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    ​​Working Papers
    ISAS publishes a series of working papers which are long-term studies on trends and issues in South Asia.


    Working Papers: South India: Possible Key to India’s Next Government

    Nalin Mehta 19 April, 2019
    India’s southern states could hold the fulcrum of power in New Delhi if the current parliamentary polls result in a hung Lok Sabha, the Lower House of Parliament. Unlike in the northern Hindi heartland states, the ruling Bharatiya Janata Party (BJP) is a major player in only one of five south Indian states, Karnataka. It is, however, hoping to open its account in Kerala after the recent Sabarimala controversy and has entered into a wider alliance in Tamil Nadu with the state’s ruling All India Anna Dravida Munnetra Kazhagamwhich swept the state in 2014 but now faces a major challenge of anti-incumbency. The BJP’s southern power play, combined with Rahul Gandhi’s gambit of leading his party’s southern charge from the front by contesting from Wayanad in Kerala, indicates how crucial the southern states will be as swing factors in government-formation if no party wins an absolute majority. This paper summarises the political outlook in India’s five southern states – Tamil Nadu, Karnataka, Kerala, Andhra Pradesh and Telangana – examines key factors at play and puts together cumulative data from various state-wise opinion polls to illustrate likely prospects in this crucial region in India’s national election.

    Working Papers: 318 : Japan’s Foreign Aid to South Asia: Addressing a Strategic Need

    Sojin Shin 8 March, 2019
    What motivates Japan to look at South Asia as a foreign aid destination? This paper explores the evolution of Japanese attitudes toward South Asia in foreign aid. Japan began sending official development assistance (ODA) to the region as early as 1958 and has become one of its largest contributors. However, Japan’s ODA goals to the region have been underexplored. Japan has expanded economic diplomacy by capitalising on the policy of development cooperation to the region and recently stretched it out to the security building cooperation with aid recipients in South Asia, especially with India.

    Working Papers: 317 : Implications of a New “Normal” Indian Ocean Economy for Sri Lanka

    Ganeshan Wignaraja 8 March, 2019
    This paper looks at the macroeconomic implications of the Indian Ocean economy for Sri Lanka since the 2008-09 global financial crisis. It maps the region’s trade and growth outlook, examines Sri Lanka’s role in the regional economy, explores challenges to realizing the regional outlook and outlines Sri Lanka’s diplomatic initiative to ensure the peaceful rise of the Indian Ocean economy.

    Working Papers: 316 : Sri Lanka and Japan: Emerging Partnership

    Chulanee Attanayake and Roshni Kapur 26 February, 2019
    Sri Lanka and Japan have maintained close bilateral relations for nearly 70 years. Diplomatic relations between the two were first established in 1952 shortly after the signing of the Peace Treaty following which missions were opened in Colombo and Tokyo. Over the years, their bilateral relations have evolved to include socio-cultural, donor-recipient and maritime cooperation. Japan was Sri Lanka’s primary bilateral donor before 2008 and also an important partner in its peace process. Although the post-conflict bilateral relations suffered a setback, it has been renewed in recent years as Japan evolves as a maritime partner for Sri Lanka. This paper explores the different phases of Japan-Sri Lanka relations and concludes that the shifting dynamics is a result of the changing domestic interests of the two countries, along with geopolitical and geostrategic shifts in the Indian Ocean.

    Working Papers: 315 : The Indian Civil Services – Shortcoming and the Course for Reforms

    Vinod Rai 3 February, 2019
    It is widely believed that the original ‘steel frame’ of the Indian civil services is now cracking and the service is not able to deliver up to expectations. Various models and reforms are being considered for its improvement. Whilst anything being considered for its ‘recast’ has been felt and talked about much earlier, it is the implementation of the reform measures that needs to be strengthened. The maladies are the usual and fairly well known: short tenures, political interference, age at entrance, monetary compensation and attraction for political alignment. These maladies have been addressed in the first and second administrative commissions and remedial action was suggested. However, implementation of these suggestions has been lacking. There is a need for ensuring recruitment of officers at a maximum age of about 25 years, providing professional training at higher level, ensuring fixity of tenures, weeding out officers perceived as deadwood and enhanced compensation at the higher echelons. Going forward, a mere tinkering will not be sufficient, as the government will have to show sufficient political will to overcome the problems. In the modern world, the civil service has to play the role of a facilitator and not merely perform the role of a regulator. It is important to free the bureaucracy from political pressures to ensure that it delivers with objectivity and transparency. This will improve the capability of the government to ensure sustained economic development as well as deliver welfare programmes to the targeted population. An attempt is made in this paper to analyse the shortcomings and then suggest a course for reforms.


    Working Papers: 314 : Mattala: Attracting Business into a Lonely Airport

    Chulanee Attanayake 20 December, 2018
    Despite commencing operation in 2013, Sri Lanka’s second international airport, the Mattala International Airport (MIA), has come under criticism both locally and internationally for accruing ‘unbearable debt’ and for being a white elephant project of former Sri Lankan President Mahinda Rajapaksa. The MIA has not been able to live up to expectations, as few airlines placed their bets on Mattala, and later ceased service, turning it into a ‘ghost airport’. In July 2018, the government called for proposals from both local and international investors for a joint venture to make MIA operational. Against this backdrop, this paper examines the reasons as to why the airport became an example of a failed infrastructure project and identifies some areas which may help in making it profitable.

    Working Papers: 313 : India’s Social Policies under the BJP Government

    Diego Maiorano 11 December, 2018
    In 2014, the BJP won a substantial number of votes among India’s poor and the lower classes, which are the main beneficiaries of the government of India’s social policies. This paper analyses the BJP-led government’s performance in the social sector, with the objective of assessing their electoral impact on the forthcoming general elections in 2019. It focuses on two main areas. First, the government’s performance at implementing policies inherited from the previous administration; second, what kind of new policies has the government introduced and what kind of benefits they brought to India’s poor and lower classes.

    Working Papers: 312 : Modi Turns West: India and the Persian Gulf

    P R Kumaraswamy 23 November, 2018
    As happened in the early 1990s, when India adopted the ‘Look East’ policy towards the Southeast Asia, Prime Minister Narendra Modi is signalling the greater importance of the Middle East and the Persian Gulf for India. He has been delineating the parameters and components of the relations through intense political engagements with the aim of transforming the transactional nature of the bilateral ties, and he is adding economic and strategic substance. There are number of challenges before meaningful progress is achieved but there are sufficient indications that, under Modi, India is turning west and befriending Gulf Arab more aggressively than in the past.

    Working Papers: 311: How Do You Make a Smart City Clean?

    Robin Jeffrey 12 November, 2018
    This paper draws attention to two signature campaigns of the Bharatiya Janata Party government in India – Smart Cities and Swachh Bharat (Clean India) and identifies difficulties facing the task of making smart cities clean. The paper begins by focusing on the under-powering of local governments, which are expected to provide many of the services that public-sanitation regulations prescribe. The paper then examines four formal categories of waste – the solid waste of households and businesses, construction and demolition (C&D), hazardous and bio-medical. All four categories are governed by admirable – but hitherto unattainable – rules spelt out by the central government and intended to ensure safe and productive disposal. In the final section, the paper examines the most difficult category of all – liquid waste and sewage. Sewage presents immense public-health threats, yet its disposal raises formidable cultural problems. The paper offers no panaceas but provides a digest of the complexities of urban waste management and government’s worthy pronouncements.

    Working Papers: 310 : India-Bhutan: Affirming 50 Years of Relationship

    Amit Ranjan and Losheini Ravindran 7 November, 2018
    During his three-day visit to India in July 2018, then-Bhutanese Prime Minister Tshering Tobgay held meetings with India’s Prime Minister Narendra Modi and other Indian ministers in which the two sides expressed happiness over the state of their bilateral relations.

    Working Papers: 309: India-Bhutan Hydropower Projects: Cooperation and Concerns

    Amit Ranjan 17 October, 2018
    In spite of being among the water rich countries in the world, parts of Bhutan are expected to face water scarcity by 2030. India has assisted Bhutan in development of its hydropower projects. The first such cooperation between the two countries took place in 1961. Since then, a number of Indian hydropower companies have been active in Bhutan. In recent times, there have been growing concerns among a section of Bhutanese against India’s involvement in the hydropower projects, alleging the country of growing hydro-debts in Bhutan. Indian hydropower companies are also being accused of engaging in allied sectors in Bhutan and not providing sufficient employment opportunities to the Bhutanese. This year marks 50 years of diplomatic ties between India and Bhutan. Politically, Bhutan is India’s closest South Asian neighbour of India. The two South Asian neighbours generally enjoy warm and cordial relations. Bhutan has supported India’s position at the regional and global levels. This paper examines India-Bhutan bilateral engagements in the context of the hydropower sector and the need for both sides to address the concerns arising from India’s involvement in this sector.

    Working Papers: 308 : Looking Back and Ahead to India’s Next General Election

    Ronojoy Sen 27 September, 2018
    India is likely to hold its next general election in early 2019. Predictions are perilous for Indian elections, but what can be said at this point is that the ruling Bharatiya Janata Party (BJP) is likely to find it difficult to match its performance in 2014 where it won a majority in parliament on its own. However, the BJP would still be the frontrunner to form the next government by virtue of being the party with the greatest chance of winning the largest number of seats, even if it falls short of a majority.

    Working Papers: 307 : The ‘New World Disorder’: Learning to live with it

    Iftekhar Ahmed Chowdhury 26 September, 2018
    The global world order that was established by a series of diplomatic initiatives after the calamitous Second World War basically set the basic ‘club rules’ for international relations on the basis of near-consensus. It seemed to work well for a few decades, the Cold War notwithstanding. However, the end of the Cold War was accompanied by the combination of excessive power leading to hubris on the part of what has been call the ‘hyper-power’, the United States. Its behaviour appeared to challenge the norms of what had been seen as globally acceptable to date. The phenomenon actually pre-dated the election of President Donald Trump whose seemingly erratic actions accentuated the tendencies. Unfortunately, the pattern is unlikely to change in any radical sense in the post-Trump period. The era of the ‘new world disorder’ is likely to become the new normal, shaping present and future international politics. This will have ramifications for the countries and regions of the world, including South Asia. This paper seeks to analyse these and related developments, and it concludes with the extrapolation that the world has little option but to learn to live with these changes.

    Working Papers: 306 : Assam’s National Register of Citizenship: Background, Process and Impact of the Final Draft

    Amit Ranjan 5 September, 2018
    The release of the final draft of the National Register of Citizenship for the Indian state of Assam has created anxiety among four million people whose names are not in the final draft. It is not clear what will happen to those whose names may not appear in the final list, which will follow this draft. Where will they go? The Bangladeshi government has repeatedly maintained that there are no “illegal” Bangladeshi citizens living in India. After the release of the final draft, to allay the fears of those whose names are not in the draft list that they may be stripped of Indian citizenship status, the Indian government and its institutions have maintained that, for now, they are not going to take any such steps.

    Working Papers: 305 : The RIMPAC Exercise and Evolving United States-Sri Lanka Military Relations

    Chulanee Attanayake 13 August, 2018
    The Sri Lankan navy was invited to be part of the world’s largest maritime exercise, the Rim of the Pacific Exercise, this year. The invitation followed a period of continuous military engagement between the United States (US) and Sri Lanka in the last few years. The growing US engagement in Sri Lanka is viewed as a shift of Washington’s policy towards the island nation, almost a decade after the latter ended its conflict with the Liberation Tigers of Tamil Eelam through a military victory. Against this backdrop, this paper examines the evolution of the bilateral military relations between the two countries since the Maithripala SirisenaRanil Wickramasinghe government came into power

    Working Papers: 304 : Militancy in Bangladesh

    Amit Ranjan and Roshni Kapur 31 July, 2018
    Militancy is one of the major security challenges for Bangladesh. In recent years, it has faced a series of violent attacks by the militants. The militants have targetted individuals and have conducted an organised terror campaign across the country. The existing political and social environment in Bangladesh, presumably, provides some encouragement to the militants to operate in the country. This paper discusses the political and social dimensions of militancy in Bangladesh.

    Working Papers: 303 : ‘Paths Uncharted’ – Balkrishna Doshi, Pritzker Laureate1

    Dipinder S Randhawa 30 July, 2018
    On 7 March 2018, the Hyatt Foundation announced the selection of Professor Balkrishna Doshi of India as the 2018 Pritzker Architecture Prize Laureate. The Pritzker Architecture Prize is recognised internationally as architecture’s highest honour, the equivalent of the Nobel Prize, were there one for architecture. Doshi is the 45th Pritzker Prize Laureate and the first to hail from India. Deeply influenced by two icons of 20th century architecture, Le Corbusier and Louis Kahn, Doshi placed his own imprint on his work; shaped by the ecology, environment, and cultural norms of his homeland, leading to an architecture sensitive to the socio-economic milieu in which people lived. Some of the most celebrated of his projects are in low income housing3. Without going into the economics and policy challenges, this paper contends that Doshi’s approach to architecture remains as relevant as ever, and if embedded in the design, it can lead to housing that is sustainable and imparts a sense of belonging, continuity and hope.

    Working Papers: 302 : The Challenge and Prospects for E-commerce in India

    Dipinder S Randhawa 30 July, 2018
    Despite its tiny presence, accounting for barely a fiftieth of sales, e-commerce looms large on India’s retail horizon. Bypassing the myriad of regulatory, logistical and infrastructure constraints, it is growing rapidly. More consequentially, e-commerce offers hope in addressing some of India’s basic economic challenges. What promise does it offer and what challenges does it face in the way of realising its potential?

    Working Papers: 301 : The Impact and Potential of E-commerce

    Dipinder S Randhawa 30 July, 2018
    From a negligible base in 1990, e-commerce today accounts for over US$25 trillion (S$34 trillion) of transactions. Some of the fastest growth is taking place in large economies such as the United States, China and India. How do we account for this remarkable growth? How is it affecting the lives of consumers, and those of small businesses and the retail sector, which are likely to be the most affected? This paper explores the reasons behind the rapid growth of e-commerce and enquires into the likely effects on efficiency and prospects for inclusive growth.

