which technology or any natural disaster, are forced concepts, framework, and indicators. (5) Women’s Development translate directly into enhanced life to sell their women and children to save expectancy and lower infant and maternal 65 Likewise, the Male Declaration, Social restrictions on women’s themselves from starving to death. Girl mortality.59 Therefore, Education Ministers of 1997, adopted a resolution to have a SAARC mobility also contribute to lesser healthcare trafficking is an internationally recognized SAARC countries, meeting in Islamabad in Convention to combat trafficking of women, for women and children. Author Seher Mir crime, both across national borders, such as June 2003, called for “removal of gender children, and related social issues, but civil reports that Pakistani women’s status has between Bangladesh and Pakistan, Nepal and disparities in education.” The meeting noted society groups and women’s associations gotten even worse because of contemporary India, and within countries, especially from that Bangladesh made “considerable progress rural to urban areas, as in India. The line legitimately suggested to the Kathmandu

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 229 Making Social Capital Work in the Theory and Practice of SAARC Santosh C. Saha 230 secretariat on how the scope and practical Child” was held in Delhi on September 19- institutions such as the SAARC Agricultural environment, environment is more than effect of conventions should be expanded 23, 1988; women’s trafficking and child girl and Information Centre and SAARC Human physical level. SAARC leaders, being and enhanced. Since many decisions were featured prominently.70 Resource Development Centre. The Resource influenced by cultural affinity to rural serenity, not implemented, a task force was initiated Centre had exchanged many related think of close man-nature relationship. Thus, to review the status of past decisions in the (5) Civic Environmentalism information. As a follow up of there has been an integration of ecological social sector.68 It is apparent that without recommendations, a Nepal meeting of experts knowledge, standards, and economic Ekins incorporates social capital strong and permanent monitoring reported that there have been reforestation of incentives in environmental policy, taking into alongside environmental, human and mechanism, the “Convention” on trafficking 2.1 million hectors, afforestation of 5 million consideration of preserving environment as physically produced capital into a four- will not be useful. The SAARC Trafficking hectors, and also some desert development had far as possible. Thus, SAARC heads of state capital model of wealth creation.71 SAARC Convention lacks a broad contextual and been undertaken on behalf of the association. or government underscore the importance of environmental projects have developed at multi-pronged approach in linking gender, Interestingly, an annual “Regional Award” was protecting “associated knowledge and other local, state, and national levels over the past human rights and development. The India given to a young environmentalist scientist or indigenous intellectual manifestations for the fifteen years, sometimes on the foundations based trafficking advisor, Jean D’Cunha a group of scientists for a research paper on advancement of the region,”74 in environment. of regulatory approaches, and sometimes in argues that strategic interventions must meteorological topics. The SAARC While measuring impact in actual terms, we response to their shortcomings. Several involve treating trafficking as a development governments thus realized the need for need to keep in mind this emotional factor. measures were implanted in the past by concern, ensure a balance between post- regional cooperation in overcoming natural SAARC. First, at the initial stage SAARC trafficking assistance and long-term disasters including flood. Bangladesh realized Conclusion formulated Marine Pollution Control which preventive intervention, while integrating a that flood control required the coordination was one of the 13 areas indicated for possible Scholars such as Pierre Bourdieu, gender perspective and rights based with neighbors with whom Bangladesh shared cooperation among the countries. A James Coleman and Robert Putnam have principles and standards into all river basins. SAARC’s “Committee on Kathmandu declaration in November 1987 develop the concept of social capital in various development policies, national and local Environment” identified measures for stated that extensive destruction of forests, ways. Writing from Marxist perspective, policies. For instance, legal strategies were environment management, including the among others, posed a threat to Bourdieu differentiates between three forms designed to adopt national legislation on establishment of a relief and assistance environment.72 SAARC’s policy of social capital – economic, cultural and trafficking.69 mechanism for natural disasters and regional formulations hold deep environmental social. But these “potential resources” are cooperation on the development of modern values, which quite often went beyond linked institutionalized relationships of mutual The Year 1990 was the SAARC disaster warning systems. Year of the Girl Child. Two girls from each instrumental value. SAARC noted that many recognition. He seems to conclude that the country, 8-12 years, would call on heads of Western governmental policy makers Third, SAARC sought to promote a working networks are held by the elites. For respective governments to deliver a message routinely failed to acknowledge balance between development and Field, “social capital generally functions to of hope and confidence for the “Girl Child,” environmental values. In the West, the environmental protection. It commissioned mask the naked profit-seeking of its holders.” to depict a positive image of the girl. problem became severe with techniques that two studies: one relating to the causes and His conclusion is that that type of social SAARC established the Farm School relied heavily on what Partha Das Gupta calls consequences of natural disasters, and capital is inimical to the open democracy.75 Projects/Agricultural Training Centres to “mathematization,” particularly in protection and preservation of the James Coleman (1988) elaborates the improve the skills and competence of the economics.73 environment, and the other dealing with the processes and experiences of non-elite groups. rural “girl child.” SAARC set up a greenhouse effect and its impact on the region. He argues that the lower classes also derive Second, SAARC’s several means “Women’s Cell” in SAARC secretariat for SAARC leaders maintained that all economic benefits. Coleman’s explanations highlight the such as “Study on the Causes and coordination of various measures in child analyses were not seriously flawed as a tool possibility of capital by different institutions Consequences of Natural Disasters,” the misuse prevention. It was agreed that female for dealing with the long term consequences. and social structures, suited to the cultivation “Protection and Preservation of the children and adolescent girls must not be In this respect, their environmental policy was of reciprocity, trust and individual action. Environment,” and the “Greenhouse Effect” neglected, and corrective measures must be value neutral. Since happiness of people seems Robert Putnam’s position is nearer the had some positive impact in several regions. taken up in advance. A “Work Shop on Girl to be determined to some extent by the direct strategies of SAARC. He writes that social SAARC’s had already instituted basic and indirect presence of nature and its natural capital calls attention to the fact that civic

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 231 Making Social Capital Work in the Theory and Practice of SAARC Santosh C. Saha 232 virtue is most powerful when embedded in a state bureaucratic collectivist regime of Cuba, democracy in a specific country, is not strong 7. Coleman, James S (1990): Foundations of Social sense of network of reciprocal social which has secured longevity and education enough and is therefore overpowered by the Theory, Harvard University Press, Cambridge, relations. “A society of many virtuous but levels unattainable elsewhere. Although there social capital groups. Robert Putnam has MA, pp. 273-82. isolated individuals is not necessarily rich in are still some controversies over the ways of shown that even in the USA there is a decline 8. Portes, Alejandro (1998): “Social Capital: Its social capital.”76 SAARC’s vision is different defining and measuring human needs, we do in social capital. In the SAARC area, Origins and Applications in Modern Sociology,” from the development theory which posits that have useful framework for both measuring and unfortunately, the social capital programs are Annual Review of Sociology, Vol. 24, pp. 1-24. economic growth, i.e., growing GDP and comparing how good different types of social compromised by political confrontations. In 9. Coleman, James S (1994): Foundations of Social modernization of the economy will generate development regimes are at enabling those sum, it is reassuring that passion, leaders’ Theory, Harvard University Press, Cambridge, a form political development that is akin to needs to be met in time. The social policy of a ambition, dedication, sensibility and sensitivity Mass, p.302. the Western model. The success of SAARC country or even a locality is no longer wholly and ideal have emerged into clearer foci by 10. Peter Evans, Dietrich Rueschemeyer and Theda is based in part on building on existing social shaped by the policies and politics of the national the goals of SAARC. My paper has concluded Skocpol (eds.) (1985): Bringing the State Back capital, reaching toward social consensus, government. It is increasingly shaped by the that SAARC’s mode of working, although In, Cambridge University Press, New York, p.59. maintaining reasonable levels of social implicit social policies of many supra-national often casual, claims to offer an alternative to 11. Wilson, William Julius (1996): When Work cohesion, and fostering a broader sense of agencies like IMF, Japan Research Foundation, modernist and socialist discourses about Disappears: The World of the New Urban Poor, community. But each country faces its own or the World Bank77 development. Alfred Knopf, New York. individual challenges. Bhutan needs to 12. For a critical analysis see Michael Woolcock strengthen its secondary and tertiary However, there are problems because Notes (2003): “Social Capital and Economic education. While SAARC faces different community and group participation necessarily Development: Toward a Theoretical Synthesis challenges, most of the countries are well creates demands for conformity. The level of 1. Nanda, Meer (2003): “Postmodernism, Hindu and Policy Framework,” in Elinor Ostrom and poised to take advantage of many community control in rural settings is very Nationalism and Vedic Science,” Frontline, Vol.20, T.K. Ahn (eds.), Foundations of Social Capital restrictive of personal freedoms, economic and Issue.26 December 20. An Elgar Reference Collection, Northampton, opportunities that are afforded by SAARC’s MA, pp.347-50. internalization and its new approaches. political. A conflict between the age-old 2. Neal , Arthur G. (2007): Sociological Perspectives SAARC social compact draws upon the dilemma between community solidarity and on Modernity: Multiple Modes and Competing 13. Woolcock, Michael ((2001): “The Place of Social individual freedom has been expressed by Realities, Peter Lang, New York, pp. 149-50 and Capital in Understanding Social and Economic involvement of an engaged civil society and Peter L. Berger (1969): The Sacred Canopy, Simmel, who as a typical Western scholar came Outcomes,” Canadian Journal of Policy a shared commitment to live as a community Anchor Books, Garden City, N.Y.. Research, 2:1, pp. 1-17. for social development. We have to admit that out in favor of personal autonomy and there are some significant differences responsibility.78 Civil Society, NGOs and 3. Bob Deacon (1997): Global Social Policy, Sage, 14. Woolcock, Michael and Narayan, Deepa, “Social regional and local leaders in various fields of New Delhi, p.29. Capital: Implications for Development Theory, between Western nations. Sweden, as a social Research, and Policy,” in Elinor Ostrom and T.K. democratic regime, is more successful at social activity have set up a constituency that 4. Putnam, Robert D (1993): Making Democracy Ahn (eds.), Foundations of Social Capital, pp. meeting the human development needs of is much wider than that of the seven states; Work: Civic Tradition in Modern Italy (Princeton: 416-440. Princeton University Press; The World Bank women than liberal Japan. Sweden meets there is now a deep sense of oneness for human 79 Report (1999) and Putnam, Robert D “The 15. Sharma, Usha (2003): Women in South Asia: more of the human needs of its citizens more progress in South Asia. Prosperous Community: Social Capital and Public Employment Empowerment and Human equitably than the USA. What is clear for Life,” American Prospect, Vol. 13 (1993), pp.35- Development,Vedams Books, New Delhi. Sampson and his associates stress the SAARC is that direct political intervention in 42. normative or goal-directed dimension of social 16. Sharma, Jitendra Kumar (2004): Rural social progress as in Nepal, Pakistan and capital.80 They claim that “resources or 5. Putnam, Robert D (2002): Bowling Alone: The Development in South Asia, Vedams Boooks, Pakistan, and indirect influence through the Collapse and Revival of American Community, New Delhi. networks alone – associations, organizations – mechanism of the NGOs and civic Simon and Schuster, New York. are neutral and they may not be effective 17. Reddy, A Ranga (2004): Empowerment of Women associations, and with the readily available mechanism for achieving intended effects. 6. Coleman, James S (1988): “Social Capital in the and Ecological Development, Vedams Books, liberal support of Japan/SAARC Funds, Many argue that the developing world lack the Creation of Human Capital,” The American Journal New Delhi. SAARC has made a good start. SAARC does of Sociology, Vol. 94, pp. 95-120. Coleman deserves social capital networks. Social capital may have 18. Keshar, Bishwa (2005): “Poverty Alleviation and not accept the non-liberal approaches of the credit for developing the “social capital” theoretical adverse outcomes if the political institution and framework. SAARC Social Charter: Perspective on Issues in

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Kha-2-906, Red Light Traffic: The argues that post-Westphalian type of strong 40. China View, 4/19, April 21, 2004. on Poverty Alleviation.” Internet: http:// Trade in Nepali Girls, Purano Baneswar, government appears to be waning. nation.ittefaq.com/artman/publish/ Kathmandu, Nepal. 41. Kaiser Daily, HIV/AIDS Report (2/6/03). printer_4803.shtml (6/2/2004). 29. M. Kabir Hassan (2001): “Is SAARC a Viable 67. LHRLA, “Current Projects: Project on Trafficking Bloc? Evidence from Gravity Model,” Journal of 42. www.Kaisernetwork.org/daily_reports/rep_ 53. www.saarc.org of Women in Pakistan”, Internet: www. Asian Economics, 12, pp.263-290; M. Dutta index.cfm?DR_ID=23295 Ihrla.sdnpk.org/traff_women.html (1999): Economic Regionalization in the Asia- 54. Godfrey Gunatilleke, “The SAARC Social Charter: Pacific: Challenges to Economic Cooperation, 43. Nihal Rodrigo (2004): “SAARC as an Perspectives and Issues,” in K.K. Bhargava and Edward Elgar Publishing, London; S.M. Khan Institutional Framework for Cooperation in

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 235 Making Social Capital Work in the Theory and Practice of SAARC

68. Ramesh Thakur and Oddny Wiggen (eds), South 75. J. Field (2003): Social Capital, Routledge, Institutional Reforms in Water Sector: Asia in the World, p. 284. London, pp. xiii. A Cross Country Perspective from South Asia 69. Annette Lansink (2003): “Trafficking: Laws, the 76. Robert Putnam, Bowling Alone; James Coleman Satyapriya Rout Female Body and Commodification,” Paper at the (1988): “Social Capital in the Creation of Human Workshop: Law and Society, School of Law, Capital,” American Journal of Sociology, vol. Abstract University of the Witwatersrand, 25-26 94, pp. 95-120; Pierre Bourdieu, cited in Social The paper investigates the water sector institutional reforms in South Asia, September. Capital Gateway, Resources for the Study of by way of analyzing the trends, patterns, directions and implications of Social Capital, internet

Satyapriya Rout is a Lecturer in Sociology, University of Hyderabad, Hyderabad – 500 046, India. E-mail: [email protected]

International Journal of South Asian Studies IJSAS July - December 2008 IJSAS 1(2) 2008, pp.236-255. ISSN 0974 - 2514 237 Institutional Reforms in Water Sector: A Cross Country Perspective from South Asia Satyapriya Rout 238

Besides population expansion, can cope up with this imminent situation. The institutions, being developed in a time of water second section sets a ground for institutional demand for water is ever increasing due to emerging water scarcity, water conflicts at abundance – especially during the colonial arrangements in water sector and provides consequential effects of economic micro and macro levels, and deterioration of period – are becoming increasingly ineffective an analytical framework for analyzing water development and lifestyle changes. Over the water infrastructures, in the recent decades, in addressing water challenges arising out of institutions. The third section describes the years, there has been a substantial change have resulted in greater policy attention being water scarcity. Consequently, institutional reform experiences of the sample countries in the urban demand for water owing to paid worldwide to institutional arrangements arrangements governing water sector in the from a historical perspective. The fourth industrialization and growth of population governing water resource development, South Asian countries are undergoing section then proceeds to generalize the water concentration. Further, the increasing urban allocation and management. The crisis in significant policy changes in the recent years. sector institutional reforms in Asia bringing water use involves the demand for better water sector, both in terms of quantity and Far from being the gradual process of out its problems and future prospects for quality of water, along with the increase in quality, has also made explicit the inherent institutional evolution, these changes have better water governance in the region. quantity of water required. The demand for inadequacies of existing institutions in dealing occurred as a result of purposive reform better quality of water in urban areas, effectively with new and emerging set of programmes, initiated by the respective 2. Water Sector and Water Institutions: however, involves a paradox (see, Saleth problems, which are not so much related to governments. Notwithstanding the variations An Analytical Framework in nature and extent of these reforms due to and Dinnar, 1999). On the one hand, the water resource development, but rather to Water sector, from a broader perspective, may country-specific economic, political and urban dwellers having a better lifestyle and resource allocation and management. Such be considered to cover all issues concerning resource conditions, it is yet possible to greater political articulation, stress upon emerging problems in water sector now water from sources such as surface, sub- insinuate some common patterns and trends better quality of water besides the demand that the means and ways for water surface, ground and recycled sources; along in them. requirement of quantity. On the other hand, allocation, water management, and with the other water related issues covering since the growth of urban water demand mechanisms for resolution of conflicts arising water and sewage treatment, management of means more residential sewerages and over them have to be either created or While discussing water sector reforms, few fundamental questions arise: costal and waterway engineering. However, industrial pollution, every increase in urban reoriented by updating the existing policies the main focus on water sector, the policy water consumption, if not addressed concerning water governance. Water what are the motivating factors behind water sector reforms, in which direction such changes of which this paper tries to analyze, properly, could lead to a deterioration of administration and management have to now is on the macro level issues of development, water quality. The challenges of water in accommodate the increasing and much institutional changes are heading, and what are the future implications of these allocation and management of water at a terms of quantity are further magnified by acknowledged role of end users associations, national level. In order to understand the the problems of deterioration of water non-governmental and grassroots level institutional reforms for water sectors as a whole. While attempting to answer questions institutional arrangements in water sector, it quality in recent years. Deteriorating water organizations, women and self-help groups, is apt to understand what institutions mean in quality caused by pollution through sinking and those promoting causes and concerns for of this nature, the present paper aims to investigate the water sector institutional the context of natural resource management, domestic, agricultural and industrial wastes environment. In a manner of speaking, as including water. into water bodies, also influences water countries move from a state of water surplus reforms in the South Asian region. The broad objective of the paper is to analyze the trends, usability downstream, and threatens human to water scarcity, water institutions, which A study of institutions, in the context patterns, directions and implications of health and the functioning of aquatic design rules for water resource development, of natural resource management, focuses on institutional reforms in the water sector in ecosystems by reducing effective allocation and management, have to reorient the laws and conventions that either directly South Asia. availability and by increasing competition themselves to meet the ever emerging allocate resources, or establish processes and for adequate quantity of quality water. challenges. Such reorientation of water The methodology adopted for the constraints for its members to make allocative institutions to best suit the current situations paper is secondary in nature, by means of a decisions. Notwithstanding the casual use of Such being the seriousness of the and meet the emerging challenges and crises the term ‘institution’ in our day-to-day life, it problem in the water sector, which till review of published articles and unpublished in water sector paves the way for water documents on water sector of sample South is mostly used in reference to rules, recently was commonly considered as being institutional reforms throughout the world. regulations, and prescriptions to behave in a plentiful and virtually free and good, global Asian countries like: Bangladesh, India, and Sri Lanka. The paper is divided into four certain way. It is often defined as rules about discussions have exhibited varieties of view To be more specific, in the context behaviour, ‘especially about making decisions’ points about how best developing countries of South Asian countries, most of the water sections. Following this introduction, the

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(Rinker 1982: 4) and about ‘individual societal conventions. The path dependency situation of a country or region, the Saleth and Dinar (1999, 2000, 2004, expression and choice’ (Pllott 1979: 156). nature of water institutions refer that their institutional structure corresponds to the 2005), in their attempts to understand the Within the broader framework of the present status and future directions can not interactive effects of legal, policy and innate nature and inherent features of water institutional economics literature, North (1991) be separated from their earlier course and organizational or administrative sector and water institutions, have developed defined institutions as humanly devised past history. Water institutions are also components of the government. The the Institutional Decomposition and Analysis systems that structure the interaction of its hierarchical in nature, being embedded within institutional environment of the water sector (IDA) framework, which becomes very members in social, economic and political the cultural, social, political and economic of a country or region would include factors much crucial to account for the recent arenas. As an organised and well-defined context. determining the water situation of a country, reforms in the water institutions. As system, institutions constraint some along with other factors determining water discussed above, water institutions, from a behaviours and favour or facilitate others. The New Institutional Economics resource conditions as well as to other water wider perspective, can be decomposed into They enforce sanctions negatively in the (NIE) literature distinguishes between related sectors such as agriculture, water institutional structure and water form of punishments when the prescribed set Institutional Environment and Institutional environment, forest, and urban institutional environment. Since the rules of rules are violated and positively in the Arrangements (see, North 1990). With development. Likewise, the water governing water institutions are formalized form of rewards when such rules are respect to the water sector, the Institutional institutional structure is defined in terms of three inter-related aspects, i.e. complied. Institutions exist both as formal Environment would include various interactively by aspects concerning water legal framework, policy environment and entities through constitutions, laws and well- government agencies that directly or law, water policy and water administration. administrative arrangements, Saleth and defined property rights; and as informal indirectly deal with water, international agents through customs, traditions, norms, agencies dealing with water resources, and Water Institutions codes of conduct, social taboos etc. water related laws and policies of the states. In consistent with the understanding Institutional Arrangements, in contrast, are of institutions, as it is represented in the the structure that humans impose on their context of natural resource management and dealings with each other’ (North 1990). In Water Institutional Water Institutional Structure Environment in institutional economics literature, water the water sector, institutional arrangements institutions may be conceived of something would correspond to ground water markets, water cooperatives, water users associations, beyond the common understanding of Water Law Water Policy institutions as mere organizations or etc. (see also, Shah 2005). Comparing these • inter- • project selection associations. Water institutions may be two aspects of institutions in water sector, governmental criteria conceptualized as an entity, which sets the we can observe that while the institutional responsibilities • pricing and cost environment functions at a macro level and • water rights recovery rules and defines the action sets for decision • accountability • user and private making in the realm of water sector. Water represents the government’s laws and provisions and sector participation institutions are the ‘… rules that together policies, concerning development, use, mechanisms policy describe action situations, delineate action allocation and management of water, the sets, provides incentives and determine Institutional Arrangement function at a very outcomes both in individual and collective micro level involving rules, practices, and Water Organisation decisions related to water development, conventions governing allocation and • organizational structure allocation, use and management’ (Saleth and management of water at the grassroots level. and the relative roles of In a similar fashion, Saleth (2004) government layers Dinar 2005: 2). Water institutions are • financing and subjective and path dependent (see, Hodgson distinguishes between institutional management 1998 and North 1990). The subjective nature environment and institutional structure. • regulatory mechanisms of water institutions stems from the fact that While institutional environment is • conflict resolution they are often constituted and also influenced characterized by the overall physical, t Figure 1: Decomposition of Water Institutions by belief systems, behavioral habits and cultural, historic, socio-economic and political

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Dinar, try to decompose the water country-specific, depending upon the over all The exogenous factors resulting in water pace of institutional change by linking factors institutional structure into three inter-related water institutional environment, and the institutional reforms are related to demographic for institutional change into transaction cost components: water law, water policy and degree of formalization of the water economy growth and mounting pressure on water and opportunity cost (see, North 1990; Saleth water administration or water related of a nation. Saleth and Dinar (2000, 2005), resources for fulfilling the increased targets and Dinar 2004). The transaction cost of organisations. These institutional however, identify two broad factors, i.e., of food production, economic development water institutional changes corresponds to components, which consists of both macro endogenous and exogenous, which account and technological pressure resulting in greater the real economic and social costs of inducing level (formal) and micro level (informal) for the corresponding changes in three inter- demand for water, reforms in the spheres of changes in the Water Institutional structure. arrangements, are further decomposed to related components of water institutional economy and polity, international pressure and In contrast, opportunity costs in the context highlight some of their major institutional structure. While the endogenous factors commitments for ensuring sustainability, of institutional change may be refereed to aspects. Accordingly, the component of responsible for changes in water institutions natural calamities concerning water, such as the opportunities lost because of changes in water law is decomposed to highlight factors are internal to both water institutional structure flood and drought, and changing socio-political status quo. The transaction cost theory of like: inter-governmental responsibilities, and water sector, exogenous factors lie values for ensuring equity, inclusion and institutional economic literature predicts that water rights, and accountability provisions outside the strict boundaries of both water justice. The exogenous factors, therefore, institutional changes occur only when the and mechanisms. Similarly, the water policy institutional structure and water sector. These include the over all environment within which transaction costs of inducing changes in is decomposed to emphasise: project two factors capture the key features of the the water sector and water institution institutional framework becomes lesser than selection criteria, pricing and cost recovery, institutional environment and institutional functions. Notwithstanding the independent that of the opportunity costs. and user and private sector participation structure, and the changes wrought out in them impacts, these factors have upon water sector policy. Likewise, the organizational as response to societal demands and water and water institutions, it is the synergy between Extending this institutional components of water institutions are sector crisis. While the endogenous factors these endogenous and exogenous factors, transaction cost argument to the water sector, decomposed to focus on: organizational correspond to physical and ecological which determine the structure and pace of we may find that while the transaction cost structure and the relative roles of problems of water sector, coupled with the institutional changes within the water sector. of water institutional changes include both government layers, finance and crisis in its legal, policy and organizational real and monetary costs of altering the management, regulatory mechanisms, and frameworks, exogenous factors are mostly The endogenous and exogenous regulatory, monitoring and enforcement conflict resolution arrangements. Such a related to wider socio-economic problems, factors of institutional change are inter-related mechanism related to water development, decomposition of water institutions can be which influence the water institutional phenomena, and do not operate in isolation, allocation and management. Similarly, the as shown in the figure 1. environment. since they influence each other. For example, opportunity costs in water sector may the exogenous factor of socio-economic and include real and economic values of Understanding Water Institutional The endogenous factors that induce technological development puts additional opportunities foregone, or the social costs Reforms institutional changes in the water sector pressure on water withdrawal and forms the of the status quo. These opportunity costs include water scarcity, emerging conflicts basis for water scarcity and conflicts over are also the benefits of water institutional Since the rules governing water over water due to improper water laws and water. Similarly, the international pressure reforms in the sense that, in the absence of institutions revolves around three inter- policy frameworks, financial and physical and commitment for sustainability may be changes in the existing water institutions related aspects, i.e. legal framework, policy deterioration of water infrastructure affecting understood as a response to water scarcity, these benefits can not be gained. Several environment and organizational framework, water resource development, and operational which forms one of the endogenous factors. studies have estimated the opportunity costs any attempts to introduce reform measures inefficiency of water organisations. Besides, The inter-connectedness of these two factors in the water sector and the expected gains in the water sector require corresponding the poor linkages between various components makes it difficult to understand the individual from the changes in water institutions or changes in water law, water policy and water of water institutional structure (i.e. water law, roles of these factors, and thereby generalize particular components of water institutions organisations. The factors that influence policy and organisation) also forms an the impact of these factors upon the pace and (see, Frederikson 1992; Picciotto 1995; Saleth water sector and bring changes in the above endogenous factor, since the performance of direction of water institutional changes. The 1996; Gazmuri and Rosegrant 1994). three main dimensions of water institutions water institutions depends very much upon institutional transaction cost theory, in the are many with diverse origins and varying these linkages between these water New Institutional Economics literature, Rather than being a one time affair, levels of impacts. These factors are also institutional components (see, Saleth 2004). however, tries to understand the direction and water institutional reforms are continuous

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 243 Institutional Reforms in Water Sector: A Cross Country Perspective from South Asia Satyapriya Rout 244 and gradual changes occur over time in where, reform implementation is reduced to up with the emerging situations of water tributaries, such as: the Teesta, Dharla, response to the factors identified above, procedural changes with policy scarcity and the increased demand for both Dudhkumar, Surma and Kushiyara. In 1990, depending upon the costs and benefits of declarations, creation of new organisations quantity and quality of water. Often factors the total water withdrawal for agricultural, reform. Since the water institutions are path or remodeling earlier ones, without any outside the purview of water sector, such as domestic and industrial was estimated to be dependent, the benefits from the earlier actual or real changes taking place. The population pressure, economic development, 14.64 km 3, of which 86 per cent was reforms smoothens the prospects for further fourth and final stage of water institutional economic and political reforms, etc. have consumed for agriculture, 12 per cent for reforms in the water sector. Saleth and Dinar changes relate to actual impact of the contributed to the crisis in the water domestic and 2 per cent for industrial (2004), in their attempts to study the pace changes implemented in stage three. governance, resulting in greater pressure for purposes. Approximately 73 per cent of the of institutional changes in water sector, have inducing institutional reforms in water sector. total water withdrawal comes from ground developed a stage-based perspective of Identification of these stages of In the recent years, countries in the South water, where as only 27 per cent comes from institutional change. They identify four institutional change in water sector does not, Asian region have responded to such crisis surface water. main stages of water institutional changes, however, mean that water institutional by introducing institutional reforms in water which progress as a circular process, and reform is a linear and unidirectional process. sector in their respective countries. Though Organized efforts to water sector are mediated by information and learning, In the process of reform, the institutional the success and pace of these institutional development in Bangladesh after political lobbying and bargaining, changes may proceed to the next stage, or reforms in water sector are country specific decolonization dates back to the devastating organizational power and politics, and remain constant in one stage for a longer depending upon factors like political floods of 1954. Following the floods, in behavioural changes and performance period, or even revert back to the previous commitment, nature of crisis, and other 1955 a United Nations mission investigated expectations (see also, Saleth and Dinar stage, depending upon the suitability of the socio-economic and political factors specific the possibilities of water resource 2005). The first stage of water institutional over all environment for reforms. to the countries, yet, it is possible to draw development in the then East Pakistan. On changes correspond to ‘mind changes’ Institutional change is always slow, some inferences regarding the nature, trend the recommendation of the UN mission, the among individuals, which occur from evolutionary and continuous, sometimes and direction of such changes. Keeping this East Pakistan Water and Power subjective and objective evaluation of involving a time gap between the in mind, the present section attempts to Development Authority (EPWAPDA) was current water situation and water crisis, implementation of reforms and the actual highlight the experiences of the South Asian created in 1959, having the responsibility information feedback and learning gains out of such reform processes. While countries regarding the on going process of of planning, designing, operation and experiences they gain from existing the implementation of reforms exhibits itself reforms in the water sector. Three sample management of all water development institutions and ongoing changes. The in substantial behavioral as well as countries, i.e. Bangladesh, India and Sri schemes. In 1964, the EPWAPDA prepared second stage of water institutional changes organizational changes, the real impact of Lanka have been identified to generalize a 20 year Master Plan with assistance from is that of ‘political articulation’, where reforms depends upon the speed and amount upon such institutional reforms in water USAID, dealing with strategies of massive intense political debates, bargaining, of influence that these changes have upon sector in South Asia. The following flood control, drainage and irrigation. This campaigning and counter-campaigning take the allocation, use and management of paragraphs depict the water management marked the centralized, top-down and civil place before arriving at a political agreement water. principles and water institutional reforms in engineering approach to water resource about the details of the institutional change. the sample countries from a historical management in Bangladesh. Water resource 3. Institutional Reforms in Water development during this period was strictly The third stage is that of ‘institutional Sector:Country Specific Experiences perspective. change’, where agreed upon changes are sectoral with very little inter-sectoral implemented. This stage is the most crucial As discussed in section one, Bangladesh communications (CWPD, 2001). stage in water institutional reforms, since, institutional changes in water sector have Bangladesh is located in towards the Following independence in 1971, the at this stage, there is every possibility of been largely a response to the emerging North-East of Indian subcontinent, and EPWAPDA was restructured and the differences occurring over reform crisis in water resource development, covers a total area of 1,44,000 km2. Most responsibilities concerning planning and implementation and actual changes, due to allocation and management. The crisis, parts of Bangladesh is located within the management of water resources was handed financial, organizational and administrative partly, has aroused because of failure of the floodplains of three great rivers: the Ganges, over to the newly created Bangladesh Water constraints. There have been many instances existing institutional arrangements to cope Brahmaputra and Meghna, and their Development Board (BWDB) in 1972,

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 245 Institutional Reforms in Water Sector: A Cross Country Perspective from South Asia Satyapriya Rout 246 which has long been the most powerful term reforms in water sector for Development Board, etc, developed guidelines of planning and management of water sector agency in the water sector in Bangladesh. comprehensive water resource development to involve local people in various projects. require a comprehensive and integrated The BWDB relied heavily on international and management (CWPD, 2001). analysis of relevant hydrological, development assistance from agencies like, In response to the Bangladesh Water topographical, environmental, institutional International Bank for Reconstruction and In the background of these and Flood Management Strategy, the World and socio-economic and political factors Development (IBRD) and the Asian developments, the National Water Resources Bank produced a report titled as ‘The Steps across all water using sectors. It directed the Development Bank. The IBRD conducted Council (NWRC) was established in 1983 as Towards the New National Water Plan’, government to frame rules, procedures and a Land and Water Sector study in Bangladesh an inter-ministerial body to look into the issues which described the structure of the water guidelines for combining water-use and and recommended a strategy of extensive concerning water resources. On the sector and the need for coherent water land-use planning (NWP 4.2, GoB 1999). minor irrigation in winter using Low Lift recommendations of NWRC, in the same year, strategy for water exploitation, use and The new policy, while retaining the absolute Pumps and Tube-wells, and for flood control the Master Plan Organisation was created, and management (see, World Bank 1997). All right over water with the state, for ensuring in small scale, low cost and quick-gestation entrusted with the responsibility to draft the these initiatives led the Government of equitable distribution, efficient development flood control projects. Following this first National Water Plan. The National Water Bangladesh to come up with the first ever and use of water and to address poverty, recommendation in 1972, minor irrigation Plan was complete by 1991, and to recast the National Water Policy, published in January, made provisions for empowering the local through Lift Pumps and Tube-wells spread Plan within the appropriate inter-sectoral 1999. governments to exercise its right to allocate rapidly, along with implementation of large focus, Master Plan Organisation was water in scarcity zones, and during periods The new National Water Policy scale water control projects (see Duyne restructured as Water Resources Planning of sever drought (NWP 4.3, GoB 1999). The (1999) of Bangladesh stated its broad 1998). The potential for Low Lift Pumps was Organisation (WARPO) with the mandate to policy also made provisions for private sector objective as: soon exhausted due to lack of surface water ‘evolve national policies and strategies for involvement in water sector of Bangladesh. availability, but growth of Tube-wells utilization and conservation of water by all’. “… to provide direction to India continued rapidly. The water sector crisis all line agencies working emerged in Bangladesh with long conflicts Years prior to the National Water with the water sector and India is the world’s largest over sectoral use of water, amongst various Plan, Bangladesh was hit by two severe institutions that relate to the peninsula, second most populous country water users in the form of fishery versus floods in 1987 and 1988, which resulted in water sector in one form or and seventh largest country, covering a pump irrigation, and domestic hand tube-wells endorsement of Flood Action Plan (FAP) in another …”. geographical area of 3,287,590 km 2. The versus tube-wells for irrigation. The problem 1989. FAP was a five-year plan (1990 – 95) two main sources of water in India are in the water sector became more serious enacted by Government of Bangladesh in The Water Policy of 1999, aimed at ensuring rainfall and the melting of the snowfromthe with drastic reduction of flow in the Ganges collaboration with the World Bank. In the water for all, promoting social justice in glaciers in the Himalayas. In 1990, the total due to construction of Farakka Barrage on final report of FAP, in 1995, Bangladesh allocation of water, accelerating sustainability water withdrawal was estimated at 500 km the Ganges in India at about 20 km upstream Water and Flood Management Strategy of the public and private water delivery 3, of which nearly 92 per cent are consumed from Bangladesh border in 1974. As a (BWFMS) was adopted, which systems, bringing out institutional change for for agricultural purposes, 5 per cent for response to this situation, a joint mission of recommended people’s participation and decentralized management of water resources domestic purposes and remaining 3 per cent Government of Bangladesh and the World Environmental Impact Assessment (EIA) as with increased participation of women, and for industrial purposes. Bank reviewed the water sector in a mandatory and integral part of water developing legal environment that will help Bangladesh, and made detailed management. Based on recommendations of the institutional change (GoB 1999). BWFMS, Ministry of Water Resources of The organizational aspects of the recommendation for institutional reforms and water institutional structure in India can be Government of Bangladesh issued The new policy made provisions for the need for a new Master Plan. By the early explained by highlighting the important Guidelines for People’s Participation for all River Basin Management, and aimed at 1980s, exogenous factors like pressure of agencies in the water sector. The Union water development projects in 1994. As a fostering international cooperation in water burgeoning population, expanding agricultural Ministry of Water Resources (MoWR), follow up to this, several other agencies such management by working with co-riparian and industrial sector and international political which evolved from the department of as Local Government Engineering countries (NWP 4.1, GoB 1999). The policy, treaty with India regarding the sharing of the irrigation under the Ministry of Agriculture water of Ganges created the ground for long- Department, Bangladesh Water for the first time, made it clear that processes

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 247 Institutional Reforms in Water Sector: A Cross Country Perspective from South Asia Satyapriya Rout 248 is the national organization for over all The Central government has also regulatory Although the water policy of 1987 has recognized Andhra Pradesh, Tamil Nadu, Orissa. planning and management of water roles in the water sector vide Article 252, the need to limit individual and collective water Incidentally, these states are under the resources in the country. The technical which is related to inter-state water withdrawals and user participation in water financial assistance from the World Bank support to the ministry comes from projects, and through the Forest management, it has failed to identify the through the Water Resource Coordination important agencies working under it, such Conservation Act, 1980, which requires the institutional mechanism of such (Saleth 2004). Projects, have not only restructured their as Central Water Commission, Central states to get Central government clearance water administration and amended their Ground Water Board, and National Water for executing ecologically sensitive water The 1987 Water Policy made it water policies, but also have made significant Development Agency. Several research projects. More so, the Central government explicit that water is a vital natural resource, progress in promoting user participation in organisations including the Water and Land has an important role in resolving inter- and its effective management is crucial for water management (Saleth and Dinar 2000). Management Institutes provide the research state water disputes as per the provision livelihood and environmental security. support to the Union Ministry of Water under Article 262 of the Constitution of Recognizing this, the National Water Sri Lanka Resources. There are also important India, and the Inter-state Water Disputes Resources Council (NWRC), the apex body organizational arrangements, like National Act of 1956 (Saleth, 2004). of policy making in water sector, amended Sri Lanka is a tropical island, Water Resources Council (NWRC) and the water policy and adopted the new situated close to the south-east tip of the National Water Board (NWB) for inter-state Most of the water related laws were National Water Policy in the year 2002. The Indian subcontinent with a total geographical 2 and centre-state coordination. The NWRC, either passed during the colonial period or were new National Water Policy, 2002 calls for a area of 64,630 km . In 1990, the total water created in 1983, is an important policy the amended versions of colonial law, and regulation of ground water extraction so as withdrawal in the country was estimated to 2 making agency in Indian water sector, were outdated due to their inability to not to exceed the recharging potential. There be 9.77 km , which is 15 per cent of the chaired by the Prime Minister, and includes correspond to the newly created water has been an urge for integration of water-use total resource, and out of which nearly 96 the Union Minister for Water Resources and demands and water crisis. The drought of and land-use policies. In a remarkable per cent are consumed for irrigation the Chief Ministers and Governors of all 1987, coupled with the macro economic crisis departure from previous policy, the policy purposes, and domestic and industrial States and Union Territories. The NWB is of the late 1980s have led to some policy of 2002 introduces participatory approach to purposes required 2 per cent each. Although the executive arm of NWRC, and is chaired changes in the water sector in India. While water resource management in the field of irrigation dominates the total water use, there by the Secretary of the MoWR and includes the National Water Policy of India, which was irrigation. The policy makes an attempt to is a growing demand for water for domestic Chief Secretaries of all states, Secretaries formulated in 1987 was a response to the maintain the quality of water and prevent and industrial use. The 2000 data for water of the concerned Union Ministries. water scarcity due the drought situation, the environmental pollution. Finally, the policy sector in Sri Lanka, the total water reduced water sector investment caused by calls for appropriate changes, reorientations withdrawal is estimated to be 10.92 km 3, of Although India does not have any impact of the economic crisis of the 1980s and reorganization of water institutions, in which 90 percent is for agriculture, 7 per cent separate and exclusive laws regarding water, has forced many states to raise internal order to give effect to the planning, for domestic purposes and remaining 3 per there were water related legal provisions resources through better cost recovery and development and management of water cent for industrial purposes. dispersed in various irrigation acts, Central external resources through mobilization of resources (see Rout 2002). and State laws, constitutional provisions, private funds (Saleth and Dinar 2000). After Constitutional Amendments in etc. The federal political structure of the In the line with the New National 1987, water sector responsibilities in Sri country resulted in creation of dual The main goals of the National Water Water Policy, 2002, several State Lanka were divided between the Union and institutional structures in India. Most of the Policy (1987) of India are the promotion of governments have also amended their state Provincial governments, with inter- water resource development responsibilities conjunctive use of water from surface and water polices paving the way for user provincial and intra-provincial water and legislative powers are with the state sub-surface sources, supplemental irrigation, participation in management. Although many responsibilities respectively. Although there governments. However, the Central water conserving crop-patterns, and irrigation states have attempted to involve users in are 40 government agencies yielding varying government has also certain indirect power and production technologies. The policy has water distribution, cost recovery and system degrees of influence over Sri Lanka’s water because of its role in project clearance, called for increase in canal irrigation water maintenance, the extent of actual Irrigation sector, only 7 of them form the core water resolution of inter state water disputes, and rates and promotion of user participation in Management Transfer is insignificant excepts administration at national level (Nanni, 1996). control over several technical organisations. canal water management (GoI 1987). in some individual state experiences such as The Ministry of Irrigation and Ministry of

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River Basin Management (the erstwhile 2005). However, the draft Water Resources launched on the initiatives of International users. By early 2000, a draft policy document Ministry of Mahaweli Development) are the Bill, being discussed since early 1980s, has Water Management Institute (IWMI), titled National Water Resource Policy and key organisations responsible for irrigation all the right ingredients for a modern water USAID and government support. At present, Institutional Arrangements has been prepared, development policy. The Irrigation policy, including water permit systems, full some 3,000 Distributory Canal Organisations which was approved by the Cabinet of Department and Mahaweli Authority of Sri cost recovery, conflict resolution etc (World or Water Users Associations (WUA), and Ministers of Sri Lanka in March 2000 (Samad Lanka (MASL) are the major organizations Bank 1992). A comprehensive proposal for about 15,000 Field Channel Organisations 2005). The reform programme has also vested with the responsibilities of policy National Water Policy was prepared during have been established and vested with the proposed a new organizational setup that will implementation. The National Water Supply 1990s with financial and technical support responsibility of operation and maintenance fill some major gaps in the existing and Drainage Board (NWSDB) and the from Asian Development Bank (ADB), of canal systems (Samad 2005). arrangements of water management. Urban Development Authority are United States Agency for International responsible for domestic and industrial water Development (USAID), and Food and In 1993, the government of Sri Lanka 4. Common Trends and Patterns in supply. Agriculture Organisation (FAO). The initiated an action plan for water policy and Water Institutional Reforms proposal, however, could not be approved institutional reforms in Sri Lanka under The institutional changes in the three Water allocation and right to access by the Parliament owing to difficulties of technical assistance from ADB and USAID. countries in the South Asian Region discussed to water are addressed in a number of achieving consensus within the political Arriens et al. (1996) have identified five in the above section provide us with a scope legislative enactments in Sri Lanka. There circles. critical factors integral to water sector, which are over 50 laws relating to such diverse prompted the urgency for a comprehensive to highlight the commonalities in such aspects of irrigation, land, agriculture and Despite absence of a unified and water policy: i) inadequate attention to reforms in the water institutions and water drinking water supply (Samad 2005). The formal water policy, there have been watershed management, ii) deterioration in sector. Notwithstanding the variations in Irrigation Ordinance was first enacted in substantial reform initiatives in water water quality, iii) uncontrolled ground water degree, pace, coverage, duration and 1856 by the British Colonial Administration institutions and water sector in Sri Lanka, abstraction, iv) deterioration of irrigation effectiveness of institutional reforms in to legalize customary irrigation practices and through introduction of several policy facilities owing to inadequate operation and individual countries, this section attempts to to prescribe the conditions for water measures concerning water. The draft Water maintenance, and v) lack of inter-sector identify the common trends, patterns and extraction. The Mahaweli Authority of Sri Bill of 1980 had provisions for full cost coordination and mechanism for managing directions of such changes. These Lanka Act, 1979, is one of the important acts pricing, setting up of inter-ministerial Water multiple uses of water (cited in Samad 2005). commonalities correspond to changes in affecting water management in Sri Lanka, Resources Council as a coordination In 1996, Water Resource Secretariat (WRS) orientation of water management, which empowers the Mahaweli Authority to mechanism, water courts for conflict was set up to implement the project, and was involvement of farmer communities in use and develop water resources of resolution, etc. (World Bank 1992). A vested with the task of formulating the management and decentralisation, Mahaweli river or any other major river. The significant change took place in the water National Water Policy. Subsequently, Water establishment of water rights defining rights National Water Supply and Drainage Board sector in Sri Lanka, when in 1984, Resources Council (WRC), consisting of to access water. (NWSDB) Act of 1974 describe the statutory government instituted irrigation fee with the bureaucrats, academicians, NGO personnel, From Water Resource Development to function of NWSDB to provide water supply aim of recovering the cost of operation and women’s groups and farmers’ representatives, Water Resource Management for public, domestic and industrial purpose, maintenance of irrigation facilities from was set up to direct and guide WRS in its and to operate a coordinated sewerage farmers. In view of difficulties in fee functioning. The reform process in the South Asian system. collection and success of experiments in region have resulted in a fundamental shift in As a part of the reform process, farmer participation in irrigation management, orientation in water sector from water Sri Lanka does not have an WRS adopted ‘stakeholder consultation’ as a in December 1988, the government formally development to water allocation and exclusive and formally approved water key strategy for policy development in water adopted the Participatory Irrigation management. This paradigm shift in water policy. Policy documents are often made in sector. WRS organized several stakeholder Management (PIM) Policy for all major sector required a radical reorientation of the official documents, such as public investment meetings involving Government agencies, irrigation schemes. To facilitate the water institutions. The pre-reform era in all programmes, annual budget speeches and policy makers, water managers, private sector, implementation of this policy, an Irrigation the three sample countries was characterized President’s address to Parliament (Samad Management Policy Support Activity was professional bodies, NGOs, and major water

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 251 Institutional Reforms in Water Sector: A Cross Country Perspective from South Asia Satyapriya Rout 252 by structural engineering approach for widely acknowledged as a result of the Further, when and how these use-rights will International (donor agency) pressure as development of water, with little or no reform process. be exercised by the farmers was also to a a source of change emphasis on allocation of such water at the greater extent influenced by the state. field level. The engagements with Flood Irrigation Management Transfer However, with the changes in water The endogenous and exogenous Control, Drainage and Irrigation (FCDI) (IMT) through Participatory Irrigation management orientations and priorities, factors of institutional change had both long projects in Bangladesh and large-scale Management (PIM) aims at transferring farmers are supposed to possess all the three term and immediate impact respectively upon irrigation projects through construction of bid managerial responsibilities including cost property rights, i.e. use, ownership and the change process in water sector in the dams reflected the civil engineering recovery, and operation and maintenance, to decision-making rights over water. The IMT South Asia region. While crisis in water sector dominance in the water sector in the periods formal Water User Associations, forms the process and the RBO approach relies on in terms of water scarcity, flood, and drought prior to reform. However, the reform policies main mode of decentralisation in irrigation WUAs and extend all the above three water have been present for a long term and of all the three countries emphasised upon sector. Sri Lanka has quite extensively rights to farmers. Though the state retains evolutionary factors causing institutional the allocation of water at the field level and persuaded with the IMT programme, while with it the de jure ownership rights over change in water sector of South Asia, the the required institutional arrangements for its it is gaining momentum in India. Similarly, water, the de facto ownership rights are now immediate factor resulting in such changes effective management. The PIM policy of Sri the provisions for formation of River Basin vested with the farmer, who by virtue of his has been exogenous in nature. For instance, Lanka, IMT in India and the Guidelines for Organisations (RBOs) as per the New membership to WUA gains access to the the impact of the economic crisis of 1980s People’s participation in Bangladesh indicate National Policy of Bangladesh, is an attempt water. forced countries like India and Sri Lanka to the shift in trend towards water management to promote decentralisation water sector with come out with reform measures for recovering from water development. the active involvement of water users. From Sectoral to Integrated Approach to operation and maintenance charges from the Water Management farmers by increasing the irrigation fee. One Farmers’ Participation in Water Establishment of Water Rights of the most important immediate factors Management through Decentralized The pre-reform period in water The water rights arrangements contributing towards institutional reforms in institutional structure sector was dominated by sectoral approaches under the reform process have become a water sector of South Asia has been the to water, with little scope and platform for intervention, influence and pressure from One of the central themes of water dynamic phenomenon. The reform process inter-sectoral communication. However, the by emphasizing water allocation and international agencies. The international institutional reforms in South Asia has been recent policy changes in water sector call for lending agencies such as IBRD, and the World acknowledgement of farmers as stakeholders farmers’ inclusion in water management has integrating the sectors and agencies relating specified property rights over water. Under Bank had profound influence for water sector in the resource and ensure their participation directly or indirectly to water sector. reforms in Bangladesh from the very in management of use and allocation of water. the auspices of IMT, user based allocation Therefore, the new National Water Policies has become an institutional to agency based beginning. Similarly in the case of India and The shift in orientation from water of both Bangladesh and India call for Sri Lanka, donor agencies like World Bank, development to water management, has allocation. Further, with provisions for integrating land-use policies with water-use private sector investment in water sector, the USAID and ADB and technical organisations brought into focus the potentials of policies. As a consequence, Integrated Water like IWMI and FAO have been crystallizing decentralized institutional structures. The reforms are also paving the way for market Resources Management (IWRM) has based institutional alternative for water factors for water institutional reforms. Some centralized management policies do not find emerged as the dominant paradigm in the of these agencies have also played important a place in the newly emerged paradigm, which allocation. Water rights have got a wider water sector in South Asia. The South Asian connotation in the wake of reform roles in drafting Water Policies of South Asian require decentralized institutional countries are on the process of developing a countries. arrangements for promoting social justice and programmes in the water sector in South National Water Plan for providing a technical sustainability of the resource. The functional Asia. Prior to the water institutional reforms framework needed to promote IWRM and 5. Conclusion distinction between centralized mechanisms in water sector, under the top-down integrated perspective to water resource needed for coordination and enforcement and centralized model of water development, management. administrative rearrangements Since its evolution, human society has the decentralized arrangements for user farmers were only possessing use rights over are being planned out for implementation of encountered many challenges, and has participation and water allocation have been water, while the state retained with it the such an integrated and comprehensive accordingly experienced corresponding ownership and decision making rights. approach to water management. changes to over come those challenges.