    Working Papers: 300 : South Asia’s Space Programmes: Development and Diplomacy

    C Raja Mohan and Chan Jia Hao 26 July, 2018
    The recent launch of the Bangabandhu-1, Bangladesh’s first geostationary satellite to orbit, marks yet another example of the growing use of space technology for development among the South Asian countries. The expanding use of space technology in the region has given China and India more opportunities to continue using technological cooperation as a tool of diplomacy. This paper argues that India still needs to raise its game in South Asia to cope with the rapid advances in Chinese space diplomacy in the region.

    Working Papers: 299 : The Eid Ceasefire in Afghanistan: A Harbinger of Longer-term Peace?

    Rani D Mullen and Roshni Kapur 11 July, 2018
    The Afghan government, the Taliban, the United States and the international forces in Afghanistan announced an unprecedented ceasefire over the three days of Eid in June 2018. The ceasefire built on an offer of unconditional peace talks by Afghan President Ashraf Ghani in February 2018, a condemnation of terrorism by international and Afghan religious scholars and clerics, and a ceasefire announcement by the Afghan government to celebrate Eid and the end of Ramadan. Scenes of Taliban and Afghan soldiers posing together abounded on the internet during the ceasefire. While the Taliban and the government have since ended the ceasefire and fighting has resumed and ramped up, this paper argues that it will be difficult to put the genie back into the bottle. There are already signs that the fundamentals of interaction between the Taliban and the government have changed.

    Working Papers: 298 : The Pashtun Protection Movement in Pakistan: The Taliban, the Military and the Fragmentation of Authority

    Iqbal Singh Sevea 12 June, 2018
    Since January 2018, the Pashtun Tahafuz Movement (Pashtun Protection Movement) [PTM] has organised mass rallies across Pakistan in which they have denounced the Taliban, Pakistani military and the state apparatus for “humiliating” and persecuting the Pashtuns. Such an open critique of the military is rare in Pakistan. By way of presenting a historical backdrop to the emergence of this movement, this paper reviews key facets of the sociopolitical dynamics of Khyber Pakhtunkhwa and the Federally Administered Tribal Areas. It also reviews the major demands made by the movement. More broadly, the paper highlights how the adoption of new media is enabling movements like the PTM evade state censorship and challenge established religious and social political authority.

    Working Papers: 297 : The New Great Game in the Indo-Pacific

    Rani D Mullen 6 June, 2018
    In a strategy which harkens back to the building of their empire by the British East India Company, the Chinese are building dual-use ports in the Indo-Pacific. These ports, which link up with Chinese controlled special economic zones or directly with China through pipelines and economic corridors, have been financed through loans and are often financially unviable, leading the debt-entrapped countries to make significant concessions on sovereignty. Yet, while China continues to build its overseas empire, regional and global powers have failed to come up with any strategy to counter this expansion of China.

    Working Papers: 296 : India’s New Geopolitical Paradigm and Reintegration of the Bay of Bengal

    Jayati Bhattacharya and Silvia Tieri 4 June, 2018
    The ‘Look East’ Policy (LEP) is usually identified as the beginning of an effort by India to build relations with its eastern neighbours lying on the other side of the Bay of Bengal rim. Following the LEP, the Bay of Bengal has been witnessing a process of economic, political and cultural reintegration. Historical analysis, however, reveals that, in the pre-colonial era, the Bay used to be a circular space, interconnected by movements of goods, people and ideas. As a consequence of colonialism, this interconnectedness was altered, a sense of otherness developed among the rim nations, while India consolidated a foreign policy focused on the territorial rather than the maritime dimension of the space. This paper adopts an interdisciplinary approach (bridging history, international relations and foreign policy analysis) in a reconstruction and reassessment of the transformation of the Bay of Bengal from a unitary to a fragmented space, as well as of India’s interaction with the same.

    Working Papers: 295 : Nepal in 2018: The Post-Conflict Situation and the State of Reconstruction

    Nishchal N Pandey 28 May, 2018
    After decades of political instability, marked by low economic growth and massive unemployment, Nepal finally has a constitution and an elected majority government. Not only was the decade-long conflict devastating for the country’s economy, the earthquake of 2015 ravaged whatever was left in terms of old temples, stupas and palace squares that used to attract tourists from all over the world. Much needs to be done in the country and there is sudden hope because all three tiers of the state now have elected representatives. However, the deeper malaise of nepotism, corruption and mal-functioning constitutional bodies need to be corrected before anything concrete can actually be done. Political and ethnic polarisation can also tear apart the fragile political stability, which is why the leadership needs to be accommodative and tolerant to divergent viewpoints. The road ahead offers a new chance for Nepal.

    Working Papers: 294 : International Tax Competition, Anti-Money Laundering Efforts and Capital Flow: Implications for South Asia as part of the Global South

    Chan Jia Hao 16 April, 2018
    In the last few decades, numerous tax experts from international organisations such as the Organisation for Economic Co-operation and Development, the European Commission and G20 have declared a ‘war on anti-tax competition’. However, this paper asserts that the efforts of these organisations have not been successful in lowering international tax competition. Conversely, there has been an increase in functioning tax havens in the Global North that enforce an umbrella of strong anti-money laundering efforts (AMLEs) within their jurisdictions. Conceptualising this paradox as “anti-money laundering efforts in tax havens”, this paper argues that AMLEs can secure the interest of these jurisdictions of easing inflow and preventing outflow of capital. Capital is often retained with a ‘carrot and stick’ approach, given AMLEs provisions and robust financial institutions. Yet, in contrast with these tax havens, the Global South countries, including those in South Asia, lack such a strategy. This may explain why long-term capital has not been flowing to the South, despite increasing economic liberalisation. For South Asia, this phenomenon can hinder long-term capital retention and have spill-over effects in the economy unless AMLEs are strengthened.

    Working Papers: 293 : The Cauvery River Water Disputes in India

    Amit Ranjan 16 April, 2018
    The Cauvery River water disputes are among the longest-running inter-state river water disputes in India. In the past, agreements were signed between the disputing States, the tribunal delivered its verdict, and the Supreme Court of India made a number of interventions on the Cauvery issue. Yet, the disputes continue. On 16 February 2018, once again, the Supreme Court of India delivered its verdict on the issue. However, this verdict has also not completely satisfied two of the four parties to the Cauvery disputes – Tamil Nadu and Karnataka.

    Working Papers: 292 : Donald Trump and the Established Trade Order: Implications for South Asia

    Shahid Javed Burki 12 April, 2018
    What is the likely impact of the assault on the international trading system by the United States (US) President Donald Trump that has developed into a major confrontation between Washington and Beijing? In particular, how would this spat affect Asia and the Continent’s less developed nations? Should these countries give up the hope that they too could follow the model of export-led growth adopted by what the World Bank, in its 1993 study, called “East Asia’s miracle economies”? 2 This paper will attempt to answer these questions by using Pakistan as a case study. The main conclusion offered in this paper is that Trump’s focus on bilateralism rather than multilateralism in the trade arena could be turned into an opportunity for the South Asian nations. They could restore trade relations among themselves that were disrupted by British India’s 1947 partition and the creation of the independent states of India and Pakistan. It would also have an impact on the potentially multi-trillion dollar Belt and Road Initiative. Launched by China, it is aimed at connecting it and the Asian countries to its west by roads and railways to Europe and Africa. This would create a new geo-economic entity in which China would be the principal player. Such an entity could affectively challenge what has been the US-dominated international economic and trade system created in stages after the end of the Second World War. There is some irony in the fact that that the system is under assault by the US, its founder.

    Working Papers: 291 : Determinant of Foreign Direct Investment in India’s E-commerce Sector

    Rahul Choudhury 11 April, 2018
    The e-commerce sector in India has experienced remarkable growth in recent years with many new players entering the market. Its heady growth has attracted a huge amount of private equity investments from both domestic and foreign investors. Most of the investment has been made by foreign private equity investors. The present study attempts to explore the economic factors that facilitated the unprecedented growth of foreign investment in the sector. We model the empirical analysis by treating the equity inflows of foreign players in ecommerce as amounts dependent on the variation in the number of mobile and internet subscribers at the aggregate level. The study uses the OLS regression model with the time series data for the period from 2000 to 2016. The econometric analysis reveals that both mobile and internet subscriptions have a positive impact on the inflow of foreign investment into the Indian e-commerce sector. However, relatively, the impact is higher in the case of mobile subscribers than internet subscribers.

    Working Papers: 290 : Bangladesh: Challenges and Opportunities

    Iftekhar Ahmed Chowdhury 26 March, 2018
    On 26 March 2018, Bangladesh turns 47. The country and its people have undergone many vicissitudes of fortune as they have evolved over time. The past and the present point to the possibility of the achievement of this aspiration. In the past, it has used its foreign aid effectively to reduce external dependence. In social indices, it has achieved remarkable success. Internationally, it plays a role perceived as positive as it has been consistently one of the largest contributors to the United Nations peace-keeping operations. The current Awami League government of Prime Minister Sheikh Hasina has proclaimed a vision to turn the nation into a knowledge-based middle-income country by 2021. This paper is a narrative of its experience as a nation-state since its inception in December 1971. It analyses Bangladesh’s potentials and challenges, and seeks to extrapolate from its past, its future ethos as a nation-state.

    Working Papers: 289 : Powerful yet Vulnerable: China’s Constitutional Amendments and Contemporary Political Thinking in China

    Srikanth Thaliyakkattil 21 March, 2018
    The Chinese constitutional amendments on 11 March 2018 mark a significant chapter in Chinese state’s political evolution. They show the country’s increased confidence in becoming a global power. However, at the same time, China appears to be vulnerable to western discourse of its system and policies. The constitutional amendments will ultimately harden China’s diplomatic position in the Asian region with far-reaching implications for the security architecture in the region.

    Working Papers: 288 : China’s ‘Digital’ Belt and Road Initiatives: Potentials for India in ASEAN’s Technological Sector

    Chan Jia Hao 16 March, 2018
    There has been a surge in Chinese investments in the Association of Southeast Asian Nations (ASEAN) states after the Belt and Road Initiative (BRI) was announced in 2013. The digital focus by the Chinese government and among Chinese firms has seen a growth in trade and investment opportunities in the ASEAN technology sector. As ASEAN-India relations mark their 25th anniversary, digital connectivity remains an important agenda. This paper discusses the potential for digital economic cooperation between the ASEAN countries and India against the backdrop of significant BRI developments in the region.

    Working Papers: 287 : The Repatriation of the Rohingyas: A Flawed Bangladesh-Myanmar Agreement?

    Roshni Kapur 16 March, 2018
    Bangladesh and Myanmar signed a new repatriation agreement on 15 January 2018. The agreement will see a total of 646,072 refugees sent back to Rakhine over a two-year period. The process of repatriating the first batch of Rohingya refugees was slated to start on 23 January but it has been delayed due to administrative issues. The Rohingya crisis has morphed into a vicious cycle of violence, displacement and repatriation. This paper argues that returning the refugees to the restive state at this given time undermines the principle of non-refoulement. Myanmar is nowhere near ready to take in the refugees. Furthermore, there are major flaws in the repatriation agreement. The parties to the contract may consider revising the agreement by incorporating recommendations by the Final Report of the Advisory Commission on Rakhine State to better cater to the needs of those displaced.

    Working Papers: 286 : Indian Export Performance As Part Of Global Value Chains

    Deeparghya Mukherjee 19 February, 2018
    As the world trade architecture modifies itself to accommodate trade through value chains, any country participating in trade invariably becomes a part of the value chains of various industries. For emerging economies, participation in world trade has become easier as the need to build an efficient industry from scratch is no longer necessary. While countries can now participate in a particular stage of a value chain and expect to grow, the problems of immiserising (heavily export-biased) growth may hamper longer-term development. This paper analyses India’s participation in global value chains after identifying its key traded sectors. The analysis shows that, while India’s participation in value chains of key traded sectors has increased, it has varied across industries. India’s participation has increased in more downstream stages in service sectors and textiles and footwear – and shifted to less valueadded segments in some of the primary and manufacturing sectors. The findings are discussed in the context of the recent coming into force of the World Trade Organization multilateral trade facilitation agreement, the policies of the Indian government and India’s trade agreement negotiations. The paper concluded by noting a few policy directions to improve India’s participation in higher value-added segments of value chains so that India’s participation in world trade can act as a means to its developmental efforts.

    Working Papers: 285 : Seventy Years Of Independence Challenges And Prospects For Sri Lanka

    Chulanee Attanayake 7 February, 2018
    As Sri Lanka celebrates 70 years of independence, it recalls how the island nation was once touted as a potential success case among the newly-independent states. However, due to various challenges over the years, Sri Lanka was then seen as a failure on many counts. Now coming out of a three-decade long conflict, another opportunity has been presented to the country to become a success. Against this backdrop, this paper examines some of the challenges facing the country and the measures being taken to address them in the post-conflict context

    Working Papers: 284 : Interpreting India’s ‘Act East’ Policy

    Rajeev Ranjan Chaturvedy 29 January, 2018
    In 2014, India’s Prime Minister Narendra Modi announced the upgrading of India’s ‘Look East’ policy (LEP) to the ‘Act East’ policy (AEP). Since then, there have been different interpretations of this change. While some argue that there is a clear shift in policy and focus, others state that the AEP is just a continuation of the LEP. This paper1 argues that there has been a change in policy and examines the reasons for and objectives of this shift. It also analyses the changes that have taken place under the AEP. It concludes that the LEP has been upgraded to a more dynamic and action-oriented engagement policy.

    Working Papers: 283 : Infrastructure-Led Growth: Maharashtra – India’s Engine Of Development

    Devendra Fadnavis 8 January, 2018
    According to the latest report by credit rating agency Brickwork Ratings, Maharashtra is the largest economy in India. Its gross state domestic product is expected to grow by 9.4 per cent in 2016-17 compared to 8.5 per cent in 2015-16. A state with the highest tax revenue in India, Maharashtra is also a leading player in the information technology, business process outsourcing and knowledge process outsourcing sectors. The state’s impressive performance has been attributed to the efforts by the government to take strong measures to address the challenges facing the state and putting in place important economic reforms. This paper examines the reforms undertaken in three key areas, namely, agriculture, ease of doing business and infrastructure development. It also highlights the impact of the reforms on these sectors and on Maharashtra as a whole.

    Working Papers: 282 : China’s ‘New Era’ Vision: Potential For Big-Power Conflicts In Asia

    Srikanth Thaliyakkattil 2 January, 2018
    During the 19th National Congress of the ruling Communist Party of China in October 2017, Chinese President Xi Jinping announced a ‘new era’ for China and for the world. The announcement seems to reflect China’s emerging confidence in its capability to reshape the regional and global geopolitics on its own terms. This paper argues that, in view of the evolving power structure in the Indo-Pacific region, it is probably premature to make that assumption. China’s bid to increase its influence in the Asian region is likely to exacerbate existing threat perceptions and may lead to the formation of informal coalitions to balance China’s influence in Asia. This could lead to heightened security dilemmas and possibly big-power conflicts in Asia.

    Working Papers: 281 : Development Of Migrant Businesses In Saudi Arabia: Towards An Economic Sociology Of Gulf Migration

    Md Mizanur Rahman 2 January, 2018
    Migrant labour has been an integral part of the social and economic fabric of the Gulf societies. While labour migration has affected many aspects of the lives of migrants and their receiving states in the Gulf, one of the most visible but often neglected migration outcomes is the development of migrant-operated businesses across the Gulf states. Evidently, many of these businesses are owned and run by migrants in collaboration with kafeels (sponsors). Drawing on the experiences of Bangladeshi migrant entrepreneurs in Saudi Arabia, this article explores the dynamics of Gulf migration, by identifying the transition from migrant worker to migrant entrepreneur, and explaining the making of migrant entrepreneurship within the temporary migration process. The study suggests that migrant entrepreneurship is embedded within the dynamics of migration trajectory and the broader factors on which this depends. Notwithstanding their marginal character, the Bangladeshi enterprises in this study have flourished because of migrants’ willingness to embrace innovation. The reconfiguration of such research, I argue, will give rise to an economic sociology of Gulf migration.


    Working Papers: 280 : Transitioning Towards a Sustainable Energy Future: Challenges and Opportunities for India

    Vikram Singh Mehta 27 December, 2017
    India sits at the nub of the crisis of the current high carbon model of development. It is not responsible for this crisis and it can legitimately argue that it must not bear the costs of adapting and mitigating its consequences. However, it cannot escape the reality that it is amongst the most vulnerable nations to global warming. This paper identifies five factors that define the reality of India's energy sector and argues that these factors should be regarded as predetermined trends that will influence the shape of India's future energy profile, at least for the foreseeable future, irrespective of the specifics of policy. It underlines that the Indian government recognises the severity of the problem and has embarked on an ambitious programme to tackle the crisis on its own. However, it requires better alignment of the political, institutional and financial framework for implementation in a given time-frame. Further, the paper lays out five propositions that are necessary first steps towards a low carbon future.

    Working Papers: 279 : Asia’s New Geopolitics

    Shivshankar Menon 22 December, 2017
    Asia's phenomenal economic success has resulted in shifts in the political and military balance of power. What do these mean for Asian geopolitics? Will Asia be able in the future to keep the security and peace that made Asia's economic transformation possible in the past?

    Working Papers: 278 : The ‘Interlinking of Rivers’ Project in India: Potentials and Challenges

    Amit Ranjan and Faiza Saleem 18 December, 2017
    India’s river-linking project carries significant possibilities and challenges for the country. Through the transfer of water from water-rich to water-stressed regions, the project may address the issue of floods and droughts, but it may also produce an adverse impact on the catchment areas of the respective rivers. This paper assesses the ‘Interlinking of Rivers’ project in India through a discussion of its positive and negative effects.

    Working Papers: 277 : The Kingdom of Bhutan: Evolution of the Modern State

    Marian Gallenkamp 18 December, 2017
    The Kingdom of Bhutan, one of the most elusive and inadequately studied states in South Asia, has seen a remarkable development since the introduction of hereditary monarchy in 1907. Each of the Wangchuck kings bearing the Raven Crown has left his distinctive mark on the country's polity and pursued the socio-cultural, economic and political development of Bhutan with a cautious mix of innovation and idealism. On the occasion of Bhutan's 110th National Day, this paper seeks to illustrate the political developments under the reign of past monarchs as well as the paradigm-shifting transition to democracy, before turning towards democracy's consolidation under the rule of Bhutan's current king, Jigme Khesar Namgyel Wangchuck. The paper concludes with a brief discussion of current challenges for the kingdom's future development.

    Working Papers: 276 : The Maldives: On a Complex Political Trajectory

    Amit Ranjan 17 November, 2017
    The political identity of contemporary Maldives, an archipelagic state in the Indian Ocean region, is the outcome of long periods of independent existence, interspersed with episodes of colonial rule. During centuries of its independent status, the country witnessed various forms of government - monarchy, authoritarianism, and controlled democracy. In recent years, there has been a rise of Islamists forces in the Maldives. They have introduced pre-modern values in the society. Under their influence, a few Maldivians have even joined the militant and terrorist groups to participate in 'jihad' in foreign territories. If the Maldives is to continue to practise democratic norms, it must tackle this phenomenon. The region and the world at large must help.

    Working Papers: 275 : Russia in Asia: Responding to Changing Times

    Andrey Tatarinov 16 October, 2017
    Deep geopolitical shifts are fundamentally changing the global landscape. Against this backdrop, the Asia-Pacific is emerging as a significant region which is likely to influence international developments in the near future. Russia's policy in the Asia-Pacific region is deliberate and focused - it is aimed at a stable balance of power and an elaboration of a cohesive regional agenda, in line with the realities of the 21st century. Russia believes there is a need to establish a strong environment of international relations in the region to promote multilateral trade and investment cooperation, initiate joint efforts to counter security challenges and prevent the emergence of new threats- and create a launch pad to build an integrated Asia-Pacific political and economic space.

    Working Papers: 274 : Water Management Practices in Pakistan

    Faiza Saleem 16 October, 2017
    Water is one of Pakistan's biggest challenges. The current discourse focuses largely on interstate water sharing and its impact on water availability in Pakistan. This paper argues that Pakistan's acute shortage of water is the outcome of distorted water management practices. An in-depth look at supply and demand practices reveals deteriorating infrastructure, belowcost pricing of water, inefficiency in usage and an absence of alternative sources of supply.

    Working Papers: 273 : Why Size Matters: Majority-Minority Status and Muslim Piety in South and Southeast Asia

    Riaz Hassan 9 October, 2017
    The differences in the socio-economic outcomes of majorities and minorities have been well studied in sociology. This paper breaks new ground by investigating the effect on religiosity of majority-minority status in two Muslim-majority and two Muslim-minority countries of South and Southeast Asia. Religiosity is conceptualised as a multi-dimensional phenomenon. The paper critically discusses this conceptualisation through an analysis of survey data. The findings show significant differences in the sociological profiles of religiosity in Muslimmajority and Muslim-minority countries. The architecture of religiosity is significantly more orthodox in Muslim-majority countries. The paper concludes with a discussion of the implications of the findings for understanding the nature and dynamics of religious orthodoxy, the nature of civil society, religious reform and the role of collective religious social movements.

    Working Papers: 272 : The Korean Nuclear Conundrum: ‘Fire and Fury’ Signifies Nothing?

    Iftekhar Ahmed Chowdhury 9 October, 2017
    The evolving strategic crisis in the Korean peninsula is arguably the most critical of its kind that the contemporary international system confronts. This has ramifications, in one way or another, for every region in the world. It appears that the acquisition of nuclear weapons by the Democratic Republic of Korea, better known as North Korea, has already become an inexorable, and indeed inescapable, reality. The international effort now should be to contain the consequences in a way that a nuclear Armageddon is avoided. This paper explores some possibilities of how this goal can be best pursued.

    Working Papers: 271 : The Rohingya Crisis – A Challenge for India and Bangladesh

    Amit Ranjan 25 September, 2017
    The Rohingya crisis in Myanmar is the result of a clash of identities between the Muslim minority and the Buddhist majority in the Rakhine state of the country. Due to an increase in violence, a large number of Rohingyas have crossed into Bangladesh. Many have also fled to India and other parts of Asia. This has resulted in great tension in Bangladesh's relations with Myanmar. On its part, the Indian government is planning to deport the Rohingyas living within its borders. This paper traces the origins of the crisis and examines whether the crisis is just a humanitarian challenge or a security threat as well to the three countries - India, Bangladesh and Myanmar.

    Working Papers: 270 : Regional Governance in a Changed Context: A Preliminary Analysis of Bihar, Tripura and West Bengal

    Subrata Kumar Mitra and Taisha Grace Antony 4 September, 2017
    Within the overall framework of India’s political stability and democratic governance, political scenarios in India’s regions and localities present a contrasting picture. This includes violent mobs on the streets of Srinagar, insurgency and armed secessionist movements in India’s north-east, Naxalite violence in several states of India, and violent inter-community riots that, nevertheless, do not impair the overall stability of the state. How does India cope with these challenges to governance? Focused on a comparative analysis of regional governance, the paper answers this key question with reference to policies and administrative and legal structures at the regional level that promote governance. By drawing on the logic of human ingenuity, driven mostly by self-interest, the innovation of appropriate rules and procedures, and most of all – agency, of elites and their non-elite followers – the paper sheds light on policies, institutions and processes that enhance governance. It argues that ‘fundamentalism’, ‘ethnicity’, conflict and fragmentation, seen as characteristic of non-western politics, have political and not necessarily cultural and idiosyncratic origins and, as such, are amenable to a general explanation, and empirical policy analysis.

    Working Papers: 269 : Governance in India: Political Order, Accountability and Public Service Delivery

    Subrata Kumar Mitra and Taisha Grace Antony 4 September, 2017
    The resilience of democratic governance makes India an exception to the rule among transitional societies. We argue in this paper that this puzzle is best explained with reference to the innovative character of India's political system and process which combines ordermaking institutions with those ensuring accountability and public service delivery. The capacity for appropriate institutional arrangements and political innovation draws on the process of institutional innovation that connects modern politics in India to its classical roots. This gives the Indian political system its coherence, authenticity and legitimacy.

    Working Papers: 268 : Afghanistan in 2017: Continuing Struggle to Define Itself

    Shahid Javed Burki 19 August, 2017
    Afghanistan has seen a lot of history. Since it is not easy to compress it into the space of a Working Paper, the author will focus his attention on more recent times. Beginning with the Bonn Agreement of 2001 involving many countries around the world that wanted to see stability come to the country that has seen unimaginable violence for four decades, this paper will provide a brief overview of the way politics has developed in the country over the last decade. It will then provide an overview of the economic situation, suggesting that sustained growth in the depressed economy will only come once the country controls violence. Since Afghanistan's political progress depends to considerable extent on the country's relations with Pakistan, its neighbour to the southeast, a section will examine how Kabul and Islamabad are looking at each other. The paper will devote considerable space to the way the American policy is evolving in the country under the newly installed administration headed by President Donald Trump. The White House is still involved in the process of developing its approach towards the country in which the Americans intervened in 2001 and have been fighting there for 16 years. The final section of the paper examines the likely impact on the South Asian sub-continent of continued turbulence in Afghanistan.

    Working Papers: 267 : Indian Democracy at 70: Some General Lessons

    Subrata Kumar Mitra 15 August, 2017
    Is democracy a moveable feast? Can all societies reach the twin ideals of popular rule and an accountable government, mindful of minorities, given appropriate institutions? Independent India's democratic experience, though fraying at the peripheries but still solid at the core, gives rise to these salient questions which have deep significance for transition to democracy and its consolidation in transitional societies emerging from colonial rule, foreign occupation or dictatorship. This paper analyses the Indian experience in the light of six general propositions about institutions and processes that pave the way for transition to democracy and its consolidation. The assumptions on which they are based are general, and not culture- and context-specific. Alone, or in combination, popular elections, institutionalised countervailing powers endogenous to the political system, power-sharing, the accommodation of diversity based on region and community, inclusive citizenship and a previous experience of limited franchise on which to build the post-transition regime can help pave the way towards democratic rule in transitional societies.

    Working Papers: 266 : Pakistan is 70: What If?

    Shahid Javed Burki 14 August, 2017
    Pakistan did not expect to be born as a nation-state. However, when its birth did occur, it led to unprecedented upheavals. Some of these have left a lasting impression on the country’s extremely turbulent history. This paper introduces the readers to some of the main features that dot the country’s landscape. It discusses the circumstances of the country’s birth; the many crises the country faced from 1951 to 2008; the country’s current situation that has several positives but also many negatives; and, finally, the direction in which Pakistan seems to be headed in the eighth decade of its life as an independent state. A section also discusses some of the “what ifs..?” concerning Pakistan to illuminate some salient points in the country’s mostly-troubled history.

    Working Papers: 265 : The Informal Sector in India: Indicator of Resilience or a Malaise?

    Dipinder S Randhawa 31 July, 2017
    The informal sector accounts for over 92 per cent of the labour force, over 40 per cent of output, and 99 per cent of businesses in India. The range and size of informality in India is arguably larger than for any other economy, compared to other economies at a similar stage of development. The informal economy primarily comprises of millions of self-employed, and small and tiny, relatively inefficient enterprises that detract from India's growth potential. Informal enterprises have deep and intricate links with formal sector enterprises and are affected by developments in the domestic and global economies. The spread of informality is symptomatic of much that ails the Indian economy. Yet, it is also a powerful safety valve, offering employment and income generation avenues for tens of millions who are unable to secure jobs in the formal sector. This paper reviews the reasons leading to the growth of the informal sector. It finds that a nuanced approach, cognisant of the wide differences across the informal sector, should identify segments that should be allowed to exist as informal entities and those that should, with improving conditions for doing business, be induced to enter the formal economy.

    Working Papers: 264 : The Informal Sector: An Exposition on its Origins, Current State and Future Prospects

    Dipinder S Randhawa 28 July, 2017
    In developing economies, it is visible everywhere. It is amorphous, difficult to define, challenging to measure, generally beyond the grasp and, indeed, comprehension of the authorities. Yet the informal sector accounts for a significant share of the economy and directly impacts the lives of a majority of the population. Fifty per cent of the global workforce is estimated to be employed in the informal sector (OECD, 2009). What is the informal sector? Why does it exist? How does it impact the quest for growth and equity?