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However, what is important is that the speed allocative decisions. Arguing in a similar References GWP (2000): Integrated Water Resources Management. in which the world has changed over last fashion, the paper tried to conceptualise TAC Background Paper No. 4, Stockholm: few decades has been unprecedented water institutions as an entity, which sets the Arriens, W. L., J. Bird, J. Berkoff and P. Mosley (1996): Global Water Partnership (Technical Towards Effective Water Policy in Asian and compared to earlier times. In the water rules and defines the action sets for decision Advisory Committee). Pacific Region. Vol. 1. Asian Development sector too, there has been a profound making in the realm of water sector. Having Bank, Manila. Hodgson, G. M. (1998): ‘The Approach of Institutional change over the last couple of decades carried out a conceptual analysis of water Economics’. Journal of Economic concerning water demands and priorities sector and water institutions, the paper Cosgrove, W. J. (2003): ‘Water Resource Sector in the Literature, 36 (1): 166 – 92. owing to corresponding changes due to proceeded further to describe country Coming Decades: Global Perspective’ in K. globalisation, technological change, specific experiences in the South Asian Prasad (ed.) Water Resource and Sustainable Nanni, M. (1996): Preliminary Report on National relentless competition for economic growth, region with respect to changes that were Development: Challenges of 21st Century. Water Resource Laws and Administration in rapid increase in population, etc. Thus, water brought forward in the water institutions. Sipra Publications, New Delhi. Sri Lanka. Water Policy and Law Advisory policies and institutions of current times Taking countries like Bangladesh, India and Programme, CGP/INT/620/NET, Food and CWPD (2001): Water Resource Management in Agricultural Organisation, Colombo. have to be significantly different from the Sri Lanka as a point of reference, several Bangladesh: A Policy Review. Livelihood- policies, strategies and institutions that were common trends and perspectives were Policy Relationship in South Asia Working North, D. C. (1990): Institutions, Institutional Change previously in practice to meet the emerging identified in the whole process of water Paper 1, Centre for Water Policy and and Economic Performance. Cambridge challenges. Countries in South Asian region institutional changes in South Asia. To Development (CWPD), School of University Press, Cambridge, M.A. have accordingly approached the conclude, the paper identified that there has Geography, University of Leeds. institutional changes in water sector in a been substantial change in the perspective North, D. C. (1991): ‘Institutions’, Journal of positive manner and have under taken in which water sector has been approached Das Gupta, A.; M. S. Babel, X. Albert and O. Mark Economic Perspective, Vol. 5 (1), 97 – 112. (2005): ‘Water Sector of Bangladesh in the several policy and institutional changes. in the region. To be precise, the region has Context of Integrated Water Resources Picciotto, R. 1995): Putting Institutional Economics The present paper attempted to underscore experienced a change from water resource Management: A Review’, Water Resources to Work: From Participation to Governance. such attempts in the South Asian region, development perspective to that of water Development, 21 (2), 385 – 98. Discussion Paper No. 304. The World Bank, while at the same time carried out a resource management. The current Washington, D.C. conceptual review of terminologies like perspective towards water has been holistic Duyne, J. E. (1998): ‘Local Initiatives: People’s Water water sector, water institution and water in nature in contrast to the excessive Management Practices in Rural Bangladesh’, Pllott, C. R. (1979): ‘The Application of Laboratory rights arrangements. importance to techno-engineering approach Development Policy Review, 16, 265 – 80. Experimental Methods to Public Choice’, in C. S. Russell Ed. Collective Decision that characterized the earlier period of water Frederikson, H. D. (1992): Water Resources Making: Application From Public Choice Water sector, for all analytical sector. Further, there have been changes purposes, was conceptualised as an Institutions: Some Principles and Practices. Theory, John Hopkins University Press, acknowledging the rights of farmers, women Technical Paper No. 191. The World Bank, Baltimore, Md., 137 – 60. umbrella term consisting of all issues and end-users as stakeholders in the whole Washington, D.C. concerning water from various sources, and process of water governance. In this regard, Rinker, W. H. (1982): ‘Implications from the the issues relating to generation, withdrawal the policy changes has proceeded hand in Gazmuri, R. and M. Rosegrant (1994): Chilean Water Disequilibrium of Majority Rule for the Study and governance of water. However, the hand with other reforms in decentralized Policy: The Role of Water Rights, Institutions, of Institutions’, in P. C. Ordeshook and K. important issues that were identified in governance, providing greater emphasis on and Market. International Food Policy A. Shepsle Ed. Political Disequilibrium, water sector were those of macro issues user participation in decision making Research Institute, Washington, D.C. kluwer – Nijhoff Press, Boston. Originally published in the American Political Science concerning development, allocation and concerning water governance. Finally, the GoB (1999): National Water Policy, Ministry of Water Review, Vol. 74, 1980, 432 – 447. management of water at a national level. A paper identified that external pressure, Resources, Government of Bangladesh, Dhaka. study of institutions, in the context of natural especially from the donor agencies, has acted Rosengrant, M, X. Kai and S. Cline (2002): World Water resource management, focuses on the laws as an important catalyst in generating GoI (1987): National Water Policy, Ministry of Water and Food to 2025. Washington, D.C.: and conventions that either directly allocate institutional changes in water sector in South Resources, Government of India, New Delhi. International Food Policy Research Institute. resources, or establish processes and Asian region. constraints for its members to make

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Rout, Satyapriya (2002): ‘Water Policy not Down to Seckler, D, R. Barker and U. Amarasinghe (1999): The Afghanistan Crisis: Geo Politics, Earth’, Deccan Herald, August 27, 2002. ‘Water Scarcity in the Twenty-first Issues and Perspectives Century’, International Journal of Water Saleth R. M. and A. Dinar (1999): ‘Water Challenges Resource Development, 15 (1/2), 29 – 42. K S Pavithran and Institutional Response’, Policy Research Working Paper 2045, The World Bank, Shah, T. (2005): ‘New Institutional Economics of Washington, D.C. India’s Water Policy’. Paper presented at Abstract International workshop on ‘African Water The Afghan conflict is a potent example of contemporary conflict resulting from a Saleth R. M. and A. Dinar (2004): The Institutional Laws: Plural Legislative Frameworks for complex mix of factors, caused by years of underdevelopment, militarisation, tribal Economics of Water: A Cross-Country Rural Water Management in Africa’, 26-28 and ethnic schisms and the United States’s geo-political ambitions of the Analysis of Institutions and Performances. January 2005, Johannesburg, South Africa containment of China and extracting Central Asian oil and gas to the world market. Cheltenham, Edward Elgar, UK. Since 2001 the US has spent $127 billion on the war in Afghanistan. Overall the Shah, T. and B. V. Koppen (2006): ‘Is India Ripe for US and the NATO has nearly 70,000 troops in Afghanistan. More than 7,000 people Saleth R. M. and A. Dinar (2005): ‘Water Institutional Integrated Water Resource Management? were killed and civilian casuality rate has far more than are estimated to have been Reforms: Theory and Practice’, Water Policy, Fitting Water Policy to National killed in Taliban attacks. The fighting between US and Taliban has drawn more 7: 1 – 19. Development Context’, Economic and than 80,000 from their homes. However, in the backdrop of the 9/11 tragedies the Political Weekly, XLI (31), 3413 – 21. US ambitions have not been succeeded in Central Asia. The US designs of exporting Saleth, R. M. (1996): Water Institutions in India: democracy and to change the balance of forces and keep the countries of the region Economics, Law and Policy, Commonwealth Wescoat Jr., J. L.; S. J. Halvorson and D. Mustafa in its orbit is a highly disturbing scenario. The US occupation of Afghanistan proved Publishers, New Delhi. (2000): ‘Water Management in the Indus that the so called humanitarian interventions are merely smoke screen to hide and Basin of Pakistan: A Half Century sell larger geopolitical agendas by the super power. Saleth, R. M. (2004): ‘Strategic Analysis of Water Perspective’, Water Resources Institutions in India: Applications of a New Development, 16 (3), 391 – 406. Research Paradigm’. Research Report No. 79. International Water Management Introduction World Bank (1992): Asia Water Resources Study: opened another battlefield in Asia. In fact, Institute, Colombo. Stage 1, Vol. 2. Agricultural Division, Asia Reminiscencing the Huntington the Afghan conflict is a potent example of Technical Department, The World Bank, 1 Saleth, R. M. and A. Dinar (2000): ‘Institutional Washington D.C. thesis of “clash of civilizations,”, the events contemporary conflict resulting from a Changes in Global Water Sector: Trends, of 9/11 brought an unexpected close to the complex mix of factors, caused by years of Patterns and Implications’, Water Policy, 2: World Bank (1997): Water Resource Management transitional phase that followed the end of the underdevelopment, Cold War politics, 175 – 199. in Bangladesh: Step towards a New Cold War. In fact, with this incident, the time militarisation and tribal and ethnic schisms. National Water Plan, The World Bank, honoured myth of an invulnerable US The conflict has been going on for two and Samad, M. (2005): ‘Water Institutional Reforms in Sri Washington D.C. hegemony, secure between two oceans has a half decades.2 Since 1994 the War entered Lanka’, Water Policy, 7: 125 – 40. been debunked. [Wenger and Zimmermann a new phase with the emergence of Taliban. 2004: 1] As the evidence against Al - Qaeda, The present article is an attempt to became more apparent, the US government comprehend the reasons and intentions of pressurized the Taliban government in United States and its allies in invading Afghanistan and with a loose coalition of its Afghanistan and focuses on the allies invaded the country in October 2001. humanitarian crisis the Afghan people face With these developments the United States as a consequence of the US led invasion.

Dr. K. S Pavithran is Reader in Political Science and Director, K.M Centre for West Asian Studies and Indian Ocean Studies, University of Calicut, Kerala – 673635.

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Historical backdrop Amanullah’s socio-political reforms Daoud returned as president of the newly To introduce radical reforms, in a The history of Afghanistan stretches like land reform, modernization of higher proclaimed Republic. [Ratnam 1981: 9] The near primitive society is not an easy task. from ancient Aryana to the empire of the educational institutions, and restricting the Soviet Union was the first country to extend The result was the alienation of Taraki from Kushans, finally reaching its peak with the power of religious leaders in politics, etc., diplomatic recognition to the new Afgan state the conservative elements of the country. foundation of Afghanistan - the first Afghan state damaged the vested interests of feudal and agreed to provide political and economic The mullahs found Taraki’s policies to be in history. The year 1747 is regarded as its date landowners and religious clerics within and assistance to the country. Although the communistic and thus anti-Islamic. Further, of birth with Ahmad Shah Abdali, later Durrani outside the state apparatus. They were in United States was dismayed with president the ruling “People’s Democratic Party of as its founder. [Vartan 1969: 14] The importance favour of preserving the old feudal system Daoud’s pro-Soviet socio-economic policies, Afghanistan” (PDPA) was rent asunder by of Afghanistan lies in its strategic position as a in the country. The feudal landowners and it extended diplomatic recognition to the new two factions, the Kalq (people) and the gateway to not only the Indian sub-continent, the highest religious circles (mullahs) were state in Afghanistan. The US administration Parcham (flag). The result was the coup of but also to Central and West Asia and in a way engaged in instigating public opinion against regarded Afghanistan’s close ties with the September 1979, by which Taraki was killed to Europe. It has been a buffer state between the state under the pretext that the state Soviet Union as a threat to the political and Hafizzullah Amin the Prime Minister Russia and British Empire for more than one violated Islamic law and the traditions of stability in South Asia and the Middle East. under Taraki, installed himself as the new hundred years. [Labh 1980: 18] Afghanistan’s Prophet Mohammad. In January 1929 President. The policies of Amin especially The year 1978 saw the overthrow strategic importance increased after World War Habibullah, organized a group of armed men the politicization of the armed forces created of Muhamad Daoud and the installation of II, with the withdrawal of the British from the and rebelled against the state on the pretext serious drift among officers and rank and Nur Mohammad Taraki as President. This sub-continent and the Gulf area. The super of fighting a holy war to establish an Islamic file. Meanwhile, some elements of the was the culmination of popular upsurge power rivalry for suzernity over Indian Ocean state in Afghanistan. Amanullah did not fight feudal order, antagonized and affected by against the murder of Mir Akbar Khyber, a and Gulf area has boosted its strategic but fled to Italy. He believed that resistance the drive for reforms in the country respected Marxist intellectual on 17th April sensitivity. It is said that “from Kabul you can would ruin the country and bring disaster to physically went over to Pakistan, the newly 1978, which created wide resentment and look both in North and South.” [Chopra 1980: the nation. However, Habibullah’s short rule installed Islamic Republic, while others demonstrations resulting in the arrest of 22]. The above said facts have transformed this collapsed in 1929. The resistance to remaining within Afghanistan established Taraki, Hafizzullah Amin etc., by Daoud country as the crux of contention. Habibullah was led by General Mohammad their linkages with Pakistan [Sharifi 1981: government. After assuming power, on 5th Nadir and his four brothers. Mohammed 37]. In Pakistan, on the border with December 1978, Taraki signed a Twenty Year Prior to Afghanistan’s independence in Nadir was assassinated in 1933. He was Afghanistan there were twenty special Treaty of Friendship and Cooperation with 1919, the state was characterized as a tribal succeeded by his young son Mohammad camps and fifty bases where rebels were the Soviet Union. History shows that right confederacy. The state was weak and could not Zahir, who ruled the country until 1973. trained by Chinese and US instructors. The extend its authority throughout the country. Each from the early days Russia has been the rebel activities of the United States and its In 1953 the governmental control section of the country was ruled by a feudal greatest factor in shaping Afghanistan’s allies assume different forms with the active was assumed by Prince Sardar Muhamad landowner until king Abdur Rahman forcibly internal and foreign policies. That is why participation of the authorities in Pakistan. Daoud as Prime Minister. Daoud was a subdued tribal chiefs and feudal landowners Mikhail Ilyinsky, upheld, “the 1978 Saur The Central Intelligence Agency (CIA) has nationalist who wanted to pursue his policy during his rule in 1880-1901. Abdur Rahman (April) national democratic revolution “as a set up in the territory of that country a of betarafi (without taking sides) of non- and his successor king Habibullah (1901-1919) land mark not only in the history of network of military camps and training alignment. While modernization of army succeeded in building a strong army and Afghanistan but also in the overall national centers for training bands of ruffians to be helped to alleviate the threat of hostile maintaining a relative political stability in the liberation struggle against feudal and sent later to Afghanistan. The United States tribes, politically Daoud was quite country. The preliminary foundation for a imperialist oppression”. [Ilyinsky 1982: 5] supplied bands of Afghan rebels with all conservative, failing his critics, ignoring modern nation-state in Afghanistan was laid “From literacy to land” wrote David Selborne types of weapons-carbines, machine guns, parliament, and suppressing hostile when the country gained its independence from “Taraki regimes radical programmes brought mortars, rocket launchers and so on. The U publications. He was dismissed from the the British colonial government of India in 1919 a new life to the downtrodden masses – a S, Britain, Saudi Arabia, Egypt and Pakistan helm of affairs in 1963. But after a series of under the leadership of king Amanullah.[Emadi development which was testified even by allocated millions of dollars for waging this developments in 1973, through a military 1991: 176] Western critics” [Selborne 1980: 11]. undeclared war3. At this juncture, the coup the monarchy was overthrown and

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Parcham elements, invited, Babrak Karmal, exit of Shah. The nuclear war head carrier religious allies, the village mullahs. The latter to withdraw its troops in Afghanistan their well acclaimed leader, who was in exile Seventh Fleet was swiftly deployed in to the issued fatwahs denouncing these reforms as beginning from May 15th [The Hindu May to succeed Amin. Ultimately on 27th Gulf region. Fifty thousand American troops un-Islamic and called upon all Muslims to 16, 1988]. With the withdrawal of Soviet December 1979, the Soviet troops marched were permanently stationed in West Asia. resist them. As a result, the landlords and the Troops followed by the collapse of PDPA a into Kabul and installed Karmal as the Diego Garcia base had been activised fully mullahs could recruit mujahideens5 from rural coalition headed by Abdul Shah Masood’s president of the Republic of Afghanistan with at the same time. Carter, spelt out, what Afghanistan to fight a holy war against the force took over control of Kabul. This an estimated 85,000 Soviet troops to help the came to be known as the ‘Carter doctrine’, infidel Marxists with the sophisticated triggered off full scale fighting, mainly regime4. Thus the rule of Taraki and Amin that any attempt at giving control of the weapons and military that began to pour in between Burhannuddin Rabbani’s Jamiat-i- spounced a period of twenty months-from Persian Gulf would lead to war. It would, from Pakistan and the United States. Islami and the Hezb-i-Islam led by Gulbudeen April 1978 to December 1979. he said, “be regarded as an assault on the In June 1982, foreign ministers of Hekmetyar. Hekmatyar become the Prime vital interests of the United States. It will Pakistan and Afghanistan entered into Minister in June 1993 as a follow up of the The view which found most support be repelled by use of any means necessary negotiations through the intermediary, Mr. Jalalabad accord. The Taliban emerged only among analysts was that the Soviet Union including military force. Britain vehemently Diego Cordovez, Under Secretary General for in 1994 from the debris of civil war from aimed at finding a direct route to the warm condemned the Soviet invasion, while, Deng special political affairs and the personal among millions of refugees living in the camps water port of Gwadar in Arabian Sea, thereby Xiao-ping, the then vice premier of People’s representative of the UN Secretary General. of Pakistan [Navlakha 1996: 2913]. giving them leverage over the entrance to Republic of China stated that, the invasion Since that first meeting two such discussions persian Gulf and enhance their presence in The Taliban began its activities in was “by no means an isolated case but a were held in 1982. Further ‘proximity talks’ the Indian Ocean. However it had reiterated Pakistan and being helped financially by component of the global strategy of Soviet were held at Geneva in August 1984, 1985, by Moscow that her troops crossed the Saudi Arabia and the United States. This is hegemonism” [Nayar 1981: 49]. However 1986 and 1987. Meanwhile, on December frontier because it had a twenty year mutual because, Talibans are conservative Hannafi Chinese presence, through the Karakoram, 24th 1986, The Revolutionary Council security agreement with Kabul, because the Sunnis and they are opposed to Shiaite Iran. in the neighbouring Pakistan, which has Presidium elected Dr. Najibullah as the Kabul government requested for help and Thus with the financial and military support been under ferment, since the execution of Council President ie., the President of because Article 57 of the United Nations of the United States and Saudi Arabia the Zulfikar Ali Bhutto could easily be Afghanistan in place of Babrak Karmal, who Charter provided the inalienable right of the Taliban wrested power in Afghanistan in interpreted to mean that a serious danger resigned the office in November. Efforts states to collective and individual self- September 1996. The Taliban rule began with threatened Afghanistan with her new toward national reconciliation in Afghanistan defense against aggression. Above all, when retrogressive policies like prohibition of revolution in its birth pangs. were continued. In July 1987 Dr. Najibullah criticism arose, the Soviets made it clear that education for girl children and prohibition travelled to Moscow and indicated that he they would withdraw their men in After having come to power in April of women from going outside home etc6. The would be willing to step down if that would Afghanistan immediately, if asked by the 1978 the Afghan communists despite Taliban was, in fact engaged in executing a lead to national reconciliation. He also Afghan leaders. internal squabbles among the Parchami and carefully prepared plan to destroy the Islam reiterated his support for a coalition The Soviet invasion set off a chain Khalqui groups and a number of hour- promoted by, Amir Habibullah in the early government which would include reaction which brought America and its handed decisions, did indeed introduced 20th century. This was an Islam that attempted representatives of the rebels. During a visit European allies into open confrontation with major reforms to benefit the poor - to bring together Shia and Sunni, Tajik and by the UN Secretary General to Moscow also the Soviet bloc. Particularly the then compulsory primary education for both boys Uzbek, Hazara and Pashtun to form a unified in July 1987 Mikhail Gorbachev stated in American President Jimmy Carter expressed and girls; abolition of mortgages and debts nation state, an Islam promoted and accepted unequivocal terms that he was more than ‘surprise’ at the Soviet move, which and reduction of interest on loans in the rural by an urbanized middle class and which willing to withdraw all Soviet troops from inaugurated a new era of Cold War, which areas; ban on forced marriages and fixation brought increased cohesion to the country. Afghanistan. All that he wanted was an the Western analysts inclined to call as Cold of minimum age for marriage and Knowing that the imposition of rigid rules independent, neutral and friendly War II. [Srivastava 1980: 58] The fact was imposition of land ceiling to release excess would lead to social fragmentation the Afghanistan. that the US administration had been facing a land for distribution among the landless. Taliban policy was more carefully calibrated serious situation with its powerful armed Opposition to these measures came from the On February 1st 1988 Gorbachev policy pursued at the behest of Pakistan. bases in Iran going in to shambles with the rich landlord-money lenders and their announced that the Soviet Union is prepared [Khosia 2008: 45] However, United States

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 261 The Afghanistan Crisis: Geo Politics, Issues and Perspectives K. S Pavithran 262 made diplomatic contacts with Taliban .The adopted a resolution on November 14 country. At the beginning of the invasion in Russia to help NATO combat the same US assessment was that Taliban did not welcoming the declaration and expressing 2001, there were only 20,000 foreign troops Mujahideen who were armed and trained by practice anti-US policies such as Iran does. its support for the “efforts of the Afghan in Afghanistan. However, in 2007 there were Washington to fight the Russians [Radyuhin The United States’ strategy was that through people to establish a new transitional 140 suicide attacks. The Afghanistan Study 2008]. The Russian corridor will greatly the Taliban controlled Afghanistan they can administration leading to the formation of Group, in its report warned that the US/NATO reduce the NATO dependence on the influence central Asian politics and a government”. The government should be mission to “stabilize Afghanistan” is faltering violence plagued Pakistan route, impart counteract the influence and activities of Iran “broad-based, multi-ethnic and fully and renewed violence, rising opium production7 critical flexibility for military operations in and to destabilize parts of China and India. representative of all the Afghan people”, and falling confidence of Afghans in their Afghanistan. Russia is using its offer of help Thus here is an effort to dominate and exploit based on respect for human rights of all government and its international partners. to NATO in Afghanistan as a bargaining chip the countries of an important region. Afghan people “regardless of gender, to stop the alliance’s eastward expansion – ethnicity or religion” [Muni 2002: 295]. The For Afghans, six years after they ie., shelving NATO’s membership plans for The impact of 9/11 and the Humanitarian resolution also asserted; “the United Nations were supposed to have been liberated, life is the strategically important ex-Soviet nations crisis in Afghanistan should play a central role in supporting the getting worse. As the International Committee of Ukraine and Georgia. At the same time efforts of the Afghan people to establish of the Red Cross reported, the humanitarian Moscow believes that the US and NATO are With the 9/11 tragedy in the United urgently such a new transitional situation is deteriorating and civilians are heading for defeat in Afghanistan. Russia States things began to change. The US never administration” [UN Resolution 1378]. suffering “horribly” from growing insecurity wants to make sure that if and when the US expected that Osama bin Laden, one of its Subsequently week long negotiations were and violence in an increasingly dirty War. The and NATO forces pull out, it will not be own original creations would now turn around held at Bonn among 23 representatives of fighting in the south has drawn 80,000 from confronted with a hostile regime or a power and attack the creator itself. As the evidence four Afghan groups-excluding Taliban-led their homes, and the civilian casualty rate has vaccum in Kabul. That was why the problem against Osama and his terrorist network AL- to the ‘Agreement on Provisional doubled over the past year. More than 200 of Afghanistan has been high on the agenda Qaeda mounted, the US pressure on the Arrangements in Afghanistan Pending the were killed by American and other North of the Shanghai Co operation Organisation Taliban Government in Afghanistan, which Re-establishment of Permanent Atlantic Treaty Organisation (NATO) troops (SCO), dominated by Russia and China and was then believed to be AL-Qaeda’s mainstay Government Institutions’. The agreement in June alone – far more than are estimated the Collective Security Treaty Organisation of support, markedly increased. Finally, the was signed on 5th December. The Security to have been killed in Taliban attacks. The (CSTO), a defence pact of former Soviet evident non compliance of the Taliban regime Council endorsed it on December 6th and savagery of indiscriminate United States’ states. The SCO and CSTO have both to handover Osama bin Laden and his came in to force on December 22nd 2001. aerial bombardments provoked violent declared their resolve to take responsibility associates in AL-Qaeda, the US supported by demonstrations and is widely seen as having for the security and stability in Central Asia. Now the United States and its allies the UK began nocturnal bombings of increased support for the Taliban’s armed [Ibid] The Afghan President Hamid Karzai are involved in everything in Afghanistan. Afghanistan on October 7, 2001. By mid campaign. has attended all recent summits of the SCO, The US has so far spent a staggering $ 127 November 2001 Kabul fell to the Northern while the CSTO has set up a working Group billion on the War in Afghanistan since 2001 Alliance. The data presented in Table I, reveal on Afghanistan that has instituted regular [Cherian 2008: 58 –60]. There is the United that at the very lead some 6500 to 7200 contacts with Afghanistan’s military, security The UN Security Council decided to States led ‘Operation Enduing Freedom’ Afghans died at the hands of the United and law- enforcement agencies. Further, an play a role in Afghanistan. The heads of (OEF), an International Security Assistance States and NATO in the past seven years. Indo-Russian joint working group on delegations of the six immediate geographical Force (ISAF) created by a UN resolution Afghanistan has been meeting regularly since neighbours of Afghanistan - Pakistan, China, on December 2001. There is NATO which To forestall the emergence of another 2000. Iran, Tajikistan, Uzbekistan and took control of ISAF in August 2003. There Taliban and another Al – Qaeda, the United Turkmenistan-along with those of United are the Provincial Reconstruction Teams States had partners in the European Union, The basic objective of Pakistan States and Russia (ie. six plus two) met in (PRTs). Overall the United States and Japan, India and Pakistan. There is also a rich policy in this regard has been to weaken the UN headquarters and adopted a declaration NATO has nearly 70,000 troops in irony in the fact that the US, which fought a Afghan state. It needs strategic depth vis-à- on November 12, 2001. Following this ‘Six Afghanistan. Three thousand more marines proxy war against the Soviet forces in vis India and has to settle its own Pashtun plus Two’ declaration, the Security Council have been deployed in Southern parts of the Afghanistan from 1979 – 1989, is now asking problem. There remains the prospect of

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which was hesitantly moving around the development to Afghanistan, its not Table 1 country outside the capital, is now crawling immediately obvious why it’s still back into the safer environs created and considered by some analysts to be a good maintained by the American and NATO war – through majority of Americans, troops. The attempt to impose a Western-style Britons, Canadians, Italians and Germans, democracy has failed in Afghanistan. In other it should be said, want their troops words, the credibility of the Karzai withdrawn. By intervening on one side of government8, which despite being a popularly an ethnically charged civil war to overthrow elected one, is largely perceived to be a US – the Taliban – rather than say, targeting backed puppet regime, stands further special forces against Al – Qaeda – the US damaged. Despite Karzai’s political and its allies ended up exchanging warlords assertions against the powerful Mujahideen for theocrats and training most of the leaders from time to time, and his attempts to country into a collection of lawless and wedge in the Tajik and Hazara leadership, brutal fiefdoms [Milne 2007]. Instead of Al authority and power for various reasons – Qaeda terror networks being rooted out, continued to elude him [Chandra 2007: 231]. they were allowed to migrate to the border The inexcusable delay by the West in lands, Pakistan and Iraq; Osama bin-Laden, providing funds for reconstruction failing to whose capture was the first aim of the war, help the Afghans improve security and take a escaped; and the limited expansion of firm position against war were all reasons for women’s and girls’ freedom in Kabul and a the failure of Americas’ Afghan policy. few other urban areas was offset by an eruption of rape and violence against * Source, Marc .W Herold (2008), ‘An Empty Buffer’, Frontline, 25 (13), June 21 – July 4. Taking into account the US women. Afghanistan is as UN warned last getting gas and oil from Turkmenistan through Afghanistan to the exclusion of Russia and proclaimed design of “exporting democracy” year a failed state, which now produces 90 Afghanistan. To implement this policy China will be kept off balance by the regional and attempts to influence the development of percent of the worlds opium and where Pakistan worked hard to create, train, equip powers. This will keep Afghanistan fragile internal socio-economic and political corruption and insecurity prevails over and finance the Taliban to seize power in and fragmented. In the process, America dynamics of the countries of the Central Asia reconstruction. The new so-called Kabul. However, under the post 9/11 might get bogged down militarily in and Middle East, as in elsewhere with the humanitarian interventions are merely circumstances the Pakistan President Afghanistan, which has a long history of objective of enabling the American protégés become a smokescreen to hide and sell Musharraf was literally forced by the fighting against the foreigners. The US geo- to come to power. Striving to change the larger geo-political agendas [Bricmont 2007: Americans to withdraw support to Taliban. political drive is motivated by twin objective balance of forces and keep the countries of 176]. the region in its orbit, Washington throws up American Strategy in Central Asia of the containment of China and extracting even new ideas like, for example, establishing In this highly disturbing scenario, The undeclared American objective Central Asian oil and gas to the world market a transport corridor between Central Asia and India is a major stake holder and hence the of promoting its geo-political interests in the [Meher 2004: 144]. South Asia by engaging Afghanistan in the imperative for Indians to keep constant track backdrop of the 9/11 tragedies has led to However six years after “Operation Central Asian regions transport and energy of developments in Afghanistan. There are strong disapproval and resentment among the Enduring Freedom” and occupation of communications. The aim is Afghanistan’s approximately 2000 Indians presently countries of the region. Russian, Chinese and Afghanistan started only 30 percent of the reconstruction and its integration with Central working in various fields and in a wide range Iranian unhappiness is particularly visible in country is under the control of the Kabul Asia [Ali 2006 : 8]. of capacities in the country both in public this context. Washington’s concept of a government. Taliban formations, have been and private sector including multi-national greater Central Asia, that should link former able to conduct frontal assaults. As the Given the manifest failure of the US/ corporations. India also has the largest Soviet Central Asia with South Asia through situation stands, the writ of the government, NATO forces to bring either peace or diplomatic presence in the country with its

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 265 The Afghanistan Crisis: Geo Politics, Issues and Perspectives K. S Pavithran 266 embassy in Kabul and consulates situated in 1. A flawed American policy of over- There are certain under currents years ago, America’s different strategically significant parts of the dependence on Pakistan army and behind the American over action in this issue. imperial destiny seemed country. While India is easily the most intelligence (ISI) which Through projecting and propagating the War manifest. It has since popular country in Afghanistan, it also ranks clandestinely supported the Taliban on terrorism the United States had succeeded become obscure. But it is uncomfortably close to the United States in and the Al –Qaeda. to a very great extent in averting the attention America’s destiny just the the list of the Taliban Al- Qaeda. Equally of the world, especially that of the Arabs, from same [Ferguson 2006: importantly, Pakistan remains staunchly 2. United States disinterests in ISAF. the Palestinian problem. Any sort of division 45]. opposed to the growing Indian influence in a among the Arab world should be maintained 3. Washignton’s policy of weaponizing country it is used to consider its natural to preserve and protect the Western interest The Solution of the Afghan problem warlords; and satellite [Mukarji 2006: 12-13]. in the Gulf area. Another most important guaranteeing peace, freedom and non- interference can be worked out taking the 4. American geo - political ambition reason, behind America’s occupation of Conclusion above mentioned factors into consideration. and shift in policy. Afghanistan is that, their nerve centre is more The fall of the Taliban regime in or less here. The United States is the giant . At the same time, the United States needs November 2001 did nothing to change the The fact is that there is no end in consumer of world’s raw materials such as to develop a sound strategy towards South, political mechanism at work in Afghanistan. sight to the insurgency unless and until oil, aluminum, chromium, lead, nickel, Central and West Asia, ie, a serious move The strategic landscape of the Afghanistan Pakistan is obliged to end its sanctuaries and tugston and uranium. The fact is that, the to bring about a resolution of the Afghan conflict is changing. After nearly a decade of drive out Taliban and Al – Qaeda elements Afghan crisis added a new dimension to the conflict, with support from Russia, Iran, disentanglement from the conflict following from its territory. Another factor of the gigantic strategic areas stretching from Japan India and Central Asia. A failure to do so the withdrawal of Soviet forces from situation is the growing unpopularity of the to Australia and across the Indian Ocean to may occasion America to regret the passing Afghanistan, major power interests are once American role in the post – Taliban period Southern African region and the Persian Gulf. of a valuable opportunity. The 9/11 attacks again on the rise in the war – torn country. due to highly injurious and largely It is a serious threat to the littoral countries and the “war on terror” have provided The United States and Russia, who engaged ineffective military campaigns and coalition of this region, Central Asia and to India’s foreign policy makers in the Bush in the proxy war in Afghanistan in the 1980s, military effort in Afghanistan. Security. The arrogance of unlimited administration with firepower to pursue a have now found a common ground in their American power has led Niall Ferguson to more active US foreign policy guided by a opposition to what has been created in the The Bush administration was observe; first-strike national security doctrine of – intervening period the Pakistan backed ultra successful in maneuvering the Security pre-emptive military force and preventive – orthodox Islamic Taliban militia. Council Resolution 1373 adopted on “sadly, there are still a few war – all grounded in the notion of self September 29, 2001 and in the formation places in the world that defence. However in the present climate Despite all claims of ‘successes’, the of a coalition against its war on terrorism. must be ruled before they of regional changes and America’s own geo- United States has failed to accomplish the However the War in Afghanistan has can be freed. Sadly, the acts strategic requirements, the prospects for a main objectives of the war. It has failed dragged on far longer than the Bush of ruling them will sorely settlement of the Afghan conflict are quite to kill or capture top leadership of Taliban administration expected, and may last try Americans, who dim. Thus a multi-dimensional framework and Al- Qaeda, including Osama bin Laden. longer than it ever imagined. The American instinctively begrudge such which can provide opportunities to discuss America has also failed to bring about any commander of United States and allied places the blood, treasure, not only matters concerning Afghanistan, but reconciliation among different factions, forces in Afghanistan Karl Eikenberry, and time they consume. Yet also the issues connected with the balance ethnic groups, warlords etc. Further observed recently that five years on from saddest of all, there seems of power in the region, is needed. The American policy has failed to initiate a nation the American invasion and occupation “the to be no better alternative democratization and normalization process building process. Afghan society remains enemy is fighting hard, and we have to fight available to the United in Afghanistan appears to have reached a fragmented politically, socially and harder….. In the next ten years things will States and to the world….. crossroad which demands immediate economically. All this happened because of get better, but things will still be hard” [Mian Once, a hundred and sixty answers. four important factors, [Meher 2004: 222]. 2006: 4234].

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Notes Goodhand (2002): ‘From Holy War to Opium Ilyinsky, Mikhail (1982): Afghanistan, Onward March Nayar, Kuldip (1981): Report on Afghanistan, New War? : A Case Study of the Opium Economy in of the Revolution, New Delhi. Delhi. 1. For a detailed theoretical exposition see, North-Eastern Afghanistan’, in Christine Noelle Huntington, P, Samuel (1996): The Clash of – Karimi et al., eds., Afghanistan: A Country Khosia, I.P. (2008): “Lost Opportunities in Radyuhin, Vladimir (2008): “Russia Returns to Civilization and the Remaking of World Order, Without a State, Vangard Books, Lahore. Afghanistan”, Seminar, No. 584, April. Afghanistan on Request”, The Hindu, June 26. Viking, Delhi. 8. Presidential election was held in Afghanistan on Labh, Kapileshhwar (1980): “A Short History of Ratnam, Parala (1981): Afghanistan’s’ Uncertain 2. The Afghan War, which broke out in 1979 and October 9 2004 and Parliamentary and Afghanistan”, Janata, Vol. XXXV, August 15. Future, New Delhi. until 1989 was conducted as a Cold War provincial councils elections were held on Mehar, Jagmohan (2004): America’s Afghanistan War Selborne, David (1980): “Afghan Needs Cool Heads”, confrontation. During the continuing conflict in September 18, 2005. Western Politicians like : The Success that Failed, Kalpaz Publications, The Guardian, February 11. the 1990s, attention faded against a background to describe the Afghan government as of a changed mood in world politics. Delhi. democratically elected,when in fact the elections Sharife, Rahmat (1981): “Report from Kabul”, Link, were marked by large scale fraud and 3. For more documentary evidence see, The Truth Mian, Zia (2006): “Choosing War Confronting Defeat”, March 20. intimidation in polls that gave warlords pride about Afghanistan: Documents, Facts, Eyewitness Economic and Political Weekly, Vol.XLI, No. 40. of place while political parties were not allowed Srivastava, M.P (1980): Soviet Intervention in Reports, Moscow: 1981. to take part. Milne, Seamus (2007): “Bloody Failure Regarded as a Afghanistan, New Delhi. 4. For more details see, The Europa Year Book 1981: Good War”, The Hindu, August 24. The Hindu, May 16, 1988. A World Survey, Vol. 1, London. References Mukharji, Apratim (2006): “Resurgent Taliban U. N. (2001): Resolution 1378, November 14. 5. Not withstanding the enormous financial support Ali, Mansoor (2006): “US, Afghanistan, Central Asia: Growing in Opposition to Karzai”, Mainstream, Vol. XLIV, No. 42, October 7. from the United States, Saudi Arabia and China, The New Game”, Mainstream, Vol.XLIV, No. Vartan, Gregorian (1969): The Emergence of the Hizb ul-Mujahideen have got split in to seven 21, May 13. Muni, U. S (2002): “The Fifth Afghan War and Modern Afghanistan, Stanford University groups and unable to form a government. There International Law”, Economic and Political Press, Stanford CA. were three broad strands in the seven Mujahideen Bricmont, Jean (2007): Humanitarian Imperialism: Weekly, Vol. XXXI, No. 44, November 2. groups of the Islamic Alliance of Afghanistan. Using Humans Rights to Sell War, Monthly Wenger, Andreas and Doron, Zimmermann (2004): Review Press, New York. Three of them were moderates and traditionalist, Navalakha, Gautam ( 1996): “Afghanistan, Great Game International Relations: From the Cold War to three hard liners and fundamentalists and one in Chandra, Vishal (2007): “The Taliban Resurrection Renewed”, Economic and Political Weekly, Vol. the Globalised World, Viva Books, New Delhi. between the two extremes. What divided them is and the Changing Course of Afghan Civil War”, XXXI, No. 44, November 2. not only ideology but also tribal instincts and their in K. Warikoo (ed.), Afghanistan : The ethnic stamps. It was the presence of Soviet troops Challenge, Pentagon Press, New Delhi. in Afghanistan that unified them for a joint struggle. Cherian, John (2008): “Resurgent Taliban”, 6. The rigid interpretation of the Sharia by Taliban Frontline, Vol. 25, No. 14, July 5–18. had the effect of antagonizing the more liberal minded minority ethnic groups, as also many of Chopra, Pran (1980): “Russian Compulsions in the Pashtuns. The Taliban Edicts forbade flying Kabul” Illustrated Weekly of India, May 25. kites; the use of paper bags; playing football or chess; listening to music; dancing or going to Emadi, Hafizullah (1991): “State, Modernisation and cinema. Insurance interest and gambling was Rebellion: US – Soviet Politics of Domination banned as was photography of people or animals of Afghanistan”, Economic and Political Weekly, or reading of foreign books or magazines. Men January 26. were compelled to grow beards. Ferguson, Niall (2005): “The Unconscious Colossus: 7. A main source of unofficial revenue in Afghanistan Limits of (Alternatives to) American Empire”, is the drugs trade. Afghanistan has become the Daedalus, Spring 2005, p. 33 cited in C.P. biggest producer of opium in the world. The area Bhambhri, “Quest for Power: America or Asia under poppy cultivation was approximately in the Twenty-first Century”, India Quarterly, 63,674 hectares, while it is estimated that dry Vol. LXII, No. 1, January-March, 2006, p. 45. opium produce was 3,269 tonnes. Many Afghan Herold, Marc W. (2008): “An Empty Buffer”, Warlords have used drugs money to fund their Frontline. Vol. 25, No. 13, June 21 – July 4. military campaigns. For more details see, Jonathan

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Indo-US Nuclear Deal and South Asian Regional Security As a region of burgeoning economic nuclear agreement is about much more than and political importance, South Asia offers a mere nuclear technicalities: it is about the C Vinodan crucial test of proliferation’s effects in the emergence of a new configuration in the aftermath of the Indo-US civil nuclear global balance of power and a broader need Abstract cooperation agreement. The nuclear for a new international nuclear order in the South Asian security is at a crossroads. The region is passing through an agreement creates a major exception to the face of a global nuclear non-proliferation unprecedented strategic transformation following the signing of the Indo-US Civil- US prohibition of nuclear assistance to any regime that seems to have become Nuclear Cooperation Agreement. The region is fast getting sucked into the vortex country that does not accept international ineffective in meeting the challenges of terrorism. The fundamental problems of regional stability and security are being monitoring of all its nuclear facilities. In fact confronting the international community spontaneously transformed by a powerful combination of circumstances in the the deal gave defacto recognition to India’s today. aftermath of the deal. It is argued that, if other alternatives are not explored, there long-standing position on the flawed non– is a risk that South Asia will experience a dangerous and costly build up of nuclear proliferation regime sponsored by the nuclear Background arsenals, which would directly invite the risk of nuclear terrorism. But both the haves. For the Indian strategic planners, a On July 18, 2005, US President parties ignored the realities in the South Asian regional security order involving strategic nuclear alliance with the US, which George Bush and Indian Prime Minister the triadic relationships of India-Pakistan-China and India-China-US. occupies the apex of the political, military, Manmohan Singh announced a bold economic and technological power in the post agreement to restore US nuclear cooperation cold war international system, will fulfill its with India.6 For the United States, the Civil The United States-India Civil is a risk that South Asia will experience a growing energy needs and further strengthen Nuclear Cooperation Initiative (CNCI) was Nuclear Pact has virtually rewritten the rules dangerous and costly build up of nuclear its great power ambitions5. Indian official designed to allow US exports of civilian of the global nuclear non-proliferation arsenals, which would directly invite the statements, including at the highest level, nuclear technology to India, while India, in regime and the South Asian regional security risk of nuclear terrorism1. Others have have taken the line that this deal is all about essence, pledged to prevent the proliferation order by underlining India’s credentials as a hailed the deal as the equivalent of civilian nuclear energy, not about India’s of nuclear weapons to non-nuclear weapon responsible nuclear state that should be President Richard Nixon’s opening to nuclear weapons programme. But getting US states. The CNCI was preceded by an integrated into the global nuclear order. The China in 19722.The Bush-Singh Accord support for India’s civilian nuclear energy agreement on 28 June 2005 between the two Indo-US nuclear deal, which was born out also reflects the new US foreign policy programme is merely one element, and not countries’ defence ministers, which of India’s growing energy needs and the thinking inherent in the Bush Doctrine3. As the most important one, in the Indian (and stipulated inter alia that India and the USA United States’, renewed strategic interest in part of America’s new grand strategy, the US) considerations behind this deal. . Each would ‘expand [their] collaboration relating 7 the larger Asian region. The South Asian US wants to incorporate a democratic, party to the agreement only considered the to missile defense’. The two agreements are region is passing through an unprecedented multi-ethnic and rising India in to its relative strategic gains and ignored the wider steps in the development of a strategic strategic transformation following the strategic fold to shape the emerging ramifications of the deal in the emerging partnership between India and the USA that signing of the Indo-US Civil-Nuclear international system and also to make the regional security order in South Asia. Does was formally initiated in 2004 in a process Cooperation Agreement. The fundamental Asian power balance in its favour4. The the Indo –US nuclear deal cause another called the Next Steps in Strategic Partnership 8 problems of regional stability and security Doctrine also aims at using India’s growing phase of proliferation of nuclear weapons (NSSP). The NSSP was founded on a are being spontaneously transformed by a influence to counter the Iranian nuclear and to intensify the risk of nuclear war in growing realization in the USA of the powerful combination of circumstances in threat and the Chinese influence in the South Asia? This paper examines the debate geopolitical advantages that would follow the aftermath of the deal. Some believe that larger Asian region. surrounding the nuclear pact and implications from closer ties with India. For India, the if other alternatives are not explored, there on the regional security matrix in South Asia. main advantage—apart from recognition of This paper argues that nuclear weapons have what it sees as its status as a ‘responsible Dr C. Vinodan is a Member of Faculty and Chairman, Centre for Strategic and Security Studies (CSSS), School destabilized the subcontinent, principally nuclear weapon power’—is the prospect of of International Relations and Politics, Mahatma Gandhi University, Kottayam, Kerala, India. because of their interaction with India and technical assistance for its endeavour to Email: [email protected] Pakistan’s territorial preferences and relative increase its production of nuclear energy for military capabilities. It also argues that the the rapidly growing Indian economy.9 In fact

IJSAS 1(2) 2008, pp.269-283. ISSN 0974 - 2514 International Journal of South Asian Studies IJSAS July - December 2008 271 Indo-US Nuclear Deal and South Asian Regional Security C Vinodan 272 the nuclear deal was part of an ambitious US energy11. At the same time, the contention the possibility of decades old restrictions being safeguarded complex, including the timeline and Indian strategic partnership which is that India is a responsible nuclear state set aside to create space for India’s when each will come under safeguards, and launched after the cold war. This new global that has adhered to the guidelines of emergence as a full member of a new nuclear also undertakes not to transfer any of these partnership includes strategic, economic, and nonproliferation (without legally being part world order15. The official US version is that civilian designated facilities, or any energy dialogues. One component of the of the NPT regime) through strict export the agreement is designed to help India component thereof, to its weapons complex. energy dialogue would allow the US to controls and denying nuclear assistance to overcome its energy deficit through nuclear . Fourteen of the existing 22 reactors would transfer nuclear technology to India, as the other states, unlike the record of some energy, without undermining US be on the civilian list and under safeguards. latter takes a number of non-proliferation nuclear weapon states12. The critiques argue nonproliferation goals and commitments16. In (India already allows safeguards on six steps, including measures to safeguard its that by acquiring uranium from foreign India, the major section of the political class reactors)18. The remaining reactors will be on civilian nuclear infrastructure. The civilian sources (to free up domestic supplies) and and nuclear establishment was unanimous in the military list and one of them will be shut nuclear element of the new partnership by placing a set of nuclear facilities on the seeing the agreement as tacit US recognition down. In addition, New Delhi’s fast breeder requires that the US keep two balls in the air military list, India can increase its fissile of India’s status as a de-facto nuclear weapons reactor program will not be under safeguards. at the same time. Although the US wants to material production for weaponization state, a claim that was repeated by Prime In return for placing its civilian reactors under expand its bilateral relationship with India, it purposes. However, a different line of Minister Manmohan Singh in the Lok Sabha, safeguards, India would be allowed to import also wants to maintain its strong non- analysis examines the implications of the lower house of parliament17. Criticism of select nuclear technology and fuel from proliferation policy. Neither should come at increased uranium supplies in the context the agreement in New Delhi took a very foreign suppliers. The July agreement the expense of the other. In the eyes of many of India’s fledgling nuclear submarine different track. Critics of the agreement— committed India and the United States to a non-proliferation specialists, this new project. This perspective views that rather representing both left and right—have largely number of reciprocal and sequential steps to relationship rewards India for its recalcitrance than increasing nuclear warhead production, posed their concerns in terms of the future fulfill their obligations for civil nuclear co- regarding the NPT; it undercuts countries that New Delhi would use the expansion of its costs of closer ties with the United States. Was operation to begin (summarized in Table 1). accepted nuclear constraints; and it uranium supplies and enrichment capability the deal a sellout by diluting Indian Negotiations pursuant to the July agreement compromises longstanding US non- to fuel its nuclear submarine project,13 a key sovereignty? What did it augur for retaining led India to provide a separation plan proliferation policy and the global non- element of India’s desire to achieve a secure an independent foreign policy, a sine qua non (finalized and signed by President Bush and proliferation regime. second strike capability under its credible for postcolonial India’s aspirations to be Prime Minister Singh in New Delhi on 3 minimum deterrence doctrine. recognized as a great power? Did it curtail March 2006) and some additional steps that The Indian nuclear establishment was very India’s ability to defend itself by imposing both sides undertook to pursue (also eager to get out of the nuclear denial regime Under the 18 July 2005 agreement, the limits on fissile material and nuclear weapons summarized in Table 1). In addition to the sponsored by the nuclear haves. India is United States recognizes India “as a state production? In India too, the same question— separation plan India also harmonized the seeking to modernize its aging nuclear power with advanced nuclear capabilities . . . and is it worth it?—was being asked; the implicit control lists related to its nuclear and missile plants with the hope of addressing its growing responsibilities” and commits each side to trade-off, however, is altogether different. spheres with those of the Nuclear Suppliers energy needs. India also hopes that the a set of reciprocal steps that will enable US Group (NSG) and the Missile Technology agreement will allow India to acquire nuclear assistance to India‘s civilian nuclear In essence, the deal separated India’s Control Regime (MTCR). It is also working technology and materials from the United program14. But more importantly, in the civilian nuclear complex from its weapons to align its control lists relating to chemical, States and other suppliers. The nuclear deal Joint Statement, the United States implicitly complex and place the former under the biological and conventional dual-use sectors reflects an influential view in India that the acknowledged the existence of India’s safeguard of the International Atomic Energy to those of the corresponding multilateral nonproliferation regime embodied in the NPT nuclear weapons programme. There was Agency (IAEA). All US and international co- regimes, viz., the Australia Group and the is defective10. According to Indian Prime also public recognition that as a responsible operation will be exclusively confined to this Wassenaar Arrangement. India is also Minister Manmohan Singh, the regime is state with advanced nuclear technologies, civilian complex, with the safeguards ensuring working to provide more transparency and ineffective and that the international India should acquire the same benefits and that no external assistance can be diverted to details to the regulations designed to community should introduce measures that advantages as other states, which have India’s weapons complex. Further, India will implement its expanded export control restrict nuclear proliferation more effectively advanced nuclear technology, such as the submit a plan listing the indigenous reactors obligations under The Weapons of Mass without suppressing peaceful uses of nuclear United States. The Joint Statement offered and facilities that it will place in the Destruction and Their Delivery Systems

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(Prohibition of Unlawful Activities) Act of which was passed with strong bi-partisan political and material support to the cooperation, including research and 2005. Further, India also committed to a support in both chambers of Congress, achievement of US goals.” India’s growing development; nuclear safety; and stipulation, of not supplying any enrichment essentially establishes a waiver specific to economic and political role in the world is commercial trade in nuclear or reprocessing technology to states that do India (contingent on certain Presidential seen as a “new and significant strategic reactors, technology, and fuel; not place the facilities receiving such determinations) from a long-standing opportunity to advance U.S. goals.” Iran gets · Affirms the fuel supply assurances assistance under International Atomic requirement under American non- a specific mention, with the US expecting made to India by President Bush on Energy Authority safeguards. proliferation law that NNWS be subject to India’s “full and active cooperation to March 2, 2006, including creating the full-scope. A reading of the Hyde Act brings dissuade, isolate and if necessary sanction and necessary conditions to allow India Hyde Act and 123 Agreement out clearly Congressional thinking and contain Iran.” There is also talk of India as access to the international fuel The most significant and controversial motivation in passing the Hyde Act. The an “ally” or at least a “strategic partner.” The market, and by supporting the development in the Indo-US civil nuclear broad objectives of the Bush Administration second objective relates to non-proliferation, creation of an Indian strategic fuel cooperation agreement was the passage of were no different, as confirmed by various through strengthening and sustaining the reserve; the Hyde Act and the conclusion of the 123 statements of top officials of the US implementation of the NPT. India remaining · Grants consent to India for certain Agreement. The U.S. Congress passed the Administration. Two principal US outside the NPT poses a “potential challenge nuclear fuel cycle activities. In Hyde Act in December 2006, which objectives stand out. The first, perhaps the to the goals of global non-proliferation.” A particular, grants consent to authorized the Bush administration to more important one, is to ensure that India’s corollary objective is to curb India’s nuclear reprocessing, with such right being negotiate a nuclear agreement with India foreign policy is “congruent” to that of the weapons capability. In a semantic concession brought into effect by India US, with this deal expected to “induce greater to the earlier Democratic mantra of “cap, under certain guidelines. The Hyde Act, establishing a new national facility rollback and eliminate”, the objective now is under International Atomic Energy Table 1: US and Indian Commitments to seek to “halt the increase in nuclear Agency safeguards dedicated to weapons arsenals in South Asia and to reprocessing safeguarded nuclear promote their reduction and eventual material, and our two countries elimination.” agreeing on arrangements and The next step was negotiating the procedures under which actual details of the agreement under Section reprocessing will take place; 123 of the U.S. Atomic Energy Act, which · Commits India to appropriate deals with international nuclear cooperation. safeguards on all civil nuclear The text of the “123 agreement” was agreed material and equipment subject to to in July 2007, and ‘frozen’ pending approval the agreement and to assuring that of the two governments. In August 2007, nuclear items subject to the India and the US released the final text of the agreement will be used only for 123 Agreement for nuclear cooperation peaceful purposes, including through simultaneously19. The completed text of the a reaffirmation of India’s proposed 123 Agreement is respectful of both commitments to safeguards in the July 18, 2005, and March 2, 2006 Joint perpetuity; Statements issued by President Bush and · Reinforces the commitment of both Prime Minister Singh. countries to global nonproliferation Key features of the agreement are: efforts; · Confirms the desire of both countries · Preserves the rights of both to engage in full civil nuclear countries to terminate cooperation