    Working Papers: 263 : The Donald Trump Phenomenon and the American Presidency

    Shahid Javed Burki 26 July, 2017
    This paper deals with the subject of what is being called the 'Trump phenomenon'. Much has already been written on the rise of Donald Trump, who gained a spot at the top of the United States political structure without previously ever having been elected to public office or holding a position in government. His rise was unprecedented in American history and will leave an indelible mark, not only on the country, but also on the entire world. Why that happened will be the subject of interest for historians and political scientists for decades to come. The final judgment is not likely to be positive. He will be seen as a great disruptor rather than as a great builder.

    Working Papers: 262 : The Indian Ocean Rim Association: Scaling Up?

    Barana Waidyatilake 12 July, 2017
    Having achieved relatively little in two decades of its existence, the Indian Ocean Rim Association, which met for the first time at a summit level in March 2017, can now assess the opportunities for economic cooperation and connectivity among its member states. While a beginning could perhaps be made at a sub-regional level, as an example for others to follow, the challenges of diversities and geopolitics cannot also be discounted.

    Working Papers: 261 : The Shaping of the ‘Trumpian’ World Economic Order

    Shahid Javed Burki 6 July, 2017
    This paper discusses the way in which Donald Trump, the new American President, is unravelling the global political and economic orders that had been painstakingly established over a long period of time. The foundation of the old order was laid right after the end of the Second World War in Europe and was built upon during the days of the Cold War. Its evolution hastened following the collapse of the Soviet Union in 1991. With the Cold War's ideological conflict over, Francis Fukuyama, a reputable sociologist, claimed that history had come to an end - it had ended, he believed, since the world would no longer be engaged in ideological conflicts.2 However, governance is more than the pursuit of ideologies. It also includes the way nations interact with one another and the institutions they create to promote these contacts.

    Working Papers: 260 : Trump’s Overtures to the Islamic World: Implications for the Middle East and South Asia

    Shahid Javed Burki 15 June, 2017
    If United States President Donald Trump had hoped to reboot his faltering presidency by going to Saudi Arabia at the beginning of his first foreign tour, he seems unlikely to achieve that goal. By starting his nine-day trip with Riyadh as the first port of call, he expected to divert the attention of the growing number of his critics at home who were focusing on the almost daily revelations about and from a dysfunctional White House. He thought that he would bring back good economic news from his foreign trip. He wanted to shift the attention of the American people towards economic issues, in particular, employment. He was of the view that the political base he had built to gain the presidency would continue to give him support if he could bring jobs to the economically-devastated areas in the country. Even with several memoranda of understanding signed with the Saudi government – and with the companies in the kingdom – it is arguably unlikely that he will succeed in creating many new jobs in America.

    Working Papers: 259 : Anti-nuclear Movements in India: The Case of Kovvada, Andhra Pradesh

    Varigonda Kesava Chandra 15 June, 2017
    The Indian state's civil nuclear policy, characterised by the construction of nuclear power plants, has witnessed considerable opposition in recent years from people residing in its vicinity. The direct impact on the livelihoods of these often rural, poor and lower-caste populations is discerned through land acquisition and population displacement, along with a loss of traditional ways of earning, especially through fishing and subsistence farming. In addition, the perceived impact on health and safety of the population and pollution to the environment, especially from the radiation emitting from the plant, as well as the propensity of a potentially catastrophic accident like that of Fukushima or Chernobyl, has driven the opposition to nuclear power. The narrative, thereby, becomes one of the state and the larger national interest versus the rights of those living in the periphery. The paper demonstrates the relationship of the periphery and the nation-state with regards to nuclear power, particularly through the example of the planned nuclear plant at Kovvada in Andhra Pradesh.

    Working Papers: 258 : Chinese Perceptions on India’s Long Range Missile Development: How Credible is India’s Deterrence against China?

    Srikanth Thaliyakkattil 24 April, 2017
    India's long range missiles such as Agni IV and Agni V are the core of its deterrence against China. The scholarly Chinese perceptions of the capability of these missiles matter very much as an important variable in the planning and development of India's deterrence. The Chinese analysis of the Indian long range missile tests especially the Agni V reveals how the Chinese view the credibility of the Indian missile threat. Chinese specialists also discuss the prospects of India attaining a credible deterrence through long range missile development, and the counter strategies China should adopt against it. These perceptions furthermore point to Chinese thinking about the ideal security architecture in Asia and India's role in it.

    Working Papers: 257 : Democracy and Ethnicity in Nepal

    Krishna Hachhethu 20 April, 2017
    Following a successful conflict transformation of a decade long Maoist insurgency (1996-2006) with the promulgation of the new constitution in September 2015, Nepal has entered into the verge of new conflict, an ethnic conflict. Ethnicity has recently become a critical issue in responding to the fact that the political structure of Nepal has not yet been framed in conformity to the social diversity of the country

    Working Papers: 256 : Dalai Lama’s Visit to Arunachal Pradesh and China’s Shifting Diplomatic Strategies

    Srikanth Thaliyakkattil 13 April, 2017
    China’s reactions to the visit by Dalai Lama to Arunachal Pradesh in April 2017 symbolises a deeper shift in China’s perception of the Tibet issue and India’s role in it. The Chinese view the unrest in Tibet as part of the unresolved border issue between India and China. The intensification of the Chinese rhetoric over Tibet is backed by newfound confidence from the Chinese diplomatic victories in recent years over the Dalai Lama issue. With the rising Chinese economic influence, China is increasingly able to isolate Dalai Lama in the international arena and the Tibetan cause he expounds. India’s diplomatic signalling of using Dalai Lama may prove to be counterproductive, because China is using it as an anti-India tool, which helps it to mobilize the Chinese nationalists against India’s support to the Chinese Tibetan “separatists”.

    Working Papers: 255 : Sri Lanka’s Ethnicized Experience of Democracy: A reading from the Sri Lankan Survey results of State of Democracy in South Asia

    Pradeep Peiris 9 February, 2017
    This paper attempts to provide a brief insight into the way in which democracy is functioning in Sri Lanka. The perceptions, attitudes and practices of Sri Lankans with regards to democracy are examined by analyzing the findings of the latest survey of the State of Democracy in South Asia (SDSA) that was conducted in five countries in South Asia.

    Working Papers: 254 : What Demonetisation Sought: Was it a Bridge Too Far?

    Dipinder S Randhawa 25 January, 2017
    On November 8, 2016, the Indian Prime Minister, Mr Narendra Modi, announced the demonetisation of the Rs 500 and Rs, 1,000 currency notes from that midnight. This was arguably the most radical monetary policy initiative since 1947, leaving no part of the population unaffected. The main objective was to curb the black economy. This paper contends that demonetisation has proven to be a blunt policy instrument for checking the parallel economy. Data shows that a small proportion of black money is held as cash, with an overwhelming majority of illegally generated funds held in other asset classes such as precious metals, property, other financial instruments and offshore accounts. Of the funds unaccounted for by the tax authorities, a significant proportion has been returned to the banking system. Though precise estimates are difficult to obtain, collateral damage on the informal sector and those on the economic margin seem to have been severe, while the return of a large proportion of invalidated cash to the banking system, may have negated the original objective of seizing black money. There are likely to be benefits for public finance and progress in the quest for digitalising payments. However, without structural reforms and reforms in tax administration, a sustainable impact on the parallel economy is doubtful. From that perspective, the rationale for demonetisation is open to question.

    Working Papers: 253 : Recent Trends in India’s China Policy: The imperative for Greater Room to Manoeuver

    Subrata Kumar Mitra and Srikanth Thaliyakkattil 20 January, 2017
    Does a sense of inadvertent appeasement underpin the recent China policy of the Government of India? Since Mr. Narendra Modi became Prime Minister of India, China has consistently adopted positions that oscillate between benign indifference, and the plainly hostile, with regard to India's national interest. The efforts by the Indian government have not visibly succeeded in influencing Chinese policy which comes across as obstructive and uncooperative on issues vital for India. India's economic engagement with China is skewed in favor of China. Under the Modi government this situation has become worse, reflecting, perhaps, a long-term term trend based on structural factors. On the basis of available evidence it can be argued that the pattern of India's increasing economic engagement with China has contributed to strengthening China's position in its relation with India, while constraining India's strategic and diplomatic options.

    Working Papers: 252 : Dealing with Trump’s America

    Shahid Javed Burki 20 January, 2017
    This essay on a rare political phenomenon – the election of Donald Trump as the president of the United States – was as unexpected as is hard to explain. It will also have consequences for the United States and the world at large that will be profound and leave their mark on history. Over time a great deal will get to be written on the subject in popular books and in scholarly journals. This is an early attempt to cover the ground in several short sections. There are three main conclusions I will reach here.

    Working Papers: 251 : China and the Trump Presidency: Some implications for the world, and South Asia

    Shahid Javed Burki 20 January, 2017
    After a quiet period that lasted for a quarter century – from the 1991 collapse of the Soviet Unions to the 2016 election of a maverick non-politician by the Americans as their 45th president – great power rivalry has reemerged on the global scene. The United States remained unchallenged by any other power ruled the waves for 25 years. As I argued in a book, Rising Powers and Global Governance, published in early 2017, the world was entering a period of considerable uncertainty. It did not have global institutions that could intermediate between competing powers to usher in a new world order.


    Working Papers: 250 : Sri Lanka’s Foreign Policy under the Sirisena-Wickremesinghe Government

    Iromi Dharmawardhane 23 December, 2016
    While Sri Lanka’s interests at its present juncture are mainly in economic development, the concerns of major powers in Sri Lanka are primarily strategic due to Sri Lanka’s proximity to major global shipping lanes. Since the change of government in January 2015, from the China-leaning Rajapaksa government to the Sirisena-Wickremesinghe government espousing a nonaligned foreign policy, there has been a great increase in engagements between Sri Lanka and the United States of America, India and Japan. Engagements between Sri Lanka and China have also resumed and intensified in 2016. This paper describes the nature and breadth of Sri Lanka’s key engagements with major powers, to determine Sri Lanka’s foreign policy under the Sirisena-Wickremesinghe government and assess its impact for Sri Lanka and on regional stability.

    Working Papers: 249 : China and Bangladesh: New Strategic Partners

    Iftekhar Ahmed Chowdhury 14 December, 2016
    Bangladesh and China are today 'all weather' strategic partners. The process, however, evolved at its own pace and took some time. This development, of course, is owed to the perceived national self interest of both countries. But it has also been aided by a certain consistency in the way China relates to the world.

    Working Papers: 248 : Indian Ocean and the Bay of Bengal: A Strategic Factor in China-South Asia Relations

    P S Suryanarayana 12 December, 2016
    Chinese President Xi Jinping's go-global strategy towards Maritime South Asia will be fashioned by the interests and concerns of China, but may well be buffeted by those of India. The centrepiece of this study is a bird's-eye view of the emerging interplay of such potential Sino-Indian power projections.

    Working Papers: 247 : Political Market Imperfections and Incentives for the Provision of Social Services in India: A Case Study of Kerala and Uttar Pradesh

    Taisha Grace Antony 8 December, 2016
    Delivery of social services of health and education often see significant cross-national variations within a country. State governments in democratic developing counties sometimes have an incentive to provide targeted benefits as political rents at the expense of the provision of broad social services. Differences in state government expenditures can be traced back to certain imperfections in the political market, which may be greater in some states as compared to others. These imperfections, in turn, affect the political incentives for the provision of social services. The three independent factors or imperfections in the political market that have been identified to have the potential for affecting electoral accountability are the degree of information available to voters, the dynamics of political competition, and the extent of ethnic fragmentation in a state.

    Working Papers: 246 : Skills Development Policy and Jobs in India: Shortcomings and Way Forward

    Anshul Pachouri 6 December, 2016
    India seems to be facing multiple challenges in the skilling space: low employability of training programs, slower employment generation, low level of skilled workforce and overall quality of training infrastructure. There has been duplication of efforts at enhancing capacity for new skills over the years with more than 21 ministries, State governments, and other agencies running skills development programs with no commonly accepted standards and norms. These challenges become more prominent for a nation with more than 65% of the population below 35 years of age. The first skills development policy of 2009 institutionalized the skills training delivery in India by establishing a three-tier structure (National Skills Development Corporation was made responsible for operationalizing the efforts) and setting-up an ambitious target of training 500 million people by 2022.

    Working Papers: 245 : Compressed Capitalism, Employment, and the Structural Limits of the State: The Indian Case

    Anthony P. D'Costa 16 November, 2016
    This paper examines the nature of changing labor markets in India and identifies the severe structural limits of the state in creating plenty of meaningful jobs. The argument is as follows: the instruments of intervention available at the state's disposal are highly constrained due to a variety of structural endogenous and exogenous factors, whose cumulative and combined effect has been to generate a form of late capitalism that does not follow the classical capitalist transition pattern. Instead the uneven development resultant from this type of capitalism is unable to create either the desirable type or high volume of jobs. This late form of capitalism is compressed due to both pre-mature stagnation and leapfrogging in specific sectors and industries and by which the classical or agrarian transition is either incomplete or stalled and thus unable to play its historic role of raising agricultural productivity to motor capitalist industrialization.

    Working Papers: 244 : India at Cross-roads: Beyond the Dilemma of Democratic Land Reforms

    Subrata Mitra and Rinisha Dutt 16 November, 2016
    During the demanding years following a century and half of economic stagnation during colonial rule, India has changed progressively from a colonial, agrarian economy into one where services and manufacturing have overtaken agriculture in terms of sectoral contribution to GDP. The country’s democratic institutions have held their own. They have generated the political momentum that reinforces reform without upsetting the democratic and judicial due processes. Many had maintained that radical changes in India’s economy and welfare would be unlikely as long as both are constrained by the liberal democratic constitution and the capitalist mode of production.3 India has defied the general norm. However, the robust confidence in long-term, sustainable growth that one finds in sections of India’s corporate sector has its critics. The diversity of India’s political economy and the complex role of the state in balancing growth and justice call for a nuanced analysis. This paper analyses how India has coped with the dilemma of ‘democratic’ land reforms – a key component of the Indian model of economic growth versus social justice – the policy paralysis this has given rise to, and the possible solution to what appears as a conundrum.

    Working Papers: 243 : Contemporary Trends and Patterns of Democracy in Bangladesh: A Perception Study

    Sk. Tawfique M Haque, Professor and Director, Public Policy and Governance Program, Department of Political Science and Sociology, at the North South University, Dhaka (Bangladesh) 2 November, 2016
    Trends and patterns of democracy in a country evolve from past historical processes to its current level of adoption and degree of liberalization of democracy. The testimony to a functional democracy in a country can be traced by the citizens' perception on public institutions, quality of adult franchise, public responsiveness, media freedom and human rights. The survey on democracy portrays citizens' perception on democracy which was carried out in 2014 in 50 constituencies under 16 districts in Bangladesh.

    Working Papers: 242 : The United States and the State of World Politics: Some Implications for South Asia

    Shahid Javed Burki 25 October, 2016
    This essay attempts to answer several important questions: What is happening to the political systems in the Western world? How will America influence the state of world politics as it goes through a period of wrenching change itself? At this time, Washington seems less inclined to get involved in world politics. What would be the impact of this virtual withdrawal from world affairs on several parts of Asia, the northeast, the east, the southeast, the south and the west? How closely are economic and political trends aligned? Would economic despair among several segments of the citizenry in the West reinforce the passive approach which the politically more-developed countries have adopted towards the countries that are relatively less-advanced.

    Working Papers: 241 : Rivals Sometimes, Friends Always? Puzzles, Paradoxes and Possibilities in Sino-Indian Relations

    Subrata Kumar Mitra 11 October, 2016
    India-China relations are today less cordial but commercially buoyant. In most of the bilateral meetings both countries pledged to increase the bilateral trade volume and in 2015 have signed a strategic partnership. The relationship continues to be beset with tensions that ever so often erupt and threaten to derail efforts to manage the simultaneous rise of two giant economies and Asian powers. A trade balance vastly in favour of China rankles in India where fears for Indian manufacturing abound especially when contrasted with Chinese prowess. Issues of infrastructure, urbanisation, corruption and governance provoke regular stocktaking on the Indian side, leading to heated debates and discussions on the successes and failures of two different political systems. Strong, negative perceptions persist on both sides, characterised by deep sensitivities on political issues, most importantly, the activities of the Dalai Lama in India and the disputed border territories. Nationalism often threatens to boil over and is egged on by a dynamic media in both countries. Border incidents along the un-demarcated Sino-Indian border occur regularly and are often depicted as ‘incursions’ and in the effort to calm tempers, labelled as ‘transgressions’. Nonetheless, Chinese Premier Li Keqiang chose to make India his first port of call signalling that perhaps the regime in Beijing was allocating greater importance to Indian than in the past. What emerges therefore remains a confusing picture of Sino-Indian relations - on the one hand more cooperative and commercially resilient than ever before and on the other hand a relationship that continues to be vulnerable to distrust and nationalism. Reconciling this contradictory picture requires the posing of some concrete questions. Who makes India’s ‘China policy’ and who makes China’s ‘India policy’? To what extent are commercial stakeholders and military strategists involved in the process of policy-making on either side? Are there institutionalised forums within which disputes and concerns are regularly tabled and discussed? To what extent is the bilateral Sino-Indian relationship embedded within multilateral frameworks? What are the main drivers of India-China relations? Does trade continue to be the abiding priority on both sides or do emerging geo-political considerations look to shape the repertoire of concerns and ambitions? Can ‘Chindia’ become the fulcrum of a new Asian Equilibrium?

    Working Papers: 240 : Democracy in South Asia: One Goal, Multiple Paths

    Suhas Palshikar 11 October, 2016
    While on the one hand, democracy in South Asia can be seen as emphasizing the welfare aspect more than the others, we have also noted that citizens from countries of the region also uphold various aspects of procedures, rights and governance when they think of democracy. If our conceptualization, therefore, does not insist on any one set of ideas as the authentic meaning of democracy, then we are in a position to study democracy in South Asia in a more nuanced fashion.

    Working Papers: 239 : The State of Bangladesh-United States Relations: Before the Kerry Visit, and Beyond

    Iftekhar Ahmed Chowdhury 28 September, 2016
    The Working paper seeks to examine the gamut of the Bangladesh-United Stated relations, of which an important milestone, given the backdrop against which it was undertaken has been the visit to Dhaka in August 2016 of the US Secretary of State John Kerry. It argues that as a relationship it has not always been smooth and feathers have been ruffled on both sides on occasions. Yet stabilizing it would redound to the interest of both governments and peoples. The paper concludes with the argument for a strong reengagement between the next Administration in Washington DC and Dhaka, closing any attention-deficit on both sides.

    Working Papers: 238 : Religious Fundamentalism in South Asia: Some Preliminary Considerations

    Riaz Hassan 21 September, 2016
    Religious fundamentalism is a distinctive set of beliefs and behaviour pattern in most modern religious communities. It is a religious way of being that manifests itself as a strategy among the believers to preserve the authenticity of their identity based on doctrines, beliefs and practices from a sacred past. This religious identity becomes the exclusive basis for a reimagined political and social order. There are numerous fundamentalist movements in South Asia. This paper focuses on four main movements namely: Arya Samaj, Rashtriya Svayamsevak Sangh or the RSS, Jamaat-i-Islami and Tablighi Jamaat. The first two are Hindu and the last two Muslim. It is argued that the genesis of these movements lies mainly in the challenges posed by modernity, political and cultural subordination, nationalism and colonialism. Like nationalism religious fundamentalist movements are intellectual projects led by charismatic intellectuals seeking to reform and remodel society using the sanctity and authority of sacred texts. All four movement have had significant impact on social and political processes in India, Pakistan and Bangladesh, some of which are highlighted in the paper. The paper concludes by suggesting that religious fundamentalist movements are new form of traditionalisms. These movements use tools of modern science and technology to advance their goals but reject some of the key features of modernity such as secular rationality, individualism, religious and cultural pluralism and tolerance.

    Working Papers: 237 : Need for Credible Anti-Terror Counter-Narratives: The Bangladesh Context

    Shamsher M Chowdhury 11 August, 2016
    Present-day religious extremism and radicalism do not target any one political party or country, nor do they favour another. These are a societal phenomenon built on a medieval narrative, characterised by a mindless anger, and have become trans-national. The most effective way to tackle this threat is to build credible counter-narratives and take a collective approach.

    Working Papers: 236 : Technologies of Swachh Bharat Machines and Methods for Cleaning India

    Robin Jeffrey and Assa Doron 5 August, 2016
    Under the categories of Earth, Fire and Water, this paper reviews some of the technologies being deployed in the Swachh Bharat or Clean India campaign. Humans have buried, burned or washed away unwanted materials since pre-historic times, but modern population densities and production capacities pose unprecedented problems. The paper examines "scientific landfills," incineration methods and toilet and waste-water innovations. Although superior technologies are essential for the success of the Clean India initiative, they must be accompanied by superior training and conditions for existing low-status workers and widespread change in attitudes towards public sanitation. Achievement of these latter ends calls for further urgent research.

    Working Papers: 235 : Attempted Military Coup in Turkey: Some Lessons for South Asia and the Muslim World

    Shahid Javed Burki, Visiting Senior Research Fellow at the ISAS 26 July, 2016
    This paper examines the failed coup d’etat in Turkey in the context of political developments in the western part of the Muslim world – the stretch of land from Morocco to Bangladesh. Of the 33 countries in this area, only three could be said to have moved towards developing inclusive political systems. Two of these – Bangladesh and Pakistan – are in South Asia. The third, Turkey, was also making progress before the military attempted to overthrow an elected government. The paper suggests that militaries succeed in political interference when a number of conditions are met: democratic institutions are weak; large segments of the population are not happy with the quality of governance on offer; and the military functions as a unified force, with a clear chain of command. Most of these conditions were not present in Turkey. It is too early to tell whether the attempted coup and the reaction to it have set back Turkey’s political progress. If it has, it will be consequential for the Muslim world. However, the relative political success of Muslim South Asia may in the end provide the Muslim citizenry some models they could follow.

    Working Papers: 234 : India’s Economic Reforms and APEC Supply Chain Trade

    Ganeshan Wignaraja 24 May, 2016
    This paper analyses India-APEC global supply chain trade performance and its links to India's business environment, particularly economic reforms.

    Working Papers: 233 : Land Management and Industrial Development in Tamil Nadu1

    Sojin Shin is Visiting Research Fellow at ISAS 4 May, 2016
    This paper addresses a central research question of how socio - political factors explain a high level of land acquisition in Tamil Nadu that is couple d with intensive industrialization. It answers the question by paying attention to the ideas of policymakers on inclusive industrial schemes and societal structure presenting the upward mobility of low caste groups in both political and economic spheres in the state. It argues that the state’s commitment to land making and industry making has met the needs of citizens favoring urbanization, thereby contributed to industrial development. Fieldwork findings collated from a bargaining process between the state, society, a nd foreign capital for land acquisition at a special economic zone for a tire - manufacturing foreign compan y strongly support the argument.

    Working Papers: 232 : The Roots of Citizen Welfare in India: Reflections on Andhra Pradesh and West Bengal

    Rahul Mukherji, Associate Professor, South Asian Studies Programme at the National University of Singapore 18 April, 2016
    This paper argues that the state in India is an important actor in engendering development and welfare. India is a different kind of development state. This argument is made by comparing two cases of welfare provision in two Indian states.

    Working Papers: 231 : Swachh Bharat!: If Not Clean India! Perhaps a Cleaner India by 2019?

    Robin Jeffrey 31 March, 2016
    This paper examines the seven goals of the Swachh Bharat! Clean India! campaign inaugurated by Prime Minister Narendra Modi in 2014. Assessing the motivations for the campaign, the appropriateness of each goal and the obstacles and opportunities that face the campaign, the author welcomes the momentum that highest-level support brings to the unglamorous (but desperately urgent) policy area of solid and liquid waste-management. But the paper also underlines the immense cultural and administrative hurdles that have to be overcome.

    Working Papers: 230 : Power and Piety: Religion, State and Society in Muslim Countries

    Riaz Hassan 23 February, 2016
    There is the logical possibility of the creation of a Muslim society that is characterised by high levels of trust in and esteem for the State, and in which there is also a high level of trust in religious institutions. However, as far as we know, there are no contemporary examples of such a situation that can be readily identified. This raises the interesting question of why this is so. Does it mean that such a situation is not possible, or could such a situation possibly come about under circumstances in which different political arrangements prevail between Islam and the State? The author argues that the findings reported in this article will stimulate further debate and discussion on the relationship between the State and religious institutions in Muslim countries and help them move from the actual to the ideal.

    Working Papers: 229 : An Assessment of the International Legal Obligations Owed to the Rohingya Refugees

    Ramandeep Kaur, Intern at the ISAS, an autonomous research institute at the National University of Singapore 16 February, 2016
    This paper considers the issue of migration of the Rohingyas from the lens of international law. It evaluates the responses of the countries that have been the destination of these migration flows – namely Bangladesh, Thailand, and increasingly, Malaysia and Indonesia (collectively, the “destination countries”) – against their obligations under international law. The response of the destination countries has, regrettably, not been entirely consistent with the international legal framework. Things are however beginning to take a turn for the better. The discovery of mass graves on Thailand’s border with Malaysia generated international pressure and pushed countries into taking collaborative action. The outcome of this collaboration has been encouraging and it represents a closer alignment with the international legal framework. However, this alignment, stemming as it does from an ad hoc arrangement, might prove to be short-lived for reasons that will be explored. This paper proceeds in the following manner: Section I assesses the extent of the destination countries’ compliance with their international legal obligations, following which Section II explores the durability of the compliance with international law that seems to have emerged recently. Here, it will be argued that this compliance is likely to be short-lived. Even more fundamentally, it will be shown that international law by itself cannot offer a comprehensive solution to this thorny problem; international cooperation is a must.

    Working Papers: 228 : Development Policies and Democratic Disruptions. Predicaments of the Marxist Left

    Dwaipayan Bhattacharyya , Centre for Political Studies at the Jawaharlal Nehru University in New Delhi 16 February, 2016
    This paper argues that development policies operate in Indian democracy at the interstices of two largely different yet interconnected worlds – of technical formulation and political formations. The Indian Left found dramatic success in its land reform policies as it travelled between the two by combining its programmatic goals with pragmatic governance, and – by contrast – failed miserably to overcome popular protest against acquiring farmland when it was driven by a top-down bid for industrialisation. Populist disruptions, strategically negotiated with, play a far more productive role in India’s democracy than ordinarily acknowledged in effecting a political scrutiny of state policies for economic development – however sound and desirable.

    Working Papers: 227 : Ontological Security And India-China Relations: From Border War To “News War”

    Lu Yang, Postdoctoral Fellow at the Department of International Relations Tsinghua University in Beijing 15 February, 2016
    This paper joins the growing scholarship on the ontological security needs of states in international relations (IR) literature and explores its relevance to India-China relations. Ontological security is the security of identity, achieved by routinized relationships with significant others and actors can become attached to those relationships. The main research question will be twofold: to what extent is the border dispute constitutive of India and China’s identities in their interactions; and, to what extent can the concept ontological security shed light on understanding India-China relations and on ending persistent border conflict? By reviewing India-China border dispute and examining recent phenomenon, the “news war,” the paper argues that there is a victim-perpetrator/loser-winner relationship between India and China, caused by the 1962 war and routinized in the years thereafter, which indicates great conflict potential.