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and request the return of transferred also confirms the Prime Ministers assurance international oversight of India’s reactors, bilateral nuclear cooperation agreement — the items under appropriate to India Parliament. The Indian government possibly help supply India’s arms programs with ‘123 Agreement’ concluded in July 2007.25 circumstances; and declared that, India is only committed to the fissile material and that it would lead to text and spirit of the agreement reached with the undermining the international Allaying India’s fears on certain · Creates the legal basis for the United the United States in July 2005 and March nonproliferation regime. Prime Minister provisions of the legislation on Indo-US States to be a stable, reliable, and 2006. In fact the many of the provisions of Manmohan Singh hailed the IAEA decision nuclear deal which he signed into law, predictable supplier for India’s civil President George W Bush has said there are the Hyde Act are incorporated to pacify the and said, “This is an important day for India, nuclear energy market. “no changes” in fuel supply commitments as non- proliferation lobby within the US and for our civil nuclear initiative for the Congress and out side. The government and provided in the 123 Agreement. “This The conclusion of negotiations on the resumption of India’s cooperation with our also claims that 123 agreement does not legislation does not change the fuel assurance 123 agreement opens the door for the friends abroad,” The IAEA decision was a mention the Act at all, and that its provisions commitments that the US government has completion of the remaining steps in the green signal for India to approach the 45 are binding not on India, but only on the US. made to the Government of India as recorded broader U.S.-India Civil Nuclear Cooperation member Nuclear Suppliers Group (NSG) to The US legislation has binding and non- in the 123 Agreement,” Bush said while Initiative. These steps include: grant a waiver to India to commence civilian signing the HR7081 bill into law last. Bush’s binding provisions, and the US administration 22 nuclear trade . The 45-nation NSG granted remarks came against the backdrop of · Conclusion of a safeguards implements only the binding portions. The US the waiver to India on September 6, 2008 concerns expressed by India over the fuel agreement between India and the president, in his signing statement, has made allowing it to access civilian nuclear technology supplies following his Administration’s International Atomic Energy Agency it clear that he would ignore the non-binding 23 and fuel from other countries . The assertion that the assurances were only applicable to India’s separated civil provisions of the Act. … According to Article implementation of this waiver makes India the political commitments and not legally nuclear sector and progress toward VI of the US Constitution, as interpreted by only known country with nuclear weapons binding. “The Agreement grants India an Additional Protocol; the US Supreme Court, obligations of an international agreement supersede provisions which is not a party to the Non Proliferation advance consent to reprocessing which will · Achievement of a consensus decision of domestic law. The agreement argued that Treaty (NPT) but is still allowed to carry out be brought into effect upon conclusion of 24 in the Nuclear Suppliers Group to civil nuclear cooperation between the United nuclear commerce with the rest of the world . arrangements and procedures for a dedicated make an India-specific exception to States and India would offer benefits to both The US House of Representatives passed the reprocessing facility under IAEA safeguards,” the full-scope safeguards of countries’ citizens through enhanced nuclear deal on September 28, 2008. Two days Bush said. In a statement released by White requirement of the Group’s export energy security, a more environmentally later, India and France inked a similar nuclear House after the signing ceremony, Bush guidelines; and friendly energy source, greater economic pact making France the first country to have described the passage of the bill by Congress opportunities, and more robust such an agreement with India. On October 1, as a “milestone” in achieving the vision set · Approval of the 123 Agreement by nonproliferation efforts20. 2008 the US Senate also approved the civilian by Prime Minister Manmohan Singh and the U.S. Congress. nuclear agreement allowing India to purchase himself of transforming the bilateral ties. “I The IAEA Safeguards Agreement and nuclear fuel and technology from the United am pleased to sign into law the United States- The Hyde Act invited severe criticisms the NSG Waiver States. In a well-attended ceremony that India Nuclear Cooperation Approval and from many quarter in India. Many of the Non-proliferation Enhancement Act, which After several rounds of hectic negotiations underlined the strategic importance of the provision in the Hyde Act are apparently approves the US-India 123 Agreement,” he beginning in November 2007, the Indian nuclear deal to the United States, against the provisions of the Bush Singh said. Bush said this act would strengthen the International Atomic Energy Agency (IAEA) President George W. Bush on October 8, 2008 accord in 2005 and 2006. It is widely regarded bilateral relationship and deliver valuable finally approved the India specific safeguard signed into law the ‘U.S.-India Nuclear as an attempt by the United States to force benefits to both nations. “The legislation does agreement on August 1, 200821. The Cooperation Approval and Nonproliferation India into the US strategic fold. But the final not change the terms of the 123 Agreement International Atomic Energy Agency’s 35- text of the 123 Agreement reflects the spirit Enhancement Act.’ The Act, known as as I submitted it to the Congress. That member Board of Governors approved the and contents of the joint declarations in 2005 HR7081, was passed by Congress on Agreement is consistent with the Atomic plan by consensus despite criticism that and 2006 between Prime Minister Manmohan October 1 and represents the American Energy Act and other elements of US law. ambiguous wording could end up limiting Singh and US President Bush. The agreement legislature’s formal approval of the U.S.-India “This legislation is important as it enables me

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 277 Indo-US Nuclear Deal and South Asian Regional Security C Vinodan 278 to bring the 123 Agreement into force and to into the vortex of terrorism. The Afghan war with China. Pakistan’s dominant concern is continued resistance to sign CTBT indicates accept on behalf of the United States the has crossed the Khyber and is stealthily that the implementation of the nuclear that India would like to keep the option of obligations contained in the Agreement,” he advancing towards the fertile Indo-Gangetic cooperation agreement would enable India to nuclear testing open, and would not succumb said. The passage of this legislation, Bush said, plains. The fundamental problems of regional make quantitative and qualitative improvement to US pressures as part of the new nuclear reflects the common view of his administration stability and security are being spontaneously in its nuclear arsenal. Pakistan considers the order. and the Congress as to the value of nuclear transformed by a powerful combination of assurance for perpetual nuclear fuel supply cooperation and is in the interest of both the circumstances in the aftermath of the deal.27 from the US would free India’s indigenous Another major dimension of the US and India. By undertaking new The US led war on terror initiated in the uranium reserves to be exclusively used for emerging regional security environment in cooperation on civil nuclear energy, India will aftermath of the September 11 incidents is making more number of nuclear weapons. South Asia is the growing role of Non –State be able to count on a reliable fuel supply for now centered in South Asia. The Besides, India’s insistence on keeping large Actors in the unfolding regional security its civilian reactors, Bush said in his speech assassination of Benazir Bhutto in Pakistan part of its nuclear facilities outside the environment in the region. This is particularly during the signing ceremony that was and the 26-11,2008 Mumbai terror attack inspection regime, insistence on US significant in the context of the expansion of applauded on several occasions by the proved the magnitude of the emerging assurances for perpetual fuel supplies for India’s civil nuclear energy sector. The 26- distinguished gathering assembled at the situation in a conflict ridden, nuclear-armed civilian facilities even if it violates part of 11-terror strike shattered the entire peace White House’s ornate East Room. Calling region.28 It is one of the few remaining parts the agreement, and India’s reluctance to process in the region and also exemplified India and the US natural partners, Bush said of the world to have failed meaningfully to declare unilateral moratorium on fissile the growing menace of terrorism and New Delhi “will continue to build on its move its security away from the exercise material production clearly sent wrong signals transnational threats in the region.31 The strong record of responsibility in operating and manipulation of military threat and to Pakistan. This could make other nuclear nuclearisation of South Asia following the its nuclear facilities. “And India and the towards the building of transparency, weapons states in the region uncomfortable. Indian and Pakistani nuclear tests in 1998 held United States will cooperate more closely to cooperation and trust, and the creation of As Senator Sam Nunn wrote in his article; out the prospect that nuclear weapons might keep the world’s most dangerous weapons out frameworks and institutional arrangements “there is every reason to suspect that Pakistan induce caution and push both states towards of the hands of extremists and terrorists.” within which security issues can be handled and China will react to this deal by ratcheting the cooperative management of their nuclear “This agreement sends a signal to the world: at the political level and without violence. up their own suspicions and nuclear activities relationship, if only to avoid the shared danger Nations that follow the path to democracy and – including making additional weapons of nuclear war. The evidence thus far of the responsible behaviour will find a friend in the The Indo-US civil nuclear material and weapons”.29 The US 1999 Kargil Conflict and 2001–02 border United States of America,” Bush said26 But cooperation agreement if implemented Administration officials and the proponents escalation crises, and, indeed, the post 26-11, all these rhetorical remarks will become without initiating sufficient confidence and of the deal, however, do not agree with this 2008 developments, does not appear to reality only with the support of the new security building measures could lead to assertion and argue that India is self sufficient support this. In each successive crisis, nuclear Obama Administration. The Indian policy arms competition in the region involving in uranium reserves and if India wanted to weapons have become a more explicit issue makers are well aware of the challenges ahead Pakistan, India and China, thus destabilizing increase its fissile stocks, it could have done and have played a more important role—yet especially in the context of the global the entire region. US objective of making so - with or without the nuclear deal30. Some their presence has deterred neither direct and financial meltdown and the growing menace India global or at least a regional military of the nuclear experts believe that if India large-scale military confrontation, nor military nuclear terrorism. power to achieve its own perceived interests indeed decides to make qualitative adventurism. could also impinge upon security interests improvement in its nuclear arsenal, it would One explanation for this stability– Changing Regional Security of other countries. It could force major require testing of the new designs. As part of instability paradox suggests that nuclear Environment in South Asia stakeholders to re-evaluate their security nuclear cooperation agreement, India has weapons may be creating a degree of South Asian security is at a interests in the face of emerging Indo-US made no binding commitment that prohibits paralysis at the nuclear level that allows, and crossroads. The South Asian region is passing strategic partnership thus triggering nuclear testing. On the contrary a pledge to may even stimulate, military activity at lower through an unprecedented strategic transformation of regional alliance supply nuclear fuel in perpetuity, even if the levels.3 The tautological second tenet of the transformation following the signing of the structures, where India is seen decisively agreement is revoked because of some reason, paradox—that nuclear adversaries will avoid Indo-US Civil-Nuclear Cooperation shifting towards the United States and provides an option to India to test new designs nuclear war despite the increased tensions Agreement. The region is fast getting sucked Pakistan exploring defence and nuclear pact in the future if it needs validation. India’s

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 279 Indo-US Nuclear Deal and South Asian Regional Security C Vinodan 280 and crises that arise from military activity at rational adversary making expected cost– can provoke tensions between India and and Pakistan strikes at the very core of their lower levels— appears to have been adopted benefit calculus) on which deterrence rests. Pakistan through mass casualty attacks. This nationhood. It involves territorial disputes and by India and Pakistan, at least in relation to The second traditionally conceived element was amply demonstrated following the terrorist violence, and is further complicated their own activities, as a cast-iron law of of strategic stability is crisis stability; that is, December 2001 attack on the Indian by the desire of some terrorist groups to nuclear engagement, rather than being treated stability is robust during crises (periods of Parliament by Jaish-e-Mohammed militants, acquire non-conventional technology. Second, with caution as a high-risk and unproven unanticipated threats to core norms, values which led to a ten-month stand-off between South Asia is part of a broader nuclear assumption. India charges that Pakistan and interests, characterised by time urgency the two armies. A second danger is through a weapons context that includes China and the demonstrates little regard for the nuclear and the risk of imminent escalation to the Kargil-style episode in which militants, in United States. Military developments by either dangers in continuing to support cross border nuclear level). The third element is arms- cooperation with official Pakistani agencies Washington or Beijing, which are perceived infiltration and promote instability, race stability, or stability that is not undermined and the military, occupy territory in Kashmir. as a direct threat, also impact military policies particularly in Indian-Administered Kashmir. by trends in arms developments (qualitative, As the July 2007 siege of the Lal Masjid (Red (both conventional and non-conventional) in Pakistan counter-charges that India is quantitative or both), including the Mosque) complex in the heart of Islamabad South Asia. At the same time, the continued similarly purblind to the risks in: continuing development of new technologies. The showed, militant groups are steadily strategic military collaboration between China its conventional military build-up, which demands of meeting the aforementioned expanding their geographical area of and Pakistan (such as the joint development of reduces Pakistan’s conventional options; requirements are complicated further by the influence, adversely affecting the stability of the JF-17 fighter plane) is a factor that motivates developing and fielding ballistic missile dynamic nature of strategic stability; that is, Pakistan. Although the nuclear weapon India to continue nuclear and conventional defence technology, which undermines the fact that it is subject to change over time complex is under military control, there might modernization. Furthermore, while the Pakistan’s deterrence confidence; and toying (in crises perhaps even on a minute-by- be pockets within the military that are territorial disputes between India and China with punitive and coercive conventional minute basis). Strategic stability also is sympathetic to fundamentalist groups. At the are relatively dormant, there is no final options, which risk rapid escalation to the subject to the vagaries of events and process very least, political and religious instability resolution. As developments in 2006-2007 nuclear level. It is instructive in this regard outcomes within the state (e.g. the rise of in Pakistan creates uncertainty in the minds demonstrated, there is still a considerable gap that India and Pakistan do not even agree religious extremism, the terrorist threat), of policymakers within and outside the region. between the two sides on the territorial where the locus of instability is to be found. within the region (e.g. asymmetric economic issue.36 Due to this combination of factors; The promotion of strategic stability (i.e. development, the War on Terrorism, the role Finally, fears have been heightened there are no clear incentives for either party assuring that neither side is incentivised nor of external players such as the United States since 9/11 over the possibility of nuclear to drastically reorient its nuclear policy. pressured to use nuclear weapons) is an and China) and at the international level (e.g. weapons technology transfers from Pakistan Conclusion urgent, albeit complex, requirement if the the emergence of an ‘Asian supercomplex’, to terrorist networks, especially after it was region is to avoid nuclear war and, in due globalisation). revealed that some senior Pakistani nuclear South Asian security is at a course, move towards a less conflictual and scientists met with the Al Qaeda leadership crossroads. The region is passing through an more predictable security relationship. As As aforementioned, nuclear prior to 9/11. A related concern in the unprecedented strategic transformation traditionally conceived,33 the term strategic weapons development and enhancement in aftermath of 9/11 is that a fundamentalist following the signing of the Indo-US Civil- stability comprises at least three elements, the South Asia are intricately related to long- Islamic group with Taliban/Al Qaeda links Nuclear Cooperation Agreement. The region realisation of each of which poses far- standing rivalries between the concerned could take over Pakistan and with it, is fast getting sucked into the vortex of reaching questions for the nuclear state. The states. However, instability does not just possession of the country’s nuclear arsenal.35 terrorism. The fundamental problems of first of these is deterrence stability: each side stem from the risk of nuclear warfare Thus, Indian threat perceptions include not just regional stability and security are being is credibly deterred (in relation to threats to between states in the region. Non-state actors bilateral nuclear stability issues between India spontaneously transformed by a powerful core norms, values and interests)34 by the also play a significant role in the nuclear and Pakistan, but also the consequences of combination of circumstances in the other, and there is no uncertainty in the minds security framework, aside from their role in nuclear technology and materials falling into aftermath of the deal. It is argued that, if other of either party about the ‘pillars’ (means to facilitating nuclear proliferation. First, the hands of militant groups. In general, the alternatives are not explored, there is a risk deter, ability to carry out deterrence threats, terrorist groups (such as Jaish-e-Mohammed complex nuclear weapons scenario in South that South Asia will experience a dangerous willingness to carry out deterrent threat, and Lashkar-e-Toiba) that are connected to Asia is shaped by two main factors. First, the and costly build up of nuclear arsenals, which assured control of deterrent forces, and the Pakistani religious-political establishment intense nature of the dispute between India would directly invite the risk of nuclear

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 281 Indo-US Nuclear Deal and South Asian Regional Security C Vinodan 282 terrorism. But both the parties ignored the future balance of power persuade the 3. V.R. Raghavan (2007): Asia’s Major Powers and 9. On the recent development of the bilateral realities in the South Asian regional security protagonists to adopt a more cautious policy. U.S. Strategy: Perspectives from India, Centre relationship see Tellis, A. J. (2005): “India as a order involving the triadic relationships of Thus, the driving forces for nuclear for Security Analysis, Chennai, India, 04-05 May. New Global Power: An Action Agenda for the India-Pakistan-China and India-China – US. modernization remain in place and this will (NOTE: Will open as a Word document; Peter United States”, Carnegie Endowment for In fact, deal comes at a time when the non- continue to develop in the aftermath of the Wonacott and Eric Bellman (2007): U.S.-India International Peace, Washington, DC, . whether non-state suppliers like, A.Q. Khan patterns, China will accelerate nuclear and India, November/December. Network or terrorist groups such the Al- strategic cooperation with Pakistan. China 10. See for example, Indian Foreign Minister Pranab Qaida. Beyond these problems, the deal will will try to contain India. And it will engage 4. Ashley J. Tellis (2006): Atoms for War? US Indian Mukherjee terming the NPT as “flawed”; Anil have major strategic ramifications for the in a nuclear arms buildup vis-a-vis India. US Civil Nuclear Cooperation and Indians Nuclear K. Joseph (2007): “We consider NPT a flawed triangular relationships involving India, will also work toward forming a balancing Arsenals, Carnegie Endowment for International treaty: India,” Rediff.com, March 23. Pakistan and China and India, China and the coalition with India. South Asia has been a Peace, June; Vibhuti Hate and Teresita C. Schaffer (2007): “US-India Defence Relations: Strategic 11. T.S. Subramanian (2004): “Non-proliferation U.S. It is clear that proliferation dynamics in major theater of rivalry during the Cold War Perspectives”, CSIS, Washington DC. Regime Puts Curbs on Responsible Powers: the subcontinent are affected by numerous era but has seen relatively immuned of great Manmohan”, The Hindu, October 24, http:// factors centered on security issues, regional power rivalry for the past 15 years or so. 5. P.R. Chari (200): “Parsing the Separation Plan: www.hindu.com/2004/10/24/stories/ and global power politics, and domestic Balance of power politics will bring back The Indo-US subsidiary Deal”, IPCS, New Delhi; 2004102407170100.htm. considerations. Broadly speaking, great power rivalry to the region and Gaurang Bhatt, “India America Nuclear Deal: A 12. Shyam Saran (2005): “Nuclear Non-Proliferation proliferation dynamics in South Asia are renewed conflict between India, Pakistan Strategic Analysis”, India Defence, New Delhi, 2006. and International Security”, Strategic Analysis, driven by a need to establish some measure and China and squandering of limited July-September, Vol.29, No.3, p.363. of relative parity against their principal resources which could be used for 6. 6. The White House, “Joint statement between adversaries-India against China and Pakistan developmental goals. President George W. Bush and Prime Minister 13. Scott Woods (2006): “Analysis of the U.S.-India against India. Such competing security Manmohan Singh”, News release, Washington, Nuclear Deal”, Defense & Security Analysis, September, Vol. 22, No. 3, pp. 325-328. agendas ensure that nuclear modernization, Notes and References DC, 18 July 2005, http://www.whitehouse.gov/ news/releases/2005/07/20050718-6.html>. through production of fissile material and 14. See www.state.gov/p/sa/rls/pr/2005/49763. htm. 1. Henry Sokolski (Ed) (2007): Gauging US – India development of more effective delivery For the 2006 statement see www.state.gov/p/sca/ Strategic Cooperation, Strategic Studies 7. Embassy of India, “New framework for the US– rls/pr/2006/62418.htm. systems will continue for the time being. The Institute, US Army War College; David Ruppe India defense relationship”, Press release, continued global hegemonic nuclear order Washington, DC, 28 June 2005, para. 4H, URL (2006): Critics Blast Indo-US Nuclear Deal, 15. Suo Motu statement by the Prime Minister Dr. . On transfers of ballistic influence the regional nuclear development. Leonard Weirs (2006): Power Points: The US- Nuclear Energy Cooperation with the United missile technologies and the commitments made Though there have been significant India Nuclear Agreement is the Wrong Deal with States. New Delhi, Feb.27, 2006. http:// under the Missile Technology Control Regime see confidence building measures between India the Wrong Energy Sources, Bulletin of Atomic indianembassy.org/newsite/press_release/2006/ Ahlström, C (2004): “Arrows for India?— and Pakistan, including an agreement Scientists, May/June. Feb/18.asp. on reducing nuclear risk as well as technology transfers for ballistic missile defence 2. Jeffrey Lewis (2007): The Minimum Means of 16. “U.S. Nuclear Cooperation with India: Issues for reestablishment of transport links, they have and the Missile Technology Control Regime”, Reprisal: Chinas Search for Security in the Journal of Conflict and Security Law, vol. 9, no.1 Congress”, CRS Report for Congress not yet brought about any significant progress Nuclear Age, The MIT Press Cambridge; Henry (spring), pp.103–25. Congressional Research Service, Washington on basic security disputes, such as Kashmir Kissinger (2006): “A New Nuclear Test for D.C., updated January 12, 2006. and terrorist violence. Similarly, Sino-Indian Diplomacy”, Washington Post, May 16, 2006; 8. See generally Kronstadt, K. A (2005): “US–India negotiations on resolving the border question, Fareed Zakaria, Nixan to China, Bush to India, Bilateral Agreements in 2005”, US Library of 17. Ibid. Congress, Congressional Research Service: while reiterating the need for a long-term Newsweek, 27 Feb. 18. Charles D. Ferguson (2008): “Reshaping the U.S.- Washington, DC, 8 Sep. http://fpc.state.gov/ solution, have not made any headway. In Indian Nuclear Deal to Lessen the general, concerns of negative shifts in the documents/ organization/53616.pdf. Nonproliferation Losses”, Arms Control Today,

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April, http://www.armscontrol.org/act/2008_04/ 30. Ashley Tellis (206): The US-India ‘Global Islam and Media Discourses in India: Constructing Islamophobia Ferguson.asp. Partnership: Legislative Options, Prepared Testimony to the House Committee on 19. Ministry of External Affairs, Government of India, International Relations, May 11. T Marx New Delhi, Agreement for Cooperation Between the Government of India and the Government of 31. See, for example, “India’s Military Options”, Abstract the United States of America Concerning the The Hindustan Times, December 5, 2008; “Pak The creation of enemies is easy. The right inflammatory rhetoric, Peaceful Uses of Nuclear Energy, 2007. Making No Serious Attempt to Dismantle Terror judicious selection of facts and malicious parodies of custom can Camps: Antony”, Times of India, January 8, 20. India – US. Nuclear Agreement (2007): “PM’S 2008; “India Shouldn’t Rule Out Military successfully demonise vast swathes of the human race: there are many Statement in the Lok Sabha on Civil Nuclear Option: Former Army Chief”, Thaindian News, situations where the society in question lacks the cognitive instruments Energy Cooperation with the United States”, December 17, 2008. to see the message that is hidden behind the myths and will accept the Strategic Digest, Vol. 37, No.9, Sept. causation that is being offered as proper explanation for its fate. The 32. For good discussions, see M. Krepon (2003): use of xenophobia narrative and scapegoating is an easy next step. 21. “IAEA approves India nuclear inspection deal”, The Stability–Instability Paradox, Misperception International Herald Tribune. Iht.com. 2 August, and Escalation Control in South Asia 2008. ,Washington, DC: The Henry L. Stimson Centre; and V. Sahni (2004): “Explaining India–Pakistan 22. “Nuclear Suppliers Group Grants India Historic The Indian as well as the South challenge posed by the mainstream media. Waiver - MarketWatch”, Marketwatch.com . crises: beyond the stability–instability paradox”, in Pervaiz Iqbal Cheema and Imtiaz Bokhari Asian media, visual as well as print, devoted It is a contention that the media campaign 23. Washington Post, 7 September 2008. (eds), Arms Race and Nuclear Developments in columns and time slots to report incidents against Islam is politically motivated, is led South Asia, Islamabad: IPRI, pp 133–149. ranging from stories of Islamic threat to 24. “House of Reps clears N-deal, France set to sign by powerful quarters in the Indian society, agreement-USA-World”, The Times of India. 33. See, for example, G. Snyder (1961): Deterrence national security to cross border terrorism. who see in Islam a potential power and Timesofindia.indiatimes.com. and Defence: Toward a Theory of National In this context of growing media attention societal alternative capable of challenging Security Princeton, NJ: Princeton University to Muslims, the role that the media plays in Hindu hegemony. The recurring view in the 25. Siddharth Varadarajan, Bush Signing on 123 leave Press; and T. Schelling (1960): The Strategy of reinforcing certain negative stereotypical flaws intact, http://www.thehindu.com/2008/10/ media is that there’s no common ground Conflict, Cambridge, MA: Harvard University images of the community becomes a critical 10/stories/2008101053571000.htm Press, 1960. between the Muslims and non-Muslims, and issue. The national media is biased in its that conflict between them is accordingly 26. Washington Post, 9 October, 2008. 34. For more on norms/interests based deterrence, coverage of issues and events pertaining to inevitable. Muslims in India are seen in the 27. Shehzard Nadeem (2006): “The Regional see Lawrence Freedman (2004): Deterrence, the Muslim community. Hostility towards media as a threat to traditional Indian London: Polity Press. Implications of the US- India Nuclear Islam and Muslims has been a feature of customs, values and ways of life. Agreement”, Foreign Policy In Focus, 29 April. 35. According to one account, the United States Asian societies that has taken different forms 28. Many studies have addressed nuclear command prepared contingency plans to take over at different times and has fulfilled a variety In terms of the biased media, the and control issues in South Asia. Among the best Pakistan’s nuclear arsenal in the event of an of functions. word Islamophobia is a term used for are: Zafar Iqbal Cheema (2000): “Pakistan’s impending takeover of the country by referring to text, or visual images that fundamentalist groups. See Seymour Hersh Nuclear Use Doctrine and Command and This paper examines the nature of presents the malicious and fabricated Control”, in Peter R. Lavoy et al, Planning the (2001): “Watching the Warheads: The Risks to current media campaign aiming at the Pakistan’s Nuclear Arsenal”, The New Yorker, narrative about Islam and Muslims ignoring Unthinkable, New York: Cornell University Press, distortion of the image of Islam, identifies pp.123–145, and Zia Mian (2001): “A Nuclear November 5; See also Farzana Shaikh (2002): or misrepresenting alternative narratives. Tiger by the Tail: Some Problems of Command “Pakistan’s Nuclear Bomb: Beyond the several tactics used by the detractors of Such narratives are likely to increase and Control in South Asia”, PU/CEES Report No. Nonproliferation Regime”, International Affairs, Islam and its symbols, and proposes an insecurity and vulnerability amongst 328, June 2001. 78, 1, pp.40-41. appropriate response for dealing with the Muslims and also to provoke anxiety, fear 29. 51 Sam Nunn (2006): “Nuclear Pig in a Poke”, 36. C. Raja Mohan (2007): “India Plays the Taiwan The Wall Street Journal. May 24. Card”, ISN Security Watch, June 18. Dr T Marx is a Lecturer, Department of English, School of Humanities, Pondicherry University, Puducherry- 605014.

International Journal of South Asian Studies IJSAS July - December 2008 IJSAS 1(2) 2008, pp.284-83. ISSN 0974 - 2514 285 Islam and Media Discourses in India: Constructing Islamophobia T Marx 286 and panic amongst non-Muslims. The biased snowballing effect of Islamophobia’s threat: Muslims and Islam. The September With its enormous power, the Media narrative will not help diminish levels of hate various features, exacerbated by the relative 11 further mobilized the stereotypes that shapes discourses and influences public crime and acts of discrimination against factors is that Muslims are made to feel that Muslims are “predisposed towards crime, perceptions on Muslims. Indian mainstream Muslims and will not contribute ways of they do not truly belong to India – they feel rape, illegal entry […] and terrorism (Hage media is one of the major factors creating maintaining and developing multicultural, that they are not truly accepted, as full 2003: 68). The Muslims who are projected as and perpetuating Islamophobia and negative multi-plural democracy. members of India. On the contrary, they are anti-nationals by the mainstream media attitudes towards Muslims. It was also viewed as ‘an enemy within’ or ‘second behave the same way. Schopflin rightly says shown to be a factor in Muslims feeling The paper attempts to understand the class citizen’ and they feel that they are that “ those stigmatised as hostile ‘begin to ambivalent about their identity as Indian root causes of recent attacks on Islam and the under constant siege. It’s in the interests of accept the demonic role assigned to them and citizens. Negative attitudes intensify efforts to distort its image must begin by non-Muslims as well as Muslims, that behave in accordance with it’” (Schopflin discrimination among Indian Muslims. If a examining the relationship between Islam and Islamophobia should be rigorously 1997: 134). It is time to challenge Muslim is involved in some crime, then the emerging realities on the ground. The challenged, reduced and dispelled. The time word ‘Muslim’ becomes the common campaign against Islam is a conscious and Islamophobia and to dispel myths about Islam to act is now, no time in the future. deliberately spread by the mainstream media. identifier of that person. Casual and deliberate effort by the established mainstream standardized interpretation of violence is media to discredit a universal belief system A further negative consequence of The heave of Hindu communalism amply critiqued by Gyan Pandey (1990) as which has been presenting itself as a societal Islamophobia is that Muslim insights on during the last decade is a reflection on the construction of a “master narrative” that alternative to Hindu hegemony, and to ethical and social issues are not given an inadequacies of secular practice in India. In provides a ready, and often misleading undermine the fastest growing religion in the adequate hearing and are not seen as India, a strong secular state, conspicuous categorization. Similarly Paul Brass (1998) world. The media, as we know, have been for positive assets. The most subtle and perilous draws our attention to the construction and so long hostile towards Muslims, especially consequence of Islamophobia is “the religious symbols are prevalent in educational institutions and offices. The display of visible availability of a pre-framed ‘context’ of after the sad episode of 9/11, and for each silencing of self-criticism and the slide into Hindu-Muslim violence (qtd. in Kaur 2005: religious symbols such as the pictures of Hindu event that takes place anywhere, the Muslim defending the indefensible” (Richardson 26). world is severely criticized and condemned 2004: 9). Muslims decline to be openly Gods, and certain rituals during Saraswathi with contradictory and misleading critical of fellow Muslims, their ideas, pooja and Ayutha pooja celebrations are The media has immense power terminology, such as Muslim terrorists and activities and rhetoric in mixed company, explicit. But, Iftar parties are not organised in because it shapes the way we understand Islamic fundamentalists. lest this be seen as giving aid and comfort any offices or educational institutions. Muslims reality, especially when we have no direct to the extensive forces of condemnation. consider this an injustice and feel they are experience of what it shows us. It has Indian Muslims are subjected to a second class citizens. “symbolic” power to “mark, assign, and higher than usual level of abuse in mainstream According to Wikipedia, media bias classify.” What we see on our screens or media whenever there is a bomb blast or is a term used to describe a real or perceived Muslims are viewed as aliens read in our books does not merely reflect terrorist attack in India. Why is it, Indian bias of journalists and news producers within incompatible with Hindu society and values. reality. Reality is presented to us through media invariably asks, that Muslims have been the mass media, in the selection of which Some writers in the mainstream media have imagery and discourse that tend to reflect so reticent about criticizing terrorism? events will be reported and how they are been no less culpable in fomenting the the cultural consensus of the dominant Muslims don’t condemn terrorism for the covered. The term “media bias” usually prejudice against Muslims. When terms like hegemony. This is bad news for minorities, same reason that Hindus don’t condemn the refers to a pervasive or widespread bias “Islamophobia” and “Islamic terrorism” run who often find themselves being defined by demolition of Babri Masjid. Muslims are not contravening the standards of journalism, riot in the media, why not terms like their difference and represented in particularly sympathetic to terrorism. rather than the perspective of an individual “Hinduphobia” and “Hindu terrorism” etc? stereotypical and negative ways. Whittaker Moreover, terrorism is a response to journalist or article. Islamophobia affects all When the mainstream media is subservient identifies four Muslim stereotypes in the aggression and not a product of religious aspects of Muslim life including attacks, to the aggressiveness of a majority religion media- intolerant, misogynistic, violent, and extremism. The moderate Muslims should abuse and violence against Muslims, and and negligent in case of the minority religions, different. These stereotypes are deeply wrest the souls of their children from the discrimination in education and employment. where are the secular principles? rooted in history. Oriental discourse clutches of self-pity and resentment. The Paranoia has focused on a more global constructs a monolithic “Other” “as its

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 287 Islam and Media Discourses in India: Constructing Islamophobia T Marx 288 barbaric, despotic, and inferior opposite or alter Besides the fact that the media coherent ideology, just like liberalism and men in sherwanis, burqa-clad women, skull- ego,” according to Edward Said. Stereotypes creates inaccurate ideas about Islam, the communism, with its own code of morality capped mullahs, inebriated nawabs and and misconceptions about Islam in the media Indian media is also very influential to its and doctrine of political and social justice. dancing girls is just a symbolic indicator of are rooted in prejudice, and ignorance. audiences in making negative Islamic The appeal of Islam is potentially universal, this harsh reality. Particularly disturbing is stereotypes, such as the assertion that all reaching out to all men as men, and not just the way in which this behaviour is linked The mainstream media expresses Muslims are fundamentalists. The term to members of a particular ethnic or national with the religion of Islam itself. Thus, scenes unfavorable views of Islam regarding the “fundamentalist” is actually a term that is group.” (Fukuyama 1992: 45) In some cases, of violence and terror are interspersed with status of women, refusal of Uniform Civil misinterpreted by the media. A woman has certain advantages over man as shots of Muslims praying, to the extent that Code etc and they say that Muslims are fundamentalist, in fact, only represents a she is exempted from the daily prayers and terrorism is elevated to the level of a disproportionately prone to violence. There normal Muslim who follows his or her from fasting during her menstrual periods and ‘religious ritual.’ is a dangerous gap between the Non-Muslims religion. Fundamentalism means an attitude, forty days after childbirth. A woman cannot The Indian media is responsible for and the Muslims and it should be bridged. an effort, or a movement that an ideology, be forced to marry anyone without her widening divisions between Muslims and the The real challenge would be to embrace an group, or religion tries to promote in its consent, so also her right to seek an end for rest of the society. The report called for the intellectual chat with those who honestly fundamental beliefs. The “fundamental” an unsuccessful marriage. government to get involved with admit there are differences with the beliefs of a Muslim is to believe in only one encouraging a debate and commissioning The Quran forbids the social custom mainstream society. Muslims oppose Uniform God (Allah) and the Prophet Mohammed is studies on this problem. Some media groups of female infanticide, and considered it a Civil Code because Islam is democratic in His messenger, pray five times a day, fast the engage in conventional propaganda but spike crime like any other murder: “Whosoever has spirit and the Islamic law enjoins Muslims to month of Ramadan, give alms to the poor, it with acts of violence. It has to be a daughter and he does not bury her alive, govern themselves by discussion and and make a pilgrimage to Mecca. This means understood primarily in terms of one-sided does not insult her, and does not favor his consensus. In mosques, there is no particular that all Muslims are fundamentalists if they propaganda. Violence and propaganda son over her, God will enter him into priestly hierarchy and each individual is believe in their own religion’s fundamentals. however, have much in common. “Violence Paradise”. (Ibn Hanbal, No. 1957). Annie responsible for the condition of his/her own Although the media is uncomfortable with aims at behaviour modification by coercion. Besant, who was writing in the 1930’s, soul. religious groups, it focuses heavily on Propaganda aims at the same by persuasion.” observed that, “It is only in the last twenty “Islamic fundamentalism”. A majority of the (Jackson 2004: 33) The media should take years that Christian England has recognised Islam is termed in popular media as media’s reports that talk about Islamic responsibility for monitoring how Muslims the right of woman to property, while Islam an aggressive faith because of the concept of fundamentalism usually describes most are represented and should aim for balance has allowed this right from all times (Besant Jihad, a misunderstood term. The biased Muslims as terrorists. through positive presentation of Muslim 1932: 32). media wants everyone to see Islam “as characters including in movies. Both Media oppressive (hence women in Hijab); that Allah condemns violence very The media creates the equation that and politicians should improve access to Islam is out-moded (hence hanging, strongly: “And fight in the Way of Allah those terrorism equals Muslim and inflammatory minority groups including Muslims, so that beheading and stoning to death); that Islam who fight against you, but transgress not the stereotypes of Muslims also permeate the different points of view can be heard. is anti-intellectualist (hence book burning); limits. Truly, Allah likes not the movies and other entertainment. Muslims find that Islam is restrictive (hence ban on post- transgressors” [TMQ Al-Baqarah: 190]. Most glaringly in recent years, Islam themselves suspected of being a fifth column and extra-martial affairs, alcohol and Regarding the status of woman, the right of and Muslims have come to be viewed or of having divided loyalties. This is gambling); that Islam is extremist (hence women to seek knowledge is not different primarily through the lens of religious reflected in the portrayal of Muslims as “the Algeria, Lebanon and of course Egypt); that from that of men: “Seeking knowledge is extremism and terrorism. Media tend to enemy within” in the Indian movies, Bombay Islam is backward (hence Pakistan, Saudi mandatory for every Muslim”. (AlBayhaqi). focus disproportionately on this dangerous and Roja. Indian movies generally portray Arabia and the Sudan); that Islam causes In terms of religious obligations, such as the and deadly minority who threaten global Muslims in negative ways, even the secular conflict (hence Palestine, Kashmir and Prayers, Fasting, and Pilgrimage, woman is security and offer minimal coverage of the ones, typically as terrorists or under world Indonesia); and that Islam is dangerous (hence no different from man. Francis Fukuyama has faith and lives of the mainstream majority dons. The Indian movie industry has confined Turkey and Iran).” (Said 1997: 200) the following to say about Islam: “It is true of Muslims. The result of the “propaganda the portrayal of Indian Muslims to bearded that Islam constitutes a systematic and blitz” and communal hysteria is a warrior

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 289 Islam and Media Discourses in India: Constructing Islamophobia T Marx 290 nation that “turns many in the TV audience in responding to Muslim requests for socio- Table 1 : Basic Misconceptions in Different Media Narratives into fanatic supporters” of communalism. cultural space. ( Kellner 1995: 214) One striking aspect of much Indian Serious and substantial problems mainstream media reporting about Muslims emerge out of the dangerous bias in the is an obsession with sensational events that coverage provided by many media outlets. are inevitably used to project Muslims in a Recently, a few young men including two particularly negative light, as a community lecturers were arrested in a town in the marked out by a certain exceptionalism. southern Indian state of Tamil Nadu on charges Muslims are reported about in the mainstream of sending e-mail threat to the President of media almost entirely in the context of some India. Since all of them happened to belong to controversy or violent incident. It is as if the Muslim community, within a day of their Muslims are considered newsworthy only if arrests, police sources leaked to the media that involved in some tragic and horror-filled they suspected the trio might be involved in event, generally as perpetrators of violence. e-mail threat. This was enough to trigger a A major factor, which contributes to Islamic series of speculative stories in the mainstream stereotyping in India, is due to the media’s media. Every publication and television ignorance of selecting their words that channel, without exception, went into a describe Muslims. Some common names heard competitive frenzy, all of them clamouring for or seen in the news about Muslims are a first shot at the most horrifying story about “extremist” or “terrorist”. These words are the ‘terrorist trio’. Almost every reporter with misleading and are mainly anti-Islamic. The imaginative talent wrote pages of articles media rarely uses more neutral terms such as quoting unnamed ‘reliable police sources’ and “revivalist” or “progressives” (Hassan 1995: 2). narrated how these young men were planning to send similar e-mails to various leaders. In India as in other Asian countries, manifestations of anti-Muslim hostility What was remarkable about these include verbal and physical attacks on reports was their contention that the three Muslims in public places, attacks on mosques young men had links right up to Osama bin and desecration of Muslim symbols, Laden and down to the local outfits such as Source : www.conservapedia.com/islamophobia Accessed on 13-10-2008 widespread and routine negative stereotypes the Lashkar-e-Toiba and the banned in the media, including the ‘common sense’ Students Islamic Movement of India (SIMI). language is frequently emotive, immoderate, none could merely accept in good faith that of non-Muslims’ talk and writing about The men were also suspected of conducting alarmist and abusive. The coverage is likely these reports were genuine. So far no proof Muslims in ways that would not be Jehadi training in nearby mosques, of flying to provoke and increase feelings of insecurity, has been unearthed to label these youths acceptable, and negative stereotypes and the Pakistani flag in their minority Muslim suspicion and anxiety amongst non-Muslims. as terrorists. The media is indulging in remarks in speeches by political leaders, college, of aiding and abetting various Alternative world-views, understandings and blatant fabrication of news. What if their implying that Muslims in India are less ‘sleeper cells’ across the state, of recruiting opinions are not mentioned, or are not given case too turns out to be another Dr committed than others to democracy and the hundreds of students to terrorist a fair hearing. The contents of these reports, Mohammed Haneef case? Haneef, who rule of law, lack of attention to the fact that organisations, etc. well laced with the terms ‘suspected’ and worked in Australia, was mistakenly Indian Muslims are disproportionately ‘alleged’, had so much of unsubstantiated and arrested by the Australian police after Facts are frequently distorted, affected by under-representation and social un-sourced ‘facts’ attributed to ‘reliable being wrongly accused of links to a failed exaggerated or over-simplified. The tone of exclusion and bureaucratic delay and inertia sources’. As citizens and discerning readers, UK terror plot.

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 291 Islam and Media Discourses in India: Constructing Islamophobia T Marx 292

Surely the police need to interrogate Indian media. In mainstream media discourses sliding seriously, its representation in jobs, bank among small groups of people who are the arrested youth and the courts have to pass about Muslims, it is often the case that the loans is abysmal, and its representation in the already committed to the cause of Islam, one their judgements before such serious most conservative maulvis are projected as political process has been very poor and can hardly speak of Muslim mass media. conclusions are drawn. But the media chose representatives of the entire Muslim worsening on the top of that. In sum and While the ineffectiveness of Muslim media to sidestep the process of law altogether and community. The voices of ordinary Muslims, substance, Muslim community is under- and its inability to counteract the campaign took it upon itself to ‘investigate’ the so-called desperately poor, living in squalid ghettoes, represented in most of the arenas of society against Islam may be to some extent crime and then pronounced its ‘judgement’ ignored by the state and the wider society, barring the jails. explained by the economic and political before the court’s judgement. for whom the struggle for sheer survival is imbalance between the established global more pressing never get reflected in the Muslim representation in the Indian order and the world of Islam. Through mainstream media, the mainstream media. media is dismal, while Muslims’ share in Hindu communalists send a veiled threat to media ownership is even more pathetic. Indian media is owned and the Muslims that their safety depends on the India’s long-cherished portrait of Muslims do not have any considerable hold controlled largely by caste, middle-class goodwill of the majority community. Over the itself as a model of democracy, secularism over the media. The representation of Hindus. The vast majority of the editors and years, the BJP and its sister organizations, all and religious-cultural pluralism has been cast Muslims is also grossly under-represented in staff of mainstream Indian newspapers and carefully nursed by the RSS, succeeded in into doubt by a new government study. The the national media, the survey notes. media houses are of this caste-class (mis)using its religious appeal to weaken Sachar Committee’s report shows clearly that Muslims, who comprise 13.4 per cent of the background. A Report (June 2006) by Anil Hindus’ resistance to communalism. The Muslims, India’s largest religious minority, country’s population, have a share of only Chamaria, Freelance Journalist, Jitendra Hindutva forces argue that India was face systematic exclusion and serious four per cent in top media posts. But despite Kumar, Independent Researcher, Yogendra predominantly a Hindu land and it must be discrimination at multiple levels. The truth the importance of electronic media and the Yadav, Senior Fellow, Centre for the Study declared a “Hindu Rashtra” creating a fear is that Muslims now constitute India’s ‘new profound impact it has made in effecting of Developing Societies, New Delhi, psychosis in the minds of the Muslims. Hindu underclass’; they are worse off than the rest cultural change, they have not yet become examined the social profile of media-persons communalism locates Islam as an internal of the population in respect of access to tools and instruments for the dissemination working in 40 media organizations. These enemy and makes it the target of mass hatred. public services, literacy, education, income, of the message of Islam. One important sign findings are based on a survey of the social social mobility, and jobs. Muslims form 13.4 of the lack of appreciation of these powerful background of 315 key decision makers from The trust of people on the protectors per cent of India’s population of a billion- these media organizations. Its key findings of law and order in a country is imperative tools may be seen in the fact that Islamic plus people, but are seriously under- higher learning institutions do not consider reflect the sources of media bias. Hindu for peace to exist. Unfortunately Muslims in represented in schools, universities, ‘upper’ caste men dominate the media. They India have been victims of press biasness. arts and technology to be useful means for government jobs, and Parliament. They reaching out with the message of Islam, but are about 8 % of India’s population but Allegations of being a Pakistani are levied typically claim a share of only 4 to 6 percent among the key decision makers of the on Indian Muslims on account of common continue to focus on interpersonal in state employment. In some respects, communication, and to a lesser extent on national media their share is as high as 71 religion and thus the word ‘traitor’ finds a Muslims are compared with the Scheduled %. Muslims are severely under-represented synonym with Muslims. public speaking for this purpose. Only Castes, India’s former untouchables, who recently, print media has received a relatively in the national media: they are only 3 % have suffered systematic, cruel more emphasis among Muslims. among the key decision makers, compared Positive stories about Muslims are discrimination for centuries at the hands of to 13.4% in the country’s population. hard to appear in the mainstream media, thus the so-called upper-caste Hindus. Admittedly, the Muslim response to further reinforcing the tendency to see media distortion of Islam is, for the most part, India’s mainstream media Muslims in negative terms. The real social, The Sachar Committee submitted its meager and ineffective. On the whole, the • lacks social diversity economic, educational and political report in November 2006. The committee, campaign of distortion and misinformation • does not reflect the country’s marginalization of Muslims as a community after extensive home work, found that the against Islam has not been effectively social profile and the pathetic conditions in which the vast Muslim minority is way behind the national countered by Muslim media, simply because majority of the Indian Muslims live are almost averages in most of the parameters of social the latter is virtually non-existent. For beyond Negative portrayals of Muslims in never commented about in the mainstream development, its economic status has been a few publications, which normally circulate the mainstream media reflect, to a large

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 293 Islam and Media Discourses in India: Constructing Islamophobia T Marx 294 extent, the widely held assumption that Indian and set out against the background of either as the Media does not know who speaks and create a cohesive and fair society. nationalism is somehow synonymous with objectivity. If Muslim communities are for the community. The Muslim response has Michael Thorburn says assertively, Brahminical Hinduism, the bedrock of the themselves to articulate a response to what been inadequate. Responses in the main have “everyone who cherishes the rights of the world-view of the castes. Bhabha (1990) they see, hear or read in the media, they either been radical or confrontational. The people should join the struggle against the emphasizes how nationalism involves a should have access to those areas of the radicals are always keen to appear in the anti-Muslim propaganda, which is nothing construction of linear narratives of nation, media that are seemingly inaccessible to media and say what many in the media want but a justification for colonialism, fascism culture and identity. Misinformation and them. There will always remain a minority to hear, thus further enforcing existing and war” (Thorburn 2006: 72). negative stereotypes heighten tensions in of people who present a uniformly negative stereotypes. Indian secularism means that there intercultural relations and legitimise war image of Islam and Muslims, not out of is no official religion for the country and against Muslims. Distortion of the image of Ignorance or misunderstanding but for The media needs to take account of that the government would maintain an Islam stems from the fact that Islam is seen ideological or political reasons or may be Muslim views, monitor output to see how attitude of perfect neutrality towards all by powerful interest groups as a challenger to religious bigotry – one must isolate these Muslims are represented, and improve religions. In the era of globalization, no the established global order. To stop the people and not let them dictate the accountability. The fourth estate should not nation is mono-religious or mono-cultural. expansion of Islamic appeal and to mobilize discourse. represent Muslims as monolithic groups. Due to fiscal migrations, all nations become public opinion against its symbols, Islam has They should try to cover the victims of pluralistic and all the religious and cultural to be presented as a negative force. Combating The Muslim response has been harassment, murder and other hate crimes as minorities enjoy equal constitutional rights distortion and restoring the true image of Islam influenced by the relative sense of thoroughly as you cover the victims of overt throughout the world. In a secular state, no is by no means an easy task. marginalisation Muslim communities feel terrorist attacks. They should avoid using in secular India. Muslims rarely gave word combinations such as ‘Islamic terrorist’ community, whether minority or majority The use and abuse of terminology is feedback to the media about their feelings or ‘Muslim extremist’ that are misleading can insist that its security depends on the an important issue because terminology on what is written or telecast about them because they link the whole religion to goodwill of the other community. The defines the social as well as the intellectual due to lack of experience and organization criminal activity. It is always better to avoid Government should adhere strictly to its discourse in this area. Cultural exchanges are on the part of the Muslim community and using terms such as ‘jihad’ unless the secular tenets and undo religion from the needed at a level other than investigative partly due to apathy and nonchalance. Many journalists are certain of their precise meaning media. The rising tide of communalism in journalism so that journalists and writers are developed a siege mentality and do not ever and include the context when they are used the media-majority or minority- can be more sensitive to Muslim feelings and read. The lack of any clear leadership and in quotations. The basic meaning of ‘jihad’ stemmed only by an uncompromising sentiments. Criticism should be constructive representative Muslim voice has not helped is to exert oneself for the good of Islam and secular stand. to better oneself. News organizations should Table 2: Representation Share in decision making in Mainstream media Status review their coverage of issues and events References involving Muslims and Islam, and should Besant, Annie (1932): The Life and Teachings of consider drawing up codes of professional Mohammed, Jeevan, Madras. conduct and careful in the use of terminology. They should take measures, perhaps within Bhabha, Homi (1990): Nation and Narration, the framework of positive action in equalities Routledge, London. legislation, to recruit more journalists of Fukuyama, Francis (1992): The End of History and Muslim heritage. the Last Man, Avon Books, New York: .

Hage, G (2003): Against Paranoid Nationalism, The The government must ensure that Merlin Press, London. Muslims are protected from hate speech. The government and media must try to do more Hassan, Anser. http://psirus.sfsu.edu/IntRel/ IRJournal/sp95/hassan.html. Accessed on Source : www.indianmuslims.info/indian_muslim_and_the to tackle the negative portrayals of Muslims mainstream_media.html Accessed on 13-10-2008

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13-10-2008 Invitation to Islam: Islamic rest of the world.” Knowlege, Power and Challenges and Opportunities of Micro-finance for Stereotypes in Western Mass Media. Islam in the western Media, Vintage, London. Poor Women’s Empowerment Jackson, Nicholas and O’Shaughnessy (2004): Politics S Vasantha & Hansa Lysander Manohar and Propaganda, Manchester University Schopflin, George (1997): “The Function of Myths Press, Manchester. and a Taxonomy of Myths”, Myths and Nationhood, Ed. G.Hosking and Abstract Kaur, Ravinder Ed. (2005): Religion, Violence and G.Schopflin, Routledge, London. The subject of micro-finance is considered as significant and emerging trend in Political Mobilisation in South Asia. Sage the present scenario for the empowerment of women and reducing poverty. Micro Publications, New Delhi. Thorburn, Michael (2006): “Oppose the Anti-Muslim finance programmes are presently being promoted as an important strategy for Hysteria!”, The Worker February 14. concurrently addressing both poverty alleviation and women’s empowerment . Kellner, Douglas (1995): Media Culture, Routledge, In the present scenario commercial banks are expanding rapidly and providing London. “Islam and the Global Challenge: Dealing with loans to small business and core micro financial services to poor people. NGO’s Distortion of the Image of Islam”, Middle Khan, Nasir (2007): “Islam In Western are competing with commercial banks in providing micro financial services. This East Affairs Journal, (Summer/Fall 1996), Mirror”,Countercurrents.org 19 May. paper examines the efficiency of micro finance as a solution to women’s Vol. 2, No. 4, pp.67-78. empowerment and whether micro financial institutions effectively improve their Nurdin, Ahmad Ali (2006): “Islam Through The Eyes http://www.thehindu.com/archive/ Accessed on 13- well being. It also focuses the challenges of micro financial institutions to reach of the Western Media”, Straits Times 03 May. 10-2008 out the poor. In Tamil Nadu State, Tuticorin district was selected for study .The Richardson, Robin Ed. (2004): Islamophobia: Issues, survey shows that SHG were satisfied about Group financing from Micro financial http://www.timesofindia/archive/ Accessed on 13-10- Challenges and Action, Stoke on Trent & institutions .The data also supports that transaction cost makes micro financing 2008 Sterling: Trentham Books. costlier. http://www.countercurrents.com/ Accessed on 13-10- Sachar, Rajinder (2006): “Report of the Prime 2008 Minister’s High Level Committee on Social, Introduction costlier. The reason behind this being high Economic, and Educational Status of the http://www.milligazette.org/ Accessed on 13-10-2008 cost of supervision, small size and large Muslim Community of India”, Microfinance is one of the powerful number of loans. It is high time for MFIS to http://www.insted.com/ Accessed on 13-10-2008 www.search.info. Accessed on 19-12-2007 weapons to fight against poverty. formulate new strategies to reduce the cost http://www.energygrid.com/ Accessed on 13-10-2008 Microfinance service industry is growing Said, Edward (1997): “Covering Islam: How the media of financing. Microfinance organizations predominantly over the past three decades of and the experts determine how we see the should provide livelihoods finance through its time in the financial market. It offers financial innovative strategy. The innovative scheme services to support the poor especially women of micro financing has transmitted the real both financially and socially. Though economic power in the hands of women microfinance services have witnessed through Self Help Groups (SHGs) and has tremendous growth, still it is not able to reach significantly reduced their dependence on out to all the segments of the poor section. men. This has helped in empowerment of The critical challenge faced by the micro women and economic independence of financial institution is high transaction cost women. which makes micro financing comparatively

Ms S Vasantha is Faculty, Magnus School of Business, Chennai, E-Mail: [email protected] Dr Hansa Lysander Manohar is Professor, St. Mary’s School of Management Studies, University of Madras, Chennai E-Mail: [email protected]

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This research is divided into three Self-Help Group • Easy repayment terms programme. Under the RBI’s Guidelines, parts. The first part explains how the Micro Self help group is an informal banks were given authorization to open financing plays a significant role in intensifying The Reserve Bank of India association of 12 to 20 small economically saving bank account in the name of SHG, the scale and an instrument of economic influenced Commercial Banks, Regional homogeneous affinity group of poor women. without any collateral security empowerment of poor women in the rural Rural Banks and Cooperative Banks to The SHG encourages small savings among aggressively participate in the linkage requirements. Thus, an informal credit area. In part II the paper discuss the problems its members. The savings are kept with a system was progressed with assistance of SHG in getting financial assistance from bank, obtain loans from bank and Table 1: Basic data on SHGs in Tamil Nadu(2005-2006) Micro financial institutions and finally in part subsequently they decides which woman III the paper analyses the challenges of Micro should get the loan at what rate of interest financial institutions to reach out the poor and also how much should be the repayment women and conclude with the presentation period. The main characteristic of Self help of cost reduction strategy to reach out poor. group is instead of one woman, the entire Poverty in India at a Glance group is to negotiate with the bank .The SHG can then on-lend the money to its members, Poverty is an acute problem in India. helping them to employ it in some income- The poverty line ($1.25 a day) as described generation activities. Presently there are by world bank report, in India the number of about 800 MFIs and 22 lakh self-help groups poor living in poverty line has increased from (SHGs) that are the main sources of 421 million in 1981 to 456 million in 2005. microfinance. The primary objective of a According to Asian Development Bank self-help group is to provide credit access (ADB), the new poverty line is roughly $ 1.35 to members of poor households on Source: Tamil Nadu Women’s Development Corporation per day. If this measure is used to measure sustainable basis. poverty, nearly two-thirds of India’s population Characteristics of Self help group from formal financial institutions. The educated bankers to become SHG or about 740 million are in poverty. To achieve various organizations involved in the supporters. The most general model for a higher rate of poverty reduction, India • Mostly focus on women schemes were NABARD, Banks, NGOs linkage is where an NGO forms a group realized the importance of poverty reduction programme of micro financing to reach out • SHG is commonly an economically and SHGs. and a bank links to it directly. Training and homogeneous group formed based capacity building is a vital module of the poorest people Micro-finance has became Role of NABARD one of the most effective tools for economic upon the affinity of its members NABARD’s strategy. NABARD has been doing well with empowerment of the poor women. Now the • Poor people are able to access credit The various Micro finance service poor people are able to access financial its Self-Help Group (SHG)-Bank Linkage providers include apex institutions like services which previously were exclusively • Encourage savings and thrift among Programme. It conducted several studies of National Bank for Agriculture and Rural available to the upper and middle income poor people and achieve reasonable the pilot programme which “showed clearly Development (NABARD), Small Industries population. In India banking system standard of life that the SHG-Bank Linkage model was by Development Bank of India (SIDBI), and, NABARD developed the Self Help Group • Avoid the dependence on far the most cost effective”. Rashtriya Mahila Kosh (RMK). At the retail [SHG] - bank linkage programme as the moneylenders innovative strategy for increasing their reach More than ten years, the linkage level, Commercial Banks, Regional Rural out to the poor. According to the McKinsey • Helps to achieve empowerment of programme not only finances SHGs through Banks, and, Cooperative banks provide India survey (April 2006) report, rural India women commercial banks, Regional Rural Banks micro finance services. has the potential to become a US$500 billion • Progressive lending (RRB) and cooperatives, but has also market by the year 2020.

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Various kinds of SHG-Bank Linkage MODEL-III: Table 2: Tamil Nadu’s Rural Population & Literacy Models SHGs financed by Banks using NGOs MODEL-I: as Financial Intermediaries SHGs formed and financed by Banks

have contributed maximum funds and avenues Swarozgar Yojana. Project Officer M. to the growth of SHG movement in Tamil Madasamy, TNCDWL, stated that now the Nadu. Tamil Nadu Government would offer the subsidy grant at the rate of Rs.10,000 to each The total loan disbursed by commercial group, with the remaining Rs.30,000 to come banks through the self help groups (SHGs) in the form of credit from financial in Tamil Nadu increased Rs. 1,302.41 crore institutions And this could be utilized for in 2007-08 from Rs. 1,098.44 crore.Of this, internal lending and micro-credit. Since India’s largest public sector bank, State Bank Rs.10, 000 was considered as subsidy grant, of India (SBI) disbursed over Rs. 750 crore MODEL-II: banks would charge interest only on the to 6 million people through 124,000 SHGs credit component. Overall 1,453 women in the state. For the current year, the bank NGOs act as Facilitators, SHGs financed SHGs functioning in the 19 town panchayats has proposed to disburse over Rs. 500 crore. directly and 1,831 groups in the three municipalities Nabard sanctioned Rs. 1 crore for capacity had been selected for the scheme. building programme during 2007-08. As part of its bank-linkage programme, it has covered The subsidy would be disbursed only MICROFINACE IN TAMIL NADU over 3 million SHGs covering more than 50 to those groups that fulfill the Tamil Nadu Tamil Nadu’s Rural Population million people in the country. Government criteria of grading such as internal lending, audit of accounts, thrift, Tuticorin district empowers women The first SHGs in Tamil Nadu were refund of credit and maintenance of records, created successfully in 1989 in Dharmapuri In Tuticorin district, the government pertaining to each group .Those groups which district through the International fund for takes all initiatives to empower the women score 60 per cent would be chosen as Agricultural Development (IFAD).In this was endorsed through news published in beneficiaries. The successful group could 1991,the scheme was extended to all the the “The Hindu” on Sep 12, 2006. It is apply to the banks for the release of the remaining parts of Tamil Nadu.The amount understood that the Tamil Nadu Corporation subsidy to them through TNCDWL. assigned for the creation of the SHGs was for Development of Women Limited Literature Review Rs.84.26 cr through IFAD.In 1996, the (TNCDWL) would extend `credit-linked activities of SHGs were accepted as a policy revolving fund subsidy’ to the women self- A majority of microfinance programs matter by the government of Tamil Nadu help groups functioning in the municipal and target women with the explicit goal of and later from 2001,this idea of SHG has town panchayat limits in the district from this empowering them. However, their been growing and expanding at a very fast fiscal. Previously, the corporation was underlying premises are different. Some rate (V.Ramanathan,S.Rajmohan,marketing offering the subsidy only to the women SHGs argue that women are amongst the poorest mastermind,April,2008). In Tamil Nadu the from village panchayats, under various and the most vulnerable of the major political parties – DMK and AIADMK schemes like Swarnajayanthi Grama underprivileged. Others believe that investing

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 301 Challenges and Opportunities of Micro-finance for Poor Women’s Empowerment S Vasantha & Hansa Lysander Manohar 302 in women’s capabilities empowers them to for the rural poor, and the poorest, and lead Microfinance activities were Practice’ must also be integral to micro- make choices, which is valuable in itself, and to job-led economic growth (Kavitha & developed to target the poor women and to finance design rather than a marginal and also contributes to greater economic growth Ramachandran 2007). set up empowerment activities. Initially, the marginalized add-on to financial sustainability and development. Another motivation is the empowerment of women was started for This paper argues for a more or poverty reduction. There is also a need evidence from literature that shows that an poverty alleviation. She defined coherent interpretation of women for innovation to ensure that access translates increase in woman’s resources result in higher Empowerment is a process of change by empowerment using Kabeer’s notion of into a significant and sustainable contribution well-being of the family, especially children. which individuals and groups gain power and women empowerment within the South to women’s empowerment. Different women Finally, an increasing number of microfinance ability to take control their lives. It involves Asian context. It therefore defines women have very different needs, even though they institutions prefer women members as they an increased well being, access to resources, empowerment as the process in which are often subject to similar forms of believe that they are better and more reliable increased self-confidence, self-esteem and women challenge the existing norms and discrimination and disadvantage (Linda 2006). borrowers thereby contributing to their respect, increased participation in decision culture of the society in which they live to financial viability. The United Nations has making, bargaining power, control over The future sustainability of SHG effectively improve their well-being. A declared the year 2005 to be the Year of increased benefits and resources and one’s Banking hinges on five factors: (a) A sound distinction is made between the outcomes Micro credit. own life(Renu 2008). self-supporting institutional framework is in that lead to greater efficiency within the place. (b) Despite exceptionally low interest Grameen Bank groups and self –help existing norms, development of the The idea of micro financing- small- rates, linkage banking was found to be viable groups; what are the differences? That, community and outcomes that can be scale loans to the entrepreneurial-minded poor Grameen groups are much better protected directly interpreted as women - reached the front page this fall when the and profit-making for all financial institutions against internal or external threats; their empowerment. Bangladeshi economist Muhammad Yunus and SHGs; however, many rural banks require members are less vulnerable, but also less and his Grameen Bank won the Nobel Peace restructuring. (c) SHGs have substantially Micro finance institutions target not empowered, since empowerment is freedom Prize. But now the San Francisco-based increased their level of self-reliance and only for giving them loans, so that they can and this must also include freedom to face nonprofit Kiva.org may have taken the idea a deposited reserves, while banks are provide financial assets to the family, but and if possible to overcome threats. SHGs are step further: with just a few clicks of the mouse, constrained by high statutory liquidity also to give them the opportunity to explore a more empowering instrument than Grameen most everyone can become a micro financier requirements. (d) Given the low inflation rate, their own talents of doing economic activities groups, but they also demand more of their (Sonia 2006). preservation of the value of resources is no (Rafiqul, Shahnaz and Hamid 2007). members, and expose them to greater risks. major issue, except in distressed banks. (e) It is clear that most micro finance Freedom does not come without a cost Not all activities that lead to an With continually increasing internal funds, programmes have a long way to go before (Malcolm 2005). increase in well-being of a woman are effective supervision of SHGs through a they make their full potential contribution to necessarily empowering in themselves .It is delegated system, together with the The self-help group model has been gender equality and empowerment. Many of difficult to say which factors are more enforcement of prudential norms in banks and identified as a potential pathway to alleviating the strategies promoted for financial important for empowering women. For SHG cooperatives, emerges as a major challenge poverty. The number of poor women and men programs, the results seem to indicate that sustainability may exacerbate the negative who are enrolling in SHGs all over rural India to the long-term sustainability of SHG banking the minimalist microfinance approach is not impacts of debt, because of over rapid has been increasing remarkably. They are not and rural finance in India. (Hans & sufficient. Additional services like training, expansion, rigid product design inappropriate only active in thrift and credit management Harishkumar 2002). awareness raising workshops and other to women’s economic activities, cutting of but are also taking up other activities, such activities over and above microfinance necessary support services and lack of There is a greater need for MFIs to as natural resource management and programs that merely focus on financial attention to local economic contexts. If micro- carefully design service that meet the needs of development work, literacy, knowledge services are also an important determinant finance programmes are to fulfill their very poor. MFIs have to understand and ensure management, nutritional security etc. SHGs of the degree of its impact on the significant potential, evidence indicates there financial and environmental sustainability and lay the foundation for self- reliance through empowerment process of women (Ranjula is a need to rethink current ‘Best Practice’ to outreach of financial services designed to meet building up of institutions, which have the and Fan Yang 2007). ensure that women have equal access to all the needs of those mostly in need of such capacity to generate employment opportunities types of financial services. Gender ‘Best services (Sheenu & Ravindra 2008).

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Objectives of the study Analysis and Interpretation Inference: Satisfaction level of SHG and It means that the satisfaction level of SHG changes after joining the SHG are members in SHGs depends upon the changes · To analyse the impact of micro Characteristics of groups dependent take place after joining the group. financing on women’s empowerment 100 groups were included in the · To analyse the constraints and study it is fully based on Women. The Table 3: Sources of Microfinance problems faced by SHG groups comprised of Minimum 12 to maximum of 20 members. Group size varied · To analyse the challenges of Micro from 12 to 20.On average the age of the financial institutions to reach out groups are approximately 3.5 years old. poor Over 35% of them are by commercial banks Research Methodology 34% respondents were financed Regional rural banks, 17% of them are by co- The present study uses both primary operative banks, 14% of them by NGO. The and secondary data. For the purpose of the study shows that SHG members save One way ANOVA study well- structured Questionnaire was between Rs.50-Rs.100.On the observation designed by incorporating scaling technique. of group leader it was found that leader of HO: The reasons for joining SHG members in SHG group are independent This study is partly exploratory and the group have good interpersonal skill, descriptive in nature and is aimed to identify H : The reasons for joining SHG members in SHG group are dependent command over group and ability to deal with I the impact of micro financing on women’s the bank personnel. Due to good organizing The result is shown in the following table empowerment and challenges of MFI The capacity of leader the repayment of loan is research was based on 100 SHGs from highly satisfactory. Table 4: Changes after Joining the SHG Tuticorin district in Tamil Nadu State using a questionnaire instrument .The questionnaire Testing of Hypothesis was translated from English to Tamil because Chi-Square Test - Table-3 the survey was undertaken in southern rural part of TamilNadu .The paper analyses the HO: Satisfaction level of SHG and data and test the hypotheses, by using the changes taken place after joining the data collected from the respondents and SHG are independent finally concluded with findings. HI: Satisfaction level of SHG and changes Analysis of Data taken place after joining the SHG are dependent The data collected through questionnaire were tabulated and further The result is shown in the following table suitably analyzed by applying following statistical tools: HS-Satisfied, S- Satisfied, N- Neutral, D- Dissatisfied, SD- Strongly Dissatisfied Ø Percentage Analysis By applying Chi-square test, it was found Ø Frequency analysis that calculated value (226.91) is more than the table value at 5% level of significance Ø Chi-square test (36.415), hence Ho is rejected. Ø One-way ANOVA test

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Table 5: Reason for Joining SHG In general, there are four main types • Sizable proportion of the clients is illiterate of intermediaries offering microfinance: or barely literate, they would prefer simple procedures and minimal paperwork Full- service private commercial banks Its presence can be felt world wide • In spite of a huge banking network, the and it provides variety of financial products facilities, particularly in rural areas, are and services through various branches of not easily accessible. network. They are using SHGs as channels to • The banking hours are not adjusted to the distribute their potential business. convenience of the small rural client who • State-owned banks - These banks act as would prefer to deal with his financial a channel for providing multiple matters in the morning or late evening SA- Strongly Agree, A- Agree, N-Neutral, D- Disagree, SD- Strongly Disagree services. Finance companies and • Rural banker being male has failed to specialized banks. These banks operate understand the psyche of the micro- By applying one way ANOVA, it was found that calculated value (11.17) is more at the regional level. E.g. Pandian finance client., who are predominantly than the table value at 5% level of significance (2.81), hence Ho is rejected. banks, Tamil Nadu Mercantile Banks female Inference: The reasons for joining SHG members in SHG group are dependent • Micro-lending NGOs - These institutions • On the savings side, the savings bank Table 6: Problems of Self Help Group are smaller in size. NGO’s are providing account in the name of the SHG is the variety of financial services for uplifting only product available. the lives of the poor. These are transformed into regulated banks or • Further, the RBI has fixed the interest rate specialized financial institutions. on savings bank deposits and there is no scope for innovation by the banks in this • Co-operative Banks regard. • NGO’s are competing with commercial • Similarly, on the credit side, banks take banks in providing micro financial services. into account the savings made by the Commercial banks are finding it very Table 7: Transaction costs of SHG group and provide credit only up to a fixed difficult to cover up their transaction cost multiple of the savings (generally four at the low interest rate on micro loans times). Challenges and opportunities of micro • Costs for micro-finance are simply higher financial institutions than those for conventional banking • The first challenge relates to sustainability. • In fact, MF has become a tool for political It has been reported that the MFI model party to collect votes. is comparatively costlier in terms of delivery of financial services. Comparative Advantages of Commercial Banks in Micro-finance • The cost of supervision of credit is high, the loan volumes and loan size is low. In the present scenario commercial banks are expanding rapidly and providing

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before the sanction of a loan. It includes Cost loans to small business and core micro financial · Banks must identify an appropriate small installments. Generally there are three services to poor people. Banks are now kinds of costs that a lending institution of documentation, appraisal of documentation, innovative financial strategy to suit competitive with Non-banks and NGO’s. The encounters when it offers a loan: disbursement and the completion of the needs of poor clients. Comparative Advantages of Commercial documentation formalities. These relate to the · Cost of the lending money Banks in Micro-finance are: · Banks must recruit and retain loan and the allocated supervision cost per specialized staff to handle poor · Cost of prudent financial practices loan of the branch manager. · They are regulated institutions and such as provisioning for loan defaults; facilitated by proper management women micro clients. Cost of other direct administrative · The large number of small size of · Cost of transaction activities include the cost of time spent by · Adequate physical infrastructure the field worker in completing administrative helps to reach out more micro finance micro finance loans make micro financing little costlier. Cost of transaction formalities such as report and format clients completion, reporting to immediate · Good administrative and accounting · Regulation and supervision: It is defined as the cost of the supervisor, filling up movement registers, control system Continuous and tight monitoring and transactor (usually the field worker) doing the filling up expense claims for travel and bank imposing regulatory requirements group-loan transaction. It generally includes related duties etc. · They have their own source of funds are compulsory to ensure effective the cost of identifying and screening the client, which in turn facilitates sustainability implementation of micro finance processing the loan application, completing Cost of monitoring the documentation, disbursing the loan and · The variety of core financial services programme. collecting the repayments on date. Cost of monitoring refers to cost of attract small micro finance clients Generally interest rates charged by monitoring of loan utilization checks and MFIs are higher than what banks charge, Its three main components are collection of installments and cost of Obstacles for Commercial banks in “avoiding default” .Evidence from article of but it is lower than interest rates of money · Group formation costs microfinance lenders .The reason being high transaction Mr. Amrit Patel and Mr. Gopal Kalkoti in · Cost of direct Administrative Business line on, Feb 28, 2007 “Micro- In spite of all these competitive cost, these costs have effect on interest rate. activities and finance needs soft norms, tough monitoring” advantages over NGO’s, still Commercial MFIs are just to cover the cost they charge .Further they added that Micro financial banks are finding it very difficult to cover up between minimum 12% to maximum 24%. · Cost of monitoring institutions portfolio tends to be extremely The Goal of every MFI is to identify their transaction cost at the low interest rate volatile and can deteriorate any time because innovative strategies to bring down the costs on micro loans .It suffer from financial Cost of group formation of an unsecured loan going bad or even strategies to reach out low income population of transaction. But still, it is difficult to bring Cost of group formation includes the default of a secured loan. In such a case, the segments. Banks are required to sort out some down the interest rate to 8% to 10% since cost of formation and training of the group collateral does not sufficiently cover the key related issues to achieve success in the the cost of lending small loans is basically with the objective of using it to deliver credit. principal, interest and the collection cost. This micro finance market: high. happens as the borrowers have no collateral · The commitment of commercial In spite of various steps taken by Cost of direct administrative activities at risk, and they do not feel constrained to repay. banks towards micro lending is very banks and financial institutions they could not Direct administrative activities cost important and it should be one of the reach out to the poor clients successfully. The main reason for high transaction cost is comprises cost of appraisal, documentation, Indirect transaction cost missions of the organization disbursement, other direct administration high cost of delivering a number of small Apart from direct transaction costs other · The bank organizational structure loans in a fragmented location. The main activities and the cost of branch manager supervision. costs such as rent, electricity and facility should facilitate to handle thousands difficulty of MFIS is to identify a borrower, maintenance also have impact on increasing of small transactions efficiently. appraising them, disbursing money and then Cost of appraisal refers to a charge the cost of financing. In addition, there are collecting it back within twelve months in by a lender for appraising, grading the group other expenses of the regional offices and

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 309 Challenges and Opportunities of Micro-finance for Poor Women’s Empowerment S Vasantha & Hansa Lysander Manohar 310 head offices – which do not do direct business Other suggestions outlets can also be designed exclusively for Linda Mayoux (2006): “Women’s Empowerment but supervise the branches. Such costs need delivery of micro-finance products. Such as through Sustainable Micro-finance: Rethinking · Another method of reducing to be considered in the Cost reduction smart cards, automated teller machines Best Practice” transaction cost is minimizing the strategies. (ATMs) and mobile phones may be employed, cost of SHG formation costs and as is being done in other countries. N. Kavitha and A. Ramachandran (2007): “Women Findings costs of lending to the poor. The SHGs in India-A Rural View” , E-mail April 11. government can fund and allocate Conclusion On the basis of the research resources for formation of self help Sa-Dhan (2007): “A Snapshot of Microfinance undertaken the researcher is able to elucidate The researcher is able to conclude on the group. Institutions in India”, Quick Report 2007. the following findings basis of primary and secondary data that micro · The amount of transaction cost can finance helps to attain empowerment through Bank Lending Sharma, K C and Tripathi, C K (2007): “Impact of be reduced to some extent by self help group. The study is able to prove SHG-Bank Linkage Programme on Financial Banks can explore various innovative professional methods of that the microfinance clients are suffered from Behaviour of Rural Poor-Evidence from Raebareli strategies to reduce transaction cost to reach management and by use of high transaction cost and this ultimately adds District in Uttar Pradesh”, Indian Journal of out to the poor people. Many banks spend technology, information system and to the cost of financing. Micro financial Agricultural Economics, July. large amount of money for recruiting and computerized methods of institutions must maintain efficiency levels to administration. . It helps micro increase their scale of operations. This surely Singh, Amit Sisodiya and De, Sanjoy (July 2007): “PEs retaining staff. The salary paid to the staff financial institutions to increase will bring down the cost of financing and Rush for Bigger Pie: Microfinance in India” The can be saved through appropriate cost saving their efficiency, thus lowering their ultimately the benefits will be transferred to chartered financial Analyst, Fixing India’s Power measures. The micro financial institutions and overhead costs, and help them to the poor people in terms of improving the Woes. banks can also follow the guidelines of RBI achieve sustainability. standard of living and reasonable cost of issued on NOV 2006 regarding ‘outsourcing borrowing. Micro financial institutions should Sonia, Narang (2006): “Web-Based Micro Financing” · The SHG can be brought under the of financial services’. The guidelines being: adopt innovative strategies to meet the New York Times, December. self employment scheme of challenges of high transaction cost to reach · The micro financial banker can government of India operated V.Ramanathan and S.Rajamohan (2008): “Self-Help out to the poor. Many studies also prove that outsource the financial services of a through commercial banks. Under Groups Prospective Channel Partners for the bankers need to regulate their loan prices and this scheme, the subsidy of 25% is Promotion of Consumer Products in Tamil Nadu’s bank including processing of loan their operating procedures to formulate given by the government through Rural Markets”, April. application, document processing, appropriate cost-saving measures. marketing and research and district industry centre. This can Verma, Renu (2008): “Microfinance: A Tool for the supervision of loans to reduce the cost reduce the ‘burden of interest’ of the References Empowerment”, ICFAI Reader, May, pp.25-29. of transaction poor people, eventually reduce the cost of operation and indirectly Dutta, Shankar (2007): “The Current Scenario: · Banks can appoint direct selling agent motivates the borrower to repay the Microfinance in India” The Chartered Financial http://www.nabard.org/microfinance/mf_ nstitution.asp loans promptly. Analyst, Fed’s Rate Cut, November. (DSA) and direct marketing agent http://rbi.org.in/scripts/BS_SpeechesView.aspx?Id=342 (DMA) to disburse large number of Banks could explore new Jain, Sheenu and K, Ravindra (2008): “Green small loans to ensure the reduction methodologies to expand lending. . In order Microfinance in India”, Professional Banker, 2008, http://www.kiva.org/about/microfinance. of cost the sensitive operations of all to reach out poor people and women the pp.35-39. the banks is loan recovery. This job micro financial institutions require to launch can be done professionally by new products further than credit like appointing loan recovery agent by insurance, deposit, remittances, securitization imposing certain code of conduct on of the loans to adhere the conventional of its functioning. the worldwide financial system. Specialized

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India-Pakistan Relations and Prospects of SAFTA: Pakistan relations and its impact on the separate states following the end of British Political Conflict vs. Economic Cooperation prospects of regional economic integration colonial rule. The two countries fought wars Saroj Bishoyi through SAFTA. It asks and seeks to answer over Kashmir in 1947, 1965, 1971 and 1999. four essential questions: Can trade improve Efforts at achieving normal relations and Abstract relations between hostile nations? Can peace between India and Pakistan have economic benefits and cooperation overtake collapsed or run into a dead-end so many India-Pakistan trade relations are of immense interest not only to both the countries political conflicts? Are better trade relations but also to the whole South Asian region. The interest in understanding the trade times in the past. The Agra summit meeting between two nations possible only after a of July 2001 between Prime Minister Atal dynamics between the two countries has arisen following the signing of the South settlement of all conflicts? And, finally, How Behari Vajpayee and Pakistan President Gen Asian Free Trade Agreement (SAFTA) in January 2004. While it is widely recognised India-Pakistan relations impact on the that SAFTA’s success depends critically on promoting trade links between the two development of SAFTA? Pervez Musharraf failed to resolve countries, bilateral trade between India and Pakistan remains extraordinarily low – differences over the “core issue” – for less than 1 per cent of their global trade. Their volatile political relationship has According to the Classical Trade Pakistan, Kashmir; and for India, an end to overwhelmed attempts to encourage trade between the two countries, and has also Theory, international trade serves to reduce “cross-border terrorism”. In 2002, escalating impacted economic integration in the South Asian region as a whole. There are both political conflicts. Trade between two nations tensions – caused by an attack on India’s political and economic obstacles in expanding trade between the two countries. Greater accrue gains to both while the loss of existing parliament building by Islamic militants in economic co-operation could, however, provide mutual economic benefits, such as trade ties, resulting from a political conflict December 2001 – led each country to amass lower prices for consumers, much-needed revenue for the governments, and cost- between the two nations, imply a loss of effective gas import to India via Pakistan. This paper is an attempt to understand, hundreds of thousands of troops along the describe and analyse India-Pakistan relations and its impact on the prospects of regional economic benefits. Two countries trading with Line of Control (LoC), which brought the economic integration through SAFTA. It asks and seeks to answer four essential each other, therefore, make an effort to avoid nuclear-armed nations to the brink of war. conflicts in order not to suffer such a loss.1 questions: Can trade improve relations between hostile nations? Can economic benefits The peace process was resumed in and cooperation overtake political conflicts? Are better trade relations between two For instance, China and Japan have shown April 2003, when Prime Minister Vajpayee nations possible only after a settlement of all conflicts? And, finally, how India-Pakistan they can have good trade relations despite relations impact on the development of SAFTA? having differences over important political offered talks, which was duly reciprocated issues. In the case of India and Pakistan, the by his Pakistani counterpart Zafarullah Khan political conflict over Jammu and Kashmir Jamali. Since relations began warming between India and Pakistan in the spring of India-Pakistan trade relations are of relationship has overwhelmed attempts to (J&K) seems to be holding free trade hostage. 2003, the steps forward have been small and immense interest not only to both countries encourage trade between the two countries, This affects measurably on the prospects of slow. Negotiations on issues from trade to but to the whole South Asian region. The and has also impacted economic integration SAFTA. transportation links have yielded some interest in understanding the trade dynamics in the South Asian region as a whole. There Indo-Pakistan relations are grounded symbolic successes – like the 7 April 2005, between the two countries has arisen are both political and economic obstacles to in the historical, geographic, demographic and opening of a bus line that crosses the LoC – following the signing of the South Asian Free expanding trade between the two countries. economic links between India and Pakistan, but a few concrete gains have been made on Trade Agreement (SAFTA) in January 2004. Greater economic co-operation could, two of the largest and fastest-developing the most important areas of conflict. The While it is widely recognised that SAFTA’s however, provide mutual economic benefits, countries in South Asia. The two countries biggest barrier to intra-regional trade is, success depends critically on promoting trade such as lower prices for consumers, much- share much of their common geographic therefore, the persistent political problems links between the two countries, bilateral trade needed revenue for the governments, and location, and religion (most notably Sikhism, between the two countries. Because of between India and Pakistan remains cost-effective gas import to India via Hinduism, Islam, and Buddhism); yet India’s market size and central location, 80 extraordinarily low – less than 1 per cent of Pakistan. This paper is an attempt to diplomatic relations between the two are per cent of intra-regional trade in South Asia their global trade. Their volatile political understand, describe and analyse India- defined by numerous military conflicts and is to or from India. India’s all neighbours share territorial disputes. India and Pakistan have a concern about being overwhelmed by Indian Mr. Saroj Bishoyi is a senior Doctoral candidate at the School of International Studies, Jawaharlal Nehru fought four wars over the J&K since 1947, University (JNU) and Doctoral Fellow at the Indian Council of Social Science Research (ICSSR), New Delhi goods. Decades of mutual political hostility when the two countries were partitioned into and suspicion compound the challenges in

IJSAS 1(2) 2008, pp.311-326. ISSN 0974 - 2514 International Journal of South Asian Studies IJSAS July - December 2008 313 India-Pakistan Relations and Prospects of SAFTA Saroj Bishoyi 314 trying to build strong trade relations between relations with Pakistan have predated the The Upper House of the Pakistani parliament would want to be seen as being soft on terror, India and Pakistan. Both sides tend to see deadly bombing. Several times over the last passed a resolution condemning the Indian and consequently a government in New Delhi progress on issues like trade as a favour to four months, India has conveyed its concerns government’s handling of the situation. The that would not want to appear conciliatory the other country rather a benefit to one’s own over ceasefire violations on the LoC, and Pakistan Foreign Ministry issued a statement towards Pakistan after blaming it for country. Pakistan, moreover, is reluctant to the sudden and quite public resurgence of expressing “deep concern” over the situation, something as big as the Kabul attack.10 Indian move too fast toward normalization of trade banned militant groups in Pakistan to the which, it said, held “serious humanitarian officials who have been interacting with the and other relations with India lest the issue of new government in Islamabad through implications”, and called on New Delhi to new government in Pakistan too say the main Kashmir get sidetracked.2 diplomatic channels. They were also “address the situation and prevent human- worry now is that the new set-up is too weak communicated at the political level during rights violations”. Moreover, Islamabad and unstable to give any assurances that it India and Pakistan struggled to hide the visit of India’s External Affairs Minister dramatically raised the ante by several notches can rein in “the elements” which have been their exasperation with each other at the start Pranab Mukherjee to Islamabad in May with Foreign Minister Makhdoom Shah chipping away at the peace process, whether of a fifth round of “composite dialogue” 2008.5 However, Pakistan has formally Mahmood Qureshi issuing a separate it is on the LoC or the attack in Kabul. between their foreign secretaries on 21 July denied the Indian charge that the Inter statement. The minister’s statement was Therefore, these recent developments have 2008. New Delhi warned that the recent Service Intelligence (ISI) was involved in couched in strong language expressing the further raised questions about the ongoing attack on its embassy in Kabul had put the the bombing, demanding evidence that New condemnation by the Pakistan government of peace process between the two countries and talks under stress. Islamabad said given its Delhi is said to have refused to share. the “excessive and unwarranted use of force early implementation of the SAFTA for enormous sacrifices it could not be put on Contrary to this, The New York Times against the people of Indian-occupied- greater economic integration of the South probation in the war on terror. After the round (NYT) reported that, according to American Kashmir”. Qureshi also expressed deep Asian region. of the dialogue on peace and security, J&K intelligence agencies, the ISI helped plan the concern over the “deteriorating situation” and and other Confidence-Building Measures suicide bombing of India’s embassy in Kabul called on the Indian government to take South Asian Association for Regional (CBMs), Indian Foreign Secretary Shiv based on “intercepted communications “immediate steps to end violence against Cooperation (SAARC) Shankar Menon said that the talks were between Pakistani intelligence officers and innocent Kashmiris”.8 Most importantly, the happening at a “difficult time of our militants who carried out the attack, US Pakistani minister linked the prevailing situation The South Asian Association for relationship with Pakistan”. “Unfortunately, officials said, providing the clearest evidence in J&K to the India-Pakistan bilateral dialogue Regional Cooperation (SAARC) comprising there have been several issues in the recent to date that Pakistani intelligence officers and the larger issue of the “long-standing seven South Asian countries; Bangladesh, past which have vitiated the atmosphere and are actively undermining American efforts dispute of Jammu and Kashmir”. New Delhi Bhutan, India, Maldives, Nepal, Pakistan and the composite dialogue process is under to combat militants in the region”.6 has taken exception to the Pakistani Sri Lanka was formed in 1985 at the initiative stress,” Menon said. He referred to recent Subsequent forensic investigations by the statements, terming them as “clear of Bangladeshi President Ziaur Rahman, with alleged violations of the ceasefire along the North Atlantic Treaty Organisation (NATO)- interference” in India’s internal affairs and the adoption of its Charter at its first Summit in Dhaka, Bangladesh. Afghanistan became LoC, cross-border terrorism and alleged led International Security Assistance Force cautioning that such rhetoric wouldn’t help the 9 eighth member of the SAARC at its summit incitement to violence in J&K.3 Moreover, (ISAF) have also reportedly established that bilateral dialogue move forward. held in New Delhi in April 2007. SAARC India said on 1 August 2008 that peace talks the explosives used bore markings of the 7 According to the Lt. Gen. (retd.) Talat provides a platform for the peoples of South with Pakistan were at the lowest point in their Pakistan Army Ordinance Factory. Masood, a strong supporter of the India- Asia to work together in a spirit of friendship, four-year history after a spate of bombings in The recent agitation in the Kashmir Pakistan peace process, a two-fold problem trust and understanding. It was created for Indian cities and at the country’s embassy in Valley over the issue of land transfer to the confronts the peace process that makes the the purpose of holding periodic, regional Kabul. Foreign Secretary Menon said the Amarnath Shrine Board and subsequent coming months a “very crucial period for consultations on matters of mutual interest blasts had “affected the future” of negotiations Pakistan’s stand on this issue has further India-Pakistan relations:” a weak government and to explore the possibility of cooperation 4 between the nuclear-armed neighbours. created question mark on their fragmentary in Pakistan that is unable to assert its political in economics, social, cultural and other While the Kabul attack has been the peace process. In a series of calibrated - will for peace with India over the fields.11 The rationale was based on the main reason for the diplomatic downturn in and seemingly pre-planned - moves, Pakistan “establishment,” and the onset of election success of similar regional groupings the peace process, Indian concerns over its has swiftly waded into the situation in J&K. season in India during which no political party elsewhere and strength of the concerted

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 315 India-Pakistan Relations and Prospects of SAFTA Saroj Bishoyi 316 action in international representation with Cooperation in the core economic areas expected to conduct trade with each other on restructuring of the economies making the enhanced competitive position ensued. among SAARC Member Countries was all items, except those in the negative list on region one of the fastest growing and most initiated following the Study on Trade, which duties are not reduced.15 Article 3 of competitive economic blocs.18 However, The SAARC, however, has not Manufactures and Services (TMS), which the SAFTA Agreement states that the there is a significant exception to this rule – achieved much since its initiation in 1985, was completed in June 1991. Currently, the objectives of this agreement are to promote that is the trade from India to Pakistan. This primarily due to the tenuous political relations following important processes of SAARC and enhance mutual trade and economic exception considerably lowers the prestige between India and Pakistan and a general are promoting cooperation in the field of cooperation among Contracting States by, of SAFTA and raises question about its future. environment of mistrust among member Trade, Economy and Finance, and related inter-alia:16 countries. Political economy considerations are The origin of the SAFTA can be areas14: important. At the time of its inception, “each Eliminating barriers to trade in, and traced back from the sixteenth session of the country of the group was pursuing autarkic Committee on Economic facilitating the cross-border movement of Council of Ministers where they agreed on economic policies and had almost no Cooperation: Overall Coordination of goods between the territories of the 18-19 December 1995 in New Delhi, the need integration with the international and the cooperation in economic areas; Contracting States; to strive for the realization of SAFTA and to regional economy.”12 Compared to other this end an Inter-Governmental Expert Group South Asian Free Trade Area Promoting conditions of fair regional blocs, the SAARC performance is (IGEG) was set up in 1996 to identify the (SAFTA) Committee of Experts and competition in the free trade area, and ensuring dismal. With a total population over one-fifths necessary steps for progressing to a free SAFTA Ministerial Council: Administration equitable benefits to all Contracting States, of the world population and a combined gross trade area. The Tenth SAARC Summit held and implementation of SAFTA; taking into account their respective levels and national income of $3 trillion, SAARC only in Colombo on 29-31 July 1998 decided to pattern of economic development; provides about one per cent of world Finance Ministers Mechanism: set up a Committee of Experts (COE) to draft production. Despite geographic proximity, Cooperation in the field of Finance and Creating effective mechanism for the a comprehensive treaty framework for trade and weak transit links, infrastructure related areas; implementation and application of this creating a free trade area within the region, difficulties, high tariff and non-tariff barriers Agreement, for its joint administration and for taking into consideration the asymmetries in hamper investment. Standing Group on Standards and the resolution of disputes; and development within the region and bearing in SAARC Standards Coordination Board: mind the need to fix realistic and achievable Establishing a framework for further Intra-SAARC trade has remained Cooperation in the field of harmonization of targets. The Agreement on SAFTA, drafted regional cooperation to expand and enhance low at a mere 3 per cent since the Standards; by the COE, was signed on 6 January 2004 organization’s inception and it still remains the mutual benefits of this Agreement. Group on Customs Cooperation is during the Twelfth SAARC Summit in small because of high tariffs and a variety of Moreover, article 4 of the SAFTA Islamabad. The Agreement came into force non-tariff barriers such as quantitative dealing with issues related to harmonization of Customs rules and procedures. agreement says that this agreement will be on 1 January 2006. Under the Trade restrictions, fiscal charges and discriminatory implemented through the instruments of Trade Liberalisation Programme scheduled for practices and outright ban on imports. It has South Asian Free Trade Agreement Liberalisation Programme; Rules of Origin; completion in ten years by 2016, the customs been viewed that SAARC must deal with the (SAFTA) Institutional Arrangements; Consultations and duties on products from the region will be world’s major trading blocks as a composite Dispute Settlement Procedures; Safeguard progressively reduced. However, under an unit to maximize the gains of trade for both The South Asian Free Trade Measures; and any other instrument that may early harvest programme for the Least sides. Although the intra-region trade is not Agreement (SAFTA) has been seen as an be agreed upon.17 Therefore, the signing of Developed Member States, India, Pakistan impressive, the South Asian nations have been important tool that can take SAARC away the SAFTA agreement at its Islamabad and Sri Lanka are to bring down their customs maintaining strong links with the outside world from its jinxed past. Though this agreement Summit in 2004 regarded as a landmark in duties to 0-5 per cent by 1 January 2009 for 13 with the advanced countries. came into operation on 1 January 2006, its the evolution of the SAARC. The SAFTA the products from such Member States. The Tariff Liberalisation Programme (TLP) Economic Cooperation under SAARC agreement has the potentiality of going beyond Least Developed Member States are started only on 1 July 2006, because the its stated objective of freeing trade in goods. expected to benefit from additional measures The acceleration of economic growth member-countries were not ready. Under It can make South Asia a magnet for vastly under the special and differential treatment is a Charter objective of SAARC. this agreement all member-countries are enhanced foreign investment and lead to a accorded to them under the Agreement.19

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SAFTA has also evolved a effective market access through smooth India-Pakistan Trade Relations relations between the two countries would framework for the creation of a free trade implementation of trade liberalization have to wait for the resolution of the Kashmir While Pakistan has so far not applied zone covering 1.4 billion people with zero programme and directed the SAFTA bodies issue.26 Until then, bilateral trade would the provisions of SAFTA to Indo-Pakistan customs duty on the trade of practically all to review the progress on a regular basis. continue to be guided by the positive list. trade relations, the largest component of intra- They emphasized that SAFTA should be products in the region by the end of 2012. It regional trade in South Asia, it remains the Pakistan ratified SAFTA, but trade implemented in letter and spirit. Successful required India, Pakistan and Sri Lanka to bring case that strong economic relationships between India and Pakistan will not be implementation of SAFTA will catalyse other their duties down to 20 per cent in the first between India and Pakistan would go a long initiated under this agreement, instead it will areas of regional economic cooperation.22 phase of the two-year period ending in 2007. way to securing SAFTA’s success. There are continue under the existing import regime. Indian Prime Minister Manmohan Singh on In the final five-year phase ending in 2012, three key reasons why trade between India “We will not allow import of Indian items under 3 April 2007 in New Delhi said that “South the 20 per cent duty will be reduced to zero and Pakistan needs to be enhanced. First, SAFTA, as Pakistan will continue to have Asia is in the midst of an unprecedented through a series of annual cuts. The four least viewed in a larger regional context, South Asia limited bilateral trade with India under existing political and economic transformation. The developing countries – Bangladesh, Nepal, is the least integrated region and stronger arrangements,” a news report quoted as political transitions, painful as they may be, Bhutan and Maldives – get an additional three economic relations between India and saying after a meeting of the federal cabinet are something that each one of us has to years to reach zero duty level. But in order Pakistan is a key element of regional which approved the agreement with Pakistan work out for ourselves, within our countries for SAFTA to achieve its goals and on integration and stability in South Asia. Second, Prime Minister Shaukat Aziz in the chair.27 and between our governments. I see signs schedule, India and Pakistan, the two leading there are vast untapped trade and investment “Unless and until there is visible progress on of hope that our governments are now economies of the region, need to cooperate possibilities between the two countries which political issues between the two countries rather than indulge in a wasteful game of one- addressing the bilateral political issues that can be gainfully exploited with significant including the Kashmir issue, Pakistan cannot upmanship.20 have prevented us from achieving our welfare gains and opportunities to alleviate initiate open trade with India. Both the potential. We must now make a break with poverty and strengthen human security. South countries are holding composite dialogue to The Governments of the SAARC the past and join hands to realise our common Asia is home to 24 per cent of the world’s solve the political issues, which are the main motivated by the commitment to strengthen 23 shared destiny.” population but 42 per cent of its poorest people. hindrance in the way of open trade”.28 intra-SAARC economic cooperation to Third, as natural trading partners with a maximise the realization of the region’s South Asian leaders signed a legal In line with this stated policy, common border, trading with each other can potential for trade and development for the cooperation pact in its Colombo Summit on Pakistan’s Central Board of Revenue (CBR) be substantially higher as the potential is benefit of their people, in a spirit of mutual 3 August 2008 to combat terrorism and issued an order notifying the tariff concessions estimated to be 10 times the current level.25 accommodation, with full respect for the agreed to set up a food bank to fight hunger under the SAFTA agreement. The tariff principles of sovereign equality, independence in the face of rising food prices in one of the reduction would be available on import of Initiatives by Pakistan and territorial integrity of all States; recognized world’s poorest regions. But the SAARC 4,872 products from Sri Lanka, Bangladesh, that Least Developed Countries (LDC) in the made little progress on trade, the central Pakistan ratified SAFTA on 15 Bhutan, Nepal and Maldives. But, imports region need to be accorded special and theme of the group formed in 1985. The February 2006. This step by Pakistan raised from India would be subject to the Pakistan differential treatment commensurate with summit provided no concrete steps to hopes that the trade barriers between it and import policy order of July 2005, which their development needs; and it is necessary invigorate the SAFTA agreement which India might soon come down. With SAFTA restricts imports of goods from India or goods to progress beyond a Preferential Trading came into effect in 2006 but which has failed making the Most Favoured Nation (MFN) of Indian origin to a positive list of only 773 Arrangement to move towards higher levels to take off. Aimed at achieving zero tariffs treatment automatic, there were also hopes items.29 Pakistan’s argument is liberalisation of trade and economic cooperation in the on almost all products by 2012, SAFTA has that Pakistan’s refusal to give India MFN of trade has to be linked to progress on the region by removing barriers to cross-border witnessed squabbles over tariff concessions, status would cease to matter. India gave resolution of long-standing disputes between 21 flow of goods. with Pakistan accusing India of violating the Pakistan the MFN status in 1995. But, soon the two countries, the core issue being that 24 of Kashmir. Pakistan dismisses New Delhi’s The heads of State or Government agreement with various non-tariff barriers. after the 15 February 2006 ratification position that trade must not be held hostage at the 14th SAARC summit on 3-4 April 2007 Terrorism in one of the world’s most troubled Pakistan’s commerce minister Humayun to the settlement of a long-standing problem. in New Delhi stressed the need for ensuring regions dominated the summit. Akthar Khan said that full-fledged commercial

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Thus, despite the SAFTA agreement becoming However, the trade policy of dryers from India will be allowed through India.” They list the “small but incremental operational from 1 July 2006, Pakistan has Pakistan for the fiscal year 2008-09 unveiled Wagha by road. The government will allow steps” that Pakistan has taken since the new decided not to accord the MFN status to India. on 18 July 2008 set an ambitious export the import of used buses not more than 10 government came to power to improve ties, It will also not be extending tariff concessions target of $22.10 billion, but avoided projecting years old under the transfer of residence such as quietly allowing Indian films to be due under SAFTA. an import target because of rising scheme for overseas Pakistanis and import screened. They worry that “compulsions” in international oil and food prices. The policy, of Compressed Natural Gas (CNG) buses an election year are making India adopt an Surprisingly, the State Bank of announced by Commerce Minister Ahmad from India. If Indian manufacturers of CNG aggressive and unrelenting posture.36 Pakistan published a report departing from this Mukhtar, offered a number of incentives for buses make a firm commitment to the traditional argument, though it bears no relation to Pakistan’s official trade policy with India. traditional products. It envisages manufacturing of such buses in Pakistan, the Initiatives by India The report released on 10 July 2006, said that establishment of 11 new industrial clusters, ministry of Commerce may provide special reactivation of the Federal Export Promotion dispensation for import of 10 buses by road India, as the largest country in the Pakistan stands to save between $400 million region, “is ready to accept asymmetrical and $900 million on its import bill if it would Board and review of the TDAP Ordinance via Wagha from each possible investor as test 33 responsibilities, including opening her markets expand the positive list and allow imports from to improve its working. consignments. Duty and taxes have been withdrawn on plant, machinery and equipment to her South Asian neighbours without India that it presently imports from other Import of more than 136 new items imported to set up a unit under the Duty and insisting on reciprocity”. The Government of countries at a higher cost. There are 2,646 from India has been allowed. Of these, 72 India reiterated its continuing and consistent items that are common in Pakistan’s imports Taxes Remission for Export (DTRE) scheme. tariff lines were added to the importable list commitment to the SAARC process, towards and Indian exports. The report, based on 2003- Inputs in DTRE have been allowed to be for raw materials, chemicals and industrial enhancing prosperity of the SAARC region 2004 data, said that after excluding the items imported from India, even if these are not inputs, nine tariff lines for pharmaceutical through social development and regional that are on the positive list for India, 45 per included in the importable items from India, products and vaccines, two for fruits and economic integration.37 In line with this stated cent of the items could be imported by or manufactured locally. vegetables, 19 for fertiliser, 32 for machinery policy, India has unilaterally decided to cut Pakistan at lesser cost from India than the and parts and two for POL and diesel. With Imports of gold, silver, platinum, the negative list with regard to the Least current cost of import from the rest of the the inclusion of these items, the total list of palladium, diamond and precious stones have world.30 For instance, in the iron and steel Developed Countries (LDC) – Bangladesh, tradable products with India has been been exempted from customs duties and sales sector, the report said Indian imports are on Nepal, Bhutan and Maldives – in the SAARC increased to 1,938 tariff lines from earlier tax to increase exports and encourage the whole not as cheap as Iran’s. But, it region to around 500 from 744, to expand 1,837. The global import of these 136 tariff investments in the sector. The import of identified 47 products that were cheaper to trade in goods in the region. Union Minister lines stood at $2.8 billion of which $2.2 billion machinery/equipment for mining/quarrying and import from India. It also pointed to chemicals of Commerce and Industry Kamal Nath, and pharmaceutical products. In these sectors, was spent only on import of POL and diesel. grinding of minerals (along with spares) will while addressing the Third SAFTA Ministerial Pakistan’s imports from India were 4.3 per This means the government has diverted this be allowed from India to improve availability Council meeting in New Delhi on 3 March cent and 6.8 per cent respectively of its total import value of $2.8 billion to India which of good quality stones for further processing. 2008, said that “In keeping with our imports in these sectors. As many as 166 of will increase its exports to over $3 billion It has been decided that the subsidy given to commitments, we have already notified the these items cost less to import from India than from the current level of $1 billion and exporters to comply with environmental advancement of the trade liberalisation from other countries.31 The paper also argued becomes the second largest trading partner standards from the Export Development Fund programme in respect to LDCs by one year 34 that trade liberalisation is not a one-way street of Pakistan after China. After this increase (EDF) will be increased to eight per cent or and with effect from 1st January 2008, the and points to tariff and non-tariff barriers in in imports from India, the grant of MFN 50 per cent of the mark-up, whichever is import duty on all items other than those in India that discourage Pakistani exporters, status to India would become meaningless, lower.35 Meanwhile, Pakistani officials the negative list has been reduced to zero”. despite India having given the MFN status to but Commerce Minister linked it with the complain that the government’s new trade He further said that “Various SAARC Pakistan as far back as 1995. It said that removal of non-tariff measures by India. A policy, with its expanded positive list of imports mechanisms have focussed on developing unless these barriers are brought down, Halal Certification Board will be set up to from India, has not been appreciated by New specific short, medium and long term Pakistan cannot gain from bilateral trade, the devise a standard and certification Delhi despite the massive hardline criticism cooperation projects to deliver direct benefits potential for which, according to estimates, mechanism for the export of Halal food the Pakistan People’s Party (PPP)-led to the people. Operationalisation of the ranges from $0.75 billion to $6.25 billion.32 products. Import of paddy harvesters and government is facing for “trying to please SAARC Development Fund and full