    Working Papers: 226 : Offshore Financial Centres and the Determinants of India’s outward FDI

    Chandrani Sarma , Research Assistant at ISAS 11 February, 2016
    The paper analyses the factors behind the trend of India's outward investment flows to a few top destination-countries during the years 2008 to 2013. India's investment decisions are not of the same kind, and hence the results of analysis showed interesting insights on offshore financial centres (OFCs). The main aim of the paper, apart from reiterating the robustness of traditional investment theories, is to test whether the traditional determinants of FDI flows; trade, institutions, exchange rate etc. hold good even when the host destination is an OFC. A significant fraction of global capital flows though these jurisdictions, but it has not received much research focus. A better understanding of their nature can help countries in policy decisions. The results confirm that for a host country to attract FDI from India, the traditional determinants remain significant; however, where the host country is an OFC, traditional factors are rendered insignificant.

    Working Papers: 225 : Spatial Dimensions of Muslim Well-Being in India: A comparative study of Indian districts

    Riaz Hassan , Mikhail Balaev and Abusaleh Shariff 29 January, 2016
    The Sachar Commission Report of 2006 on Social, Economic and Educational Status of the Muslim Community of India generated widespread awareness of the socioeconomic disparity and exclusion of religious minorities, especially Muslims, in India. The theoretical framework of the Report was predicated on Indian's constitutional promise of equality of opportunity for citizens of secular democracy. One of the biggest gains of the Sachar Commission was its reconstruction of the Muslim community as 'development subjects' in the state rather than primarily as a religious community. An important finding of the Sachar Commission was that there is a clear and significant inverse correlation between the proportion of the Muslim population and the availability of educational, communication, health and physical infrastructures in villages.

    Working Papers: 224: The Indo-Russian Defence Partnership : A Framework for the 21st Century

    Jayant Singh, Research Assistant at ISAS 22 January, 2016
    Since the 1960s defence trade has been the raison d'?¬tre for strategic relations between India and the Soviet Union/Russia. However, in consonance with India's enhanced geopolitical status and the strategic rapprochement with the United States, New Delhi has found new partners in the West. India's military-technical relationship with Russia is no longer an exclusive partnership. The resultant downgrade in Indo-Russian defence engagement has unsettled longstanding geo-political equations. Given the export-dependent nature of the Russian military-industrial complex, the Kremlin has begun to revise elements of its arms policy in South Asia. Russian military export overtures towards Pakistan are now perceptible. In order to recapture their old charm and take their military partnership into the 21st century, recurring problems in Indo-Russian defence engagement must be ironed out.

    Working Papers: 223 : Elite Politics and Dissent in Sri Lanka

    Harini Amarasuriya, Open University of Sri Lanka, Nugegoda, Sri Lanka 22 January, 2016
    The year 2015 has been dramatic for politics in Sri Lanka. A Presidential, as well as a General, Election within the first eight months of the year saw the country having a new President and a new government come into power. The new political order was brought into power on a wave of mobilisation from a range of civil society groups and actors reminiscent of the political transformation that took place in 1994. Then too, a government that had been in power for 17 years, which had overseen the violent suppression of an insurrection in the South, was defeated by a relative newcomer in politics. This paper attempts to examine the changes that have taken place in 2015, in relation to certain established facts about Sri Lanka's political system, particularly the dominance and endurance of the elite.

    Working Papers: 222 : Challenges and Trends in Decentralised Local Governance in Bangladesh

    Niaz Ahmed Khan, Professor and Chair, Department of Development Studies, University of Dhaka, Bangladesh 22 January, 2016
    Bangladesh has a rich legacy of establishing and promoting local government institutions, but the actual roles and contributions of these institutions to augment citizens’ participation and consolidate democratic practices have often been marginal - due mainly to the overwhelming central interference, and abuse and manipulation by authoritarian regimes to perpetuate their power. This study takes a retrospective look into the evolution and functioning of decentralised local governance in Bangladesh with a view to eliciting the major trends, characteristics and challenges. Such a reconnaissance exercise may be particularly relevant in consideration of the fact that there has, of late, been renewed emphasis on decentralized local governance by the government and civil society alike, and a number of structural and legal reforms have been made.

    Working Papers: 221 : Andhra Pradesh: Political Dynamics of Regionalism, Formation of New States in India

    K C Suri, Professor in the Department of Political Science at the University of Hyderabad, India 22 January, 2016
    Delving deeply into the dynamic factors that have led to the creation of language-based sub-national States in India, the author explains the political and psychological basis of the recent bifurcation of Andhra Pradesh, a composite State for the Telugu linguistic group, in a context in which the two new entities continue to be dominated by people speaking the same language.

    Working Papers: 220 : From Congress-system to Non-hegemonic Multi-party Competition: Politics in Maharashtra

    Suhas Palshikar , Department of Politics & Public Administration at Savitribai Phule Pune University, Pune, India 15 January, 2016
    The paper reviews the changing nature of politics in the state of Maharashtra - an important subnational state in India. Politics in the state underwent a shift in 1978 and later again in 1990s. The present moment (2014) may be seen as the third shift firmly pushing the state out of the grips of Congress dominance. State politics has witnessed not only the decline of the Congress and a somewhat stable coalitional competition during the 2000s, it has also witnessed a decoupling of structures of economic power and structures of political domination. This development has led to the main ruling community in the state, the Marathas, being restless. Thus, social, political and economic factors have coincided in producing a juncture of political competitiveness that fails to produce well-being in the larger sense.

    Working Papers: 219 : India -Bangladesh Land Boundary Agreement

    Sreeradha Datta, Director, Maulana Abul Kalam Azad Institute of Asian Studies, Kolkata, India 12 January, 2016
    The recent success of India and Bangladesh in settling the complicated issue of political enclaves in each other's territories could be traced to the spirit displayed by the leaders of the two countries in 2010 through a leap of faith in the promise of shared prosperity. Nonetheless, the latest exchange of enclaves brings in its trail a host of humanitarian, legal and social issues. These need to be addressed through fairness by both sides.


    Working Papers: 218 : Government and Garbage: Local Administration, Public Sanitation and the ‘Clean India’ Campaign

    Robin Jeffrey 28 December, 2015
    The paper examines a crucial component of public sanitation and waste management – the role of local government. It concludes that improvement of public sanitation in India, which is the goal of the Bharatiya Janata Party (BJP)-led government’s ‘Clean India’ campaign launched in 2014, hinges on the capacities of local government; but these capacities are limited, for reasons that the paper seeks to make clear. The paper examines Indian local government under the following headings: history, jurisdictions, technology and people.

    Working Papers: 217 : Partnership without Alliance? The Contained Volatility of Indo-US Relations, and a Prognosis

    Subrata Kumar Mitra,Director and Visiting Research Professor at ISAS 3 December, 2015
    In a wide-ranging perspective on India's improving relationship with the United States, which is of strategic importance to the global order at this time, the paper explores the convergences and divergences in this bilateral engagement.

    Working Papers: 216 : A Tortured History : Federalism and Democracy in Pakistan

    Aasim Sajjad Akhtar, Visiting Research Fellow at the Institute of South Asian Studies (ISAS) 19 November, 2015
    The Pakistan Army's ideological hegemony, especially in the country's Punjabi-speaking heartland, the continuing focus on the state's narrative of a religion-based unitary identity which is under a constant external threat, and the failures of the political parties to rein in the military and address ethno-nationalist sentiments impede the growth of democracy and federalism in this key South Asian nation-state.

    Working Papers: 215 : Memory, Identity and the Politics of Appropriation. ‘Saffronisation’ among the Dalits of North India

    Badri Narayan,Professor, Centre for the Study of Discrimination and Exclusion, School of Social Science, Jawaharlal Nehru University, New Delhi (India) 19 November, 2015
    In a comprehensive study of the politicisation of the Dalits in North India (those regarded in some quarters as “untouchables” in the past), the author discovers how the Rashtriya Swayamsevak Sangh (RSS), an ideological patron of India’s current ruling party, the Bharatiya Janata Party (BJP), has re-defined and appropriated, for its own political purposes, the memories and identities of these communities. In explaining this, the paper delves into the formation and current crystallisation of these memories and identities.

    Working Papers: 214 : Pakistan’s Past, Present and Future – III : Placing Pakistan’s Future in a Broader Context

    Shahid Javed Burki, Visiting Senior Research Fellow at the Institute of South Asian Studies (ISAS) 6 October, 2015
    Islamic extremism may find it difficult to establish itself in Pakistan. The reason why the country may not spread a welcoming mat for radical ideologies, such as those espoused by the Islamic State in Iraq and Syria, is that Pakistan is making progress in creating political and economic orders that will accommodate the aspirations of the youth.

    Working Papers: 213 : Pakistan’s Past, Present and Future – II : Pakistan’s Major Challenges

    Shahid Javed Burki, Visiting Senior Research Fellow at the Institute of South Asian Studies (ISAS) 6 October, 2015
    Pakistan's education crisis apart, its economic managers have not succeeded in reducing dependence on external capital flows. While the country will continue to receive significant amounts of capital from the multilateral banks, and while it will possibly continue to get help from the IMF, it is unlikely that it will receive much financial assistance from the United States, its largest benefactor in the past. Nations seldom forge relations for sentimental reasons. They do so for strategic interests. Notwithstanding the hyperbolic pronouncements of the leaders of China and Pakistan about the nature of their relations, the two countries have strictly followed their national interests.

    Working Papers: 212 : Pakistan’s Past, Present and Future – I : To Understand Pakistan’s Present, Study the Past

    Shahid Javed Burki, Visiting Senior Research Fellow at the Institute of South Asian Studies (ISAS) 6 October, 2015
    Pakistan's Constitution had been cleansed of the military-crafted changes by the time Mr Nawaz Sharif became Prime Minister, for the third time, in 2013. However, the main toolkit for addressing the country's challenges is a proper grasp of its history of crises and crises-management.

    Working Papers: 211 : Institutional Changes Favouring FDI Inflows to India : Gradual Transformation Since 1969

    Sojin Shin, Visiting Research Fellow at the Institute of South Asian Studies (ISAS) 21 September, 2015
    How did India respond to globalization in the realm of inward foreign direct investment (FDI)? This paper presents the economic institutional change favouring FDI inflows at the union level of India by tracing political and economic history from the Indira Gandhi government in the late- 1960s to the current Narendra Modi government. From a historical institutionalist perspective, it highlights the significant correlation of institutional evolution with socio-political factors such as ideas of key policy makers and various interests in society. The paper argues that the institutional changes favouring FDI inflows to India can be defined as ‘gradual transformation’. This argument is based on the ideational tipping point model that underlines the role of endogenously-driven ideas that favoured foreign capital and finally won over various interest groups that were opposed to FDI inflows. It stresses that the dynamics of ideas and interests contributed to an incremental institutional change over a period of time. By demarcating three different periods based on the policy regime change toward foreign capital and foreign investments—anti-FDI (1969-1975), selective FDI (1975-1991), and pro-FDI (after 1991), the paper presents empirical evidence which backs the gradual transformation mode of institutional change, discussed in scholarly literature on historical institutionalism.

    Working Papers: 210 : India in the International Trade of Intermediates & Final Products – A Sector Level Study

    Deeparghya Mukherjee, Visiting Research Fellow at the Institute of South Asian Studies (ISAS) 21 September, 2015
    International trade is redefined today in terms of trade in value added and global value chains. Most countries trade both in finished goods as well as intermediates. India, a less talked about country in the context of trade through value chains cannot remain insulated from the new trend. This paper investigates key factors associated with India’s international trade of both intermediates and finished products at a sectoral level. The significance of bilateral and multilateral trade agreements is specifically analysed in furthering each type of trade. Finally industry specific effects of trade in intermediates and final products are also brought to light.

    Working Papers: 209 : Why the India-Pakistan Dialogue needs to be reconceptualised on the lines of ‘Principled Negotiations’

    Subrata Kumar Mitra, Director and Visiting Research Professor at the Institute of South Asian Studies (ISAS) 17 September, 2015
    The cancelled trip of Mr Sartaz Aziz – the National Security Advisor of Pakistan – to meet his counterpart Mr Ajit Doval of India in Delhi, and the circumstances leading to it, should not be considered as isolated events. Seen in juxtaposition with an earlier cancellation of the scheduled meeting of the foreign secretaries of India and Pakistan, the disappointment arising from the failed ‘Ufa initiative’ points towards a pattern. Underneath the roller-coaster ride that Indo-Pak relations routinely assume, there are some hard structural issues that must be tackled in order for specific initiatives like Ufa to succeed. The article suggests ‘principled negotiations’ – a method which identifies all the relevant stakeholders and their preferences, and encourages the actors to move beyond ‘positions’ to concrete ‘interests’ - in order to seek win-win solutions. The essay ends with some preliminary steps that might lead to the beginning of a serious and sustainable India-Pakistan dialogue.

    Working Papers: 208 : Pakistan, Power-Play and a New South Asian Paradigm

    Iftekhar Ahmed Chowdhury , Principal Research Fellow at the Institute of South Asian studies (ISAS) 2 September, 2015
    The total gamut of Pakistan's external policy - aimed at making up the difference in power with India, accessing external resources and expanding manoeuvrability - can be said to be resting on four pillars. These are: one, relations with the US and the West; two, ties with China; three, linkages with the Islamic countries; and four, interactions with multilateral bodies, in particular the United Nations.

    Working Papers: 207 : Skills Development in India: Prospects of Partnership with Singapore and Japan

    Rahul Advani , Research Assistant at the Institute of South Asian Studies (ISAS) 22 July, 2015
    Every year, India produces 2.5 million college graduates. Out of these, the country has 100,000 more specialising in the sciences and 60,000 more in engineering than the United States.2 On the strength of this one can assume that India contains the foundations for a strong manufacturing core. To add to this, Prime Minister Narendra Modi’s vision for India could signal a change of pace for the country’s flagging industrial growth given his impressive track record in Gujarat, where the annual growth rate of the manufacturing sector was 10.89 per cent between the years 2004/2005 and 2011/2012 - far higher than the national average of 8.96 per cent during this same period. Speaking on 25 September 2014 in Delhi to a group of diplomats, businessmen, journalists and politicians, Modi emphasized the “urgent need for skills development as far too many of India's youngsters are poorly prepared for globally competitive work”.3 The strengthening of ties with both Singapore and Japan under the Modi government presents several opportunities for India to improve both the economic and employment growth rates of its manufacturing sector through seeking much needed expertise on the delivery of technical education and skill development

    Working Papers: 206 : India’s Rural Employment Guarantee Scheme

    Kala Seetharam Sridhar, Professor, Centre for Research in Urban Affairs at the Institute for Social and Economic Change, Bengaluru (India), A Venugopala Reddy ,Centre for Symbiosis of Technology, Environment and Management at Bengaluru (India). 22 July, 2015
    In this paper, we evaluate India's flagship rural employment guarantee programme, the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), by answering questions such as whether the MGNREGS wages have been above their reservation wages. Furthermore, we estimate the reservation wages as a function of individual and labour market characteristics, being the first study to do this in the Indian context and compute net benefits from MGNREGS jobs. Next, we understand what demand-side (individual) and supply-side (programme) characteristics determine enrolment in the programme and determine MGNREGS wages.