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 321 India-Pakistan Relations and Prospects of SAFTA Saroj Bishoyi 322 implementation of SAFTA would pave the commodities, India’s Science and The prospects for increased two way Improved trade relations between Indian and way for this development. The South Asian Technology Minister Kapil Sibal said after a trade are also based on the assumptions that Pakistan would lead to an environment more University and the SAARC Food Bank can Cabinet meeting in New Delhi on 8 August cooperation between India and Pakistan has congenial for strengthening SAARC as a also bring benefits to South Asia”, Kamal Nath 2008. “This is in pursuance of India’s been accelerating in field of banking, freight whole. said.38 He also expressed confidence that the announcement during the SAARC summit transport and goods like tea and rice. After new government in Islamabad will soon regarding its readiness to accept the launch of SAFTA in January 2006 and A recent study done by the Asian implement the SAFTA with New Delhi and asymmetrical responsibilities including opening up of rail and road transport, bilateral Development Bank (ADB) and the United take necessary measures, including duty opening her markets to her South Asian trade increased to $ 400 million. With SAFTA Nations Conference on Trade and changes, to facilitate trade. neighbours without insisting on reciprocity,” becoming operational in July 2006, over 4000 Development (UNCTAD) on Regional Sibal said.40 India, South Asia’s biggest commodities were opened for trade compared Cooperation in South Asia, “Benefits from Prime Minister Manmohan Singh, at to less than 1000 under the India “Positive SAFTA and Way Ahead” tried to quantify th economy, and seven other nations including the Inaugural Session of the 15 SAARC Lists” maintained by Pakistan. Exports from Pakistan and Sri Lanka, during the 15th benefits of SAFTA. It has undertaken both Summit in Colombo on 2 August 2008 said India to Pakistan have grown at a SAARC summit in Colombo in August 2008 quantitative and qualitative assessment of the that “India has experienced vigorous growth Compounded Annual Growth Rate (CAGR) vowed to cut trade barriers to accelerate outcome of SAFTA. The study observed that at an average of 8.8 per cent per year for the of 60 per cent and imports at a CAGR of 64 the full implementation of the SAFTA would growth, underscoring the importance of past four years. India is now an open per cent for the period 2002-07. contribute to stronger economic growth in the regional groupings after the collapse of World economy welcoming investment from region. While there would be losses in some Trade Organisation (WTO) talks. Bilateral trade swelled from $ 235.74 everywhere. The other countries in our region sector in the region, there would be gains in million in 2001-02 to more than $ 1 billion in have also done well. Today, Asia has become other sectors, the net effect on economic 2006-07. Share of Pakistan’s exports to India the engine of growth of the world economy Even though Indian and Pakistan output being positive. Much higher gains for in total exports rose from 0.5 per cent in 2001- and South Asia is a part of this resurgence. are currently entangled in political and the region can be secured, the study said if 02 to 1.8 per cent in 2005-06. Balance of trade This growth must have a multiplier effect in economic deadlock, the Associated SAFTA would be simultaneously has remained in favour of India. The main our region. We have rich and varied Chambers of Commerce and Industry of implemented with measures to reduce commodities of exports to Pakistan include experience in development, which we must India (ASSOCHAM) has suggested host of transaction costs and create more efficient sugar, dyes, plastic and petroleum products pool together to create a model of inclusive measures to achieve the target of Indo-Pak regional transportation and infrastructure and cotton while main import items from and sustainable regional development. He two-way trade to $ 9 billion in next few years. networks. Increasing the scope for intra- Pakistan are petroleum and crude products, further said that “Economic cooperation, Despite their trade as per current estimates regional trade in energy, improving road, rail fruits and nuts (excluding cashew nuts), cotton connectivity and integration will be the has touched around $ 2 billion and its potential and air links within the region, building modern yarn & fabrics and organic chemicals.42 The cornerstone of SAARC in the years ahead. customs and border crossings, developing will grow many fold as their inter Chamber has come out with host of We have already agreed to move towards a sophisticated telecommunications links like dependence on economic and trade related recommendations which included the key to South Asian Customs Union and a South Asian optic fibre were vital to this endeavour, it issues would leapfrog in future, thereby bury solving Indo-Pak issues lie in increasing Economic Union in a planned and phased said.43 deep down Indo-Pak political differences, bilateral trade, promoting people to people manner. India has granted zero duty access said the ASSOCHAM President, Sajjan contact and raising businessmen’s stake. India to our markets to LDC members from 1 Another study done by the Indian Jindal, while releasing its recent publication has granted Pakistan MFN status in 1996, January 2008, one year ahead of the target Council of Research on International on “Indo-Pak Trade Ties” in New Delhi on though Pakistan has not reciprocated Economic Relations (ICRIER), a New Delhi and also pruned our sensitive list for these 41 19 August 2008. The ASSOCHAM Chief presumably because the trade balance is highly based economic think tank, said that India countries. We will go ahead with these also expressed optimism that in future, rail in favour of India. Therefore, both the and Pakistan have a trade potential of $11.7 initiatives at a pace we are all comfortable and road linkages between India and countries should device means and ways to billion (Rs 46,098 crore), but the two with”.39 Pakistan would witness intensifications, thus, reduce the imbalance by opening fresh trade neighbours need to take proactive measures Meanwhile, India lifted the ban on pave ways for larger movements of trade routes and encouraging Indian traders to to exploit untapped areas of economic trading in 264 items and pruned the list to 480 and tourism. identify more commodities for import. cooperation. The study, based on surveys of

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 323 India-Pakistan Relations and Prospects of SAFTA Saroj Bishoyi 324 business people, has identified export potential Moreover, India and Pakistan, at a meeting economic cooperation subsequently promoting capital and economic infrastructure by of $2.2 billion from Pakistan to India, while of the Joint Working Group on Cross-LoC regional trade in the South Asian region as the releasing budget resources that are now India can ship goods worth $9.5 billion per Confidence-Building Measures (CBMs) on future of South Asia depends on the relationship committed to defence and security. Both annum to its neighbour.44 Removal of tariff 22 September 2008, finalised the modalities between two major players. President countries, therefore, need to make an effort and non-tariff barriers between India and of the cross-Line of Control trade. Zero-tariff SAARC CCI said that since the escalating to avoid conflicts in order not to suffer such a Pakistan can also take bilateral trade to $9 trade of items produced in both regions will tensions between India and Pakistan had welfare loss. The development of trade billion in a short time frame, according to be conducted on the Srinagar-Muzaffarabad threatened to cast a shadow over the South relations between the two countries will serve Muhammad Nasir Khan, President, Islamabad and Poonch-Rawalkot routes. The two sides Asian Association for Regional Cooperation to resolve their political conflicts. For this, Chamber of Commerce and Industry.45 also agreed to resume truck services summit should aim at improving regional political will and long term vision is required. between Srinagar and Muzaffarabad from 1 economic growth and cooperation with letter The year 2008 has in fact already seen October 2008.48 and spirit.51 President SAARC CCI was of Notes a wide-ranging number of breakthrough the opinion that in addition to political mediation, developments in areas such as film, finance 1. Frey, Bruno, S (1984): International Political However, the greatest economic economic diplomacy was also required to shift and flights. Bollywood could finally be coming Economics, Basil Blackwell Publishers Ltd., New benefit of trade relations between India and the priorities and to achieve the objectives for to Pakistan as Pakistanis Parliamentary York, p.4. Pakistan would occur in the sphere of energy which SAARC was created. He added that committee on culture has given its go-ahead cooperation. India is one of the most rapidly economic cooperation was a must to make to lift a four-decade ban on Hindi films. The 2. Sangani, Kavita and Schaffer, Teresita (2003): growing energy markets in the world and will South Asian region a tension-free zone. “India-Pakistan Trade: Creating Constituencies for Securities and Exchange Board of India be able to absorb new sources of supply as Peace,” South Asia Monitor, Centre for Strategic (SEBI) and the Securities and Exchange they materialize in the region. Pakistan’s Conclusion and International Studies (CSIS), Washington D.C., Commission of Pakistan (SECP) have signed potential role in fulfilling this need is not as a No.56, 3 March at http://www.csis.org/media/csis/ a Memorandum of Understanding (MoU) to Free Trade Area in South Asia has supplier but as a potential transit route for little meaning unless India and Pakistan are pubs/sam56.pdf, accessed on 10 July 2008. encourage greater cooperation in promoting energy from Iran and Central Asia. This and developing their respective capital involved in it whole heartedly. It is easy to list 3. “Dialogue Under Stress: India”, The Dawn, 22 would require construction of one or more the benefits of expanded India-Pakistan markets. Of perhaps the greatest impact, both new pipelines, a major capital investment that July 2008 at http://www.dawn.com/2008/07/22/ countries have agreed to double the number economic relations, but much more difficult to top1.htm. accessed on 2 August 2008. makes sense only if the political stability and develop a road map for getting there. of weekly passenger flights with direct flights economic feasibility of the project can be 46 Ultimately, trade is unlikely to be the lead issue 4. “Peace Talks at Lowest Point, Says India,” The commencing between Delhi and Islamabad. 49 counted on. Meanwhile, India and Pakistan in this complex relationship. Both sides are Dawn, 2 August 2008, at http://www.dawn.com/ In recent years, the private sector has have resolved commercial differences accustomed their current economic isolation 2008/08/02/top3.htm, accessed on 4 August 2008. played an active role in identifying areas of holding up a proposed multi-billion-dollar gas from one another. Once the two countries’ trade interest, areas of possible joint ventures pipeline from Iran, Shah Mehmood Qureshi leaders decide to start a political dialogue, 5. Subramanian, Nirupama (2008): “India-Pakistan and other forms of co-operation between the and Murli Deora, oil ministers of both South however, expanding trade could become a Peace Process: Hopes & Fears”, The Hindu, 2 50 two countries. Potential sectors for mutual Asian nations said on 27 June 2008. The useful adjunct to the political process, instead August. cooperation between India and Pakistan project, which aims to transport gas from Iran of being hamstrung by it. With an improved 6. Mazzetti, Mark and Schmitt, Eric (2008): include agricultural products, tyres, auto to Pakistan and India, was first mooted in security and political environment and a “Pakistanis Aided Attack in Kabul, U.S. Officials 1994 but has been stalled by a series of spare-parts, minerals, chemicals, resolution of the long-standing Kashmir Say”, The New York Times, 1 August, at http:// pharmaceuticals, leather, textiles, tele disputes over prices and transit fees. conflict, citizens of both countries would be www.nytimes.com/2008/08/01/world/asia/ communications, gas pipeline, electricity President SAARC Chamber of able to reap a large peace dividend. It would 01pstan.html?_r=1&em=&pagewanted=print&oref=slogin, generation using coal and wind energy in the Commerce and Industry (CCI), Tariq Sayeed come not only through more trade in goods accessed on 3 August 2008. Sindh province of Pakistan. Studies appreciated the initiatives of the Government and services, but also from joint ventures and undertaken by the private sector also see a 7. Lakshman, Kanchan (2008): “Escalation on the of Pakistan and India for trashing out a investments in each other’s country, improved large scope for trade in several service sectors Cards”, South Asia Intelligence Review (SAIR), comprehensive plan to improve bilateral coordination of economic and financial policies, such as health, entertainment services, and, from financing investments in human Vol.7, No. 4, 4 August. information technology, energy and tourism.47 engagement and hoped that it would lead to

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 Saroj Bishoyi 326 325 India-Pakistan Relations and Prospects of SAFTA

8. Bhadrakumar, M K (2008): “India-Pakistan 20. “Contentions over Tariff”, The Dawn, 5 March 31. Ibid. www.saarcchamber.com/newsreader.asp?id=100 Relations in Free Fall”, Asia Times Online, 15 2007, at http://www.dawn.com/2007/03/05/ accessed on 25 August 2008. August, at http://www.atimes.com/atimes/South_ ed.htm, accessed on 6 August 2008. 32. Ibid. Asia /JH15Df01.html, accessed on 9 Sept 08. 42. Ibid. 21. See note 16. 33. “Trade Policy Widens Scope for Imports from 9. Ibid. India,” The Dawn, 19 July 2008, URL: http:// 43. “SAFTA to Have Positive Impact for S. Asia: 22. “Declaration of the Fourteenth SAARC Summit,” www.dawn.com/2008/07/19/top1.htm, accessed on ADB-UNCTAD” 1 April 2008, at http:// 10. See note 5. 3 - 4 April 2007, New Delhi, at http://www.saarc- 20 July 2008. www.saarcchamber.com/newsreader.asp?id=28. sec.org/data/summit14/ss14declaration.htm, Accessed on 24 July 2008. 11. “South Asian Association for Regional accessed on 8 June 2008. 34. Ibid. Cooperation (SAARC)”, SAARC Secretariat, 44. “India, Pakistan have $11 Billion Bilateral Trade Official Website, at http://www.saarc-sec.org/ 23. “Address by Prime Minister Manmohan Singh 35. Ibid. Potential: ICRIER”, The Wall Street Journal, 16 main.php?t=1, accessed on 15 July 2008. at the 14th SAARC Summit in New Delhi on 3 December 2007, at http://www.livemint.com/2007/ 36. See note 5. April 2007”, Strategic Digest, Vol. 37, No. 4, 12/16235954/India-Pakistan-have-11-billi.html. 12. Jhamb, Sujata (2006): “India’s Regional Trading April 2007, pp. 440-441. 37. “India’s Chairmanship of SAARC”, Ministry of 12 August 2008. Arrangements,” South Asia Journal, January- 24. “SAARC Accord to Curb Terror, Fight Hunger” External Affairs, Government of India, SAARC March, at http://209.41.191.254/Magazine/Jou 45. “Remove Trade Barriers between India and The Dawn, 4 August 2008, at http:// Division, 22 April 2008, at http://meaindia.nic.in/ rnal/11_india_regional.htm, accessed 15 July 08. Pakistan”, The Hindu Business Line, 27 April www.dawn.com/2008/08/04/top1.htm, accessed onmouse/saarc2007.htm, accessed on 20 June 08. 2007, at http://www.thehindubusinessline.com/ 13. Ibid. on 4 August 2008. 38. “Kamal Nath Calls For Review of Negative List to 2007/04/27/stories/2007042703611000.htm. Accessed on 18 July 2008. 14. “Economic,” SAARC Secretariat, Official website, 25. Zaman, Arif ((2008): “Trade Potential between Expand Trade – India Unilaterally Reduces Pakistan and India Untapped” The News, 10 Negative List for SAARC LDCs from 744 to 500 at http://www.saarc-sec.org/main.php?t=2.1, 46. See note 25. accessed on 4 August 2008. August at http://www.thenews.com.pk/ Maldives to Host Fourth Meeting of SAFTA”, print1.asp?id=129120, accessed on 15 August Ministry of Commerce and Industry, Government 47. Ibid. 15. Bishoyi, Saroj (2006): “India-Pakistan Relations 2008. of India, Department of Commerce, New Delhi, 3 and SAFTA,” Institute of Peace and Conflict March 08, at http://commerce.nic.in/PressRelease 48. “Cross-LoC Trade with Pakistan Soon,” The 26. See note 15. Studies (IPCS), No. 2102, 28 August, at http:// /pressrelease_detail.asp?id=2228, accessed on 20 Hindu, 23 October 2008; and “Cross-LoC Trade www.ipcs.org/India_Pak_articles2.jsp?action= 27. “Pakistan Ratifies SAFTA, But No Free Trade June 2008. to Begin from Oct. 1”, The Times of India, 23 showView&kValue=2117&status=article&mod=a, with India”, Greater Kashmir Online, 17 September 2008. 39. “Statement by the Prime Minister of India Dr. accessed on 4 August 2008. February, http://www.greaterkashmir.com/ Manmohan Singh” at the Inaugural Session of the 49. See note 2. full_story.asp?Date=17_2_2006&ItemID=26&cat=1#Print% 16. “Agreement on South Asian Free Trade Area 15th SAARC Summit”, in Colombo on 2 August 20This%20Story, accessed on 17 September (SAFTA)”, SAARC Secretariat, at http:// 2008, Prime Minister’s Office, Government of India, 50. “IPI Pipeline Fee Dispute Resolved”, The Dawn, 2007. www.saarc-sec.org/data/agenda/economic/safta/ at http://www.pmindia.nic.in/speech/content. 28 June 2008, at http://dawn.com/2008/06/28/ top2.htm, accessed on 24 July 2008. SAFTA%20AGREEMENT.pdf, accessed on 6 28. Ibid. asp?id=697, accessed on 19 August 2008. August 2008. 29. Kumar Anand (2006): “Pakistan and Bangladesh 40. “India Cuts ‘Sensitive’ List to Encourage South 51. “Future of South Asia Depends on Indo-Pak 17. Ibid. Delay SAFTA Take off,” South Asia Analysis Asian Trade”, SAARC Chambers of Commerce Relation- President”, 1 August 2008, SAARC Group (SAAG), Paper no. 1891, 26 July, at http:/ and Industry (SCCI), Apex Business Organisation Chambers of Commerce and Industry (SCCI), 18. Dubey, Muchkund (2004): “SAFTA: A /www.southasiaanalysis.org/ of SAARC, 10 August 2008, at http:// Apex Business Organisation of SAARC, at http:/ Perspective”, The Hindu, 10 January, at http:// %5Cpapers19%5Cpaper1891.html, accessed on www.saarcchamber.com/newsreader.asp?id=98, /www.saarcchamber.com/newsreader.asp?id=93, www.hinduonnet.com/thehindu/2004/01/10/stories 5 August 2008. 22 August 2008. 26 August 2008. /2004011001211000.htm, accessed on 14 July 08. 30. Subramanian, Nirupama (2006): “India-Pakistan 41. “Indo- Pak Two Way Trade Going Up To $ 9 19. “South Asian Free Trade Area (SAFTA)”, SAARC Trade Stuck on SAFTA”, The Hindu, 31 July, Billion in Next Few Years”, SAARC Chambers of Secretariat, official website, at http://www.saarc- http://www.hinduonnet.com/2006/07/31/stories/ Commerce and Industry (SCCI), Apex Business sec.org/main.php?t=2.1.6, accessed on 16 Aug 08. 2006073101901100.htm, accessed on 14 July 08. Organisation of SAARC, 20 August 2008, at http:/

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Mitigating Gender Inequality: Road to Development behind women have remained in seizing male dominance thereby restricting women opportunities for improving their level of living. from entering the mainstream and narrowing An approach through Women Empowerment Gender inequality has direct and indirect impacts down their role to that of a home maker. This is Gautam M Pillai & Anushital on poverty and alleviation of the same will lead facilitated by societal taboos like the dowry to the holistic upliftment of all sections of the system, domestic violence against women and Abstract society. There is little doubt that India, although inheritance rights biased towards the male Gender inequality is a ubiquitous phenomenon in the Indian society which is a deterrent in a sky-rocketing growth phase, is not able to offspring. In the Indian society a woman has factor in attaining sustainable and inclusive development of the country at large. The do justice in this issue because the benefits of always been the shadow of a man be it her issue of gender inequality which is being faced by educated and empowered women as the growth phase hardly reaches the women father, brother or husband. She is forced to well has been rightly depicted in the scene (Scene No. 9) which has inspired this paper. population especially in the rural sections. In the accept their decisions in matters concerning her The paper has identified the areas of gender discrimination and has analyzed the same Indian society where structurally embedded life as well as her children’s lives. from social, economic and political angles. A mitigation strategy for resolving this discriminations prevail, women are kept aloof issue would be to holistically empower women from the grass root level. Financial from the mainstream proceedings. In most parts The qualitative aspects like access to inclusion through microfinance should prove to be a competent measure to achieve of rural India, women posses near to nil decision paternal property and resources, ability to take the same. The Self Help Group (SHG) model which has already been implemented in making power and financial assets. Daughters independent decisions, nutritional standard of different parts of the country is the most workable approach towards women are considered as a liability in the family and their diets and accessibility to primary health empowerment .Access to Microfinance in the past few years has economically female foeticides are quite common. This services can be used to subjectively summarize empowered women to a great extent. This has a “trickle down” effect on other social, increased marginalization of women affects the degree of social gender inequality. economic and political issues of great concern. sustainable development thus highlighting the In a quantitative sense, the factors that importance of engagement of women to ensure can be used to measure the level of social 1. Introduction The main inspiration for this paper economic, social, cultural and ecological vitality. gender inequality are sex ratio, female life has been to provide a commercially viable Gender inequality can be discussed under three Gender Inequality has always expectancy at birth, infant mortality rate, solution to one of the most troubling issues subheads: social, economic and political. The first haunted the Indians time and again in all the maternal mortality rate and child mortality rate. in India - gender inequality. Empowering factor is more elusive than the other two as it strata of society which has been depicted in Figure 1 shows the declining levels of sex ratio women through microfinance is considered cannot be quantified. in India through the years which indicates higher the ninth scene of ‘Swades’. Geeta, who is as a viable mitigation strategy to alleviate educated, self-reliant and who wants to 2.1 Social Gender Inequality levels of infanticides and foeticides. Table 1 this century old issue. The profit generating shows a global comparison of selected health contribute to the upliftment of society by capability of the proposed solution will teaching children, is asked to quit her job after This is a very broad and subtle form of indicators for females which shows India does provide a least corruption prone system. The gender inequality where the culture sanctions not enjoy an enviable position in the same. marriage. She chooses to opt out of a concept of “fortune lies at the bottom of the possibility of such a marriage. It is women pyramid” supports the sustainability of Figure 1: Sex Ratio levels in India like her who are relatively more empowered microfinance to empower women both as than myriad others to make choices. They are business model and societal upliftment model. the ones who can and do raise voice against gender discrimination. But more voices are 2. Gender Inequality needed to protest and condemn the practice Of all the multi dimensional problems which can be done only if women across the existing in India, gender inequality is one of the society in all regions, classes, castes and most critical factors that need to be addressed religions are empowered especially in the for the sustainable economic and social economic aspect. Once that is achieved, development of the nation. According to the political and social empowerment will follow budgetary document of 2001 ‘Gender bias’ is sooner or later. a term commonly used to describe how far

The authors are Management Students of NMIMS University, Mumbai, India Source: Census, 2001.

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2.2 Economic GenderInequality 3. The Road Ahead -Women Table 1: Global Comparison of Selected Health Indicators for Females Empowerment Economic gender inequality can be summed up through wage differentials, less A frontal attack on the root cause of opportunities in the economic spectrum for gender inequality which is the inaccessibility women and skewed professional education to resources coupled with lack of information in favour of men. The GDP per capita for and societal constraints will be the optimal solution to the much discussed issue of gender women is generally extremely low in South inequality. In other words, holistic empowerment Asian countries. In India it is 38 per cent of of women from the grass root level is the that of men. The reason for the same being need of a fast developing country like India. their low social status despite the fact that The term empowerment has been interpreted women work considerably longer hours than in several ways by various analysts in the field men do in both household and productive and most of the findings point towards a strong labour especially agriculture.1 Economic correlation between sustainable development gender inequality is very much linked to social and women empowerment. The World Bank gender inequality as depicted in the selected report of 2001 explains that societies which scene of Swades where the society lays down discriminate on the basis of gender pay the restrictions on women from going to work. cost of greater poverty, slower economic Generally according to the Indian society, the growth, weaker governance and a lower living standard for their people. It also job of women is that of a home maker which identifies four key elements of empowerment is also not taken into consideration by the to draft institutional reforms: access to System of National Accounts thereby information, inclusion and participation, underestimating their productive contribution accountability and local organizational to the society which brands them as capacity. economically less active. UNDP Human 3.1 Measuring Empowerment Report of 2004 suggests the same by indicating the women’s economic activity rate Empowerment is a very qualitative in India is just 50% as that of the male rate. term. An all encompassing quantifiable measure for empowerment is yet to be found 2.3 Political Gender Inequality out. Neither the World Bank nor any other major development agency has developed a Gender inequality in a political sense rigorous method for measuring and tracking refers to lack of proportionate female changes in levels of empowerment. The representation in key decision making posts UNDP report of 1995 introduced two new in the government corridors. The percentage complementary indices: the Gender-related of women parliamentarians was as low as Development Index (GDI) and the Gender 13% in 20042 which signifies the male Empowerment Measure (GEM). The GDI dominance on important issues and political indicator measures the inequalities between ineffectiveness of women at the macro level. men and women in terms of access to basic In a grass root level, general political needs. GEM evaluates women’s access to awareness and relative participation in public political and economic posts. The GDI and decision making are factors which affect GEM are in fact indices which throw light on political gender equality. the level of empowerment but even those are not comprehensive.

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The most plausible explanation of socially and economically disadvantaged much beyond any of their individual capacities. 10.5 percent and are refinanced by empowerment is found in related literature segments of society. The concept of SHG members begin to appreciate that NABARD at 6.5 percent. The high interest talks about three levels of empowerment to Microfinance is very much prevalent in resources are limited and have a cost. Once rate discourages credit for consumption and attain sustainability. Those are social ,political South Asia where there is a dire need for the groups show this mature financial ensures that the loans are for productive and economic empowerment. such services. Grameen Bank of behaviour, banks are encouraged to make income-generation activities. Bangladesh was such an initiative, whose loans to the SHG in certain multiples of the 3.2 Social and Political Empowerment This system by itself is very success has attracted a lot of players like cumulated savings of the SHG. The bank loans empowering as all the decisions are in the The entry of women into the banks, credit organizations and NGOs into are given without any collateral and at market hands of women. In this case instead of one mainstream activities and subsequent control the same. Rural India is a huge market for interest rates. The groups continue to decide woman, the whole group is negotiating with over resources will improve their standard of Microfinance products and activities and in the terms of loans to their own members and the bank. The fact that it is the woman who living and boost their confidence levels. It will addition to generating profits, they also result peer pressure ensures timely repayments. is getting the loan and not the husband makes also help them to form their own networks in increasing social values. At present, a large and organizations. Such initiatives will act as The SHG-Bank Linkage model her confident and at least she has some say part of micro finance activity is confined to a platform to help each other to improve their evolved from the pioneering efforts of if not complete on how the money should be credit only. standard of living without any external support. NABARD and two NGOs, MYRADA and used. If against the loan some asset is This does not necessarily imply change of 4.1 SHG: Collective Effort towards PRADHAN, which had persuaded the purchased then the SHGs register it in the gender relations at the household levels. This Sustainable Empowerment government in 1992 to remove legal obstacles name of the woman. Out of the loan she exactly is the underlying concept behind Self Statistics show that a good so that NGOs could take loans from banks takes, she will like to influence the fact that Help Groups (SHGs) which will be explained that could be further lent to the SHG members. the children should go to schools and have a in the subsequent sections. proportion of the clients of Microfinance are women who don’t have any securities to The expansion of the SHG bank linkage better lifestyle. There is a constant 3.3 Economic Empowerment offer, no asset is in their name and most of programme has accelerated in the past few improvement in the health and nutrition. If the time their husbands are defaulters of the years. It has reached an estimated 121.5 women get empowered, they do influence Attaining self sufficiency and ability million people and disbursed more than Rs.68 social issues at the community level. Their to take independent decisions in matters banks. Therefore a sustainable model for women empowerment should be focused on billion in cumulative bank loans up to March self esteem goes up and they consider that related to income generating activities 2005, using a network of 41,082 bank branches they are also the productive part of the captures the essence of economic how women can be made the recipients of and 4,323 NGOs3. society. empowerment. Increased access to savings the services of microfinance. The Self Help and credit facilities to women ensures Group (SHG) model is an initiative 4.2 Modus Operandi of SHGs 4.3“Kudumbashree” –A Proven Initiative forwarded in this direction. maximisation of their own as well as the Different SHG models all over India households’ welfare. Besides, women’s The SHG model has been A Self Help Group (SHG) has been have diversified modes of providing financial income can be considered as a second source successfully implemented by the defined by NABARD as a group with an access to its members. The whole concept of of income for the family thereby enhancing Government of Kerala through its innovative average size of about 15 people from a SHGs revolves around the fact of creating their status within the family as well as in the initiative named “Kudumbashree”. The homogenous class who come together to society. Therefore any institutional attempts unity, solidarity and accountability. The credit programme was launched with an ultimate like Microfinance aiming at women address their common problems. Their services are obtained only through the SHGs objective of complete poverty eradication by empowerment should be encouraged for the regular voluntary savings are pooled to the member women. The amount of each 2008. It followed a methodology of creating overall upliftment of the society apart from a together to make small interest- bearing loan and the priority of disbursement are Neighbourhood Help Groups (NHGs) among sustainable business model. loans to their members. Thus, they imbibe decided by the SHG members. The interest women who were involved in many collective the essentials of financial intermediation income from thrift is generally used for re- activities like diary farming, handicrafts, 4. Women Empowerment Though including prioritization of needs, setting terms lending. The interest rates are usually steep, fishery, nursing etc. Kudumbashree has Microfinace and conditions and keeping accounts, building averaging 2 percent per month. SHGs are free successfully launched microcredit system to Microfinance refers to small savings, financial discipline in all of them. They also to charge any interest rate they believe meet the poor women’s inaccessibility to credit and insurance services extended to learn to handle resources of a size that is prudent, though the commercial bank charges banking. The financial empowerment

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 333 Mitigating Gender Inequality: Road to Development Gautam M Pillai & Anushital 334 achieved through thrift accessibility intends for mitigating Gender Inequality should be 5.2.1 Backward and Forward value chain are responsibility of the SHGs. to improve their social status. formulated in a manner which accommodates Integration through SHGs This motive can be realized through forward all sections of the society. At an individual level, and backward integration where the former This success story should be To reduce their credit risk, the a feasible solution to mitigate the problem is ensures finding proper markets, right prices replicated in the other parts of India as well microfinance institutions have to go one step and customers for the products and services especially in regions where the Human through active participation of NGOs which further to guarantee the proper utilization of provided by the enterprises availing Development Indicators (HDIs) are facilitate microfinance solutions. Broadly this the disbursed funds. Reducing exploitation by microfinance facilities. Backward integration substantially low like Bihar, UP, MP etc. can be further bifurcated into solutions for the issues faced by rural and urban women. middle-men and providing symmetric can help them find suppliers and raw materials 4.4 Is Access to Sound Financial Service information to all the women included in the to carry out the respective activities Synonymous to Empowerment? 5.1 Urban Women Empowerment Formulation of sound SHGs having In comparison to their rural Figure 2: Backward and Forward Integration through SHGs organized structures and which are self sufficient counterparts, urban women are empowered is the responsibility of the State and Central to a great extent in terms of education and governments. Let us assume that ten years down job opportunities. The awareness and Other the line, India has a sound micro-finance network exposure levels among urban women are Women through SHGs and 75% of the women have generally high and hence microfinance access to financial services. Does this imply solutions can be introduced among them empowerment? The whole idea of women efficiently. NGOs can design micro- empowerment would go down the drains if the enterprises for unemployed but educated Inspiration (Trickle rural women get loans and services from SHGs women and can have awareness programs down Effect) to satisfy their husband’s or in-law’s demands. to make them socially and politically active As explained earlier empowerment should so that they can leverage it for their happen in economic, social and political terms. advantage. Women’s clubs and social Attaining high levels of literary is one of the most gatherings can be organized by NGOs as a Suppliers Business Buyers important factors for empowerment. The measure in this direction. run by Southern-most state of Kerala is the best 5.2 Rural Women Empowerment Women example in this case. Kerala has 88% female literacy rate as against 54% of entire India4. As A lot of business opportunities have a result of which “The God’s Own Country” been identified in rural India by several experience very low levels of gender inequality academicians and researchers in this field. Produced Management guru C K Prahlad defines this Goods as compared to rest of the country. Raw Funds & as “the fortune at the bottom of the Training Materials Payment 5. Sustainable Solution Model pyramid”. Efforts need to be made by Most of the steps taken in the direction individuals to capitalize such opportunities of mitigating gender inequality have been State and channelize them in a way that will or Central government initiatives with the aid of empower women. Microfinance can be global agencies like World Bank, ADB, UN etc. leveraged in many ways for attaining MFIs with SHG sustainable women empowerment. A few Individual efforts and participation are required Payment model Goods to make such initiatives more effective. In a of those are being discussed in the following diverse country like India, a sustainable solution sections.

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5.2.2 Women Employment through SHGs drinking water supply in schools. Another Figure 3 : Mitigation of Gender Inequality initiative can be to set up day care for small In addition to providing credit, kids in particular areas who are otherwise microfinance institutions can themselves get taken care of by the young girls when their involved in small business startups thereby mothers go out for work. providing employment opportunities for rural women. This will also prove to be a training The above mentioned steps are ground for women who intend to acquire skills purely individual efforts which can help in to start their own entrepreneurial units in future. bringing down the drop out rate in schools and education is an inevitable feature of 5.2.3 Providing Loan Products empowerment. Exclusively to Women 6. Conclusion Taking a cue from Grameen Bank of Bangladesh, Microfinance institutions and The key elements of the above NGOs should insist on giving loan products discussions have been depicted in the figure like home loan, farm equipments loan etc only below. It shows a vicious cycle where gender to women. Further they should take measures inequality leads to greater poverty, slower to ensure that the assets are registered in the inequality and low living standards. To break name of women. Such measures will help in this chain, mitigation of gender inequality is required and this paper analyses one of the reducing domestic violence against women and Notes most feasible solutions which is women their abandonment by men. 1. Govind, Kelkar (2005): “Development Mayoux, Linda. Microfinance and the Empowerment empowerment through microfinance. Effectiveness through Gender Mainstreaming”, Of Women: A Review Of The Key Issues. 5.2.4 Spreading Awareness and Providing Economic and Political Weekly, 29 October. Support for Women Education Educating women about the various Mayoux, Linda (2006): “Sustainable Microfinance For functionary aspects of small scale farming 2. Vimal, Gokhale : “The Women’s Reservation Bill”, Women’s Empowerment”, International Mutual NGOs through a proper network of and giving them general awareness about how Combat Law, Vol.4 Issue 6. Learning Workshop, IFMR, Chennai, India. September. SHGs should also provide awareness among the money given by MFIs can be utilized 3. NABARD, 2005. the rural women regarding their social, political 4. UNDP, 2003. Menon, Rathi (2006): “A Silent Revolution, should be in the primary agenda of the SHGs. Kudumbashree”, Kerala Poverty Eradication 5. Ministry of HRD, 2003. and legal rights. As explained in the previous The member women of the SHGs should be Model, June. References section, access to financial aid may not empowered enough to handle their own NABARD Report 2005 necessarily empower women. household budgets thereby succumbing less Acharya, M and Ghimire,P (2005): “Gender Indicators Raghavan,V P (2006): Livelihoods and Empowerment of Equality, Inclusion And Poverty Reduction: to male domination. This will help in the :The Kudumbashree Projects in Kerala ,India- Apart from this, providing support for Measuring Programme / Project Effectiveness” economic empowerment of women. As A New Paradigm of Participatory Economy,July. promoting education at the grassroots level, Economic and Political Weekly, 29 October. SHGs are a society initiative where like- Reddy, C S (2005): Self-Help Groups: A Keystone Of these SHGs should take effective and Gokhale, V: “The Women’s Reservation Bill”, Combat minded people come together, the social Microfinance In India –Women Empowerment Law, Vol 4 Issue 6. innovative measures. Out of a total of 1024996 empowerment part will be well taken care and Social Security, October. schools in 2003, 45.9% did not have toilets and Kadiyala, Suneetha (2004): “Scaling Up Collective of. Political empowerment should also be Swain, R B (2006): Microfinance And Women’s Action for Poverty Alleviation and Women’s 17.3% did not have water supply. 58% of girls Empowerment Evidence From The Self-Help made possible through awareness campaigns Empowerment”, Discussion Paper, Food dropped out of school before reaching class Group Bank Linkage Programme In India, Sept. and giving specific importance in particular Consumption and Nutrition Division, May. VIII as an indirect consequence of this to women. Making them accountable and UNDP Report 2003 fact.(Ministry of HRD 2003). Kelkar, G (2005): “Development Effectiveness through responsible for the political happenings in a Gender Mainstreaming: Gender Equality in Vaid, D (2004): “Gendered Inequality in Educational particular area should prove to be an efficient Poverty Reduction in South Asia”, Economic and Transitions”, Economic andPolitical Weekly, Individual efforts by NGOs and SHGs August. can be taken to provide proper sanitation and strategy. Political Weekly, 29 October.

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The Prospects of Economic Integration of South Asia The term ‘economic integration’ through democratic means, these attempts with Regard to Intra-Regional Conflicts and Tensions encompasses broad areas of socio-political, have often been frustrated by the background economic and cultural links with nations joining of colonial rule and societies behest by Arvind Adityaraj together in a forum generally belong to one or extraordinary religious, ethnic, and linguistic several regions.2 The Association of South complexity. Among the issues related to Abstract welfare, the most important concerns of South The process of economic integration with regard to the ongoing conflicts East Asian Nations (ASEAN), European and tensions has been taken as panacea for preventing any future escalation Union (EU), North American Free Trade Area Asia include limiting population growth, raising of tension. It has brought historically rival countries under one umbrella in (NAFTA) are few examples of such literacy levels, and addressing environmental Europe and South East Asia. The concept ‘economic integration’ leads to peace is not workable in every possible setting, however. By taking South integration. The degree of economic degradation. South Asia today contains 20% Asia as an example, this article will make an endeavour to answer the question integration ranges from Preferential Trade of the world’s population. At present levels of whether economic integration is conducive to peace. Despite attempts to Arrangements (PTA) to Free Trade Area growth, the most recent World Bank bring countries together through the process of economic integration, thanks to the initiatives taken under the auspices of SAARC (South Asian Association (FTA), Customs Union (CU), Common Market projections for the year 2025 put India’s for Regional Cooperation) – neither peace nor the process of economic (CM) and Economic Union (EU).3 population at 1.3 billion, Pakistan’s at 244 integration itself has been fully realized in South Asia due mainly to inter and million, Bangladesh’s at 180 million, Nepal’s intrastate conflicts. The article traces the process of evolution and prospects An Overview of South Asia of peace through regional economic cooperation in South Asia and argues at 38 million, and Sri Lanka’s at 24 million. that the legacy of state formation in South Asia to some extent pre-empt any Viewed from either the global or These high rates of population growth threaten sort of regional cooperation. Political strife’s rooted on the religious and to undermine the benefits of economic cultural belief surrounding the countries of South Asia show somewhat regional perspective, South Asia provides a uncompromising picture for the full-scale of integration in the region and disappointing picture in every social, economic, development, as well as advances in hence the peace thereof. The article ends with a cautious positive note that and political context. This is due to the fact agricultural productivity, and place massive durable peace through regional economic integration in South Asia is not pressures on the land and its resources. With impossible in the present settings. that South Asia is almost perpetually plagued by various domestic and intra-regional conflicts a substantial population living below the and crises originating from myopic attitudes poverty line in most of the South Asian of the largely illiterate masses and the countries (one-third, in the case of India) and Introduction The present international economic lackadaisical approach of the ruling elite with extremely low Physical Quality of Life situation, characterized by stagnant growth, Indices (39 for a well-established democracy The formation of regional integration toward resolution of such problems. Moreover, recessionary conditions and protectionist like India), none of these nations can really has been greatly successful in brining constant and often excessive preoccupation tendencies in the developed countries has afford added detriments to their overall growth historically hostile countries together. The with internal problems renders such states seriously underpinned the economic growth and progress. In fact, the South Asian region factors that push countries closer are both highly vulnerable to external threats and in developing countries.1 The worsening terms contains more people living in abject poverty economic and political but economic factors interference, which also challenges their of trade, acute balance of payment crisis and than any other region of the world. In terms have always prevailed over the political ever sovereignty and consequent legitimacy. In debt burden on developing countries have of providing for these people, the nations of since the formation of nation states – the other words, the persistence of multifarious further crippled the potential economic the region are required to come closure for classic example is the states in the European problems, both within and between the South growth of these countries. Therefore current having an integrated economy. However, Union and the South East Asia where Asian states, hampers the sustenance of an world economic conditions underscore the Politics have prevailed over economics and economic dimension have brought long time environment wherein the basic essential needs need for a greater economic cooperation political disputes have prevented the formation foes in the same dais. of the common man are fulfilled. among the developing countries. of cohesive economic bloc in South Asia. Taken collectively, though the Despite the slow pace of economic governments of India, Pakistan, Bangladesh, cooperation, there is an increasingly greater Sri Lanka, and Nepal have been making efforts urge to forge an economic cooperation on the Dr. Arvind Adityaraj is a Senior Lecturer, Post Graduate Department of Political Science, College of Commerce, Patna-800016, Bihar, India. (A constituent unit of Magadh University, Bodh Gaya) to improve their socio-economic conditions lines of European Union and Association of

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South East Association for Cooperation inexplicably brought forward to 2001. caretaker Prime Minister of Nepal in his final Certain serious misgivings about (ASEAN). The smaller countries are However, in the following year – voicing retreat from the state affairs just to appease the SAARC developing into a vehicle of especially keen for such cooperative concerns of some member states – the Indian rulers.) Disputes between India and purposeful and effective cooperation among mechanism. Bangladesh has been pioneering Eminent Persons Group proposed a longer Bangladesh are over illegal migration from the the member countries are created by the the efforts of regional cooperation despite the timeframe of 2008. But the constant Chittagong Hill Tracts (CHT) and the history of the subcontinent, which has been lukewarm response by India and Pakistan. reversals of dates did not help in instilling demarcation of boundaries involving fertile replete with conflicts and discords. On top of confidence that SAARC had carefully islands5. this, since its inception in 1985 there have Although SAARC was established in thought out its agenda. Rather, it appeared also been serious differences among member 1985, the South Asian Preferential Trade far too hasty in setting itself an ambitious Divergences are also manifest in countries over the aims and functioning of Agreement (SAPTA) was accepted only in timeframe for the establishment of SAFTA, values and principles followed in governance SAARC (The main point of debate hinges 1993 and came into operation with the without due consideration to overcome the and statecraft. The Indian political system has on the Charter of SAARC which does not ratification of the first round of negotiations problems and challenges it was likely to face. been professedly a blend of democracy, allow bilateral issues to be discussed at the only in December 1995. Developments in the federalism, secularism and socialism. regional level summit diplomacy). Such Intra-Regional Conflicts global trading system undoubtedly exerted Bangladesh and Pakistan are Islamic states differences have been pronounced in verbal where the influence of religion runs very high their own influence on South Asian South Asia is one of the ‘critical bickering in several SAARC meetings. This as an instrument of political profiteering rather policymakers. South Asia was increasingly regions with complex security’ in the world is in the face of the fact that closer social, than indicator of prevailing public opinion. being marginalized as a region – Europe, North primarily due to the fact that most of the economic and cultural ties (the espoused Maldives is an Islamic society with relatively America, Latin America and South East Asia South Asian states are engulfed with varying ideals of SAARC) are considered the one lesser influence of religion in politics. Nepal were all moving either in the direction of degrees of conflicts and disputes. Intra- and only hope for building regional cooperation remains under Hindu influence while Bhutan forming new regional trade arrangements or regional conflicts in South Asia probably are efforts in South Asia in the coming years. and Sir Lanka are Buddhists societies. Not strengthening existing ones. For South Asian highest compared to any other regional blocs. Indeed, increasing rationalization of world surprisingly, a leading scholar of South Asia countries, in the absence of an entry point into Bilateral relations are defined by antagonism trade and the fluidity of the emerging global remarked that ‘South Asia presents as a more dynamic regional body, the second- and mistrust. The differences between India system has increased trade within each trade different political order and powers structures best option appeared to be to cooperate and Pakistan over Kashmir, between Sri blocs and those countries that do not belong as one seldom finds in any other geo-political amongst themselves in the hope that it would Lanka and India over the nationality of to any trade blocs are likely to be the losers. region of the world’.6 generate political goodwill, if not actual Tamilians, where Sri Lanka accused India, This also provides a strong rationale for economic benefits in the medium to longer especially state government of Tamil Nadu Almost inexorably, South Asian nations, sustaining the SAARC vis-à-vis future trade term. The first round of trade negotiations for supplying arms and providing trainings despite their apparent adherence to the ideal prospects of South Asia. covered only 226 products, largely of little to the Tamil terrorists in its Southern areas of nonalignment, have pursued extremely dis- relevance to the actual trade that was taking Economic Integration are only two of the most outstanding consonant foreign policies. Consequently, the place amongst the member countries, 4 examples in this regard. The problems major global powers have played their roles The proposal of economic integration sufficient to build enough confidence amongst between India and Nepal exists regarding in aggravating the intra-regional cleavages of among South Asian countries has long been the regional partners to actually initiate a an open border and the Indo-Nepal Treaty South Asia. Finally, India’s overwhelming discussed. The basic reason for such proposal dialogue of taking South Asia from a of Peace and Friendship of July 1950.( The regional preponderance creates certain basic has been the acute under development of the preferential agreement to a more intense level Treaty of Peace and Friendship between insecurities and sharp differences between region. The sources of capital accumulation of integration in the form of a regional free India and Nepal is a major point of debate India and its neighbourhood. All these aspects are limited, and the most promising source of trade area. In principle, the concept was between India and Nepal as it completely have created a multitude of problems for the foreign exchange is the export of industrial accepted by member states in 1996 and a date ignores Nepal’s right to decide anything on South Asian region. These problems raw materials to the industrial West. The of 2000 but not later than 2005 was proposed its own sphere. Some academicians of collectively boil down to a crisis of legitimacy, prospects for increasing domestic capital for the establishment of SAFTA. Thereafter, international law believe that the treaty itself welfare, and order in the affected area. generation and accumulation are essentially at the 1997 Summit in Male, the date was was illegal because it was signed by the the same as for the general economic growth

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 341 The Prospects of Economic Integration of South Asia Arvind Adityaraj 342 of which capital accumulation is a vital part. regional trade among South Asian countries duties down to 20 percent in the first phase of cooperation would point to monetary Population increases and the obstacles to was only 4.5% of total exports in 2003 as the two year period ending in 2007. In the cooperation thereby suggesting the need for industrialization becloud these prospects. compared to21.2% of ASEAN countries. final five year phase ending 2012, the 20 greater coordination among Central Banks. Most of the countries in the region have largely There is no denying the fact that South Asia percent duty will be reduced to zero in a series Sustaining trading links would require agricultural economies and depend heavily on has great economic strength in terms of of annual cuts. The least developing country investment cooperation involving public and primary production. Primary production can market potential, rich natural resources and group in South Asia consisting of Nepal, private sector cooperation through joint be as profitable as industrial production, even human capital. Considering the huge Bhutan, Bangladesh and Maldives, gets an ventures. Investment cooperation would need in commercial terms. But it is obvious that comparative advantage that these countries additional three years to reach zero duty..7 to be underwritten by financing through a profits from primary production are most have in export sector, the increased regional prospective South Asia Development Bank. The free trade agreement was effective in terms of general economic growth trade through an integrated economic It would follow from such levels of considered to be a big move towards the goal when the total size of the population is arrangement is likely to benefit the South cooperation that the governments would of regional economic integration. However, relatively small and when the bulk of the labour Asian countries especially smaller countries. discuss, coordinate and exchange information the success of the agreement still seems far force is engaged in commercial rather than The protectionist policies of the Western with a view to adopting common positions, from certain. Doubts are being expressed that subsistence production. This is not the case countries and increased emphasis on regional where appropriate, at multilateral forums. SAFTA may not deliver as expeditiously as in South Asia which is the most heavily blocs also necessitate the fact that promotion required without separating trade from politics populated region of the world. In such scenario, of regional trade would eventually be In each of the above-mentioned of bilateral conflicts and overcome a tendency the possible economic union can enable the inevitable. The counter argument to the idea areas, there would be scope for deepening to dominate and fears about hegemony of one regional countries to trade in the primary of relatively free and fair trade in South Asia cooperation. The Free Trade Area could over the others. Faced with the challenges of production at a cheaper cost .Moreover, the lays stress on the political disputes that seem evolve into a Customs Union with a common an irreversible globalization, growing export of primary products from smaller to effectively marginalize the attempts of tariff barrier with the rest of the world. The engagement with numerous bilateral and countries to relatively more industrialized India economic integration. Customs Union could lead to a common multilateral Free Trade Areas (FTAs), within and Pakistan can reduce the cost of exchange rate policy and eventually a and beyond the region, and quite radical production. The economic managers of the common currency underwritten by region are cognizant of the importance and reduction in tariffs under structural adjustment coordination of macro-economic policy Countries in South Asia have more potential of a free trade arrangement in program of IMF, undertaken by most South across the region. Energy cooperation could socio-cultural similarities than European South Asia. The initiation of SAARC Asian nations, it is essential that member evolve into a common energy grid across the Union and ASEAN. The experience of Preferential Trade Arrangement (SAPTA) countries of SAARC take a big stride.8 region with integrated electricity and gas ASEAN proves that economic benefits can in 1996 was an attempt in this direction. In systems as is the case in Europe today. Deepening Cooperation in South Asia drive the countries to focus more on continuation of SAPTA, an Agreement on Transport cooperation would lead to an convergences rather than divergences. the South Asian Free Trade Area ( SAFTA The key Summit decisions indicate a integrated transport infrastructure which Moreover, European Union has been able to ) was reached at the 12th SAARC summit commitment towards deepening cooperation permits uninterrupted travel from Peshawar integrate developed countries like Germany at Islamabad in 2004. It creates a in South Asia. The SAFTA agreement is only to Chittagong and from Kathmandu to and France and under developed countries like framework for the creation of a free trade the first stage in this direction. However, if Colombo as in the European Union. Lithuania and Latvia. The key seems to be zone. SAFTA aims to arrive at zero customs South Asia’s trade is to be integrated, it will Investment cooperation would culminate in political will, not economic and cultural duty on the trade of practically all products require integration of the infrastructure of the regional corporations with production facilities uniformity. in the region by the end of 2012. The new region. This would point to cooperation in the located across the region within vertically and agreement will be operational following the horizontally integrated production systems. Free and Fair Trade Agreements areas of energy as well as the strengthening ratification of the agreement by the member of transportation, transit and communication Shares of both national and regional It is ironic that intra-regional trade governments. SAFTA required the links across the region. This would further companies would be quoted in the stock among SAARC countries is lowest among all developing countries in South Asia that is, require harmonization of standards and exchanges across the region as capital flows similar regional arrangements. The intra- India, Pakistan and Sri Lanka, to bring their simplification of customs procedures. Trade without hindrance across national boundaries