    Working Papers: 205: Youth, Social Change and Politics in India Today: An Introduction to the Delhi Studies

    John Harriss, Visiting Research Professor, ISAS and Mr Rahul Advani, Research Assistant, ISAS 11 April, 2015
    Events in many parts of the world over the last decade - starting with protests in Greece in December 2008, following the death of a young student at the hands of the police, and continuing through the Arab Spring, the movement of Los Indignados in Spain, the Occupy Wall Street Movement, then widespread demonstrations in Brazil and Turkey in 2013, and other protest events - have thrown into sharp relief the significance of young people in contemporary politics. In India, similarly, young people were generally recognised as having played a vital role in the India Against Corruption movement (IAC), associated with Anna Hazare in 2011-12, then in the wave of protests over the Delhi rape case of December 2012, and in the meteoric rise of the Aam Aadmi Party (AAP) in 2013. Observers have noted some commonalities amongst these events: the central, though not exclusive role played by young people; the extensive use in them of social media; that they have mostly been characterised by spontaneity and the absence of hierarchical leadership (though this is not true in the case of IAC).

    Working Papers: 204: Modi’s Foreign Policy: Focus on the Diaspora

    C Raja Mohan 11 April, 2015
    Engagement with overseas communities has become a major element of India’s dynamic foreign policy under Prime Minister Narendra Modi. Although the problems and opportunities presented by the diaspora have gained traction in India’s post-Cold War foreign policy, they have drawn particular attention from the Bharatiya Janata Party (BJP)- led governments. If Atal Behari Vajpayee’s tenure (1998-2004) saw Delhi attach greater importance to the overseas Indian communities, Modi has injected a new vigour in the few months that he has been the Prime Minister. Modi sees the diaspora as central to India’s development journey and as a strategic asset in promoting India’s foreign policy interests abroad. At the same time the Modi government has had to spend considerable time and energy dealing with the problems arising from India’s expanding global footprint. The paper reviews the evolution of India’s diaspora policy and examines the possibilities and pitfalls that could arise from Delhi’s new political enthusiasm for overseas Indian communities.

    Working Papers: 203: Modi’s American Engagement: Discarding the Defensive Mindset

    Chilamkuri Raja Mohan 1 April, 2015
    In two quick summits with the US President Barack Obama, Prime Minister Narendra Modi has taken big steps to resolve the lingering nuclear dispute, revive defence cooperation, go past trade disputes, explore common ground on climate change and renew the engagement on regional security cooperation. For years now, progress on these issues has been held up principally by Delhi’s reluctance to negotiate purposefully and find practical solutions. By combining strong political will with a clear focus on practical outcomes, Modi has altered the bilateral narrative on India-US relations and created the basis for deepening India’s strategic partnership with America.

    Working Papers: 202: Identity, Interests and Indian Foreign Policy

    Rahul Mukherji, Honorary Senior Fellow and Head (Research), ISAS 22 March, 2015
    This paper argues that India's foreign economic policies were shaped to a substantial extent by developmental ideas within the Indian state and by the international context of the Cold War. Individuals mattered, but the preferences of leaders like Jawaharlal Nehru, Indira Gandhi, Rajiv Gandhi, P V Narasimha Rao, Atal Behari Vajpayee and Manmohan Singh were filtered through Indian politics and political economy. This involved engagements between the Indian state and economic actors. It was the interaction of the Indian state navigating state-society relations between domestic social constraints and international political constraints that generated different types of economic policies and external engagement for India.3 I lay out the major conceptual issues in this section. This will help to run an analytic narrative in the next one.

    Working Papers: 201: TRIPS and the Balance between Private Rights and Public Welfare: The Case of Pharmaceutical Sector

    Deeparghya Mukherjee, Visiting Research Fellow, ISAS 27 February, 2015
    Adherence to the Trade-Related Aspects of Intellectual Property Rights (TRIPS) have had varied impacts across the world, and concerns of adverse effects on public welfare, especially in the context of the pharmaceutical sector, are largely debated. In this paper, we try to analyse the effects of TRIPS on public welfare in the context of the pharmaceutical sector. We take a closer look at the policies of some developing countries and their usage of the flexibilities that TRIPS allows. The cases of China, India and Brazil (three major players in the global pharmaceutical industry) are studied. China, which has not used the TRIPS flexibilities, has benefited from appropriate technology transfer and Foreign Direct Investment in Research &Development. The need for FDI in R&D in India and Brazil as potential destinations of research on neglected tropical diseases (NTDs) is brought out. We conclude that the effects of TRIPS on public welfare are critical for countries which do not have the ability to use the flexibilities. At a time when trade and investment treaties are mostly aimed at stricter commitments on Intellectual Property Rights (IPR) than the TRIPS, such countries need to negotiate appropriate investment and knowledge-sharing commitments from their developed counterparts so as not to be adversely affected by agreeing to demands on bending IPR laws.

    Working Papers: 200: India’s Mars Mission: Multidimensional View

    Ajey Lele, Research Fellow at the Institute for Defence Studies and Analyses, New Delhi (India) 15 January, 2015
    Over the years, Mars has been the centre of attraction for science fiction writers, Hollywood movie makers, astrologers, astronomers and the scientific community. For scientists and technologists, Mars continues to be an enigma. This is essentially because even tough humans have dreamt for long about human colonisation of Mars. Still, in reality humans are nowhere near to realising such a dream. During the last five decades, more than fifty percent of human efforts to send an unmanned spacecraft to hover in the vicinity of Mars or to land on the Martian surface have failed. Interestingly, in September 2014 India, a developing state, succeeded in placing its own satellite in the Martian orbit in its first attempt, an achievement unequalled by any other country. India's success has won significant international acclaim and has significantly raised expectations about its overall space programme. This paper attempts to understand the rationale behind India's Mars agenda and its implications and discusses its progress towards success.


    Working Papers: 199: State, Ideas and Economic Reform in India

    Rahul Mukherji, Honorary Senior Fellow and Head (Research), ISAS 1 December, 2014
    This paper argues that the state is an important institution for initiating economic reforms in India. Ideas held within the state are especially important. When the state reposed faith in a closed economy model with stringent government control, it could not be forced to shift to a new path during the balance of payments crisis in 1966, despite considerable foreign pressure. On the other hand, when the Indian state became aware of the pathologies of persisting with import substitution through the 1980s, it used the balance of payments crisis in 1991 to re-orient India's economic paradigm. India did not change course because of the balance of payments crisis in 1991. Nor did India embrace globalisation and deregulation because of entrepreneurs in 1991. In fact, the powerful corporates were opposed to substantial economic deregulation in 1991. I have argued that substantial economic change in India often resembles a tipping point.

    Working Papers: 198: India’s Popular Culture in Southeast Asia

    Rahul Advani, Research Assistant, ISAS 8 October, 2014
    This paper will explore India’s influence on Southeast Asia during the 20th century, with a focus on its cultural dimensions. The Indian independence movement in particular played a significant role in shaping ideologies and spurring the creation of various movements and political groups in Southeast Asia during the early part of the 20th century. In the past couple of decades there has been a dramatic rise in the popularity of Indian cinema, dance, art and music among Southeast Asian audiences. Traditional and contemporary forms of Indian dance and theatre have gained recognition in Southeast Asia as many of its cities have begun to strive for world-class status through developing thriving scenes of the arts and tourism hotspots. Bollywood dance classes have accompanied the fitness-craze that has made its way from the United States to Southeast Asia. Hindi films have garnered a mass appeal not only among Indian diaspora in Southeast Asia but also among non-Indians, many of whom are familiar with the three ‘Khans’ of Bollywood – Shahrukh, Salman and Aamir, arguably the industry’s biggest stars.

    Working Papers: 197: New Maritime Silk Road: Converging Interests and Regional Responses

    Rajeev Ranjan Chaturvedy, Research Associate, ISAS 8 October, 2014
    The Maritime Silk Road (MSR) emphasises improving connectivity but more importantly, it is designed to improve China’s geostrategic position in the world. This paper discusses revival of the Maritime Silk Road. It begins with a narration of the historical background of MSR, its origin and development, followed by an analysis of latest announcements by the Chinese leaders to revive it. It also discusses reactions from China’s neighbours, including India. Finally, the paper sums up the discussion. It concludes that the MSR is an effort in initiating a ‘grand strategy’ with global implications. The MSR initiative could be very helpful in reinforcing cooperation and raising it to a new level of maritime partnerships. Nevertheless, China has yet to cultivate the much-needed political and strategic trust.

    Working Papers: 196: The Indian Bond Market

    Chandrani Sarma, Research Assistant, ISAS 2 October, 2014
    The Indian bond market covers main types of bonds, namely, Government bonds, corporate bonds, tax-free bonds, banks' and other financial institutions' bonds, tax-savings bonds and tax-savings infrastructure bonds.

    Working Papers: 195: The ‘Missing Women’ in India

    Riaz Hassan, Visiting Research Professor, ISAS 19 September, 2014
    Twenty-five years ago Nobel Laureate Amartya Sen used the concept of ‘missing women’ to highlight the gender bias in mortality that results in a huge deficit of women in substantial parts of Asia and Africa. It was an innovative and novel way to use the sex ratios to assess the cumulative effect of gender bias in mortality by estimating the additional number of females of all ages who would be alive if there had been equal treatment of the sexes. Sen classified those additional numbers of women as ‘missing’ because they had died as a result of discrimination in the allocation of survival-related goods (Sen, 1990, 1992).

    Working Papers: 194: A Possible Paradigm for Afghanistan’s Future

    Iftekhar Ahmed Chowdhury, Principal Research Fellow, ISAS 1 August, 2014
    The most important question confronting us in Afghanistan is this: what is the best method by which individual state-interactions with Afghanistan, or among the state- and non-state actors, may be managed, organised and coordinated in such a fashion as to bring stability and harmony to Afghanistan, to the extent possible, when the ISAF forces are largely gone. The global, in particular, the regional matrix is not any more secure than it was when the ISAF forces had gone in, in the first place. A similar foreign intervention in Iraq seems to have ultimately found fruition in the birth of a virulent resistance in the form of ISIS. In the view of a senior UN official, the Taliban would be watching the developments in Iraq closely, and drawing lessons from it.2 In Afghanistan itself the pre-US and Western withdrawal phase is becoming increasingly problematic.

    Working Papers: 193: Afghanistan Today: Politics of Drawdown

    Iftekhar Ahmed Chowdhury, Principal Research Fellow, ISAS 1 August, 2014
    Mullah Omar’s face bore no resemblance to that of the celestial beauty, Helen of Troy. Yet it too was one that caused the launch of a thousand ships, airships to be more precise, as Helen’s had done. Like Troy, the besieged city of the past in Homer’s epic tale of ‘IIIiad’, Afghanistan of the present, was swarmed by invaders, by those whom some see as the modern counterpart of the Greeks – the Americans and their allies. As in the Trojan War, ten years down the line, the war council (NATO Summit, in this case) met, as it must have also in Mycenae of ancient Greece, in Chicago in the United States, home of the modern-day mighty Agamemnon, President Barack Obama. In Chicago, as it also had happened in the epic tale, after ten years of unwinnable and unrewarding warring, the invaders finally decided to call it a day. In “line” with a “firm commitment to a sovereign, secure and democratic Afghanistan”, it was decided at the gathering of NATO leaders that the allies’ “mission will be concluded by 2014”. True to his words, Obama had no intention of staying around to build a “Jeffersonian democracy” (in those parts).

    Working Papers: 192: Initiative for ‘Southern Silk Route’ Linking Bangladesh, China, India, and Myanmar

    Zaara Zain Hussain, Research Assistant, ISAS 17 June, 2014
    This paper looks at the ‘BCIM Regional Cooperation’ and the related proposal to revive the ‘Southern Silk Route’ connecting China and India through Bangladesh and Myanmar. The aim is to understand the relationships among the four countries involved and analyse the opportunities and benefits of successful cooperation. This idea of building a sub-regional economic corridor was proposed by China in 1999, but because of various challenges and concerns it progressed slowly. Recently the initiative has been gaining much policy traction and therefore is an important area of study. Northeast region in India and the adjoining parts in Bangladesh, Myanmar, and South West China remain neglected and largely underdeveloped and could greatly benefit from sub-regional economic cooperation. It is a natural economic zone, boasting a market size of 2.8 billion people.

    Working Papers: 191: Suicide Bombings in Afghanistan

    Riaz Hassan, Visiting Research Professor, ISAS 17 June, 2014
    Since 2006, the insurgency in Afghanistan has been escalating, not decreasing in intensity. One of the weapons increasingly being used by insurgents is suicide bombing. Afghanistan now is the main site of this terrorist weapon in the world. So what motivates Taliban suicide bombers? The following insights into the motives of the perpetrators of suicide attacks are drawn from my research on one of the lethal weapons used by insurgents ÔÇô suicide bombing. Between 2001 and 2011, there were 545 such attacks in the country, resulting in 3,604 fatalities and injuring 10 times more. Suicide attacks constitute only four per cent of all insurgent attacks in Afghanistan but account for around 20 per cent of all insurgency-related deaths. Their main targets are the local and foreign forces.

    Working Papers: 190: India’s Military Diplomacy: Legacy of International Peacekeeping

    C Raja Mohan, Visiting Research Professor, ISAS 13 June, 2014
    India‘s expansive tradition of sending its troops in large numbers to international peacekeeping operations under the aegis of the United Nations has been rightly described as a paradox. The contradictions between India‘s role as a regional belligerent and an international peacekeeper, its substantive participation in United Nations (UN) peacekeeping from its very inception and its ambivalence about postCold War peace operations have been identified by scholars.