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 343 The Prospects of Economic Integration of South Asia Arvind Adityaraj 344 to underwrite investment in any part of the Lanka, it is widely believed that the less developed countries. As in the case of integration is perhaps the most urgent since South Asia region.9 expectation of servicing a market of one the European Union, a special fund is needed it is integral to the operationalization of a free billion people in India will open up new to enhance the development capacity of trade area. South Asia inherited an integrated Moves towards deepening investment horizons. Given the opportunities weaker countries to enable them to enhance transport infrastructure from the British who cooperation would have to take the ultimate for unrestricted access to an integrated South their competitiveness in an integrated market. were themselves bequeathed a road network step, which today binds Europe, by integrating Asian market, deep structural changes in Billions of Euros were invested through the by the Mughal Empire. This infrastructure our labour markets. Today in Europe any their production capacities which can expand EU in such funds, to finance investment in was fractured not by the partition of India European can move across national and diversify the basket of goods available Spain, Portugal, Greece and Ireland when they but by its political aftermath and now needs boundaries to seek work anywhere in the for export are essential to transforming the entered the EU, to enable them to upgrade to be rebuilt within the context of greater region. The countries of South Asia would fortunes of the smaller economies of South their infrastructure and enhance their political harmony in South Asia. need to aspire to a similar situation in South Asia. Structural changes have the potential competitive capacity. A similar fund, Across the mainland of South Asia Asia after making due allowances for our of transforming the dynamic comparative underwritten from within SAARC but the original transport infrastructure is already prevailing social and political realities. The first advantage of an economy and can, supplemented by aid resources from outside in place, but in many areas has fallen into stage in deepening cooperation would be to therefore, never be adequately captured in the region should be established to enable disuse or needs upgrading. The main obstacle enhance trade. For a region which aspires to the static gravity models used to forecast Bangladesh, Bhutan, Maldives, Nepal and Sri to improving connectivity is political. The an economic union, it has one of the lowest gains from regional cooperation. Business Lanka to invest in infrastructure projects. barriers to cross-border movements make levels of intra-regional trade anywhere in the houses in India and outside investors could Investment which modernizes and enhances neither commercial or logistical sense and world. While this originates from prevailing also be expected to adjust their production capacity in transport and communications as originate in the pathologies of inter-state as trade barriers in each country, the more base by locating plants to serve South India well as energy, perhaps with a special focus well as domestic politics. The political leaders substantive constraint lies in the structural in Sri Lanka or Northeast India and Eastern on regional connectivity but not exclusive to of South Asia will therefore need to first asymmetries in the national economies which Bangladesh rather than servicing them from it, will enhance the attractiveness of these dismantle the political barriers to transport limit the scope for trade. Moving towards Mumbai or Kolkata or Bangalore. New economies to prospective investors. integration. Once this is done, procedures for SAFTA is the first phase in a process of patterns of vertical and horizontal integration, A second fund should be established facilitating cross border movement of people deepening economic cooperation. The with plants located across the region, could as an Investment Fund, serviced by both and goods will need to be harmonized (visas, problems to be faced at this stage remain less serve to restructure the manufacturing public and private capital, to finance private customs facilities) and system connectivity severe than may be apparent at first glance, landscape of South Asia.10 but one should not underestimate the enormity sector investment projects within the weaker will have to be established. Infrastructure of the challenge. The proposal for a dedicated South economies, which involve cross border where fractured will have to be rebuilt or Asian development fund may also be investment as well as projects for serving upgraded to sustain a heavier traffic load and Investment Cooperation encouraged. The Fund was endorsed by regional markets. This should attract capacity will need to be expanded to The move towards SAFTA will be SAARC more than a decade ago but has prospective investors from India and Pakistan accommodate the enhanced traffic meaningless unless the issue of stimulating been virtually stillborn. The Fund’s mission and could be used to leverage further private emanating from intra-regional movements. In investment in the region, particularly in the needs to be clarified and new life needs to investment from outside the region which may some cases new investment would be needed less developed areas, including Sri Lanka, is be breathed into the organization. There is even cover private investment in infrastructure to build transport links where none exits today. some confusion as to the scope of this fund projects. accelerated. The substantive point of a free So far SAARC has done very little and whether it will cover both financing of trade area is for small economies with narrow Integrating the Infrastructure to address the issue of transport integration. infrastructure projects as well as private markets, such as Bangladesh, Nepal and Sri Some meetings have been convened by the investment. Here it is suggested that two The Islamabad Summit quite appropriately Lanka, to be able to use the incentive of the SAARC Secretariat to look at the issue of funds may be developed. One fund should identified energy, transport and larger South Asian and particularly Indian standardizing the transport infrastructure but be dedicated to financing infrastructure communications as important areas for market to stimulate enhanced investment from there is no strategic vision to guide the within and without. In Bangladesh as in Sri development projects mostly located in the cooperation. Of these, the need for transport

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 345 The Prospects of Economic Integration of South Asia Arvind Adityaraj 346 integration process largely because of the point for connecting the vast energy the scope for a Customs Union. This issue out at Colombo, and at New Delhi, has underlying political tensions which constrain reserves of West and Central Asia to South will not be as complex as it might have examined the implications of moving towards issues of transport connectivity. Whatever Asia but has not been able to benefit from appeared some years ago. Under the pressure exchange rate harmonization and eventually dialogue on improving linkages has taken place its strategic location because of its political of the WTO convergence in tariff levels a common currency. Both studies have owes either to the enterprise of multilateral tensions with India.14 across the world is the order of the day. Since recognized that any move in the direction may bodies such as the World Bank, Asian all SAARC countries have been lowering their be premature. However, what has emerged The SAARC governments have Development Bank or UNESCAP or civil tariff rates, mostly under pressure from the out of these civil society consultations is the already recognized the need for cooperation society initiatives. The mandate from the World Bank/IMF structural adjustment suggestion that a parallel currency rather than in the energy sector. The Summit in Islamabad Summit has inspired the SAARC reforms, the deep disparities in tariff levels a common currency may be put in place Islamabad reaffirmed this interest. A Secretariat to place the issue of improving which once characterized the region are less largely to underwrite trade and investment transport linkages on its work programme. meeting of SAARC ministers was held in Dhaka in 2003 to explore the scope for apparent toady. It, therefore, makes sense to transactions in the region. So far little or no However much work is needed to both design open up discussion on adopting a common discussion at the official level has taken place an underlying vision and then translate it into cooperation. But so far very little has been done to work out the economics or explore tariff policy vis-à-vis the rest of the world. It among SAARC finance ministers on macro- programmes and projects which free up would therefore make sense to initiate work economic policy. 11 the political implications of such cooperation. movement of traffic across South Asia. on the implications of a Customs Union within At the level of civil society a Task Force Integrating Labour Markets Energy Cooperation was set up to explore the scope for South Asia in order to see when, under what cooperation. Its report identified the circumstance and at what pace such a Union To the extent that SAARC South Asia is, in aggregate, an energy attendant benefits as well as the complex can be put in place. governments may remain inhibited about deficit area largely because India is emerging issues of politics, ownership, pricing and discussing the problem of labour flows it is as one of the world’s largest energy markets. Deepening integration will involve management associated with building suggested that at the level of civil society In contrast, Nepal and Bhutan retain the moving beyond trade to address the broader energy linkages in the region. This report serious discussion of the issue should take potential to emerge as major sources of issue of harmonizing macro-economic policies. was presented to the SAARC Summit in place. These dialogues would need to be energy exports though harnessing the vast This would cover areas such as fiscal, Islamabad. Another study by the Coalition backed by major research on the underlying hydro power potential in their rivers. Indeed monetary and exchange rate policies. Such a for South Asian Cooperation (CASAC) has economics, the social implications in the power is already Bhutan’s largest source of level of cooperation would demand taken the work of the Task Force forward receiving and sending countries and the export earnings directed to India which has coordination amongst SAARC finance and completed a more comprehensive study political fallout from this process. Such an helped to make it the only country in the region ministers to ensure that their budget deficits, on energy cooperation. There is a need for exercise should recognize that important with a trade surplus with India. However, inflation, exchange and interest rates maintain both SAARC and civil society institutions issues of human rights as well as national Nepal’s export-oriented hydropower projects some element of alignment. Such issues have in the region to come together to draw a security are involved along with the criminal have been tied up in protracted negotiations never been discussed at any level within substantive and implementable programme dimension associated with human trafficking with India, its principal prospective market for SAARC. Coincidentally, such macro- for energy cooperation which can be of women and children. It is hoped that out power. These negotiations have acquired economic indicators, with episodic variations, discussed more comprehensively by the of such research and consultation, a realistic political overtones which have strained have in recent years not significantly diverged SAARC governments before concrete and humanitarian policy will emerge which bilateral relations and have also become a across the SAARC countries. However, this proposals for cooperation are placed before can serve to formalize the process of labour major issue in domestic politics in Nepal. cannot always be the case so that some the Summit. flows and integrate this into the process of Bangladesh has a potential for exporting consultation, if not coordination, amongst economic cooperation in South Asia. Such natural gas to India but is reluctant to do so Harmonizing Macro-Economic Policies finance ministers would be in order. because of domestic political opposition to an exercise will need to recognize that if a Any move towards an Economic such exports on the grounds that its gas The more advanced move towards a South Asian Economic Union is to emerge Union cannot limit itself to a free trade area. reserves are insufficient to justify such common currency lies even further ahead. The labour market integration will have to be a SAARC will sooner or later have to explore exports. Pakistan remains a potential transit two studies on monetary cooperation carried central component of the process.

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Peace and economic integration: not qualify until they discarded their finally, they should settle all their disputes endemic conflicts and mistrust in the region, An analysis dictatorships in the 1970). This drives home through peaceful bilateral negotiations.13 But the fact that the formal cooperation process the point that political harmonization must in reality it has never been applied or discussed in the region has survived recurrent setbacks Economic cooperation yields peace at the policy level. Indian bureaucrats were is testimony of resilience of the organization. and prosperity if the differences among the precede economic harmonization. The same skeptical about the idea. Also once Gujral was The antagonistic nature of relations with large member states are put aside. Current level of pattern is evident in the ASEAN, which was out of power, the doctrine went with him. sets of outstanding issues, low levels of intra- cooperation in South Asia, however, is formed as a political grouping to oppose threat of Communist expansion from SAARC trade and joint economic ventures, manifested by historical legacy of state There are growing concern that Vietnam and China. This helped bring inadequate information and infrastructure formation as said earlier; economic well-being regionalism in South Asia might end up as a together ASEAN members that were facilities; independent and largely and the size and power of individual states. great fiasco concerned efforts are not made uncoordinated economic policies pursued by The spontaneous Indo-Pakistan tensions have otherwise dogged by political disputes. These beyond the turmoil of political exigencies. Even each country in the subcontinent and put a damper on any kind of activities to factors hardly exist in South Asia. the newly formed SAPTA has met with increasing ‘militarization’ of the region are increase the pace of economic integration and extremely limited success in promoting intra- To create a sense of ‘easiness’ all indicators of lack of ‘region-ness’ and bring about peace in the region. It seems that SAARC trade. (Under SAPTA, SAARC among her neighbour, the former Indian herald a bleak future for any type of powerful nations of South Asia are not countries have agreed on tariff provisions only Prime Minister I K Gujral adopted a doctrine sustainable economic integration. The interested to accelerate economic integration on 226 objects). Similarly, hopes of forming a called ‘Gujral Doctrine (I K Gujral first realization of durable peace and the future of towards its stipulated goals. Hence ‘unless South Asian Free Trade Area (SAFTA) became India’s foreign minister and then economic integration through SAARC lies on there is a dramatic change between India and considered being more unrealistic. For Prime Minister in mid 1990s enunciated the ability and interest of South Asian leaders Pakistan relations and they commit their instance, a free trade implies to dismantling Gujral Doctrine’) as a tool of conflict to resolve domestic as well as long-standing genuine interest chances of SAFTA coming customs barriers, which means all SAARC management in the region. The Gujral intra-regional differences. Any realistic into action are very low, let alone the prospects members will have to agree on a common Doctrine is a set of five principles to guide assessment of the prospects for the growth of peace”. import policy, either formally or informally and the conduct of foreign relations with India’s of economic integration depends on as how no country will retain sovereignty over the South Asia also holds the dubious immediate neighbours. Among other factors, individual country address existing contentious import policy.14 However, it is felt that unless distinction of lacking economic incentives for these five principles arise from the belief issues and their commitment in promoting countries of a region enjoy considerable regional cooperation. History shows that that India’s stature and strength cannot be regional cooperation given the extensive political harmony, they cannot possibly agree regional economic integration can be divorced from the quality of its relations with heterogeneity of state formation and on concessions like surrendering sovereignty successful only if the countries concerned its neighbours. It, thus, recognizes the economic dynamics in South Asia establish a commonality of political purpose. supreme importance of friendly, cordial over their import policy. Lessons from other parts of the The driving forces behind regionalism should relations with neighbours. These principles Conclusion be to forge closer links between historical are: first, with neighbours like Bangladesh, world (such as neighbouring Southeast Asia) rivals to prevent the occurrence of wars. As Bhutan, Maldives, Nepal and Sri Lanka, South Asia has emerged as a regional prove the fact that regional organizations have in the case of France and Germany who India does not ask for reciprocity, but gives entity in the international political system with thrived mainly on cooperation in trade and fought three titanic wars between 1871 and and accommodates what it can in good faith the creation of SAARC but it failed to economic relations that bring visible and 1945 but were able to thaw differences through and trust; second, no South Asian country strengthen regional cohesiveness. Regional tangible benefits to the people. The EEC. The Cold War gave western European should allow its territory to be used against cooperation in South Asia cannot be said to emergence of several trading blocs and nations another urgent reason to bind the interest of another country of the region; have evolved into a complete bloc in terms of economic groupings all over the world clearly economically together to gain strategic third, no country should interfere in the ‘regionalism and economic integration’ due indicates that the economic survival and strength. Finally, basic EEC rule was that only internal affairs of another; fourth, all South mainly to the prevalence of conflict over the prosperity of any nation in this increasingly democracies could become members (which Asian countries must respect each other’s desire of peace and stability. Given the competitive post-Cold War era crucially meant that Spain, Portugal and Greece did territorial integrity and sovereignty; and, historical legacy and contemporary reality of depends on its ability to successfully integrate

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 349 The Prospects of Economic Integration of South Asia Arvind Adityaraj 350 with other economies. Despite some 3. Ibid. p.146 References Durrani, Mahmud Ali (2002): India & Pakistan: The Cost of Conflict and Benefits of Peace, Oxford indications to the contrary, it would not be 4. Zaglul Haider (2001): “Crises of Regional Adelman, I and Robinson, S (1978): Income Distribution University Press, NY. erroneous to state that the prospects as well Cooperation in South Asia”, Security Dialogue, Policy in Developing Countries: A Case Study for as compulsions for enhancing regional Sage Publications Vol.32 (4) p.427. Korea, Stanford University Press, Palo Alto. Falk, R (1997): “Resisting ‘Globalization-from-above’ through ‘Globalization-from-below’,” New cooperation in South Asia are tremendous. In 5. Bhanot, Monica (1999): “Challenges to Regional Ahmed, Khaled (2005): “South Asia’s Unresolved Political Economy, 2 (1): 17-24. fact, according to certain analysts of South Cooperation in South Asia: A New Perspective” Disputes”, South Asia Journal, January – March. Asian politics, there has been a growing Online Journal of Peace and Conflict at http:// Frame, Mariko and Haider A. Khan (2007): “Deep www.trinstitute.org/ojpcr/toc2 3.htm, Issue 2.3, Baker, Dean; Epstein, G and Pollin, R (1998): realization among South Asian states of the Democracy : A Political and Social Economy August. Globalization and Progressive Economic Policy, Approach”, CIRJE Discussion Paper, downloaded importance and necessity of constituting South Cambridge University Press, Cambridge. from http://ideas.repec.org/p/tky/fseres/ 6. Rajan Mahan (1991): “The Nature of South Asian Asia as a region and looking for solutions to 2007cf469.html. Region: Assonant Affinities, Dissonant Barber, B (1995): Jihad vs. McWorld, Random House, the problems of resource and security Diversities” in Kaushik Mahan and Rampant New York. Gills, K B (1997): “Editorial: ‘Globalization’ and the management within a regional framework. (eds.), India and South Asia, South Asian Bhanot, Monica (1999): “Challenges to Regional ‘Politics of Resistance’,” New Political Economy Publishers, New Delhi, pp.24-5. Also see Once such a path has been well and truly Cooperation in South Asia: A new perspective”, 2 (1): 11-15. Iftekharuzzaman (1996): “The Nuclear Issue and adopted, South Asia can indeed begin to hope OJPCR, an Online Journal of Peace and Conflict Instability in South Asia: A Bangladesh Gilpin, R (1987): The Political Economy of International Resolution, Issue, 2.3, August. for a more effective role in the post-Cold War Perspective”, in P R Chari, Pervaiz Iqbal Cheema Relations, Princeton, New Jersey. P.40 global environment. In this context, it must and Iftekharuzzaman (eds.), Nuclear Non- Bhatta, Chandra D: “Regional Integration and Peace in Greenspan, A. (1997): Statement before the U.S. House Proliferation in India and Pakistan: South Asian also be remembered that without an integrated South Asia: An Analysis”, Peace Studies Journal of Representatives Committee on Banking and Perspectives, Manohar Publications, New Delhi, economic, technological, and military Financial Service’, Washington D.C., 13 pp.153-54 for a detailed argument. Bhattacharya, Mita; Smyth, Russel and Vicziany, technology, none of the South Asian countries Marika (2004): South Asia in the Era of November. 7. Bhanot, Monica, op.cit. can ever hope to become significant global Globalization, Nova Science Publishers, NY. Griffin K and Khan A R (1992): “Globalization and the players. Thus, akin to the problems of South 8. Ibid. Bose, Sugata and Jalal, Ayesha (1998): Modern South Developing World: An Essay on the Structural Asia, the solutions also seem to be intrinsically Asia: History, Culture, Political Economy, Oxford Dimensions of Development in the Post Cold War 9. Lama, Mahendra, P: “Energy Cooperation in University Press, New Delhi. Era”. UNRISD, Geneva. inter-related in nature. It must still be hoped South Asia”, available on that, however complex, such solutions will www.southasianmedia.net/conference/ Bosier S. (1997): The Elusive Goal of Regional Harris, Laurence (1998): “The Dynamics of ultimately be implemented in order to build an Regional_Cooperation/energy.htm Development: Between the Black Box and the Globalization: Eight Skeptical Theses”, Paper Political Agenda, Stantiago-Chile, Edificio CEPAL. presented at the UNU/AERC Conference, Tokyo, economically stronger and socio-politically 10. Bhanot, Monica, op.cit. August 3-4. more cohesive region called South Asia. Cohen, Stephen: “Nuclear Weapon and Nuclear War in 11. Hewitt, Vernon (1997): The New International South Asia: Unknowable Futures by South Asia in Hirst, P (1995): “Globalization in Question”, Political Politics of South Asia, Manchester University the World edited by Ramesh Thakur Economy Research Centre Occasional Paper Press, Manchester and New York , p.223. Number 11, The Political Economy Research Notes Cook, P and Kirkpatrick, C (1997): “Globalization, Center, Sheffield, England. 12. Lama, Mahendra P, op.cit. 1. Chawla, Kanhiya Lal (1991): Economic Regionalization and Third World Development”, Hussain, Ishrat (2004): South Asian Economies: Future Cooperation Among Developing Countries: With 13. Murthy, Padma (1999): “The Gujral Doctrine Regional Studies, 31 (1): pp.55-66. Challenges, South Asia Journal, October- Special Reference to SAARC, RSBA Publishers, and Beyond, Strategic Analysis”, A Monthly Dash, Kishore C (1996): “Political Economy of Regional December. Jaipur, p.1. Journal of the IDSA, Vol. XXIII No. 4, July. Cooperation in South Asia”, Pacific Affairs, Vol.69, James, J and Khan, Haider A (1993): “The Employment 2. Hussain, Moazzen; Islam, Iyanlur and Kibra, Reza 14. For further details see Singh, Ghanshyam N (ed) No.2. Effects of Income Redistribution,” World (1999): South Asian Economic Development: (1993): The Economy of the SAARC Nations, Desai, Meghnad (2004): “Development and Development, March, pp.817-28. Transformation Opportunities and Challenges, Anmol Publications, New Delhi. Rutledge, London. p.145. Nationhood: Essay in the Political Economy of South Asia”, Oxford University Press, New Dehli.

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————— (1997): “Technolgy Choice and Income ————— (1998): Technology, Development and Distribution” World Development, February, Democracy: Limits to National Innovation Regional Economic Integration and Development: pp.153-165. Systems in the Age of Postmodernism, Edward Sustaining Trans-regional Cooperation in South Asia Elgar, Aldershot, U.K. ————— (1998): Technological Systems and Sailaja Gullapalli Development, Macmillan, London. ————— (2004): Global Markets and Financial Crisis: Asia’s Mangled Miracle, Macmillan/ Abstract Jomo, K S (1998): “Introduction: Financial Governance, Palgrave. Liberalization and Crises in East Asia,” Tigers in The issues relating to the global economy and economic regionalisation have become Trouble: Financial Governance, Liberalization ————— (2004): Innovation and Growth in East central to international economic affairs. The increasing economic interaction and and Crises in East Asia, Hong Kong University Asia: The Future of Miracles, Macmillan integration is leading to open economies and there are massive trade and investment Press, Hong Kong, pp.1-23. flows to the benefit of many crisis-ridden economies. The co-ordination and Sartaj, Aziz: “South Asia; Melting Pot of Global Fault harmonisation of the policies between the regional groups expands trade linkages and Khan, Haider A (1985): “Technology Choice in the Lines” South Asia in the World, edited by Ramesh Energy and Textiles Sectors in Korea”, in A.S. Thakur facilitates greater economic interdependence. The paper intends to look into the origin, Bhalla ed. Technology and Employment in Industry, efficacy and the need to forge economic blocs. It also deals with the problems of regional ILO, Geneva. trade in South Asia, and what could be done to increase the trade flow without compromising on the environmental concerns. Khan, Haider A (1996): “Beyond Distributive Justice in the McWorld”, Global Justice, Spring/Summer, pp.30-40. Introduction stronger relations with their neighbours-both Economic regionalism has become a far and near and these efforts are based on universal phenomenon, with the degree of the consciousness to proceed beyond the integration spanning across the globe, even confines of the traditional approach of among the culturally heterogeneous nations. integration theories. Economic diplomacy With the expansion of markets and removal thus assumes an important role in the wider (partial or complete) of trade barriers, the context of the global trend towards regional trading groups are thus no longer regionalism and the success is more or less confined to a specific region. The growth of ensured depending on the bargaining and the regional economic zones is characterised negotiating strategies of the nations. The by new technologies in not only trade and regional groupings represent the collective investment, but also in knowledge intensive efforts of the states to fulfill their economic areas like computers and electronics. Foreign objectives and improve their bargaining direct investments, Technology transfers, joint position while retaining their autonomy. There ventures, co-production, cross-licensing etc. are divergent views on whether economic call for a wider area of co-operation and the regionalism is a viable alternative or not, regional trade agreements have greatly especially in the context of the globalisation facilitated these moves. of the world economy. These groups are also labelled as being contrary to the spirit of the Many a nation today, including India, multilateral trading system i.e. the World are engaged in sustained efforts in forging Trade Organisation.

The author is Research Associate, Gandhi Smriti and Darshan Samiti, Rajghat, New Delhi. Email:[email protected]

International Journal of South Asian Studies IJSAS July - December 2008 IJSAS 1(2) 2008, pp.352-362. ISSN 0974 - 2514 353 Regional Economic Integration and Development Sailaja Gullapalli 354

With this background, the paper national corporations (TNCs) has increased, to prefer a regional method or a system where economic growth, investment and intends to examine the regional trade groups mergers of companies across borders have the aim is towards a greater degree of development, facilitating cross border in historical and contemporary perspectives multiplied and private finance has assumed autonomy in managing their own affairs. It is movement of goods and technology transfer and how they are effective for regional greater role in world trade. The developing definitely not an alternative to globalism as it thus ensuring an overall scope of cooperation development. The paper is divided into four countries, in particular, perceive the global is generally viewed upon; neither is it an and convergence in policies. Regional trading sections. Section I deals with the conceptual financial integration as an indispensable escapism nor a challenge to nationalism. It is arrangements can be valuable arenas for framework; section II analyses the trend factor for securing financial stability and an effective alternative that can dampen local tackling volatile trade issues such as towards increasing regionalisation; section III providing them with better economic conflicts, and enable to find more compatible agricultural subsidies and trade in services; examines the prerequisites for an effective opportunities, thus making the cross-border solution to a regional problem. As the Cold political initiatives and regional diplomatic regional integration and development; section linkages the order of the day. These War ended, there arose much complex issues efforts can resolve issues that cause an IV studies the trade patterns in South Asia developments have occurred against the leading to new conflicts, tensions, local wars, impasse in multilateral negotiations. The and how these can be improved upon. backdrop of globalisation: new technologies decline of living standards, environmental critics hold the view that the system is nothing I. Globalisation and more liberal trading regimes have led to degradation and so on. In order to achieve a less than trade diverting, leading to the higher trade volumes, larger investment more balanced development, the nation states breakdown of the multilateral approach. The The concept of globalisation has now flows, and increasingly footloose production converged their common interests to create trade groups create preference systems that become the hub of the foreign policies of (Schiff and Winters 2003: 3). compact regional groups to achieve common transcend regional boundaries, while some different nation states. The present goals. This helped them manage their relations Defining Regionalism even argue that political and economic globalisation process is characterised by rapid in a much more cordial manner which would growth in international financial transactions, tensions will lead to hostility and increased Regionalism is defined as an attempt have been otherwise difficult at a global level. fast growth in trade, surge in foreign direct retaliation. by a group of states to order their relations They have thus become the dominant players investment, emergence of global markets and amongst each other. Their purpose is to in a “fragmented and unstable world The conditions and terms governing diffusion of technologies and ideas through advance “commonly agreed aims, to avoid characterised by free trade within each of the the regional trade have been approved by the rapid expansion of transportation and local conflict and to manage it, if it does break blocs and managed trade with them and other WTO though compliance to the rules and communication system (Singh 1998: 3-4). out, as much as possible, on a regional basis” countries” (Sideri 1997: 49). regulations depends much on the guidelines Rapid developments in communication, (Chimpman 1997: 22). It is aptly pointed out formulated under the regional trade groups information technology and economic activity that the ‘regional economic integration can be II. Trend towards Increasing Regionalism (RTGs). The RTGs do discriminate against enabled rapid movement of the processes too, compared along various dimensions of the the non-members, thus going against the spanning across distant miles. While some of The earlier wave of regionalism has scope (the range of issues included), depth (the multilateral principle of non-discrimination as the nations associated themselves with their not been very productive barring the success extent of policy harmonization), enshrined in the erstwhile General Agreement affluent neighbours and improved the status of the European Union. But the resurgent institutionalization (the extent of formal on Tariffs and Trade (GATT) and World of their economies can be seen in North phase of the late 1980s and 1990s is increasing institutional building) and centralization (the Trade Organisation. Nevertheless the WTO America, while many of their counterparts the scope of the bilateral and regional degree to which effective authority is failed to initiate liberal economic policies, agreements. This has further led to the debate monitors the functioning principles of the centralized)’ (Smith 1992: 5). According to owing to apprehensions. Therefore, an uneven as to whether regional trading system is a RTGs through Committee on Regional Trade another definition, regionalism is a “sustained relative growth performance by individual threat to the multilateral system of trade. The Agreements (CRTA). The fundamental co-operation, formal or informal, among countries and changing patterns of trade, parallel growth has been significant particularly object of this review process is to scrutinise governments, non-government organisations investment and production has tilted the in the developing countries. In a way, it whether the agreement is in tandem with the or the private sector in three or more balance towards the formation of regional stimulates the fact that if we cannot benefit principles as laid down in the multilateral contiguous countries for mutual gains” trading groups to withstand the shifts of in a wider context of multilateralism, why not system. It prescribes that trade barriers (Alagappa 1994: 158). balance of economic power. With this, the adopt a regional approach? The proponents against non-members should not to be raised resurgence of regionalism at a much faster From the above definitions, it can of regional trade groups fervently support the and need to be eliminated subsequently in case pace has been on the rise. The role of trans- be understood that regionalism is a tendency system as contributing to the welfare and they are imposed.

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 355 Regional Economic Integration and Development Sailaja Gullapalli 356

The trend towards regionalism arose for a better economic interaction among no option but to forge alignments at a global economic scenario. With increased basically with the disenchantment with the the nations. The states, in order to sustain regional level. special arrangements, the challenges and functioning of the multilateral system where and prosper, have started adapting difficulties for the system started the negotiations were long and arduous. The themselves to economic arrangements and • The intense competition among the three mounting. (Ibid 26) non-compliance to the rules of the system technology transfers. Thus, being a part powers-the European Union, the United • even by the most developed countries and to of a regional agreement helped them to States and Japan made it difficult to arrive For decades, the US had been a strong their own benefit has left a myriad of economic enhance their relative gains in terms of at consensus on various issues at the advocate of the multilateral trade. The problems for the developing countries. The trade. The weakening of the Bretton GATT forum. Each of these nations was attitudinal change towards regional and problems that arose during the Uruguay Round Woods system that was created in the post highly competent in itself and found it bilateral trading agreements resulted out of trade negotiations gave new dimensions to war order gave way to the rise of these difficult to compromise on various of its decreasing competitiveness and it. The GATT was mainly handicapped by its regional economic alliances. contentious issues. The US followed an increasing competition from other institutional weakness; further, some aggressive trade policy and imposed high advanced nations. Forging these provisions underlined the fundamental • For all practical purposes, GATT was non-tariff barriers thus ruling out any agreements has, in a way, answered its protectionist concepts and have been criticised never complete and many important reconciliation. economic insecurity and thereby, it did by many a nation as lack of conceptual clarity. sectors were excluded at the very not lag behind in opting for regional trade Thus the rise of new regional groupings as a outset. In the agricultural sector, many • Departure from the non-discrimination arrangements. free trade area or customs union as a more of the rules became ineffective as one principle and increasing protectionism profitable alternative strategy to tackle the country after another avoided the have gathered momentum and some of The gradual decline of the rules based problems gained momentum in place of dealing implementation of the prescribed the policies were designed in a way as to multilateral system considerably weakened with the GATT directly. disciplines on agriculture. harm the interests of the developing institution of the GATT. With this, there was a countries in areas like agriculture, steel surge in the number of regional groupings. In the face of increasing globalisation, Moreover the co-ordination of the macro- • and textiles. various nations are in the process of redefining Each nation understandably insisted on economic policies among the large number of their identity, thus enabling economic setting its own economic and social states became much difficult to achieve and • GATT was often criticised for its inability globalisation to go hand in hand with political priorities and could not give way to a the deregulation worldwide was unsuccessful. to secure agreements among countries nationalism. Today we have over 150 nations more international vision. The nations More and more states favoured the expansion with diverse interests, its slowness to act, around the world aspiring to be members of were unable, rather unwilling, to change of market forces and deregulation that had given its limited agenda and its inability to enforce one regional bloc or other. To put it aptly, the traditional political and economic scope for expanding regional ties. In this context, established disciplines (Low 1993: 31). regionalism is redefining the power equations structures. They wish to bind themselves the regional groups became the preferred lot to at the regional level and increasing awareness to better policies-including democracy- multilateral approaches. of economic interdependence. It is more open and to signal such bindings to domestic • With the end of the Cold War and the to new approaches for a deeper integration. and foreign investors. (Schiff and transformation of Russia and the East III. Regional Route to Development Since the negotiations involved fewer Winters 2003: 6). European Countries into market The regional organisations are members, the formalization of rules and economies, the power as well as economic created by states by which the members • The interests and priorities of the regulations of the trade become transparent relations has also gone through a transitory pursue their common goals and without a developing countries varied in and easy to implement. phase. The arrangements for member’s consent, no regional action or comparison to the unified demands of accommodating the socialist countries Some of the fundamental and decision can be taken. Here the negotiations the developed countries. This variation involved discrimination against them and practical reasons for the increasing and diplomatic relations are major amounted to their disagreements over many of these countries of the Eastern regionalism can be summarised as below: determinants that characterise the approach various issues. The deadlock over many Europe were rather marginalised in the of the states in achieving regional co-operation • The post-cold war international order, devoid an issue proved costlier for the GATT. These Republics sought and development. Since the decision-making of bipolar alliances, provided an opportunity developing countries leaving them with renegotiations regarding their status in the is an outcome of the combined efforts of the

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 357 Regional Economic Integration and Development Sailaja Gullapalli 358 regional actors, modern diplomacy offers to For example, a recent study (3) Investment: Investment is a key is an exemplary model that has brought defend the interests of the states in various reported a registered growth in the trade determinant of economic growth and together nations from different quarters of the issues of economic co-operation. Thus patterns of the South Asian region. On an development of a nation. The economic world based on the above-mentioned regional trade is an effective platform to average, they have registered 5% of growth programmes and plans of action for principles. further trade interests andprovides an open per year bringing down considerably the implementation in different sectors depend (6) Convergence: Convergence between the access to prosperous business and flourishing levels of poverty in the region (Devarajan greatly on these resources. Larger markets, policies of the state and market forces is more markets, facilitating further liberalisation and et al: 3573). Since the region suffers from more competition and improved policy often than not an uphill task. A conglomeration investment etc. on a much larger scale. numerous demerits like political conflicts, credibility will increase the incentives for of nations that intend to integrate policies for unprecedented levels of corruption and investment and so raise incomes (Schiff and It also facilitates multilateral rule economic purposes have to ensure the persistent fiscal deficits, the growth rate Winters: 17). But at the same time, they point making or rule changing, creating a favourable following aspects: (1) domestic regulation and comes as an indicator that given the out that the principle applies differently to political setting or legal framework at a control mechanisms (2) result oriented necessary direction and political will, the South-South countries trade and North-South bilateral or regional level, resolution of disputes, strategies (3) monitoring of trade policy region can see a much higher level of countries. and creation of innovatory agreements, implementation and (4) the degree of development. Some of the factors that conventions and treaties (Bulajic 1997: 9-10). (4) Capital Returns: The rate of return on reciprocity. constitute core ingredients of regional trade Precisely these trade blocs are, for the capital is much higher in the contemporary are enumerated as below: Convergence is crucial for deciding developing countries, the easiest way to times than it was earlier, as it is suggested by on policies related to market access, development, while at the same time offering (1) Economic Reforms: Reforms constitute the latest economic analysis. This is regardless transaction costs and standards, safety solutions to their longstanding regional peace necessary prerequisites for the holistic of the economic condition of the investing regulation, tax benefits and so on. Cooperation and security problems. Regionalism is thus aspect of trade and investment growth. The countries, be it developed or developing. But on domestic policies can also assist in characterised by politico-economic objectives. institutional regulations are complementary a cautious approach is needed with an overcoming market failures and can help to these efforts. As the study reports, factors effective management from the financial Dimensions of Economic Development ensure that trade restrictions are not like external finance in consonance with sector. As Schiff and Winters point out, there reimposed through the back door (Schiff and What merits does the regional trade reforms of the banking and energy sectors, are few empirical evidences of the impact of Winters: 20). In the absence of such offer? Why is it preferred? The following privatisation of state-owned enterprises and regional trade on investments. In other words, coherence, not only do superficial goals engulf explains the same: improved public finances and accelerated the performance of the individual nations in a trade bloc but also likely to end up in the growth rate, even in relatively ƒ Stimulates investment in the region economic terms is more important than its formulating the terms that are technically underdeveloped countries. regional affiliations. On an optimistic note, the distorted. Convergence also lessens the ƒ Initiates reforms from governments regional trade groups boost FDI, particularly (2) Coordinated Policies: Regional trade regulatory costs and needless delay in the the inflows of investment from nonmember complements the reform efforts through regulation of transactions. Unfortunately, the ƒ Provides conducive trade environment countries. Nonetheless, pessimism can be set coordinated trade policies, and the sustenance of the convergence depends on due to cultural commonalities aside as there is no ample evidence of any governments can make the best use of their the political stability, mutual respect and negative effects so far. ƒ Aids further industrialisation that is membership in the trade bloc. Evidently, the recognition of the members towards each development-oriented success of the trade bloc depends on the (5) Institutional Reforms: Institutional reforms other. Therefore, coordination in collective convergence and cooperation between its that facilitate market access, stimulate growth, action is a necessary condition for the success ƒ Enables better coordination of policies, members, even if the volume of the effectual banking sector, effective planning of a trade bloc. harmonisation and mutual recognition economies vary. For a larger country, the and implementation, clearly articulated terms Finally, policy integration involves the export of its goods means better revenue ƒ Strengthens institutional mechanisms and conditions, enhanced productivity, merits of flexibility and stability of the and for the smaller countries, it is expanding appropriate locations and well defined concerned region. As Wade says, “markets ƒ Acts as an insurance against negative the bulk of their trade and meeting the insurance norms further facilitate the can be embedded not only nationally but also effects of trade demands of the domestic consumer markets. movement towards integrated policies. APEC in regionally distinct configurations, with policy

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 359 Regional Economic Integration and Development Sailaja Gullapalli 360 solutions tailored to the different vulnerabilities the past decade despite numerous obstacles, lower transaction costs, latest technology, providing modern agricultural tools and of different countries and regions” (Gallagher such as conflicts in Sri Lanka and Nepal, streamlining regulations, sound investment, equipment. 2005: 97). corruption in Bangladesh and many Indian climate and macroeconomic stability. (4) Cooperation in technology-both states, and high fiscal deficits in India and Bangladesh, Bhutan and Nepal especially face IV. Regional Economic Integration in indigenous and modern-can be enhanced for Sri Lanka (Devarajan 2006: 3576). But as enormous infrastructure deficits, apart from South Asia: An Overview better infrastructure development and to how far this situation is sustainable inefficient communication networks. This facilities. Economic cooperation in the South remains to be seen. For a real consistent logistic deficiency is a common denominator Asian region has been painfully slow and development, the required percentage of along with tardy regulatory mechanisms. (5) Improve upon the existing transport discouraging. Weighed down heavily by the growth level is anything between 7-10% a Regional trade thus needs a sound base facilities via road, rail and air links and help regional conflicts and apprehensions, the year. It needs a massive effort akin to the without which the purpose of integration is construct related infrastructure that meet region lost out on what may have been growth rate in the South East Asian countries lost forever. One of the most important international standards. economically fruitful openings and thus lags during the last decade. As observed in the measures that need to be taken includes behind inspite of 20 years of existence. The above study, the South Asian region lags far addressing the issues related to high average (6) Expanding the investment horizons and most menacing feature has been its poverty behind in the areas of intensive technology, tariff levels, which are major constraints to attracting private investment will also help in and the resultant inequality that afflicts almost infrastructure, savings and investment, those who want to invest. South Asia is generating the job opportunities, thus 400 million people in the region. South Asia’s manufacturing and export orientation. If one undoubtedly a favourable destination for minimising the poverty levels and providing high and growing inequality may itself act as looks forward to the regional (trade) route investors considering the cheap labour and for better livelihood standards. a brake on future growth and poverty to development, the observations are further flexible environmental standards but the (7) Location of industrial sites, human reduction (Devarajan 2006: 3574-75). The disappointing. It quotes that the intra- cumbersome process keeps the investment resources, entrepreneurship skills, reasons for this are mainly political in nature SAARC trade figures at 6% (of the area’s rate at an abysmal low. infrastructure and enhancing competitiveness with the conflicts looming large over the worldwide exports) as compared to 23% of SAFTA has set a very ambitious automatically leads to increasing investment efforts towards regional cooperation. In spite ASEAN, 56% of NAFTA, 61% of EU. Worse, target of multiplying its volume of trade but in and trade. of the formation of the South Asian even MERCOSUR stands at 12%, which is the absence of conducive investment and Association for Regional Cooperation double that of SAPTA (now SAFTA). (8) Through minimum levels of education liberalisation of trade, the goal is rather (SAARC) in the mid-eighties, intra-regional and training facilities, high standards in In the absence of substantial impossible to achieve. The following measures trade between the member countries remain productivity can be achieved and this itself is investments and liberalisation of services, are likely to enhance regional trade in the negligible even in absolute terms…restricted a crucial factor for an investment led growth. simplification and harmonisation of rule, the region. by numerous quantitative and administrative risks of trade diversion are more and likely (9) While there is no dearth of poverty measures. This can be called inverse to result in a downward trend. For example, (1) The trade group should be devoid of alleviation programmes in the region, the regionalism. (Lahiri cited in Wolfgang-Peter trade-facilitating indicators are rated to be any political undertones. For it is the political implementation of the same remains to be Zingel, see URL) The region has over one- far below normal in South Asia. The export conflicts that are greater impediments to the answered. Almost all the countries have fifths of world population and a combined dwelling rates and inefficient customs cooperation in the region. scored remarkably high on corruption index gross national income of $ 3 trillion but management have not only made the and this depicts the insensitivity of the provides for only 1% of world production. (2) There should be stringent terms related transaction time and methods cumbersome to anti-dumping measures and rules of origin. administrations in implementing the public Despite geographic proximity, trade and weak but also increased the cost of trading Since most of the countries have similarities welfare schemes. transit links, infrastructure difficulties, high substantially. tariffs and non-tariff barriers have hampered in some of the sectors, a strict regime of rules (10) Cooperation in energy and water the investment prospects (Roy 2005: 6). Besides, the management of ports of origin helps in avoiding duplication. resources is of utmost importance considering and transport infrastructure too are far below (3) One of the most important sectors for the deficiencies in these resources in some Yet, as already mentioned in the in comparison to the South East Asian cooperation can be agriculture, where India of the regions. It is much easier to tap the preceding paragraphs, South Asia is reported nations that enjoy the advantages of better can help develop its regional counterparts by resources from the energy intensive nations to have achieved a relatively high growth in infrastructure, faster clearance for exports,

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 361 Regional Economic Integration and Development Sailaja Gullapalli 362 such as Nepal and Bhutan rather than (17) The free trade often involves an of convergence and coordination of policies. Nye, Joseph (1968): International Regionalism, Little importing the same from a region that is much unscrupulous depletion of the natural Given the cultural homogeneity of the region, Brown and Company, Boston. far off and at a higher cost. Similarly environmental resources, especially in the the trade creation and cooperation is much Radoslav, Bulajic (1997): “Global and Regional Trade agreements regarding the sharing of waters timber and wood products where the forest easier to realise. India has a greater role if and Co-operation - Key tasks of Today’s should be concluded not only to avoid further resources are prone to enormous risks. this process has to be expedited and should Diplomacy”, Review of International Affairs, water disputes but also to enhance the farm Introducing the principles and obligations display its sincerity as a reliable trading partner. vol.58, 15 July-15 August. productivity of the adjoining areas of the river relating to environmental protection in the basins. trade agreements would greatly contribute References Roy, Jayanta (2005): “South Asian Regional Trade towards avoiding damage to the natural Agreements: Perspectives, Issues and Options”, (11) Minimise the shipping and transaction Alagappa, M (1994): “Regionalism and Security”, in resources. Draft Paper Presented at an International Round costs and ensure the implementation of Andrew Mack and John Ravenhill (ed.), Pacific Table on The WTO at 10 Years-The Regional investor friendly policies and capital protection Bridging the Gaps in Mindsets Co-operation: Building Economic and Security Challenge to Multilateralism, URL: http:// through effective insurance and profit Regimes in the Asia-pacific Region, Allen and mba.tuck.dartmouth.edu/cib/news/itr_2005_pdf/ repatriation. Most importantly, mutual suspicions, Unwin, Canberra. Roy.pdf lack of confidence and obstinate conflicts (12) Promoting trade expansion not just in need to be resolved to facilitate meaningful Cable. V (1994): The Future of Regional Integration, Russell, Bruce, M (1969): “International Regimes and Macmillan, London. the capital cities but also in other areas that economic cooperation. To promote the Study of Regions”, International Studies Quarterly, vol.13, no.4, December. hold a lot of promise will be the key to success; coordination among the member countries, Chimpman, John (1997): The New Regionalism: as these areas are much more cost effective stronger economies like India should extend Avoiding Strategic Hurdles, MacMillan Press, Schiff, Maurice and L Alan Winters (2003): “Regional in terms of capital, labour and infrastructure, cooperation in the area of investment, London. Integration and Development - The International that ensure high returns. technology transfer, technical assistance, Bank for Reconstruction and Development”, Dam, K J (1970): The GATT Law and International Washington, DC, URL: www.worldbank.org (13) Introducing the latest technology in data and trade promotion to the relatively Economic Organization, University of Chicago collection and business transactions, promoting underdeveloped countries to shrink the Press, Chicago cited in Frans Buelens “The Sideri, Sandro (1997): “Globalization and Regional e-commerce and showing flexibility in existing inequalities. It is this movement Creation of Regional Blocs in the World Economy”, Integration”, The European Journal of business visa rules will all help in faster towards greater equality and stability that Intereconomics, Vol.27, No.3, May/June 1992. Development Research, Vol.9, No.1, June. movement of goods, capital services etc. determines the strength of the regional trade cooperation. While the challenges are Devarajan, Shantayanan, and Ijaz Nabi (2006): Singh, Kavaljit (1998): Globalisation of Finance, (14) Using the regional platform to address enormous, the dynamism and openness that “Economic Growth in South Asia: Promising, Madhyam Books, New Delhi. Unequalising, Sustainable?”, Economic and trade issues at various multilateral forums and characterise South Asia today make us Political Weekly, 19 August, pp.3573-3580. Smith, Peter H (1992): The Challenge of Integration: trade negotiation rounds is the best way to optimistic that they will be met, and the region Europe and the America, New Brunswick, New ensure regional development. will be substantially free of poverty in a Gilpin, Robert (2003): Global Political Economy: Jersey. (15) Opening up of traditional (trade) routes decade (Devarajan 2006: 3580). Though the Understanding the Economic Order, Orient Longman, Hyderabad. Wade, R.H (2005): “What Strategies are Viable for akin to that of Nathula (India-China border) optimism can be very much shared, the elimination of corruption, which is a major Developing Countries Today? The World Trade trade route will not only arrest the inordinate Lahiri, Sajal (1998): “Controversy: Regionalism versus Organization and the Shrinking of ‘Development obstacle to the implementation of the agreed delays in movement of goods but also reduce Multilateralism”, The Economic Journal, 108, July. Space’”, inn Gallagher, Kevin (ed), Putting transport costs while, at the same time, policies, remains an uphill task. pp.1126-1127 as cited in Wolfgang-Peter Zingel, Development First, Zed Books, London, pp.80- generating local employment opportunities. If regional economic integration is on the Economics of Regional Cooperation in 101. South Asia URL: http://www.sai.uni-heidelberg.de/ rated high as a route to regional development, (16) There should be consistent efforts to abt/intwep/zingel/praha98.htm. Woods, Ngaire (ed) (2000): The Political Economy of work out a common currency in South Asian the South Asian region should extract Globalisation, MacMillan Press, London. region on the lines of Euro (in European maximum leverage from this approach. As Low, Patrick (1993): Trading Free: The GATT and US Union). This brings about uniformity in cited in the preceding sections, regional Trade Policy, The Twentieth Century Fund Press, business transactions. economic integration involves a high degree New York.

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Workers Managing Sick Industry: The Experience of Kamani (Interview with D. Thankappan on 08.9.07). Limited with special attention to analyse and Tubes Limited from Mumbai There were many sick companies spread all locate the still unrevealed causes of the over the country some of which were taken decline of the Kamani industry, especially Jose George & Manoj Kumar over by the workers cooperatives but most of after the industry was taken over by the them failed to survive for long time due to a workers’ union of the Kamani Tubes Limited, Abstract number of reasons (Interview with D. the problems faced during the process of The union of workers and cooperative had to confront a number of problems which was Thankappan on 08.9.07). This has necessitated takeover of the industry, including its aggravated by the institutional discriminations manifested through inadequate state debates on the feasibility of workers’ takeover management, and finally the major causes of policies and affirmative endeavours as well as non-cooperative prejudicious attitude of of sick industries. It is in this context that this the failure of this experiment. The study also financial institutions like various banks who were supposed to make available the study is focused upon. aims to critically examine the role played by requisite capital support to the Company for its operation and sustenance under the various leaders, bureaucrats, bankers and The issue of workers’ takeover of managerial control of the workers cooperative. The state and its associated institutions management bosses (including promoters) in Kamani Tube industry and its management by showed keenness to help revive the sick industry and assist in its successful operation revival and management process or in this the workers cooperative society generated by making some provision though enactment of legislations. Their support reflected unique experiment and ascertain the factors curiosity, debates and discussions among more on paper than in practice. It would not be an exaggeration to say that this exhibits for success of such industry. The hypothesis, various segments of society, especially the the classic character of the capitalist system. this paper tries to test, is this that the activists, intellectuals, academicians, and policy experiments of takeover of a sick industry for makers, regarding viability of this kind of revival and management by workers’ experiment in which the mass media also cooperatives are found to fail in the bourgeois The industrial units incurring over by the Workers’ Cooperative Society played a very important role (Palande 1991; socio-economic system in the absence of continuous losses instead of sustainable of the Kamani Employees Union (KEU). It Srinivas 1993: Thankappan 1992; Aarti Dua favourable government policy and the policies benefits and suffering from the financial was a unique experiment of management of 1993; Kanika Dutta 1993; Ramaswamy 1998). (and also attitudes) of other related institutions crunch, mismanagement, non-payment of a sick industry by the workers in the history The minds of workers and their leaders were and agencies to workers’ cause (which is salaries and wages to employees, non- of the Trade Union Movement in India. The filled with zeal and enthusiasm which proved rather often regressive and prejudicious in availability of raw material and the problems workers had high level of zeal and to be short lived. The significance of the study nature). of marketing of products for a certain period enthusiasm on attaining the ownership of an lies in the fact that this kind of experiment of are generally known as sick industries. To industrial unit and pinned high hopes to make control of industrial units by working class The study is descriptive and analytical revive such industrial units and make them a substantial gain. In the beginning, after promised restructuring of socio-economic in nature and the sources of data are official operational and profitable, a bill was introduced takeover, satisfactory progress was made but order of Indian society along the lines of and organisational published/unpublished in the 1985, which was assented, by the soon it began petering out and started facing democratic and socialist principles which could documents, news articles and reports President of India in the 1987, and came to a number of crises in the early 1990s1 leading have reduced the degree of unjust economic published in journals, magazines, and be known as Sick Industrial Companies to its virtual closure in the 1997. Since then inequalities in society by ensuring the protection newspapers, documents of court cases related (Special Provisions) Act (SICA), 1987. Under no concrete step was taken to bring it back and promotion of the interests of marginalised to this matter, including interviews with the the provisions of this act, the Kamani Tubes into operation and the employees’ union is sections like industrial workers. It becomes leaders of Kamani Employees’ Union, Limited (KTL) (established in the 1960, by mainly fighting for arrears and dues of important to identify the key factors that were Kamgar Ekta, and creditor bank officials. The Ramjibhai Kamani, and closed down in the workers basing their arguments on the plea responsible for failure of the management of reports and documents prepared by the 1985, because of various reasons) was taken that the unit was never officially closed down sick industry by the workers of the company workers union and other institutions like BIFR and determine the elements to make and banks concerned, including petitions filed suggestions for success in reviving and by the Kamani Employees Union in recent managing sick industry by workers’ past along with schemes framed by financial Dr Jose George is Professor and Head, Department of Civics and Politics, University of Mumbai & cooperative society. This paper is an attempt institutions and other associated agencies Dr Manoj Kumar, Research Associate in the same Department to look at the whole story of Kamani Tubes have been referred.

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Background of the Kamani Industry to takeover the company and revive it was The main provisions in the scheme provisions of the existing legislation related made after the closure of KTL in 1985. sanctioned by them were; (i) the industry to industrial labour. The arrears that were An industrialist, Ramjibhai H. The situation worsened when the Company would restart in about six months after calculated from December 1984 to August Kamani, who belonged to the Kamani family owners expressed their inability to restart it completion of required repair works which 1988 amounted to rupees six crores and fifty (earlier the Kamanis had established Kamani and no one was ready to buy and run it. The would incur approximately Rupees sixty lakhs exceeding the amount of liabilities of Enginnering Corporation Limited (KEC, now KTL was declared a sick industry under the lakhs; (ii) the shares of the Kamanis and the Company which was five crores and forty KEC International Limited) and the Kamani provisions of the SICA, 1987 and on the basis others of ninety six lakhs to be transferred to seven lakhs (Srinivas 1993: 90, Palande 1991: Metals and Alloys Limited (KMA) in the of the same KEU approached Supreme the workers’ cooperative at the reduced cost 3). Besides this, the scheme settled and 1944 and 1945 respectively), formed an Court in the 1987 with a proposal to takeover, of rupee one per share against the face value approved by the BIFR demanded further industrial company, the Kamani Tubes revive and manage the operation of KTL. of rupees ten per share; (iii) the KTL to be sacrifices from the workers such as, the Limited in 1960 in Kurla of Mumbai, to The apex court, after realising the substance managed by the Board of Directors consisting retrenchment for some of the workers, wage manufacture non-ferrous tubes. It made high in the proposal, referred this case to the of professionally qualified or experienced freeze for three years, the payment of wages profits over a decade which had been Board of Industrial and Financial persons and two representatives of the restricted to seventy five per cent of the wage increasing since its inception and reached its Reconstruction (BIFR) which was a newly workers cooperative; (iv) the workers rate in the first year of operation and eighty peak in the 1972. The main customers of its constituted body to examine viability of such cooperative to raise an equity capital of rupees five per cent from second year onwards, copper based alloy tubes and rods were the scheme. As the BIFR did not have many seventy lakhs. The cooperative, with its deferment of the annual increments for a sugar industry, thermal power stations and the cases with it, this case was given early membership of nearly six hundred, was period of two years, postponement of payment defense establishments. The demise of attention and quick disposal. The Industrial directed to arrange this amount of capital from of dues of workers during the closure period Ramjibhai H.Kamani and ensuing feuds Development Bank of India (IDBI) was each of its members who would manage until all other dues were cleared, linking among Kamani brothers paved the way for appointed as the Operating Agency (OA) rupees twelve thousand each consisting of certain salary/ wages with certain production decline of this highly profitable industrial unit. and was directed to submit its report on the rupees two thousand from their provident fund norms, liquidation of loans taken by workers The decline of this company began in 1973 viability of the scheme prepared by the account and rupees ten thousand by taking for their contribution through profit sharing that led to its closure in the 1985 after water KEU. After submission of report by the loans from urban cooperative banks; (v) the mechanism, stoppage of overtime and ban and power supply was disconnected due to IDBI, the BIFR took up this takeover offer State government to provide equal amount to on strikes, etc (Palande 1991: 10). non-payment of bills (Palande 1991: 2). In of the KEU with the parties concerned, banks, financial institutions and the State and augment the share capital after the workers’ 1984, just before its closure the Company had After going through the exhaustive Central governments to confirm and cooperative corrected its share of contribution; shown an all time low performance with a tribulations and the endorsement of the ascertain their commitments for the support (vi) the scheme did not make any additional huge loss. The situation of continued losses scheme by the Supreme Court on 19th in form of concessions and relief to be made long term loan from financial institutions and September 1988, the workers’ cooperative leading finally to closure occurred as a available for smooth operation of the banks as the requirement of margin money consequence of feuds in the Kamani family, Company. The IDBI was asked to revise for working capital was to be met from the succeeded in taking over the KTL under the problems in management, prolonged litigation and make some amendments in its report balance of funds to the extent of rupees leadership of D. Thankappan in October 1988, and appropriation of finance resulting in which was complied by the bank. On the seventy lakhs (Palande 1991: 6). The BIFR under the provisions of the Sick Industry shortage of requisite amount of working basis of the report prepared by the IDBI also assigned certain responsibilities to Bank Companies (Special Provision) Act, 1987. capital. and the discussions held with other parties of India, Canara Bank, Dena Bank, State After doing required repair works the company was made operational in April 1989. The Process of Takeover by the Workers’ and institutions concerned, the BIFR Government, Central Government, prepared its own feasibility report and While making efforts for revival of the KTL, Society Management and Share Holders to ensure submitted it to the Supreme Court. Originally, smooth operation of the industry (Palande, workers had agreed to the provisions of the Though the Kamani Employees the scheme proposed by the KEU for take 1991: 6). The workers made considerable scheme prepared by the BIFR by which their Union had started approaching the state over of the sick company was the basis of sacrifices in the process of implementation of privileges of arrears and increments in wages (Maharashtra) as well as central government the report prepared and submitted by the the scheme. As the Company was officially were curtailed. Thus the takeover involved to takeover the management of the company IDBI and ultimately, sanctioned by the BIFR not closed, the workers were entitled for salary a lot of sacrifice from the part of workers after the mid-1970s, the serious endeavours (Palande 1991: 6). and other wages privileges as per the In the beginning the workers and their leaders

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 367 Workers Managing Sick Industry Jose George & Manoj Kumar 368 were overzealous and started the work of managerial control of the workers It could be easily realised that the them in difficult time, for the emergence of production with great enthusiasm and made cooperative. The state and its associated KEU had to face many obstacles before it took new problems in the Company. One of the profits for nearly two and half years. Later institutions showed keenness to help revive over the management of Kamani Tubes reasons of the formation of the Kamgar Ekta on many-fold problems started occurring. The the sick industry and assist in its successful Limited in October 1988 which was due to is said to be promises made by the prospective main causes of problems were shortage of operation by making some provision though the exploitative and repressive characteristic promoter for better arrears and prospect for working capital due to dilly-delaying nature enactment of legislations. Their support of the capitalist socio-political order. It has the workers. of fund provider banks and apathy of the reflected more on paper than in practice. It been observed over the period of centuries that The Kamani Tubes was in deep BIFR and the State government. The situation would not be an exaggeration to say that this capitalist system tries to create an illusion of trouble since the 1995. A management aggravated in the post-1992 period due to the exhibits the classic character of the capitalist reform and welfare of the marginalised consultant, appointed by the IDBI in August communal riots (as a consequence of Babari system. sections with sole purpose of containing their 1996 to assess the viability of the KTL had Mosque demolition in December 1992), and outbursts and maintaining its hegemonic Right from the process of takeover suggested that the Company could be brought related problems besides the negative impact position. The story of the experiment of the of the sick industry by the workers back into smooth operational mode by of the liberal import policy of the government. workers’ management of the sick industry, cooperative to aspects of maintenance, providing an additional rupees four crores of In the early 1997, the KTL, finally, ceased Kamani is no different. The Company under operation and sustenance of the Company working capital and the equal amount rupees functioning leaving the workers jobless. the management of workers society performed and finally to secure their ecquitable arrears of capital investment for modernisation of the Kamkar Ekta a Parallel Union came into well and made profits during 1989- 1992 after the closure of the industrial unit in industry. The consultant valued the surplus existence since 1998. Since then no serious period. It was made possible despite the 1997, the workers’ society had been facing assets of KTL at Ballard estate at a minimum and sincere effort was made to revive it either difficulties to successfully re-establish its a number of problems which could have of rupees twenty six crores which, after by government institutions or any other agency position in the market after a gap of five years. been avoided or at least reduced to the paying tax dues and liabilities of creditor like promoters. The promoter, Kalpana Saroj The Company had to face tough competition comfortable degree by the sincere and banks that was estimated rupees ten crores & Associates (KSA), primarily a developer from the companies operating from Rajasthan. favourable policies of State and their proper sixty lakhs as on 31 December 1996, would in construction area came forward to revive The latter had to pay low sale tax compared implementations. What were the problems leave a comfortable reserve capital for stable the dying industrial unit but indulged itself in to that of KTL and also exemption of turnover that the Workers’ Cooperative faced as a operation and investment for modernisation dubious acts of manipulations and tax provided them an edge over the marketing result of which the management of the (CWM 1999:13). The plan of selling out the maneuvering to appropriate the assets of the position of the KTL. The Kamani Tubes Company by the workers stated fizzling out Ballad estate building could not be Company giving way to dispute litigations Limited developed problems in 1992 .The generating the atmosphere of disappointment, implemented because of the difference shown involving court cases. The KEU, at present, liberal import policies of government and anger and frustration among the workers that and delaying tactics adopted by the IDBI. is making efforts to get the dues and arrears communal riots at large scale crippled the resulted in their desertion from their parent However, the IDBI was instructed by the of the workers and rehabilitate them. production and market profits of the Kamani union the KEU and join a new Union the Tubes Company. The shortage of working BIFR to honour the report prepared by the Problems Faced by the Workers’ Kamgar Ekta? Why did the experiment of capital, lack of efficiency on the part of consultants (Interview with D. Thankappan, Cooperative and re-occurrence of crisis the management of a sick industry by management and continuous losses faced by 14.02.1999).When the plan for the sale of the The union of workers and cooperative cooperatives of the working class fail? The the Company created a situation leading to its Ballad estate was making progress through had to confront a number of problems which answer probably lies in critical examination closure in the March 1997 when the water multilateral discussions, the prices of real was aggravated by the institutional of the internal and external factors such as and electricity supply to it was disconnected. estate suddenly crashed as a result of which discriminations manifested through inadequate attitude of workers after attaining the After the closure of the Company in the 1997, the party negotiating for the purchase of the state policies and affirmative endeavours as ownership of the Company, the level of their dissension came to surface and a separate building backed out. The attitude of the IDBI well as non-cooperative prejudicious attitude cooperative culture and conciousness as well union of workers, Kamgar Ekta was formed was negative in this regard as it did not believe of financial institutions like various banks who as their training and education, and the by the dissident group of the KEU which was the economic feasibility of the Company if were supposed to make available the requisite evaluation of the role related state policies, joined by many disappointed workers of KEU. investment were made in its revival after the capital support to the Company for its policies of associated banking institutions and The angry and frustrated workers blamed their sale of the Ballad estate building (K.V. George operation and sustenance under the their implementation. earlier leader, D. Thankappan who had led 19.02.1999).

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Despite of the favourable historic industrial legislation at that time. The fate of of property belonging to the KTL, though the KTL which was established in the 1960 grew judgment of Supreme Court, support of the such experiments is also determined by the promoter group was not authorised to do to prosperous and made substantial profits for financial institutions and the governments in level of class consciousness and the intensity that. An advance cheque of rupees fifty lakhs over a decade. After the death of its founder, the initial phase, supportive mass media and pattern of mobilisation (whether political was issued in the name of M/s Kalpana Saroj Ramajibhai H. Kamani in the 1972, the coverage, united and committed union or economic aspects given priority)2. and Associates and not in the favour of the Company started petering out as a membership, gaining good ground in the KTL. The KEU, after getting this information consequence of, mainly, the family feuds market even entering the market after the gap The Struggle of KEU Continues by end of the October 2006, brought it to the among the Kamani brothers, mismanagement of five years, this unique experiment met with The management of the KTL was notice of the AAIFR. The Kamgar Ekta which and appropriation of the Company’s profits utter failure. The major factors responsible run by the workers’ cooperative society, the was not recognised by the Industrial Court by the feuding employers leading, finally, to for the failure of this takeover and Kamani Tubes Limited Kamgar Audyogic supported the promoter, KSA. its complete closure in the 1985, however, management experiment included, the unofficially, when the supply of water and Utpadak Sahkari Society Limited. For nearly The KEU had been struggling against attitude of the financial institutional agencies three years, the Company made satisfactory electricity was cut off. The workers union, such as, BIFR, Appellate Authority of the manipulative promoter group and had the KEU, after undergoing the arduous task progress and thereafter it started facing been raising objections by making several Industrial and Financial Reconstruction crises of various kinds and incurring losses. of process of takeover of the industry under (AAIFR), Industrial Development Bank of representations in the High Court, Mumbai the provisions of the Sick Industry (Special During the 1994-95, G.D. Apte Consultancy as well as to various authorities concerned. India (IDBI), other banking institutions as Services Private Limited was appointed to Provision) Act, 1987, succeeded in its historic well as government machinery, the lack of The KEU lost the case in the court of AAIFR mission of taking over the management of carry out the Techno-Economic Viability and thereafter it has approached the Bombay diversification of the products, the lack of an (TEVS). On the basis of the report prepared the Kamani Tubes Limited and after the efficient marketing executive, failure of the High Court. The Division Bench consisting necessary repair works started its operation by the Consultancy, the BIFR declared that of the Chief Justice of Bombay High Court union to cope up in the changed situation, the scheme (of take over of the KTL by the in April 1989. managerial difficulties, and the lack of Swatantrakumar and another Judge heard the workers) sanctioned on 6 September 1988 th The Company made satisfactory development of the cooperative culture and case on 06 February 2008 and stayed the had failed and the Board directed the IDBI progress under the management of the understanding, besides some sudden external sale of the Bangalore land and Mumbai (OA) to conduct TEVS and submit a long workers’ society but after nearly three years, factors. In the capitalist system of production property of Kamani Tubes Limited until the term revival plan. In May 2000, the BIFR it started confronting a number of internal many of the industrial units cease to operate disposal of the case/next hearing. Later instructed the IDBI to advertise for sale of and external problems. The main causes and sustain due to market competition and hearings were held on 15.2.2008 and 18.3.08. the Company. The IDBI put out among them were the lack of sufficient only the big monopolist industries survive and However the matter remains to be settled advertisements for take over of the KTL. working capital, the institutional maintain their hegemonic position. finally. The KEU is opposing the unjust method The Kalpana Saroj & Associate (KSA) of selling out the real estate assets of KTL discrimination, non-cooperative and In capitalist system of production an group applied but its proposal was not found which has the value much higher than that of prejudicious attitude of the financial institutions impression is created among the workers that acceptable and therefore this promoter group what the KSA was trying to sell out. And also like banks that were to support the industry the government institutions are meant to look was asked to resubmit a revised plan. In the Union is making its all out efforts to by making required finance available which after the interests of the workers and August 2003, the KEU filed its objections to safeguard and secure the interest, wages and was aggravated by the sudden outbreak of downtrodden. The state uses such tactics to the proposals submitted by promoters as they arrears of the workers. the communal riots between the Hindu and hide its real interests of serving to augment were not in favour of workers. In March Muslim community in December 1992 in the Summary and Conclusion and consolidate the capitalist system. This was 2004, the KSA group was given clear control aftermath of the demolition of the Babari evident even during the phase of process of of the management of the Kamani Tubes The takeover of the management of Mosque by the Hindu religious takeover of management by the workers as Limited appointing its Chairperson, Kalpana the Kamani Tubes limited in the 1988 was a fundamentalists which intermittently the BIFR had sanctioned the scheme after Saroj as the President of the Company and unique experiment of its kind in annuls of the continued till March 1993 involving not only inserting some conditions that loss of wages employees of KSA as officers of the history of the Trade Union Movement in India the City of Mumbai but many parts of the and arrears of the workers that the latter were Company. In August 2004, the KSA which, unfortunately, failed due to apathy of country, thus affecting the prospect of trade entitled to get according to the existing fraudulently entered into agreements for sale the bourgeois democratic social system. The and commerce very badly. The effort to

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 371 Workers Managing Sick Industry Jose George & Manoj Kumar 372 revive the company and keep it operational experiment of the management of a sick the political consciousness and the Sick Industries: An Analytical Study of Kamani began sending strong signals of its failure in industry by the workers’ cooperative. consciousness of being ‘class for itself’. No Tubes Limited and KMA Limited (Monograph), the 1995 by making continuous losses resulting, effort was made by the leadership to join with New Delhi, January. Is the option of the management of the other established trade unions having ultimately, in the closure of the Company when Dua, Aarti (1993): “A management Guru for the a sick industry by the workers cooperative national character and patronised by the party the water and power supply to it was Workers”, Hindu Daily, 19 October. viable? Such experiments are bound to fail such as CITU or AITUC as a result of which no disconnected. However, this time too, in bourgeois democratic system unless the concerted endeavour was made to form an Dutta, Kanika (1993): “A break with tradition”, declaration of closure of the Company was State and its related institutions take sincere alliance with other trade unions and struggle Business Standard, 6 January. officially not announced. unitedly in the interests of working class. The and active interest in making it a success by High Court, Delhi, Order Number 706 dated 4.7. 2006 No sincere and serious effort was making available the required infrastructural outstanding examples of successful management made to bring the Company back into life inputs and also directing its financial of industrial and commercial units by the Masilamani, S (1993): “Trade Unions on Defensive”, either by any state agency or private promoter. institutions to cooperate, or until working workers in India are the Indian Coffee House Sunday Observer, 21 April. Workers Co-operative functioning in all major A private promoter, the Kalpana Saroj & class has its own resources like banking Nandwani, Deepali and Rath, Anamika (1991): “No cities in India and Dinesh Beedi Workers longer a workforce to reckon with?”, Sunday Associates, primarily, a developer in the area agencies to depend on. The sick industries Cooperative functioning in in Kerala. These are Observer, 16 February. of Construction Work, came forward with the can be revived and managed successfully being successfully managed by the class and declared objective to revive the Company but, only if state is committed to the cause of the politically conscious workers with support from New Trade Union Initiative (NTUI), Worker contrary to working towards its official aims, workers along the lines of socialist principles the leftist political parties. Cooperatives: A Force Resisting Industrial it began manipulations and manoeuvring and the working class is adequately Closure: A Case Study of Kamani Tubes Ltd., and References activities to appropriate the real assets of the indoctrinated and trained in the cooperative KMA Ltd, New Delhi. Kamani Tubes Limited even on the expense culture as well as takeover and management Appeal Against BIFR’s order dated 21.3.2006 in case Palande, P S (1991): Revival of Kamani Tubes Limited of the interests of the workers in tacit of sick industries. number 218/87, Appeal numbers 103/06, 125/06, (a report), Pune, Indian School of Political connivance (it is widely believed by the 154/06 & 157/06 addressed to AAIFR (KEU Vs. Notes Economy, April. members of the KEU) with some officials BIFR & Ors) concerned. The Kamani Employees Union 1. The problem was aggravated by the Hindu- Ramaswamy, E A (1992): “Can Workers be Owners?” Appellate Authority for Industrial & Financial Muslim communal riots in aftermath of the Business India, 30 March -12 April, p.106. have been struggling against such Reconstruction (AAIFR), New Delhi, Order Babari Mosque demolition by the Hindu Ramaswamy, E A (1993): “A Glimmer of Hope”, manipulations to secure the arrears of its number 18906 dated 18. 9. 2006 on appeal numbers fundamentalist under the leadership of the Business India, 27 Sept. - 10 Oct., pp.115-6. members and if possible help in revival and 103/2006, 154/2006 & 157/ 2006 (KEU vs.BIFR Bharatiya Janata Party, a national political reopening of the Company (however, the & Ors) party and cultural -religious organisations like Ramaswamy, E A (1998): “Worker Cooperative in India- Union also does not appear to be too optimistic Lessons from Kamani”, paper presented at the the Rashtriya Swayam Sevak Sangh (RSS), Board for Industrial and Financial Reconstruction on this issue. The possibility of revival and re- Workshop on A Critical Analysis of Kamani Tubes Vishwa Hindu Parishad and Bajrang Dal. The (BIFR), Sanctioned Scheme: Kamani Tubes Limited and KMA Limited held at the ICSSR hall, starting of the Company seems to be a distant supply of raw material needed for the Limited: no. 218/1987, Kurla, 1988. possibility due to discriminatory and production and also marketing of products Vidyanagari, University of Mumbai, Mumbai, on Board For Industrial and Financial Reconstruction, Case prejudicious attitude of the State and its were badly affected due to the large scale- 28 and 29 December. no. 218/87: Kamani Tubes Limited, Bench-1, associated financial institutions. The conditions disruption of public life and other facilities Singh, Kulbir (1990): “Workers Participation: Welcome Summary Records of the Proceedings of the of the institutional constraints, the lack of like transportation. Interview Comrade After ground is prepared”, The Hindu, 26 Hearing Held on 21.3.2006 Before S/Shri Ravindra development of the cooperative culture and Sreedharan, Secretary, KEU, KTL, 20 March September. Gupta, Chairman and A.K. Goswami, Member, 2008, Mumbai and also D. Thankappan, class consciousness among the workers, the Reference no. 02/8/87-Bench-II, dated 31.3.2006. Working President, KEU, 8th September 2007. Thankappan, D (1992): “Against All Odds”, Business lack of proper training and education among Standard’, Calcutta, 2 September. BIFR Corrigendum dated 16 October 2007 on case them, including the lack of modernization and 2. The workers of the KEU comprised of various number 218/1987 the non-cooperative attitude of the banking political leanings (leftist and rightist). They Ratnam, Venkata, Batterwack, Gerd and Sinha, Pravin (eds.) (1994): Labour and Unions in a Period of institutions and their dilly-delaying behaviour could not think beyond the boundary of Centre for Workers Management (1999): Potential for Transition, New Delhi, Friedfich Ebert Stiftung. are main causes of the failure of this economic gains and therefore could not develop Workers Cooperatives as a Tool for Revival of

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Seabrook, Jeremy (1992): “Kamani Tubes: A Hope for 4. B.S. Survashe, Vice-President, Kamgar Ekta, Civil Society in South Asia: Nepal and Pakistan in a Workers”, NFS India, 1 June. Kamani Tubes Limited, 17th February 1999. Comparative Perspective The Supreme Court order on BIFR Sanctioned Scheme 5. Govind D Karatmol, General Secretary, Kamgar Anil Kumar Mohapatra Regarding Revival of Kamani Tubes Limited, A Audyogik Utpadak Sahakari Society, KTL, 17th Synopsis, New Delhi, 1988. February 1999. Abstract Thomas, C P (1995): “We Need a Uniform Floor Wage”, 6. D. Thankappan, Director, CWM, Delhi, and The year 2008 has been a year of triumph for the forces of democracy in most The Economic Times, 15 August. Working President of KEU, Mumbai, 14th parts of South Asia. One single factor that has provided impetus to this February 1999 & 8th September 2007. phenomenon of democratic upsurge to a great extent has been the substantial Writ Petition Number- of 2007 (KTL/syn2) in the High growth of civil society in the constituent states. Mostly these civil society groups Court of Judicature at Bombay in its Ordinary 7. P.R. Krishanan, Secretary, CITU, Maharashtra, have played a commendable role in bringing down authoritarian regimes in Original Civil Jurisdiction (KEU vs AAIFR & State unit, 14th February 1999. Nepal and Pakistan. These bodies have enhanced the prospects of democratic Ors) under article 226 of the Constitution of India. 8. Y.V. Chavan, President, Lal Nishan Party, and transition in the said states. With the insistence of these bodies in both the Writ Petition no. 278 of 2007, High Court Bombay Sarva Shramik Sangh, Mumbai, 12th February states are now more and more engaged in the policy discussions that affect (KEU vs. AAIFR & Ors) 1999. them. In both the states, the civil society does not have the same achievements and handicaps. However, on one count, both share one thing in common. Both Interviews 9. G.V. Chitnis, President, All India Trade Union have to play a more crucial role in the process of democratic consolidation in Congress, Maharashtra state unit, Mumbai, 11th 1. V. Shreedharan, Secretary, Kamani Employees their respective states in the years to come. February 1999. Union (Representive of Kamani Tubes Limited), Mumbai, 8th September 2007 & 20 March 2008. 10. Sudhakar Nalawade, General Secretary, KEU, Mumbai, 10 February 1999. Until recent times the fertility of South head of its military backed caretaker 2. Hema Thakur, Deputy General Manager, IDBI, Asia with regard to democracy was a question government has announced to hold ‘the th 24 February 1999. 11. K.L. Bajaj, Secretary, Centre for Indian Trade mark. But today South Asia as a region has parliamentary elections’ and ‘the Upazilla Union, Maharashtra state unit, Mumbai, 9th 3. K.V. George, General Manager, IDBI, 19th been a witness to a wave of democratisation elections’ in December, 2008 (Hindu 2008: February 1999. February 1999. spilling across its most part since the dawn of 21 September). In a similar way the Election the year 2008. As a result of which, within Commission of the island nation of Maldives the last six months South Asia has attracted has finalized to hold ‘the first-ever multi-party increasing attention of scholars of democracy presidential elections’ (Hindu 2008: 8 across the globe having nestled in its precincts August) on 8th of October this year. Sri the ‘youngest democracy’ i.e. Bhutan (Hindu Lanka and India, despite their internal 2008: 26 March) and the ‘youngest republic’ difficulties have been successful in their tryst (i.e. Nepal) of the world today. Not only this, with democracy. This is how in total South Pakistan has made great strides in the direction Asia has become a prospective haven for of democracy by successfully conducting democracy. In addition to the structural Parliamentary elections in last February being features and formal signs of democracy the freed from the clutches of an authoritarian uniqueness of this phase of democratisation rule for nine years. Bangladesh is also making in South Asia has been that it is preceded by slow but promising headway in its march a substantial growth of civil society in all towards democracy and stability. Recently the constituent states of the region.

Dr Anil Kumar Mohapatra is Head, Department of Political Science, Government Women’s Jr. College, Jeypore, Koraput (Dist.), Orissa, Pin - 764001, India, E-mail - [email protected]

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Civil society in South Asia nevertheless very active in Nepal and prospective democracies in particular and in the said countries. It is suffice to to say that Pakistan; and in India and Sri Lanka it is the region of South Asia in general. before and after February — April (2008) The civil society groups have made maturing. In Maldives civil society groups elections in Pakistan and Nepal respectively their presence felt and have made their voices As a sovereign entity Nepal is older are expected to get a fillip after the country have seen new forces and actors coming into heard across South Asia. These bodies today than Pakistan but as countries undergoing joined the Commonwealth Foundation as its existence of which civil society has been a have played a significant role in engaging the great hardship and toil in establishing 47th member2. In Bhutan it is beginning to prominent one. It has been evidenced by public in their respective countries in policy democracy in their respective states both are exist. In the Draft Consitution of Bhutan( frequent reference to civil society in all discussions. They are not only the brokers of contemporary and similar. Their experience 2005) there has been a special mention of matters and issues that these states confront new ideas but also have projected themselves in democracy has been almost the same. Both civil society in its 9th article. The said article today. Now this non-state actor i.e. civil as one of the major stake holders by posting are hanging in between hope and despair. directs the state that ‘it shall endeavour to society has played and will be playing a their reactions- both positive and negative They have witnessed several offs and ons of create a civil society free of oppression, crucial role in these two countries in the against their respective governments. In India democracy within almost six decades of their discrimination and violence based on the democratic consolidation of their respective they oppose the policy of the Central striving for and experiments with democracy. rule of law’ (Mohapatra 2008: 109-10). states. In this background a comparative study Government to go for ‘Ready-to-eat meal Both of them are more known for coups d’etat of civil society in both the states is of greater scheme’ (Hindu 2008: 3 October); in Sri Lanka Speciality of civil society activities in than for democracy. If Pakistan has long being importance and of relevance to both the states they are critical of the government policy of Nepal and Pakistan grappled with military coups Nepal has been and to the scholars of democracy in the third ‘racial profiling’ (Ibid) while demanding for tormented by royal interventions or takeovers. The narrative above brings us to world as well. Taking notice of this new setting up a ‘humanitarian corridor’ (Hindu For both the countries their experiences with home that civil society has made a development and its growing importance the 2008: 21 September) in the battle torn Vavuniya regard to democracy have been almost the phenomenal progress in South Asia. Today present paper makes an attempt to discuss the in Northern Sri Lanka; in the republic of same. Both have had the bitter experiences these bodies have made their voice heard concept of civil society followed by its Maldives their main concerns are : facilitating in seeing toppling down of democratically which was not having that much impact and evolution and lacunae in both the states in multi party elections involving ‘civil service elected governments several times, gagging influence earlier. Taking the whole scenario the following four sections that concludes employees in politics and political of press freedom, censoring media operations, into account, however, one would make a with a summation that outlines its future role. parties’(Maldives Institute for SDD 2008) , wrapping up of the freedom of speech of special appreciation of its activity in Nepal fighting corruption in every sphere of life people, oppression and torture of the I Civil Society: A Conceptual Analysis and Pakistan where its emergence has been through transparency, addressing the issues of common man and an iron hand repression of phenomenal. The success stories of civil Civil Society is a much hyped term vulnerability coming from climatic change any movement or dissenting move against the society organizations in these two countries today. At present any discussion on and promoting ‘press freedom’; in Bangladesh authoritarian regime. Under such are exemplary. They have achieved democracy and development seems to be they fight for rehabilitation of the disgraced, circumstances the growth of a civil society successes in their respective countries in incomplete without taking a reference to civil lifting up of emergency and holding of multi was like a mirage since those were sailing against current. These bodies are society. In this context C.D.Bhatta is worth party elections early; in Bhutan they talk about detrimental to the growth of it. However, found to be not only very active but also quoting here who said, “Since the last couple human rights violation and environmentalism; today both the states have undergone a very effective. In this backdrop this new of years, the word ‘civil society’ have been in Pakistan they support peace deal with India process of democratic transformation. A force needs a careful study in the so called used frequently in different perspectives of instead of war and the restoration of the democratic upsurge has enveloped both of semi-democracies i.e. Nepal and Pakistan state affairs. Nothing is complete without an independence of the judiciary; and in Nepal them. As a result their society, economy, which are heading towards a kind of explicit reference to the civil society”(Bhatta they are the chief advocates of democracy, polity and culture are taking new moulds. In substantial democracy. Since civil society 2006). development, republicanism, secularism and these days a democratic space has been is a sine qua non for the growth and federalism. But the growth of civil society is widening for which a civil society has been Despite the wider publicity and use sustainability of democracy and vice versa not uniform in all the states in South Asia. It emerging as a new force in both the countries. of the term, it still lacks a universally a comparative study of civil society in those is in a nascent stage in the Maldives and Especially the last two years in particular and acceptable definition. There has been a states will be of a greater significance in Bhutan; in Bangladesh it is gathering the last two decades in general have brought persistent debate on a precise definition of assessing the role of civil society in the momentum ‘since mid 1980s’1; it is in infancy a sea change in the democratic landscape of Civil Society. In the development discourse it

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 377 Civil Society in South Asia Anil Kumar Mohapatra 378 is regarded as one of the haziest terms. The e.g., family, school, church, trade unions etc. the increase in the level of literacy commoners Commonwealth expects these people’s concept has been subjected to widespread is based on authoritarianism. The CSOs give began to increasingly involve themselves in organizations to promote culture, good disagreements over its meaning and scope. the experience of self-organisation or co- those groups. That period was too marked by governance, human development and However for the sake of a minimum determination to the people at all levels and a rapid expansion of the middle class. Through livelihoods while addressing Commonwealth understanding of the concept in order to make them responsible and active citizens. those bodies they started demanding the goals for development, democracy and appreciate the present paper let’s consider few Without them it is almost impossible at the services like education and health etc. from cultural understanding. USAID regards these definitions and views of some leading individual level to further legislation, the state. That resulted in the downward bodies to be non-business and non-partisan; exponents on the subject to be preceded by a protect individual liberties, and engage in stretching of the state. Local government units UNDP identifies these bodies with freedom discussion on its evolution and meaning as the very demanding task of placing checks came into existence as a result of that. It was of association and participation and the World we accept in usage in regard to this on governmental power. Signifying their the story of late-19th and early-20th century. Bank identifies them with freedom of phenomenon today. importance the liberals like J.S. Mill and Those bodies were not having any political association and expression of Alexis De Tocqueville expressed their objective nor were revolutionary. Limited in opinion(Guhathakurta and Karim Meaning apprehension that “without these active both size and programme , such groups sought 1998).There are some other definitions given Civil society implies a domain between social associations, even democracies could more and improved services for their by scholars of civil society too. Let’s begin individual/family and the state where social become despotic regimes” (Indira Gandhi community. However, today some of those with a useful analysis given by Mahmood associations exist allowing individuals to National Open University 2006 : 214).It is bodies are utilized for political ends. In the Monshipouri (Monshipouri 1997). To him ‘In pursue their private interests in free therefore said that civil society could exist 21st century we find a quite different form of general, civil society is thought of to provide associations with others. Civil society prior to democracy but democracy can not civil society organizations. We are talking about a buffer between state and citizens: it counter represents a distinct sphere of human relations sustain without civil society. international civil society. These bodies are balances the power of the state by promoting and activity; distinguished from the state- it no longer bound by time and distance. We societal interests vis-à-vis the ruling elite. Evolution is neither public nor private –but perhaps both find how widely scattered persons with Thus conceived, civil society includes at once. As a sphere it is independent of and Civil society as a phenomenon is common interests in larger issues have begun professional associations, guilds, syndicates, protected by the state whereas it may European in origin. Traces of its origin can to join together. Non-Governmental labour unions, federations, political parties, challenge the excesses of the state. In that be found in the ancient and mediaeval Organisations, foreign or domestic and other non-governmental groups. Some light CSOs (Civil Society Organisations) period but in the 18th century it became development groups, charities for relief, scholars even include ‘informal politics’ as a imply independent self-organisations within conspicuous. The developments that special interest groups, research component of civil society, arguing that clans, society where people work collectively to accelerated its growth were the decline of organizations, advocacy groups and media etc tribes, and religious groups can be considered solve their own problems, articulate and absolutist state when political power came too are regarded as components of civil part of the definition’. Such a definition falls channelize public opinion and exert pressure out of the royal courts to the popular society. short of what we mean by civil society in on government. Therefore undemocratic assemblies, emergence of a secular Views and Definitions our own country usages. It is not always anti governments are afraid of civil society and authority, the coming into existence of the state nor does it seek to balance the state. they do not allow them to flourish. However, institution of private property, the growth For a deeper understanding of the Blair’s definition seems more acceptable. democracy facilitates its growth and vice of urban culture, the rise of nationalist and concept let’s take some leading definitions Civil society, according to Harry Blair, versa. Modern democracies cannot function democratic movements. It resulted in a and views especially of three schools (Liberals, comprises the collective social organizations without a vibrant Civil Society since public sphere. With the change in political idealists and Marxists) into consideration. that enjoy autonomy from the state, and have democracy implies the authority of the state and socio-economic conditions in the Civil society has been defined by one important goal, among others, to influence to be limited by the existence of social society people began to form associations many in many different ways. From the point the state on behalf of their members. A strong associations organised independently of the or groups for the fulfilment of their needs. of view of its relationship with development civil society supports democratic participation, state. It derives support and inspiration from Those were formed independent of the state. and good governance several international assures the right and probity of the citizenry the assumption that democracy at the level Community organizations, social welfare agencies/ organizations have there own and contributes towards a deepening of policy of the state will be weak if the rest of society bodies were created for mutual help. With interpretations and perceptions of civil society. accountability (Rahman et al. 2002 : 424).

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Views of Three Schools together with the accountability of the states, into account the insights of all. Accordingly first, purpose and requirements of the present the limits on state power, the responsiveness it is required that the state power must be paper we shall have to agree to the Let’s discuss views of three schools to the spontaneous life and the interactions controlled and it has to become responsive proposition that civil society can be namely Liberal, Idealist and Marxist. (i)As a of civil society. (ii) Next school of thought through democratic practices of an independent understood in contrast with political and theory it forms an essential part of liberal was idealism. It was Hegel who represented civil society; second, political accountability has military society. It implies a zone or space democratic theories. Hobbes, Locke, J.S.Mill, it. Instead of keeping the state below the to reside not only in constitutions, laws, and which is neither political nor militaristic. It is Tocqueville and Adam Smith etc. were its civil society he kept the state above the latter. regulations, but also in the competence of the also a zone that includes associations which chief advocates. It stands against the idea of To him state was the synthesis of the thesis social fabric or political public. are not selfishly private and at the same time a totalitarian state that had sought to regulate (family) and anti-thesis (civil society). For which do some public good. Civil society all social institutions leaving no democratic State, Civil Society and Democracy Hegel civil society was a negative institution thus includes all human associations space for them. According to the Liberal which was the result of the irrational forces Since this paper is going to discuss excluding the formal wings of the School an active civil society is regarded to of individual desires. It was, to him, an the role of civil society in the democratic government (also the local self governing be a precondition for the realization of true expression for the individualist and atomistic transition and consolidation in two states units and military establishments) and private democracy and development. It strengthens atmosphere of middle class commercial which were for a long time were under sector trading and manufacturing units. In and facilitates democracy and acts as an society. According to Hegel state was the dictatorial rule it is necessary to find whether the same vein, civil society is regarded to antidote to authoritarianism. Hobbes and final form of social institution and thus there exists a relationship between state, civil have composed of all institutions that are Locke were the early thinkers who made a ultimately civil society should be kept below society and democracy. According to some inherently non-governmental in nature. It clear reference to ‘civil society’ as the state. There was essentially no scholars state and civil society are mutually includes NGOs (Non Governmental distinguished from the ‘state of nature’. dichotomy between the state and civil antagonistic since civil society wishes to Organisations), media, trade associations, Through social contract a civil society or society. (iii)Marx’s view came in sharp restrict the state authority and vice versa. In sports clubs, advocacy groups, and groups political society came into being. Both talked contrast with the Hegelian view. Marx dictatorial regimes state power is used to of special interests. According to Beetham about a public sphere where individuals had sought to restore the civil society to the restrict the activities of the civil society and and Boyle the elements of Civil Society some inalienable rights which were protected position of making it the theatre of history. thus state becomes the spokesperson on include “(i)independent media of by the state. The concept of civil society then But Marx found that in liberal democracies behalf of the civil society. It becomes a zero- communication that includes television., got a fair treatment in the hands of the classical civil society had failed to live up to creating sum game where one grows at the cost of radio, news papers, internet, journals, political economy theorists like Adam Smith. a situation where the individual could find other. However democracy or a democratic periodicals;(ii)expert bodies on all aspects They demanded more freedom of the individual freedom and democratic transformation and system unites them and keeps both the state of govt. policy;(iii)a net-work of voluntary and the least intervention of the state in the could integrate into society and the state. and civil society in a harmonious relationship. associations in all walks of social life through domain of individual. This helped the civil For him civil society was too a bourgeoisie State gives legitimacy and protection to the which people manage their own affairs society as a historically evolved area of institution. It had become an arena of class civil society and civil society gives stability among them some assume significance for individual rights and freedoms, where conflicts, selfish competition and to the state. Civil society can not grow if the the promotion of democracy those are trade individuals in competition with each other exploitation. It was in contrast was serving state is not democratic and the state can not unions, professional associations, women pursued their respective concern. J.S.Mill and the interests of the owning classes. Marx survive for a long time if it does not provide groups, self help groups(SHGs), human De Tocqueville wished to limit the growing therefore demanded the abolition of the conditions for the growth of civil society. rights and developmental organisations, power of the state through the mechanism of antithesis between political society (state) Therefore in the liberal democracies there is religious bodies and grass-root organisations civil society. Tocqueville termed them as and civil society through the abolition of found a constant reciprocation between both of any kind”( Beetham and Boyle 1995 : intermediate associations. He said such civil both. Therefore he said with the withering the state and civil society. 95-106). And finally from the usage and associations prepare people for democracy away of the state the civil society would also normative point of view we have to accept and puts a check on the state. Accordingly come to be abolished. Thus from the above discussion it is that it embraces an entire range of the role of the state witnessed an eclipse vis- realized and understood that civil society as a assumptions and facts that are indispensable à-vis the civil society. For the liberals, civil In the backdrop of the views discussed concept leaves much scope for confusion. It preconditions for democracy or at least a society presupposes democratic states above a definition of civil society should take is an evolving concept. However for the vital component of a democratic movement.

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Most of us would agree that it is an essential organizations have had limited impact on Civil society in Pakistan today only one private T.V. channel in the country; component of well-functioning governments policymaking and implementation. comprises of non-governmental organizations today there are more than thirty private news – democratic or otherwise. (NGOs), community-based organizations and information channels, in all major But today the situation is quite (CBOs), think tanks, trade unions, cultural languages. With constant information, II Civil Society in Pakistan: A study of different. At present Pakistan is passing groups, and informal citizen organizations. It analysis and chatter about even minuscule its Evolution and Present Initiatives through a phase of transformation. Its is gathered from a statistics (in 2001) that political tremors and developments, much of society, polity, economy and culture – all are Civil society grows in a politically there were around10, 000 to 12,000 active and Pakistan’s society has become involved with on the verge of a marked change. Today registered NGOs and up to sixty thousand and informed about what goes on in the liberalized society having democratic new forces, new factors and new players unregistered groups like NGOs and eight country. While numerous rumours and spins institutions and a general level of mutual are making their presence felt in Pakistan. thousand trade unions in Pakistan. Civil are given to political stories, no one can any tolerance among , between and within Now there is a new movement in the making, Society in Pakistan can be seen in terms of longer claim to be uninformed.” Besides the different ethnic/religious groups in the society. surrounded by vastly changed social and three broad groups: NGOs and CBOs media and press the human rights groups, Pakistan is known for the conspicuous economic circumstances in the country. One (including welfare, service delivery, human environment protection and conservation absence of such a culture which could have of the key features of this new movement rights, advocacy, social, and membership groups and women and child welfare been conducive to the growth of civil society. has been civil society activism. The old groups); professional and other membership movements are already making their voices In Pakistan after independence political power power structure is on the wane. The role of associations (such as labor and trade unions, heard across the country. The human rights went into the hands of elite of military generals, Pakistan’s army and its intelligence agency, the press/media); and academic and research activists like Hina Jilani, I.A. Rehman and feudal lords and bureaucrats who hijacked the the Inter-Services Intelligence (ISI), who had institutions. Political parties and religious very process of popular government in their long been on top of the power structure in Asma Jahangir are household names in groups are in a category of their own. favour by gagging the press and aweing the the country are facing challenges from Pakistan who have gained prominence in the judiciary into silence. They perpetuated their international community. The Human Rights commoners today in the form of civil society Free press (privately owned), non- rule in the garb of a fabricated ideology and Commission of Pakistan is devoted to the movements. Today these CSOs are governmental organizations are on the thus kept the commoner participation off the promotion of human rights and democratic increasingly emerging as an important group. increase today. It’s an irony that General politics. They too did not accept the federal Even the civil society activists have dared Musharraf who has been the target of civil development in the country. Today there are formula which could have dissuaded the to register their protest against any society movements in 2007(March and ninety registered political parties in Pakistan. growth of ethnic strife and the growth of crackdown or lapses by government or the There are several religious militant religious militancy. As a result what to say of November) was its creator and promoter eight military. years back. In 2000 after assuming power, organizations having tie up with political the CSOs, even the democratically elected parties. governments on four occasions have been Pakistan’s civil society has been Musharraf changed the landscape for private yielded to military dictatorships and its leaders growing in various spheres of social life. Its broadcast media in the country. A range of Recent Initiatives and Achievements like Nawaz Sharif (leader of the PML ) and traditional focus had been on human rights, television, and radio outlets, as well as The year 2007 was most significant Benazir Bhutto( the ex-PPP supreme) are especially minorities and women, and on Internet sites, opened up as more and more and of relevance for the Civil Society been forced to be in exile. This historic legacy social development in rural communities. Its private players won licenses to operate. Movements. Since November 2007 things has precluded the development of a culture recent focus is on the establishment of the Private T.V. channels like Geo TV network, took a swift turn that began in March that of participation and accountability, causing not rule of law, independence of judiciary, ARY-TV, and AAJ TV started competing with only the waning of institutional mechanisms representative government and democracy state run news channels. People of Pakistan year. The judiciary provided the lead which such as parliamentary institutions, mass media as a universal social value and development then were exposed to an open information was then joined by media, lawyers, social and CSOs, but also has squeezed citizen as well. While activism in these areas grew environment unprecedented before. The activists, and secular and religious political expectations in Pakistan. Therefore CSOs are appreciably, the traditional associations, like information systems of Pakistan became an opponents of the authoritarian regime of being marginalised in Pakistan politics until the labour unions and student groups that had important factor in shaping the course of the General Musharraf. When in November 2007 recent past because the democratic and played a major role in the past (in toppling present civil society movements. Sabar Zaidi( President Musharraf sought the approval of political space afforded to civil society Ayub Khan’s regime) are found to have Zaidi 2008:10-11)has observed that “In 2002 the Supreme Court for the suspension of the organizations was limited. As a result these declined. when the last elections were held, there was Constitution and (to rule by decree) the

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 383 Civil Society in South Asia Anil Kumar Mohapatra 384 imposition of emergency/ martial rule it was pressure on the minority government run by Indian Express 2008) innocent lives as its time provided an atmosphere which was declined by the Court. Several of its judges the PPP to reinstate all the judges including death-toll. These circumstances allowed little conducive for promoting and strengthening including the Chief Justice Iftikhar the Chief Justice Iftikhar Mohammed democratic space for the CSOs to flourish in civil society. But with the comeback of Muhammad Chaudhry refused to sign Choudhary suspended/ dismissed by Nepal. Given background was quite “assertive monarchy” in 1962 that suspended Musharraf’s decision. That was an Musharraf. discouraging for the growth of civil society. the first ever elected government the civil unprecedented incident in Pakistan’s history. Hence civil society has had a stunted growth society movement received a jolt. III Civil Society in Nepal: A study of its To avenge this Musharraf deposed Mr. in Nepal till the recent times. evolution and present initiative However, in the late 1980s, the civil Choudhury (who he had initially tried to Despite being mostly an authoritarian society’s movements again got a fillip. The dismiss in March 2007) and some other judges Like the Pakistani experience the system the existence of civil societies in “mode of occurrence” of the triumph of and put them under house arrest. Musharraf erstwhile Himalayan Kingdom of Nepal has Nepal has a long past. During the period of liberalism was “televisional.” So the winds of then moved to crack down on the media, had a mixed experience with democracy and Prithvi Narayan Shah such organizations were change were blowing in Nepal too. Although lawyers, social activists, and secular and autocracy. Within a span of 239 years of non-existent. However,Nepal did not remain the then liberal monarch, King Birendra religious political opponents- the emerging monarchy more than a century (1846-1951) devoid of social movements during the 104 allowed political society to exist, it was players in Pakistani society. The media was Nepal was kept under a hereditary prime years of Ranacracy. Arya Samaj was formed subjected to coercive measures when it got intimidated but they did not fear to give a wide ministerial autocracy called ‘Ranacracy’. in Kathmandu in 1896 to spread political active and hostile to the regime. Next came Next phase saw the advent of democracy in coverage to such undemocratic action. awareness and social reform which was the period of low economic growth of the Nepal but of no avail. Within the last 57 Nirupama Subramanian (Subramanian 2007) eventually suppressed by Ranas. Some country with growing fiscal deficits and years after the introduction of parliamentary wrote on that incident in the following words organizations like the Gorkha League declining international reserves. It resulted in democracy in it democratic governments in that “Most analysts had already given up the operated in India published newspapers to an acute macro-economic instability followed the real sense had prevailed over there for deposed judiciary as a lost cause… then there raise awareness about the state of Nepal by the “strategic” economic blockade only a very few years yielding to royal is Pakistan’s civil society. In Islamabad, there amidst Nepalese migrants. The other notables imposed by India for 15 months. This situation interventions and coups on several are near daily citizens’ rallies to the deposed were the first educational movement known indirectly empowered opposition political occasions. After the completion of more than judges’ homes, with the participants- lawyers as Library Parva, the establishment of Nepali society and a civil society as well to a great one year in office of the first ever and retired judges, school children, college Civil Rights Committee in 1936 followed by extent. They came down the street to democratically elected government of students, academics, teachers, human rights the emergence of Nepal Praja Parishad (Nepal demonstrate against the King. That resulted Bishweshwar Prasad Koirala the then activists, news paper columnists, journalists People’s Council)-the first political party in the restoration of multi-party democracy monarch reasserted his reign by dismissing and even house wives- carrying flowers for inside the country and slowly other political in April 1990. Mr. Chaudhry and the other judges elaborately the democratic government in 1962. From parties began to grow in numbers. There were handing them over to the policemen who stop 1962 to 1991 Nepal saw a King dictating a also women organizations run by the wives Since the restoration of multi-party the rallies midway.” That was how the civil party less democracy phase called of political leaders. The Revolution of 1950 democracy in April 1990 there has been the society asserted itself. The result was ‘Panchayat System’ followed by incessant which overthrew Ranacracy ushered a new ushering of a liberal tradition in Nepal. Free culminated in the ‘Fairest’ ( Zaidi op squabbles among, between or within political era in modern political history of Nepal. A press (private owned), non-governmental cit)Parliamentary elections in Pakistan’s parties causing political instability during type of trans-national civil society, Indian organizations are on the increase today. history after the restoration of Constitution and 1992 to 2006 which indirectly strengthened National Congress was the source of Formally registered civil society organisations Rule of Law. It has played a substantial role and consolidated the reign of the kings . Such inspiration of Nepali Congress. The educated in Nepal are over fifty thousands. Some of in forcing general Musharraf to resign from an undemocratic circumstance was further middle class were at the forefront of political the NGOs are emerging into powerful the office of the President of the republic of deteriorated and accentuated by the Maoist and social movements with some exceptions pressure groups and advocating for sweeping Pakistan followed by the election of Mr. insurgency that created havoc for a of few “enlightened” people from other ethnic changes in the socio-economic and cultural Zardari( the president of PPP) to the august decade(1996-2006) by terrorizing people groups. Then the new source of authority was milieu of the society. The human rights groups, office. Today these bodies, especially the spearheading a protracted struggle against defined by popular sovereignty and women environment protection and conservation lawyers’ and judges’ associations are putting the monarchy having over ‘1300’(New were granted adult franchise in 1951. The then groups and women and child welfare

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 385 Civil Society in South Asia Anil Kumar Mohapatra 386 movements are already making their voices society. For the first time in the history of issues. The recent agreement of the SPA seems to be devoid of an effective and a heard across the country. Since 1990 the Nepal, different marginalized sections, races (Seven Parties Alliance) over some crucial widely established civil society”. people of Nepal are being exposed to an open and nationalities have raised their voices issues that has brought few proposals for In 2001, Civicus, an international information environment unpredicted before. through Civil Society Platforms and provided amendment to the interim constitution which alliance of civil society groups, too described With all the attributes of a free and liberal their vision and blueprint of New Nepal.” is hoped to pave the way for government Pakistan’s civil society as a “collection of democratic environment, the information formation after the CA election in April (2008) Recent Initiatives and Achievements incoherent voices, conflicting worldviews systems of Nepal are increasingly emerging has been regarded as an outcome of the and opposing interests” characterized by as an important factor in shaping the course Since the Jan Andolan II in March- persistent insistence of the CSOs on the “unresolved struggle between the practices of civil society movements. April, 2006 the CSOs have emerged as a political parties to break the deadlock among and values of pre-capitalist society and new potential force in Nepalese politics. The them. Some Scholars argue that it modes of social life, between authoritarian civil society movement now motivates manifested itself in a more concrete way IV Lacunae in the Civil Society legacies, and democratic aspirations” people towards social, economic and through the showdown of ‘people’s power’ (Jayashree 2007). political cooperation. People are gradually Nepal and Pakistan are more in the April 2006 Jana Andolan-II (mass relying more on these non-state social authoritarian than a democratic system as a movement) that played a crucial role in In addition to the above the other institutions, through which they can work result of which civil society has been regime change. During the Jan Andolan II, thing that weakens the role of civil society is collectively to solve their own problems, prevented to grow properly in both the states. civil society regrouped demonstrating its the very low rate of literacy in a country like which can act as channels of popular In Pakistan even its existence has been resilience and commitment to democracy. The Pakistan where more than 50 per cent of its opinion and put pressures upon the debated by its scholars in the country and Civil Society Organisations (CSOs) and people are illiterate. There has been an government and which can serve as a beyond. Iftikhar H. Malik ( Kapila 2008) – a NGOs were able to connect by e-mail, and alarming increase in the level of violence and protection against its encroachments. These known Pakistani intellectual has made a human rights groups issued an appeal that intimidation against journalists and media civil society institutions are trying to remark regarding the existence of civil society called upon the international community to organizations in the country. There are too enhance social democratisation and national in Pakistan that a ‘civil society’ cannot be demand some specific measures from the several voluntary groups which have slipped development. Not only these civil society taken as a given reality; it has to be created Nepalese authorities. These include the into fanaticism and religious militancy. Now organizations are inculcating civic virtues and strengthened. He has made the following unconditional release of those arrested and a some of them are used to preaching but are also insisting the furtherance of observations: “The Pakistani State has halt to the ongoing atrocities by the security intolerance and inciting sectarian hatred and democracy in the country. Credit goes to the successfully refurbished itself at the expense forces. violence. All civil society groups in Pakistan leaders of the civil society who had of vital civil institutions – Constitution, are thus not a part of a democratic civil Nepal’s Civil Society consists of succeeded in organising an interaction pluralism, political parties, independent society. The other deficiency in the civil business, sports, social, political, health and among all stake holders, the disputing judiciary, free press and activist groups. The religious interests and Nepalis (in Nepal or political parties and factions along with the imperatives for establishment of a civil society movement in Pakistan is that while it abroad) participate in a wide variety of clubs Maoists in Lalitpur on 23rd December, 2007 society in Pakistan have been side lined. is encouraging to see that the legal and associations. The most visible and most to sort out all political issues including the Totalitarianism, elitist monopolization, associations have spearheaded the vocal of the lot from Nepali Civil Society, of decision on holding the Constituent majoritarian coercion and ethnic fascism movement to restore democracy but it must course, are the media and the Human Rights Assembly (CA) elections in mid-April, which normally stand rejected by a ‘civil take other such groups to build a common NGOs – the political component Civil 2008. That resulted in the 23-point society’ are all pervasive and predominant in and potent platform to work for the Society. Civil Society in Nepal today is agreement which sustained the hopes of Pakistan.” In the opinion of a leading political furtherance and consolidation of democracy gaining new momentum. Today, according to democracy active and alive and led to the analyst in India Dr. Subhash Kapila ( Ibid.) in Pakistan. Its challenge thus lies in Prasant Kumar (Kumar 2008: 34), “Civil successful conduct of the historic CA “some may be able to discern a semblance of mobilising people, creating unity among societies in Nepal provide an ‘alternative elections on 10th April, 2008.Today these a ‘civil society’ in Pakistan from a handful of diverse social and political groups and space’ for the historically suppressed voices bodies are very much active in urging the objective political commentators, intellectuals providing an alternative leadership that would and intervention in the affairs of state and political parties to build consensus on national and human rights activists, Pakistan otherwise win the trust of the people.

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 387 Civil Society in South Asia Anil Kumar Mohapatra 388

In Nepal, in a similar manner, some states. The growth of civil society and its Constituent Assembly Elections in April 10, of the present General Kayani(?).The way critics are of the view that what we call a activities in recent times evidence the 2008. In view of its success during April 2006 the army reacted against the move of Prime ‘civil society’ is nothing but an amorphous broadening of the democratic space in both today it is believed that it could play a more Minister Gilani to ‘put the ISI under the control notion of people’s power as demonstrated in the states. With the revisit of democracy, it significant role in the Post-CA-Poll Nepal both of the Interior Ministry’ ( Sharma and Reddy the April mass movement in 2006. These bodies is expected that the institutions like in addressing the immediate issues like 2008)has been a matter of concern. The are neither organized nor are having any ideal universities, schools, newspapers, banks, drafting of the Constitution, to bring about a people of Pakistan are too critical of or consensus. These bodies have become hospitals, professional associations which will consensus among political parties on all Pakistan’s policy towards Afghanistan and its agents facilitating the global neo-liberal be made accessible to all and in turn that national issues like deciding upon the nature war on terror. In this backdrop civil society process. The political agendas of NGOs come would strengthen civil society. Today in view of republic and federation, bringing needs to go hand in hand with the political from the economic, political and financial of the numerical growth of the CSOs it is improvement in the deplorable Human rights parties to strengthen the forces of democracy. power in the developed countries. It is the result said that the states are being ‘societalized’. situation, securing freedom and representation The civil society too has a role to play in of foreign funding through which there has Today the legitimacy of the state has begun for all, fight against exploitation, conflict redefining the national interests and national been the cropping up of CSOs and NGOs in to be obtained or withdrawn according to the resolution among different sections and long threats of the country. In this regard civil the name of conflict resolution. These are demands of civil society which the state can term issues like strengthening the society in Pakistan has to take a firm stand formed in order to tap the monetary benefits it not overlook. The states in Nepal and democratization process, nation building, on terrorism and peace deal with India. brings. Their motivation is not voluntary but Pakistan are slowly coming out of the hang- institution building, integration of Maoist rebels Besides these issues the success of monetary gain. Mostly the people from middle over of the past, and understand those into the army and mainstreaming of the democratic switch over and its sustainability class and elite have formed them. They wish demands put by the CSOs. However the Maoists etc. In a similar way the civil society depends much on the civil society. How does to continue the conflict without resolving future of civil society depends on how it pulls in Pakistan is now found to be very active. it respond to the prevailing situation is a matter them. Had they been resolved the conflict together with the political society. In both the People are getting aware of political that counts. In conclusion it can be said that many organizations would go bust and would states the governments need to appreciate happenings and are thinking of asserting their civil society is gaining new momentum in both have been dried up. Therefore they do not have the contributory role of the civil society and role through them. With the insistence of the the states today. Civil society in both the states has expanded considerably and has made consensual opinion/ voice in terms of peace they must learn to build partnership with these civil society organizations some effective use of the media as a platform to building and conflict resolution. Creating bodies to lead the respective countries unprecedented developments like restoration of the Constitution, establishment of rule of put forth its views and articulate a sharp NGOs are like a business on which depends towards democratic consolidation, stability law and the independence of judiciary and critique of government policies. The public their livelihood. This professional civil society and development. is a donor driven society. Thus the conduct of parliamentary elections after six perception in Pakistan and Nepal vis-a-vis transformation of this amorphous notion of Conclusion years and above all winding up of the India has witnessed a steady change, with power into civil society should be the first and dictatorship of Musharraf in Pakistan - have civil society engaging in a critical questioning It is said that civil society develops foremost task to be undertaken and taken place in Pakistan. Despite its preliminary of their governments policies towards India. and plays an essential role in influencing the accomplished in Nepal. successes the CSOs have a lot to do in the However it is to be admitted that both Pakistan political system either before or after the present political situation where a coalition and Nepal being transitional democracies, the Despite these lacunae in Nepal and downfall of non-democratic regime. This is between (Pakistan People’s Party) PPP and ideal conditions of a civil society are not yet Pakistan we have to admit that both are true in case of Nepal and Pakistan. In case PML(N)(Pakistan Muslim League led by achieved but a marked shift has occurred in transitional democracies where the ideal of Nepal the civil society organizations not Nawaz Sharif) has been failed to pull together both the states. Despite its commendable conditions of a civil society are not yet only waged a successful revolution that resulting in a minority government of the PPP initiative and success in the respective states achieved but a marked shift has been occurred. brought the regime change in April, 2006 but with the withdrawal of the PML(N) from it. the current situation of renewed internal Today therefore despite having these these bodies did extend their support to Peace Under such circumstancesthe question that conflict (especially in Pakistan’s Federally inconsistencies civil society has emerged as Negotiation between 7 Parties’ Government then arises is regarding the possibility of a Administered Tribal Agencies) and political one of the most powerful means in the political and Maoists as per the Mandate of the military coup, and should the democratically degeneration characterized by schism discourse of the respective states and a great People’s Movement and these bodies too elected government fail. Nobody knows what between the major political parties in both the deal of expectations is pinned on it in both the have played an active role to accomplish is going to happen in 2010 after the retirement states calls for soul- searching and

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 389 Civil Society in South Asia Anil Kumar Mohapatra 390 introspection on the part of both civil and grants and participate in initiatives in each of Kumar, Prashant (2008): “Redefining Nepali State and Sharma, R and Readdy, N (2008): “A Trip Report on political society of both in giving shape to a our four programme areas on culture, Civil Society: The Madheshi Perspective”, Civil Pakistan” Report of IPCS Seminar held on 2 new Pakistan and Nepal. governance, human development and livelihoods. Society in Emerging Democratic Nepal, Centre September, Institute of peace and conflict studies The Foundation will now be able to strengthen for study of Nepal (B.H.U.), Varanasi, p.36. (IPCS) Journal, 5 September available at http:// Notes the work of civil society in Maldives and www.ipcs.org/whatsNewArticle1.jsp?acti Maldives Institute for Security Democracy and encourage partnerships with governments and on=showView&kValue=2684&status=article&m 1. Bangladeshis in general seem to be skeptical about Development (2008): “For political party system others in addressing Commonwealth goals for od=b, accessed on 12 September 2008). the future of democracy and democratic to work, Maldives Civil Service Commission Law development, democracy and cultural governance. Political parties have chosen a path needs to accommodate the right for civil Service Subramanian, N (2007): “Pakistan Civil Society understanding.” (See “Maldives joins of confrontation than consensus. Development employees to participate in political Parties”, takes on Mission Impossible”, The Hindu, Foundation” at http://www.commonwealth debates and issues are addressed from mere August 10 available at http:// December 12. foundation.com/ news/news/detail.cfm?id=440 – partisan perspectives. However, since mid 1980s misdd.wordpress.com/2008/08/10/civil-service- web accessed on 4 September, 2008). Zaidi, S A (2008): “Social and Structural Civil society has emerged as an alternative force commission-law-needs-to-accommodate-the- Transformations in Pakistan”, Economic and along with the conventional political parties and right-for-civil-service-employees-to-participate- Political Weekly, Vol. XLIII, No.20, pp.10-11. pressure groups in Bangladesh. Though there has in-political-parties accessed on 3 October. References been some criticism about its focus, effectiveness “‘Ready-to-eat Meal’ Scheme Opposed”, The Hindu, Mohapatra, Anil Kumar (2008): “Democracy in the and partisan inclinations, however the civil society Bajoria, Jayshree (2007): “Pakistan’s Institutions and Visakhapatnam, 3 October 2008. Himalayan Kingdoms: Hopes and Humps”, has now being recognized as a credible channel Civil Society”, December 27 available at http:/ International Research Journal of Social “Bangladesh Polls on December 18”, The Hindu, for voicing the critical issues ranging from politics /www.cfr.org/publication/14731/ Sciences, Vol.1, No.2, July- December, School of Visakhapatnam, 21 September 2008. and governance to participative development and pakistans_institutions_and_civil_society.html, Social Sciences and International Studies, human rights. Civil society has opened a new accessed on 6 June 2008. “Bhutan’s Democratic Government Soon”, The Hindu Pondicherry University, Pondicherry, pp.109-10. ‘window of opportunity for the community to Visakhapatnam, 26 March 2008. Beetham, D and Boyle, K (1995): Democracy, monitor public institutions, identifying critical Monshipouri, M (1997): “State Prerogatives, Civil National Book Trust, New Delhi, pp.95-106. “Maldives Goes in for Multi-Party Polls”, The Hindu, issues and constraints in legal, institutional and Society and Liberalization: The Paradoxes of the Visakhapatnam, 8 August 2008. judicial processes of governance, persuading the Bhatta, C D (2006): “Role of Civil Society in Conflict Late Twentieth-Century in the Third World”, political parties to follow ‘modus operandi’ for Resolution”, The Rising Nepal, Kathamandu, Ethics and International Affairs, 11, p.247. “NGOs: Set up Safe Corridor for Citizens”, The Hindu, participative and responsive politics. (See July 27. Visakhapatnam, 21 September 2008. Rahman, A; Wadood, S N and Eusuf, M A (2002): Asaduzzaman, M. (2003): ‘Politics, Development Guhathakurta, M and Karim, S (1998): ‘Towards a “Civil Society and Governance”, in Hasnat Abdul and Civil Society in Bangladesh’, University Theory of Governance and Development Hye(ed.) Governance south Asian Perspective, Grants Commission of Bangladesh and Learning from the East Asia’, Table 4.1, UPL, Manohar, New Delhi, p.424. Department of Public Administration, University Dhaka, p.91. of Dhaka, Bangladesh, 7 October at http://atlas- conferences.com/c/a/m/m/37.htm -web accessed Ibid. (See ‘Another Census Move in Sri Lanka’ at on 25 September, 2008). page-17). 2. Recently the Maldives has joined the Indira Gandhi National Open University (2006): Commonwealth Foundation (an inter- India: Democracy and Development (MPS- governmental forum and a sister concern of the 003), School of Social Sciences, New Delhi, Commonwealth organization) as its 47th member. p.214. Speaking on the occasion Dr Mark Collins, Kapila, S (no date): “Pakistan: do a ‘civil society’ Director of the Foundation said: “We are delighted and a ‘peace constituency’ exist?” available at to welcome Maldives into membership. This is http://www.southasiaanalysis.org/ good news for the Commonwealth and for %5Cpapers20%5 Cpaper1917.html, accessed Maldivian civil society. The benefits of being a on 5 June. member of the Foundation mean that people’s organisations in the Maldives can now benefit from

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Northeast India As a gateway to India’s Look East Policy economies as well as for avenues to get its construction of a security order that will be own economy integrated into the global in India’s interests. This is not only on account Munmun Majumdar market. For that reason India deliberately of the perception of Asia -Pacific as a zone fostered a “Look East” Policy, in foreign affairs, of increased threats, potential turbulence and Abstract and made resolute efforts to strengthen and unbridled great power rivalries are gaining “…Yet all experience is an arch where through upgrade ties with ASEAN as a group. With greater currency in India, but also for the Gleams that untraveled world… for my purpose holds this the Government of India, for the first time reason that ASEAN is seen as potentially To sail beyond the sunset, ...” since independence, turned its attention sharing a range of common military and non- (Ulysses: Tennyson) towards the ASEAN region with economics military threats and concerns, including those India’s Look East policy was launched nearly simultaneously with its economic in mind.3 related to issues as diverse as energy, reform when India began to see South East Asia as the region where politico- economics and sustainable development, non- strategic and economic conditions offered an opportunity to play a substantial The combined effects of the systemic traditional security issues, human security etc. role. Launched in the early 1990s as an economic and security-oriented foreign changes that followed the collapse of the India sought a more active role in the region policy initiative linking India and East Asia, it took fifteen years for the Ministry of former Soviet Union, resolution of the External Affairs to bring the policy to the Northeast India. The emergence of the Kampuchean conflict, and the liberalization also since it was deeply concerned about the look east policy as a model of development for the Northeast arose out of external and economic reform program initiated during uncertainties of the future involving China’s and internal security concerns. the Prime Ministership of Mr. Narasimha Rao, predominance. Thus the policy was more than New Delhi’s long-standing quest to integrate the Northeast Region with the rest of in turn, helped to persuade ASEAN countries just a foreign policy alternative in view of the India can be fulfilled only with the economic integration of Northeast India with to step up trade and investment in India. Thus, fact that it provided a development alternative Southeast Asia which will in turn foster the region’s political integration with India. in looking east, India sees a great opportunity as well. To quote Prime Minister Manmohan Therefore, to reach Southeast Asia via Northeast India New Delhi cannot circumvent in terms of trade expansion and economic Singh, “it was also a strategic shift in India’s and downplay the continental dimension of the Look East policy. And more opportunities and also to position itself as a vision of the world and India’s place in the importantly India’s engagement with Southeast Asia will be incomplete without the determining factor in the security and stability evolving global economy”. It is only with the participation of its Northeastern States. of the region. This was well articulated by formulation of the Look East Policy that India Key Words: Look East Policy, ASEAN, Northeast India, Asian engagement, Connectivity. India’s former Prime Minister A.B. Vajpayee: has given Northeast India focal reference in “This region (Southeast Asia) is one of the its foreign policy planning. Significantly, this approach has received unanimous support With Prime Minister Narasimha economic reform when India began to see focal points of India’s foreign policy, strategic from all governments that came to power in Rao’s visit to South East Asia and the South East Asia as the region where politico- concerns and economic interests. We have New Delhi since that time, regardless of their exposition of a new Look East Policy in his strategic and economic conditions offered it always sought to integrate India’s strengths political ideologies. According to Prime much publicized and well received Singapore with an opportunity to play a role. The in various social, scientific and economic 1 Minister Dr Manmohan Singh, “The look east lecture at the prestigious Institute of South emergence of Asian Tigers and the growth sectors into the relevant ASEAN processes. policy is more than a slogan, or a foreign East Asian Studies, stating; “I have come to of the Association of South East Asian Reflective of India’s interest in intensifying policy orientation. It has strong economic extend my hand of partnership in this venture- Nations (ASEAN) as the foremost its engagement with ASEAN, we are in the rationale and commercial content. We wish a partnership having so much in common, and economies of Asia provided further fillip for process of jointly developing an India- to look east because of the centuries of so close already in multi-faceted cooperation”, the Indian policy makers to look at the East ASEAN Vision 2020, as a road map to our interactions between us”.5 marked the beginning of India’s effort to renew as a possible avenue for economic mutually desired objectives. The move 2 towards greater economic liberalization in the a closer relation with the South East Asian transaction. Consequently India’s foray into Though the policy was given an initial ASEAN Free Trade Area and the ASEAN countries. India’s Look East Policy was Southeast Asia was the logical extension of thrust with India becoming a sectoral dialogue Investment Area reflects this recognition”.4 launched nearly simultaneously with its India’s search for potential markets in newer partner with ASEAN in 1992, it was accepted Gradually the ASEAN region has as a full dialogue partner in 1995, and a member of the ASEAN Regional Forum Dr Munmun Majumdar is a Reader, Department of Political Science, Northeastern Hill University (NEHU), emerged as a central pivot in the Indian view Shillong 793022. of Asia and its future, and essential to the (ARF) in 1996. The policy was pursued in

IJSAS 1(2) 2008, pp.391-405. ISSN 0974 - 2514 International Journal of South Asian Studies IJSAS July - December 2008 180 Northeast India As a gateway to India’s Look East Policy Munmun Majumdar 394 fits and starts till recently. It was given a boost and hitherto unexplored areas of economic are real possibilities for increased capital and the two major thrust areas, Prime Minister when India became a summit level partner of cooperation. In other words, the look east trade flow between the two regions. The Manmohan Singh mooted the idea of a pan- ASEAN (2002) involved in regional initiatives policy has presently acquired a strategic presence of a large expatriate Indian Asian Free Trade area (FTA) on the lines of such the Ganga Mekong Cooperation and dimension. The Southeast Asian countries community in ASEAN economies can always the North American Free Trade Area and became a member of the East Asia Summit are also simultaneously beginning to see a act as a bridge between India and the nations the European Union to make the region an (EAS) in December, 2005. These regional strategic dimension. As a result the Look of Southeast Asia. One of the dangers for the economic powerhouse. He said, “I believe initiatives such as the Ganga-Mekong sub East Policy is responsible in making India Indian diaspora though would be to reduce the objective basis for economies of our region region, BIMSTEC etc can be relevant to the an inalienable part of the Asia-Pacific itself to a business network only. Business to come together exists. The desire to create prospects of the emergence of a cross-border strategic discourse. This can be viewed as should be a propelling force for people to an East Asian community, bringing together region bringing together the North East India the second phase of the engagement which come together and not an end in itself. ASEAN, China, Japan, Korea-and also and the adjacent trans-national areas on its began in 2003 as a more comprehensive Australia and New Zealand-is manifest. A Another serious cause of concern for east. The Framework Agreement on phase involving players extending from Pan- Asian FTA will be a dynamic, open and India is the role of fundamental -Islam in South Comprehensive Economic Cooperation (for Australia to East Asia with ASEAN as its inclusive association of countries in the region. East Asia in the coming years. The spread of establishing a FTA in a time frame of 10 years) core.6 I am convinced that this is the only way to fundamentalist Islam from the Moro islands was concluded in Bali in 2003, an ASEAN- move forward”.7 Noting that the process of India is gradually looking at its in Southern Philippines through the Maluku India Joint Declaration for Cooperation to Asian engagement had taken off, he hoped developing relations with its eastern peninsula to Aceh and Malaysia, the bombings Combat International Terrorism has also been that it would be “Self sustaining, increasing neighbors from the prism of its domestic in Indonesia and the secessionist movements adopted. India and Southeast Asia have no peoples interface in the region”.8 compulsions particularly in the North East all pose a cumulative threat .Its consequences history of wars between them and through and in the Andaman Sea. The security of have the potential to spread beyond the India’s accession in October 2003 of the Between engagements and the Andaman Sea, the sea lanes and the borders. All of these necessitate a common ASEAN Treaty of Amity and Cooperation estrangements, India-ASEAN relations Indian economic zone will require sub- approach to redress the problem. The growing (TAC), India has reaffirmed ASEAN’s witnessed early exchanges replaced by regional cooperation with countries such as non economic convergence include areas such territorial integrity and sovereignty and also periods of isolation. It is evident that both Thailand, Myanmar, Indonesia and as the war against global and regional terrorism non-interference in ASEAN’s internal affairs. India and ASEAN need each other and Bangladesh in preserving the ecology, and extremism, transnational crime, cross Defence cooperation agreements with a recent developments have created conditions environment and the unique biodiversity of border subversion and insurgencies and number of countries and regular joint military conducive to greater coordination of policies the region. This region has also emerged as maritime cooperation, including safety of sea exercises and top-level political exchanges between the two sides. Improvement of a focal point for piracy, poaching and lanes, ports, economic zones etc. The have also taken place. In short a number of bilateral relations with the nations independent maritime crimes. Even intelligence gathering economic convergences go beyond the institutional mechanisms have been put in place of the grouping is equally important. Each by foreign powers in this space is said to traditional trade and commerce and now for regular interaction at all levels and nation has its own strengths and have increased. If China’s growing influence include areas such as energy security, human simultaneous strengthening of bilateral characteristics and the bilateral relations have and military presence in this strategic space resource development (HRD), environment, linkages with individual member-states The to be tailored to suit the requirements of that is to be managed especially in view of science and technology. current phase marks the beginning of a vibrant particular state and that of India. As the Indian China’s military bases in Myanmar close to relationship on the economic, political and India and ASEAN countries face Prime Minister Manmohan Singh noted, “The India then India will need to strengthen ties strategic fronts. These developments suggest similar problems of human development. New abundance of natural resources and with its eastern neighbors. That will be the that India appears to be well poised for a more Delhi’s offer to lower trade barriers, extend significant technological skills in the ASEAN rationale of India’s renewed Look East meaningful role in the Asia-Pacific affairs. help in making generic drugs to combat bird region provides a natural base for the growth Policy in the contemporary context. Although India’s look east policy was premised flu and taking part in regional maritime security of synergies and integration between ASEAN more on economic rather than strategic To view India’s perusal of friendship in the recent years are part of India’s attempts and India-both in trade and investment. The considerations, in recent times however India with ASEAN in purely strategic terms as to assume not just a greater role for itself but challenge, however, is to create and maintain has expanded her talks with Asia Pacific to an attempt to counter China, however, would a more responsible one as well. While greater a regional and international environment that include political, defence, maritime, strategic be to miss the point. The fact is that there investments and economic co-operation were enables us to attain and sustain high rates of

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 395 Northeast India As a gateway to India’s Look East Policy Munmun Majumdar 396 economic growth”9. Hence they have a very and culturally remote from the heartland of it is widely believed that it is much more than has India been able to develop a coherent broad scope for cooperation that would help India and incorporates a cultural the formal trade. There are other trans- border approach to address the throttling of strengthen and enlarge India’s ties with the kaleidoscope of more than 200 ethnic and links too based on cultural affinities, tradition, democracy in Myanmar. Nonetheless these region that is of great strategic and economic tribal groups, who are ethnically, linguistically connectivity and ethnicity that have governed aspects make it imperative for India to engage importance to it. The absence of conflict on and culturally distinct. This makes it a relations between the Northeast India and the the regime in Myanmar in a meaningful vital issues and the presence of common hopefully future tourist paradise and an neighboring countries. Thus, real politic dialogue. At the same time, it is crucial to keep challenges make it possible to expand intriguing enigma for social scientists. They demands that India cannot keep away from lines of communication open with the constructive ties between the two peoples. belong to the Southeast Asian culture zone its neighbors like the ASEAN countries, India democratic activists in Burma, for their cause One important facet of the Look East Policy that includes the Assam valley, Northern part too has tried to woo the Burmese generals in is worthy and will bear fruit in the years to that has received very late attention from of Myanmar and Thailand and the Yunan a diplomatic network in order to attempt to come. Indian policy makers relates to Northeast province of China. Unlike their counterparts secure the strategic zone between India, China Any development in Myanmar India. I shall endeavor to traverse the arch in the rest of India who speak languages and Southeast Asia. This movement fitted therefore has to be closely watched and an and take the road less travelled and highlight belonging to the Indo-European and perfectly with India’s desire to make its improper handling of Myanmar would hurt some of the important facets of Northeast Dravidian family of languages a large presence felt much more in Asia, through India’s strategic interest as well as the Look India as a gate way to Southeast Asia. number of people from Northeast India Myanmar.13 Consequently New Delhi has East Policy. Myanmar is strategically located speak Sino-Tibetan languages or Austro- been engaging Myanmar and this policy has India’s Look East Policy via North East 11 between India and Indo-China and offers an Asiatic languages. Northeast India is prompted Myanmar to deny assistance to India alternative way to reach out to the East and connected with the rest of India by the 22 militants in the Northeast though the nature Southeast Asian markets. As a land bridge to India’s landlocked North East km wide Siliguri corridor (the famous of its cooperation may be of a limited scale. South East Asia developing communication covering an area of 255037 sq.km bordering Chicken neck or Siliguri neck). The Siliguri The poor border security facilities necessitated and trade relations with Myanmar as an option China, Myanmar, Bhutan, and Bangladesh strategic neck controls access to the seven the establishment of controls on the Indo- India is keen to build up. India is Myanmar’s comprises of seven states. They are sisters of the Northeast and represents a Myanmar border to prevent large scale second largest export partner and fourth Arunachal Pradesh, Assam, Manipur, developmental hurdle as much as it acts as movement of illicit arms, drugs and goods. largest source of imports. Trade between Meghalaya, Mizoram, Nagaland, and Tripura. a psychological barrier to the integration of Although the Ministry of External Affairs of India and Myanmar is said to have expanded The construction of a region called northeast the region with the rest of India.Southeast India has sanctioned funds to expedite the from $87.4 million in 1990-1991 to $569 million is a post-1947 development. At the time of Asia is geographically contiguous with parts work of fencing parts of the Indo-Myanmar in 2005-2006 in the wake of the Look East India’s independence in 1947, the northeast of Northeast India sharing a long border that border this again is a sensitive issue since initiative India’s trade with countries bordering was organized as two entities: the state of forms a land bridge that connects India with fencing would divide many ethnic communities the North East has seen the most dramatic Assam and Northeast Frontier Agency Southeast Asia. This fact and also the reality like Lushais, Nagas,Chins or kukis who inhabit expansion, with their share in India’s total (NEFA). In 1949 the principalities of Tripura that over 95% of the borders of the Northeast hamlets on both sides of the international 12 trade going up more than five times (from 1.7 and Manipur were incorporated into India as India are with foreign countries , are the border. a centrally administered area and union ones that India cannot ignore. The Northeast per cent to 8 per cent). For the first time, territory respectively. Continuing with the region is unique and historically has had Natural gas is available in abundance India has initiated a free trade agreement British tradition of the inner line under section trans-national links. The geostrategic and in Myanmar and this fact should be of interest (FTA) with Thailand and is in the process of VI of the Constitution tribal people in the economic stakes involved in the Indo- to India. In areas such as energy, the policy is negotiating similar agreements with Singapore Northeast had special autonomy over their Burmese region may be underestimated but yet to yield results with the Indo Myanmar and Malaysia. It is clear that in the days to local affairs including language, social policy they are far from negligible. Subversion and energy relations mired in controversy. come, India is willing to pursue closer trade and in migration10. It is strategically located terrorism, drugs and its nexus with crime However the actual fact remains that and economic ties with its eastern neighbors, at the centre of three giant markets of the and trans-border trade and economic links infrastructural projects connecting Northeast and there are possibilities for the entire North world i.e., China, ASEAN and the SAARC have to be seen in a historical and traditional with Myanmar and other Mekong countries East region to acquire a place as India’s region. Lying at the cross roads of South and context. While there is no precise estimate are faced with problems such as time-lag, Eastern entrepôt. Unfortunately, these Southeast Asia the region is geographically of the volume of trans-border informal trade incomplete projects and lack of resources. Nor initiatives have not yet changed the fate of

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 397 Northeast India As a gateway to India’s Look East Policy Munmun Majumdar 398 the North East region. Most of India’s trade to force the pace of development in North major granary as its vast lands are very fertile. course of his four-day visit to Assam, expansion with Southeast Asia has taken place Eastern states. India and Thailand can do much to tame the Meghalaya and Tripura from 21-25 June through seaports. To improve trade and transit Mekong River, and enhance cultivation by 2007, Thailand’s Commerce Minister, Krik It is part of the larger project to build by land, a direct bus service between the spreading irrigation. Krai Jirapet14 had expressed interest in Eurasian land and rail corridors that could Indian border town of Moreh and Burma’s investing in the region and identified it as a connect Singapore with Istanbul and Europe With Bangladesh there is an second largest city, Mandalay, has been zone of convergence between Thailand’s via both India and China. The agreement to run a passenger train service planned. The bus service will run on a route, Look West and India’s Look East policies. transcontinental highway and railway could from Sealdah to Joydebpur and it is hoped which is part of the proposed Trans-Asia Earlier, Jirapet was invited as the chief guest lead to the ultimate link up of China, Russia that the service will start shortly. The bus Highway and Trans-Asian Rail link. It would for the valedictory session of the 3rd and Central Asia, bringing immense benefits service between Kolkata and Dhaka is already take Burmese traders and tourists from Northeast Business Summit, held in April to all the countries. India recently opened operational. Bhutan also figures in the Mandalay only 12 hours to reach the Indian 2007 in New Delhi. In his speech, Jirapet had the road linking Tamu with Kalewa and scheme; here we are reminded by what Mr border town and this has been one of the major offered to collaborate with India in various Kaleymo, and from there to Mandalay, the Pranab Mukherjee said that there is increase demands of the Indo-Myanmar Border investment efforts in the North Eastern states commercial heart of Myanmar. China has in the export of raw material and agricultural Traders’ Union. A more ambitious venture is covering areas of road construction, inland already agreed in principle to build a highway produce from North East to Bhutan. India’s to link the ports on India’s East coast and water transport and rubber production. With connecting Bangkok with Kunming in the new north east Industrial policy recognizes Sittwe in western Myanmar. The Kaladan this Thailand became the first ASEAN thriving Yunan province of China, through Multi-Modal Transport Project will provide an the need to have more investment in the 15 Laos. A road from Kunming to Ruihi on the country to agree to invest in the Northeast. access to Mizoram and to other North Eastern Northeast and aims to provide higher Chinese border with Myanmar already states of India as a well as an outlet to the incentives for industrial development and Three key sectors have been exists. China is also developing the “Irrawadi sea. This facility, envisages connectivity investment promotion. He said since the identified, that offer immense opportunities Corridor”, beginning in Kunming and between Indian ports on the eastern seaboard service industry is not very quite developed for Thai investment in the Northeast, which reaching the western coast of Myanmar and Sittwe Port in Myanmar and then through in the region incentives have also been are exceedingly important for the economic facing the Indian Ocean Rim. Thailand also riverine transport and by road to Mizoram, provided to some specified sectors like hotels, development of the region as a whole. First, has plans to build another highway linking it thereby providing an alternate route for adventure and leisure sports, tourism, nursing Thai companies are willing to invest in the with Vietnam through Laos. This will give transport of goods to North East India. homes and vocational training institutes. agro-based and food processing sectors since Thailand access to the Danang port on the Discussions are also on to start the work on Considering the rich biodiversity of the the region is rich in raw material and also in Vietnamese coastline to the east and hopes trilateral Highway project, which proposes to region, bio-technology has been brought terms of a large market. A leading Thai food- to connect this road to Moulmein in connect Moreh in Manipur to Mae Sot in under the purview of the new policy. producing company, the C P Group, has Myanmar. decided to negotiate directly with the Thailand via Bagan in Myanmar. He said Briefing newsmen prior to the government of Tripura regarding investment efforts are also on to improve road links at The essence of this road and rail investment opportunity week in Bangkok in this sector. In the agro-based industries, the border trade point at Rhi-Zowkhathar in diplomacy involving India, China, Myanmar which sought to pave the way for one to one rubber and bamboo have drawn the attention Mizoram sector by upgradation of the Rhi- and Thailand is also about linking the Indian interaction between the state governments of of the Thai companies. Tidim and Rhi-Falam Road segments in Ocean to the South China Sea. In economic Northeast India and industrialists and Myanmar. There are also efforts to have rail and Strategic terms India wants to develop prospective investors from Bangkok, the Infrastructure, especially energy and links from Jiribam in Assam to Hanoi in its North East by increasing its connectivity Minister for Development of Northeastern the transport sector, is another area, which Vietnam passing through Myanmar. Mr with the rest of the world through commercial Region (DoNER) Mr. Mani Shankar Aiyar has appealed the Thai investors. Of a fifty linkages with ASEAN countries. By taking Pranab Mukherjee said that in order to have said that Thailand was eager to have trade member business contingent accompanying advantage of Myanmar’s links with other digital connectivity, there is a plan to have and transit relationship with the Northeast. the Thai Minister, some fifteen private ASEAN countries. India hopes to transform optical fibre cable link between Moreh in “Unlike us”, he added “the Thai’s see the companies, which specialize in the the North East from a security burden into Manipur and Mandalay in Myanmar. India geological and economical advantage in development of infrastructure, have a land of economic opportunity. The Mekong therefore now has added a new dimension to investing and interfacing with Northeast.” In expressed interest in investing in the region. its look east vision by making serious attempts Basin also has the potential to emerge as a

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 399 Northeast India As a gateway to India’s Look East Policy Munmun Majumdar 400

Tourism is the third important subject intense economic integration with Southeast Subsequently flagging off the First linking Moreh in Manipur with Kalewa in in the proposed Thai investment in the Asia. India-ASEAN Rally at a colorful function at Myanmar with Kalewa that was built in Northeast. There are two basic aspects of Taking cognizance of the urgency the Nehru Stadium in Guwahati (Assam) in February 2001. Thai investment in this sector- to make the November 2004, Prime Minister Dr of the development of the Northeast and its The North Eastern region has been region attractive to tourist and to facilitate Manmohan Singh had said, “We are now strategic potential for advancing the on the southern trails of the silk route. diversion of tourist arriving in Thailand to the rediscovering the age old relations” while objectives of the Look East policy, a three- Francoise Pommaret review of historical Northeast.16 referring to India’s Northeast as a gateway to pronged approach of - offering incentives, literatures on ancient trade between Bhutan, the “Asian Century.” He had expressed his Thailand’s proposed investment in the developing infrastructure, and marketing Cooch Bihar and Assam reveals the clear assets has been adopted. The government, desire to forge deeper engagement with region along with India’s facilitating role can picture of Northeast India’s strategic location under the North East Industrial and ASEAN states through enhanced interaction pave the way for economic development of in these trade routes where he stated that, Investment Policy (NEIIP) has offered between India’s Northeastern States and the the entire Northeast by supporting local “Kamrupa (which denotes almost the whole various financial, fiscal and investment states of Southeast Asian grouping in the industrial entreneurship and creating an of the present day Northeast India) was on incentives for a decade. The proposed presence of the ASEAN Secretary general enabling atmosphere, for further investment. the trading route between Southwest China accelerated North-East Road Development Ong Keng Yong and several other dignitaries While the development of infrastructure is and India.”19 N.K. Basu, wrote that Project and the proposed four-laning of the from the ASEAN states. Apart from being a essential for operationalizing production “Assamese merchants went to Yunnan in East-West Corridor will connect various sport event the car rally had meant to attract facilities in the region, they also offer China by the line of trade through Sadia, Bisa capital cities and district headquarters both commercial interest in the infrastructure along incentives for investment due to growing and across the Patkoi range of mountains.”20 within the Northeast and with mainland the route and also aimed at promoting business demand in India. Captain Welsh, who led a British military India. Mr Pranab Mukherjee had and development activities. This inaugural car expedition to Assam between 1792- 1794, Though the Look East Policy was emphasized that in order to improve rally had been an important step in India’s reports that regional trade was very active.21 launched in the early 1990s as an economic connectivity India is involved in a variety of ambitious plan to link its Northeast region with Apart from silk and other goods, the Silk Road and security-oriented foreign policy initiative cross border development projects with Southeast Asia. Since then there has been also carried ideas, art and cultures, thereby linking India and East Asia, it was some fifteen Myanmar in diverse fields such as roads, much speculation on the potential that the Look facilitating the spread of Buddhism across years later, that the External Affairs Ministry railways, telecommunications IT, science East Policy has of transforming the economy Asia. The Northeast region’s difficulties as a brought the policy to the North East for the and technology and power. These initiatives and geopolitical status of India’s Northeast result of loss of connectivity following the first time (in course of a consultative meet are aimed at improving connectivity between Region that borders ASEAN. held in Shillong in June 2007). The idea of North East India and western Myanmar and partition in 1947 are well established. inclusion of North East development concerns are expected to give impetus to the local The first India –ASEAN car rally Preceding this, the nineteenth century British are an important component of the look East economies as well as bilateral trade.17 served to convey the message to Southeast colonial decision to delimit free trade between policy came up in 1997 following a report – Former Prime Minister of India Atal Asianations that both have a very good reason the hills and the plains by means of inner line ”Transforming the North-East: High Level Bihari Vajpayee had India’s ‘Look East’ to forge closer ties. It was in fact a precursor restrictions and other artificial barriers Commission Report “ placed before the Prime policy in mind when he had proposed it at to initially to the building of a 1400km long between Bhutan and Assam and to treat Minister, in March 1997. Consequently it is the ASEAN-India summit in Bali 2003 the highway (proposed in April 2002) that would Burma as a buffer against French Indo-China only in recent times that New Delhi has holding of an India-ASEAN car rally “to link India, Myanmar and Thailand which would and China disengaged the region from its recognised the importance of opening it up draw dramatic attention to our geographical be eventually be extended to include Singapore, traditional trade route - the Southern trails of for commercial linkages with South East Asia proximity”. A possible route according to him Malaysia, Cambodia, Laos and Vietnam. the Silk Road. While colonial rulers built and has opened up to the potential of economic could be from Guwahati in Northeast India, Despite the geographical contiguity between railways and roads mostly to procure tea, coal integration of its Northeast region through joint through Myanmar, Thailand and Cambodia Northeast India and Myanmar and Thailand oil and other resources out of Assam, the economic co-operation and development with to Hanoi in Vietnam. He said then “It would the poor physical connectivity hinders them disruption of old trade routes remained the 22 Southeast Asia. In its effort to Look East, India draw commercial interest in infrastructure from reaping full benefits of cross border time most lasting legacy. After more than a has the vision for North East, as the gateway along the route, promote tourism and overland trade. Until now the only direct land century and a half of forced restrictions which to the East and a springboard for launching development”.18 route between India and ASEAN is the road has pushed the economies of the Northeastern

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 401 Northeast India As a gateway to India’s Look East Policy Munmun Majumdar 402 states to the brink the time has come to reverse policies towards China, Myanmar and the local people in production and distribution although we often tend to overlook the fact the consequences of colonial geopolitics. India ASEAN with its domestic policies towards activities should be ensured and the education that through the centuries there has been a historically has had strong maritime ties with Northeast India. sector must be assigned greater role. natural exchange of peoples’, goods and the countries of Southeast Asia, given that it Educational institutes of higher learning services between our Northeast and the One has to be careful to ensure that 27 is both cheaper and easier to trade by sea located in North East must include courses countries of South and South East Asia. The the roads do not become easy passage to than by land with the ASEAN countries. on Southeast Asian studies and its languages Ahoms of Assam, after all, migrated several siphon off the rich natural resources and Hence, it may therefore be a while before and engage specialists in Southeast Asian centuries ago from the Shan State of abundant forest products. The region should the Northeast is actually translated into a studies, to disseminate knowledge about the Myanmar; a language almost identical to increase the size of the market by allowing centre of a thriving economic space linking Southeast Asian region in all its aspects. What theirs is spoken in Laos and Thailand. The scope for trade and specialization within the two dynamic regions with a proposed network has to be kept in mind is that climate of Chins from Myanmar have migrated over the Northeast through improvement of intra- of highways, railway pipelines and investment, market integration and local past centuries to Manipur and Mizoram and regional connectivity etc. and the attempt transmission lines crisscrossing the region. economic development can disappear if the Maiteis of Manipur have had ties lasting to rediscover the old silk route to bolster certain hurdles such as lack of infrastructure, over 2000 years with the Burmans of Despite the massive increase of trade from Northeast to China and other East poor connectivity, problems posed by the Myanmar. There has been a similar migration India’s international trade during the19th Asian markets. The external affairs Minister insurgency and the atmosphere of local- to the Northeast from the Yunan Province of century its impact, if any, on the economy of Mr. Pranab Mukherjee has assured the versus- migrant tension are not removed or China. The ties between what is now the northeastern region has been negligible. people of North East that the Look East contained. Most importantly, however, the Bangladesh and its neighbors like Assam and This is a sad lesson from the past. Here, the policy would be evolved in keeping with government has to make sure that the pattern West Bengal are also so close that there is lack of intra regional as well as intra-state particular needs and sensitivities of the of investment and development gives little that governments can do to prevent the connectivity, poor infrastructure and the issue North Eastern people but subtly reminded appropriate representation to all sections of free movement of goods and services across of security and governance have been the them that all economic development would the people. national boundaries. Likewise, there are now stumbling blocks. The Northeast India- come at a price. He advocated a balanced nearly half a million people of Indian origin Investment Opportunities Summit facilitated approach in terms of trade activities with The emergence of the Look East living in Myanmar who retain close cultural, by the Thai government correctly emphasized Southeast Asia and at the same time warned Policy as a role model of development for emotional and spiritual ties with India. Before on connectivity especially air connectivity. them against risking the security of the the North East arose out of the security national boundaries were drawn in 1947, the The basis of this argument is that integration country. Mr Pranab Mukherjee is of the firm concerns both external and internal. Northeast and Burmese territories shared will allow increasing trading opportunities for opinion that the North Eastern states can Addressing the security concerns of the deep cultural, economic and political ties.28 the northeast region with the promising become the bridge between the Indian country Mani Shankar Aiyar24 suggested that Then, when the boundaries began to define markets of the East and the Southeast Asia. economy and the fast- growing and dynamic a prosperous North East can act as a shield rival nationalistic aspirations and conflicting There is a strong case for a new continental East and Southeast Asian region. What must against the threats to the security of the priorities, these historical links were severed, perspective for the region in the context of not be overlooked are the real issues - apart country emanating from the eastern frontiers. except in a few stray instances of informal the Look East initiatives. Thus, a successful from the lack of integration - which have He said, “Emergence of the Northeast as an trade such as Indo-Myanmar trade via Look East policy should have both a maritime resulted in tardy growth of the economy of economically prosperous zone could be the Manipur and Mizoram. What has received as well as a continental thrust. Downplaying the North East as a whole and have posed best guarantee to the security concerns” and little attention is the anguish that local the continental dimension may have adverse insurmountable constraints in the way of its that India can enter South East Asian region communities continue to feel about them being effects on India’s emerging role as a major development and it’s so called isolation from by using the option of Myanmar through severed from the plurality of relationships that power.23 If the Look East policy is to live up the rest of India. Care should be taken to Northeast India.25 Mr Jairam Ramesh, a noted they enjoyed with the people in and beyond to its potential of becoming the North East’s ensure that mere facilitation of trade through economist and politician, is of the opinion that Myanmar. In Asia, political boundaries have road to peace and prosperity, it has to have a the region with the neighboring countries will the India’s North East requires political separated peoples who have cultural, robust continental thrust and include a clear have only a marginal impact on the economy integration with the rest of the country and historical, racial and ethnic affinities and share vision of a trans-national region-building unless the region can be converted into a economic integration with the Southeast Asian socio-economic and climate conditions. But, project. India, has to fine tune its foreign production centre. Greater participation of countries.26 This is not new to Northeast for the people of the North Eastern states

International Journal of South Asian Studies IJSAS July - December 2008 International Journal of South Asian Studies IJSAS July - December 2008 403 Northeast India As a gateway to India’s Look East Policy Munmun Majumdar 404 the exchanges of goods across borders leaders away from their democratic states similar to what China has done in the India. 21st Singapore Lecture. Singapore: Institute artificially drawn up by the British merely is a responsibilities as in the case of India’s ( Yunan province. India can refer to the of Southeast Asian Studies, 2002. continuation of their historical links with the land of Gandhi and Nehru) obvious Southeast Asian roots of the Tai Ahom[29], 5. Singh, Manmohan, Speech delivered at the Third countries like Myanmar, Laos, Thailand and reluctance to critique the incarceration of or the Balinese Hinduism and art forms that India-ASEAN Business Summit, New Delhi, 21 China. the tallest democratic leader of Myanmar. are close to Manipur’s culture and thereby October 2004. There is no doubt that there are enormous convert North East’s history and culture into The hurdles to the Look East Policy potential of economic integration with its a soft power resource. 6. Yashwant, Sinha, “Resurgent India in Asia”, developing its Northeast thrust have prompted transnational neighbors that could open up Speech at Harvard University on 29 September a growing sense that there may be more If New Delhi wants to fulfill its long 2003, Ministry of External Affairs, Government for Northeast India but what matters is a rhetoric than substance to the talk of the standing quest to integrate the Northeast of India, New Delhi, http/www.meaindia.nic.in/ viable time-frame Development must be region becoming a gateway to Southeast Asia. region with the rest of India it can be done speech/2003/9/harvardlecture29ss01.htm brought about without much loss in terms If the concerned governments, particularly meaningfully only with the economic of preservation of indigenous culture and 7. The Times of India, 13 December 2005. that of India, Burma and Thailand, and local integration of its Northeast India with its practices, security parameters, justice authorities of these countries are serious about Southeast Asia which will in turn foster the 8. Ibid. and democracy. The region’s interests must their declared intentions, then these new region’s political integration with India. st not be sacrificed at the altar of national and 9. “Make 21 Century Truly an Asian Century”, initiatives would indeed rediscover, renew Therefore to reach Southeast Asia via North international aspirations. Great care will Keynote Address at special Leaders Dialogue of and rejuvenate the age-old cultural and East India New Delhi cannot circumvent to need to be taken to ensure that the benefits ASEAN Business Advisory Council, Press historical ties between the peoples of intelligently yoke the continental dimension of are not appropriated by the elite in the Information Bureau, Government of India, Press Southeast Asia and Northeast India. This in the Look East policy to its domestic concerns. Release, 12 December 2005, http://pib.nic.in/ region with political muscle power. The turn, would encourage greater interaction release/release.asp?relid+14102. common people, the farmers, artisans, wage leading to an increase in trade, commerce and earners and subsistence labourers, in short Notes 10. See Bhupinder, Singh (2002): Autonomy tourism in the entire region. The development all those people who have either had a raw Movements and Federal India, Rawat, Jaipur. model resulting from India’s Look East Policy 1. See Kely, Brian and Mark, London (1989): The deal or those who are vulnerable to the has tremendous potential for the Northeast. Four Little Dragons: Inside Korea, Taiwan, Hong 11. Anne, Hvenekilde (2001): “Kinship System and machinations of the separatist groups and Kong and Singapore at the dawn of the Pacific It serves as a contiguous gateway to the Language Choice Among Academics in Shillong India-baiters must be brought into the net. Century, Simon and Shuster. Association of Southeast Asian Nations Northeast India”, International Journal of Applied (ASEAN) countries with which India has Past attempts to integrate the 2. India was invited for the first time to attend the Linguistic Ties, vol.II, No.2, p.174. established engagement models. The share of Northeast with the Indian mainstream, ASEAN plus Three (APT) summit meetings in 12. Just 2% of the borders in the North-East Indian North East India in the trade with ASEAN economically at least, have yielded no November 2002. New Delhi is ready to consider a States are national borders (Between Assam and was around 12 percent annually. There is tangible results. Therefore, the focus has free trade agreement with ASEAN. Singapore’s West Bengal) - almost all the borders being tremendous scope to increase this further. now shifted to trans-national and sub- Prime Minister Goh Chok Tong reportedly told international borders: Assam-Bhutan and regional cooperation between India and in the APT summit meeting on November 2002 Bangladesh, Arunachal-China and Myammar, Thus, looking into the political, Southeast Asian countries, seen as the only that ASEAN resembles the body of an airplane Nagaland-Myanmar, Manipur-Myanmar, strategic and economic aspects of the Look with one wing made of East Asia and the other of way to bail out the region from its state of Mizoram-Myanmar and Bangladesh, Tripura- East policy of India involving the ASEAN can China and India enabling the grouping to establish underdevelopment and political instability. Bangladesh, Meghalaya-Bangladesh. spell a never imagined success story for North the ASEAN Economic Community by 2020. But the share of benefits for the Northeast East India and in due course sort out her age 13. Renaud, Egrateau (2003): Wooing The Generals region from such integration will also depend 3. See Annual Report: 1992-93, Ministry of External India’s New Burma Policy, New Delhi, Authors old political and economic ills. on how much of the trade traffic will move Affairs, Government of India, New Delhi, 1993, Press, p.101. through the land routes via Northeast India. p.27, p. 6 At this point diverting from the 14. Vibhanshu, Shekhar (2007): “Thailand’s general mood of euphoria and gung ho Yet another way of giving a continental 4. See Vajpayee, Atal Bihari, “India’s Perspectives Investment Strategy in India’s Northeast’, Institute optimism one may add that the economic orientation to the Look East policy would on ASEAN and the Asia- Pacific Region”, Address of peace and Conflict studies, Article No.2384, 29 priorities, which are increasingly turning our be to give a direct role to the North East by H.E. Atal Bihari Vajpayee, Prime Minister of September.

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15. Ibid 23. Sanjib, Barua (2005): Durable Disorder: Understanding the Politics of Northeast India, 16. Ibid New Delhi, p.225. 17. Sarath, Kumar (2007): “Burma Visists Highlights 24. Mani Shankar Aiyar speaking in a conference in India’s Look East Strategy”, World Socialist Web Guwahati on “India’s Look East Policy- site 6 April, at http://www.wsws.org/articles/2005/ Challenges for Sub-regional Cooperation”,10 apr2005/india06_prn.shtml, accessed on 20 May. October 2007. 18. Vajpayee, Atal Bihari, Address, ASEAN-India 25. News Track India, 10 October 2007. Summit , Bali 2003. 26. Jairam Ramesh., “Northeast India in a New 19. Francoise, Pommaret, “Ancient Trade Partners: Asia”, Seminar, 550, June, accessed from http:/ Bhutan, Cooch Bihar and Assam (17th-19th /www.indiaseminar Centuries),” Journal Asiatique. 287: pp285-303. English translation available online at http:// 27. F, Pommaret, “Ancient Trade Partners: Bhutan, www.bhutanstudies.org.bt/journal/vol2no1/v2n/ Cooch Bihar and Assam (17th 19th Centuries), ancienttrade.pdf Journal Asiatique 287: pp285-303. English translation available online at http:// 20. Basu, N K (1970): Assam in the Ahom Age. www.bhutanstudies.org.bt/journal/vol2no1/v2n/ Sanskrit Pustak Bhandar, Calcutta, cited in ancienttrade.pdf. Francoise, Pommaret. “Ancient Trade Partners: Bhutan, Cooch Bihar and Assam (17th -19th 28. Ramananda Wangkheirakpam and Smitu Kothari Centuries)”, Journal Asiatique, 287: p.285. (2007): “Looking East and Talking West”, Hindustan Times, November 05. 21. Ibid. 29. Yasmin, Saikia (2005): “The Tai-Ahom 22. Vergese, B G (2001): “Unfinished Business in the Connection”, Seminar, 550, June, at http:// Northeast: Priorities Towards Restructuring www.indiaseminar.com/2005/550/550%2o Reform, Reconciliation and Resurgence”, Seventh yasmin%20saikia.htm, accessed on 10 May 07. Kamal Kumari Lecture, http://www.free indiamedia.com/economy/19 _june_economy.htm

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