    Working Papers: 189: The Afghanistan Conflict in its Historical Context

    Riaz Hassan, Visiting Research Professor, ISAS 10 June, 2014
    In April 2013 the Defence Select Committee of the British Parliament published a report on Securing the Future of Afghanistan which concluded that civil war in Afghanistan is likely when the international forces there leave in 2014. One wonders what the Committee thought had been going on in Afghanistan over the past 35 years. The war between the Western forces and the Taliban is part and parcel of the Afghan civil war which began in 1979 between the Communists and their enemies and, after the collapse of the Communist regime in 1992, developed into a conflict between different factions of Mujahedin. Since 2001 the war has expanded to include conflict with the Western forces. What happened in 1979, and again 2001, was that foreign superpowers intervened on one side of a civil war, violently tipping the balance in favour of that side ÔÇô for a while. The question, therefore, is: Will this protracted civil war continue after the planned departure of American and the North Atlantic Treaty Organization (NATO) forces in 2014 or are alternative scenarios possible or likely?

    Working Papers: 188: Pakistan’s New Choices in Economic Diplomacy

    Shahid Javed Burki, Visiting Senior Research Fellow, ISAS 15 May, 2014
    For the last several decades Pakistan has based its foreign economic relations on bilateral contacts. Both the fears and rewards were based on the policy making equations involving two variables: Pakistan and another country. Thus Pakistan-India, Pakistan-China, Pakistan-Great Britain, Pakistan-Saudi Arabia and, to a lesser extent Pakistan-Iran, dominated Islamabad’s foreign affairs. This approach will need to be updated in view of the rapid developments taking place in the global economic and political orders.

    Working Papers: 187: Foundations of Bangladesh’s Economic Development: Politics of Aid

    Iftekhar Ahmed Chowdhury, Principal Research Fellow, ISAS 14 April, 2014
    Bangladesh today with a population of nearly 160 million faces myriad development challenges. But it is far from being the ‘basket case’ that Henry Kissinger once described it as. Despite its still being poor and challenged, it has to its credit many successes particularly in the social sectors. It, in many ways, defies the ‘Washington Consensus’ wisdom that growth would lead to poverty eradication. It embodies the inverse of that thesis, for while its growth has much room for improvement, its poverty eradication has been impressive.2 This was largely made possible through its skilful handling of foreign aid in the early years since its independence from Pakistan in 1971 following a bloody and destructive war.

    Working Papers: 186: Extremism: Pakistan in Search of a Solution

    Shahid Javed Burki, Visiting Senior Research Fellow, ISAS 28 March, 2014
    Pakistan is in agony. In almost 67 years of sovereignty, it has never had political leadership that could foster a national feeling among all citizens. And now a relatively small segment of the population has taken up arms to challenge the authority of the state. When we view Pakistan's experience with extremism through a wide-angle lens, we see that its rise and stubborn presence are the consequences of the coming-together of a number of complex circumstances. It is also clear that the country will not be able to make economic progress unless the various groups that have taken up arms against the state are made to obey the law of the land.

    Working Papers: 185: Is India Making Waves in South China Sea?

    Rajeev Ranjan Chaturvedy, Research Associate, ISAS 26 March, 2014
    The South China Sea (SCS) disputes are regarded as one of the most difficult regional conflicts in the Asia-Pacific, in an 'arena of escalating contention'.2 Indeed, some scholars suggest that for the next 20 years, the South China Sea conflict will probably remain the 'worst-case' threat to peace and security in the Association of Southeast Asian Nations (ASEAN) region. Territorial sovereignty, contentions over energy, significance of the geographic location, threat to maritime security and overlapping maritime claims are all sources of the SCS disputes. 4 Being one of the most important seas of the world5 geopolitically, economically and strategically, the SCS attracts considerable attention in contemporary thinking in international relations and strategic studies. Moreover, it continues to be seen as a potential source of tension, and is becoming increasingly turbulent. Security in the SCS is a concern both for the regional countries like China, Vietnam, the Philippines, Malaysia, and extra-regional countries including India, due to their strategic and economic interests in this region. Any conflict in the SCS will pose a threat to regional and international security.

    Working Papers: 184: Indian Military Diplomacy: Humanitarian Assistance and Disaster Relief

    C Raja Mohan, Visiting Research Professor, ISAS 26 March, 2014
    Humanitarian assistance and Disaster relief have emerged as important missions for major militaries around the world after the Cold War. The missions that were once largely left to such organisations as the International Red Cross have now become an important part of the security agenda of nations with significant military capabilities. The absence of great power rivalry and conflict after the collapse of the Soviet Union compelled a revaluation of the objectives of military force after the Cold War.

    Working Papers: 183: Rural Tamil Nadu in the Liberalisation Era: What Do We Learn from Village Studies?

    John Harriss, Visiting Research Professor, ISAS and J Jeyaranjan, Institute for Development Alternatives, Chennai (India) 24 March, 2014

    Working Papers: 182: State of Injustice: The Indian State and Poverty

    John Harriss, Visiting Research Professor, ISAS 20 March, 2014
    Addressing the Constituent Assembly in the opening debate on ‘The Resolution of Aims and Objects’, on 22 January 1947, Jawaharlal Nehru said: ‘The first task of this Assembly is to free India through a new constitution, to feed the starving people, and to clothe the naked masses, and to give every Indian the fullest opportunity to develop himself according to his capacity’ (cited in Corbridge and Harriss 2000: 20). This is a remarkable statement, expressing as it seems to a conception of what development should mean that comes very close to the one that Amartya Sen laid out much more recently, of development as freedom (Sen 1999).

    Working Papers: 181: South Asia’s Economic Changes and Diaspora Groups

    Shahid Javed Burki, Visiting Senior Research Fellow, ISAS 19 March, 2014
    The paper looks at the flow of ideas from the South Asian Diaspora groups to their original homelands. This is occurring in the areas of economic management and political change. As a result of the interaction of the Diaspora groups and the countries from which they came, a profound structural change is occurring in the South Asian societies. The business community will do well to recognise both the pace and direction of change that is taking place. A new set of opportunities, not fully understood, has arisen, waiting to be grasped.

    Working Papers: 180: South Asian Diaspora: A Changing Landscape

    Shahid Javed Burki, Visiting Senior Research Fellow, ISAS 19 March, 2014
    This paper is an attempt to expand the debate on the impact that the South Asian Diaspora groups are having oThis paper is an attempt to expand the debate on the impact that the South Asian Diaspora groups are having on the countries of their origin. It goes beyond the discussion of the quantum and structure of financial resources that flow from the expatriate communities to the countries of their origin. While those financial resources are large – they touched US$100 billion for all South Asia – the story of the impact of the Diaspora groups on what were once their homelands should extend beyond matters of finance. We should look into how the size, structure and pattern of South Asia’s middle class, by now nearing one billion people and expanding at a rate three to four times the increase in population, are being influenced by the Diaspora groups. The upper end of the South Asian middle class is increasing because of the growth in national incomes in the region. As is now recognised, a significant increase in the incomes resulting from economic growth is being captured by the well-to-do segments of South Asian societies. At the lower end of the income distribution scale, the increasing size of the middle class is largely the consequence of the amount of remittances received by the households in the space between the poor and the not-so-poor.n the countries of their origin. It goes beyond the discussion of the quantum and structure of financial resources that flow from the expatriate communities to the countries of their origin. While those financial resources are large - they touched US$100 billion for all South Asia - the story of the impact of the Diaspora groups on what were once their homelands should extend beyond matters of finance. We should look into how the size, structure and pattern of South Asia's middle class, by now nearing one billion people and expanding at a rate three to four times the increase in population, are being influenced by the Diaspora groups. The upper end of the South Asian middle class is increasing because of the growth in national incomes in the region. As is now recognised, a significant increase in the incomes resulting from economic growth is being captured by the well-to-do segments of South Asian societies. At the lower end of the income distribution scale, the increasing size of the middle class is largely the consequence of the amount of remittances received by the households in the space between the poor and the not-so-poor.


    Working Papers: 179 : The Pakistan-US Parleys

    Shahid Javed Burki 11 November, 2013
    Pakistan’s Prime Minister Nawaz Sharif’s recent state visit to Washington was essentially a “get to know” encounter with United States President Barack Obama. Pakistan’s new leader – sworn into office on 5 June 2013 following a thumping victory scored by his party, the Pakistan Muslim League-Nawaz (PML-N) in the elections of 11 May – had inherited a difficult situation from the Pakistan People’s Party (PPP)-led government that had ruled for five years from 2008 to 2013. Among the problems the new prime minster faced was a serious cooling-off of relations with the United States, long a Pakistani benefactor. Sharif’s main objective was to reverse the trend and establish a working relationship with America. He succeeded in that objective. The detailed statement issued by the two governments following the talks between the two leaders spelled out the measures that were to be taken by Islamabad and Washington to have a business-like relationship between the two nations.

    Working Papers: 178 : Non-Proliferation and WMD Debate: The Relevance to South Asia

    Iftekhar Ahmed Chowdhury 2 October, 2013
    The 2013 s ession of the United Nations General Assembly has commenced in New York, as per the usual schedule in New York. On the first day of the General Debate all eyes were focused on the Presidents of the United States and Iran, and the softening of postures by b oth sides on the nuclear disp ute, the West's suspicion that Iran is aiming at nuclear weapon acquisition which President Hassan Rohani has denied. Still, as the session develops the debate will gain traction. For any breakthrough in terms of global non - proliferation, the existing regime will need tweaking. That would involve Pakistan and India, two countries in South Asia with fast growi ng nuclear arsenals, who are looking for appropriate seats at the global negotiating table - as 'recogni s ed nuclear powers ' , which are being denied them.

    Working Papers: 177 : Factors Driving Drug Abuse in India’s Punjab

    Rahul Advani 24 September, 2013
    This paper explores the phenomenon of drug abuse among the youth of Punjab, India. In aiming to identify the factors influencing the problem, the paper focuses on the importance of the exceptional aspects of drug abuse in Punjab, including the core demographic of users and the types of drugs being commonly used. These unique characteristics point towards the contextual factors that have possibly influenced the scale and character that the state’s drug problem has taken on. For example, the rural background of Punjab’s drug-user demographic hints at the influence of factors including historical developments in the state’s rural economy and the Punjabi culture of masculinity which is deeply tied to images of strength and physical labour. On the other hand, their relatively-affluent class background suggests that the impact of unemployment, the cultures of consumption and aspiration and the modernity associated with injectable drugs are all particularly powerful in driving them to use drugs. The literature referred to in this paper includes both quantitative and qualitative studies of drug abuse in Punjab and throughout India, the history of Punjab’s rural economy, unemployment, participation in higher education, masculinity, as well as ethnographies of young men in Punjab.

    Working Papers: 176 : Economics of Pak-Afghan Relations

    Shahid Javed Burki 24 September, 2013
    This paper examines the economic relations between Pakistan and its neighbour Afghanistan in the context of Afghan President Hamid Karzai's visit to Pakistan in August 2013. These ties have been under strain for as long as Pakistan has been an independent state. Recognising that each country needs the other, a serious effort is being made by the leaders from both countries to find a common ground for working together. There are, however, major differences in the way Islamabad and Kabul would like to fashion their relations.

    Working Papers: 174 : Youth and Politics in India-II

    Rahul Advani 7 May, 2013
    This paper aims to uncover the features that make India's youth politics so distinct from other forms of politics within the country, the kinds of politics young people participate in, and the kinds of young people who participate in it. F irst , there is a detailed discussion of the various identities that political parties have used for mobilising youth, as well as those tha t the youth themselves have used as a basis of political mobilisation on their own terms and in their own way s

    Working Papers: 173 : Youth and Politics in India-I

    Rahul Advani 18 April, 2013
    This paper spells out the ways in which, and the reasons why, young people in India today engage in politics. An answer to this research question is attempted by first locating the politics of youth within its economic and educational contexts so as to ide ntify the factors that draw young people into politics. Explored in the process are the problems of boredom, exclusion, unemployment and the desire to escape, all of which are closely connected to the contexts in which young people operate. Finally discuss ed is the issue of alienation, a condition deriving from various identified issues, which causes youth to turn to politics in search of identity.

    Working Papers: 172 : A Turbulent Pakistan: India’s Choices in Response

    S D Muni 8 April, 2013
    The fate and future of Pakistan has been an issue of considerable concern and anxiety not only inside Pakistan but in the world at large and South Asia in particular. The Fund for Peace project on the ranking of failed and failing states has been placing Pakistan in the top category of ‘critical alert’ year after year. According to this ranking Pakistan was 13 th i n 2012. It was 12 th in 2011 and 10 th in 2010 and 2009. 2 In an analysis of Pakistan for the 2012 listing, Robert D Kaplan , who organi s es these rankings , said : “Perversity characteri s es Pakistan”. Several academic institutions and scholar s have come forward to explore the fate of Pakistani s tate and society. 3 The Brookings Institution undertook such a project in 2010 with the support of US Institute of Peace and the Norwegian Peace Foundation, and the results of the study have since been published. The coordi nator of this project and an acknowledged American scholar on Pakistan Stephen P Cohen wrote after completing the project : “With its declining social indicators, crumbling infrastructure and the military’s misplaced priorities, Pakistan is a deeply trouble d state and, were it not for the large number of talented Pakistanis, one would be tempted to judge it to be in terminal decline”

    Working Papers: 171 : India’s Role in 1971 Bangladesh War: Determinants of Future Ties

    Iftekhar Ahmed Chowdhury 2 April, 2013
    The past is always an important ‘input’ as a determinant of the present in international relations. This is no different in the case of the shaping of ti es between two major South Asian countries, Bangladesh and India. An examination of India’s role in the emergence of Bangladesh as a sovereign entity in the global scene provides a significant key to the understanding of their mutual behavio u r - pattern in c ontemporary times. This paper will seek to demonstrate that while a large majority of Bangladeshis, with ample reason, were overtly grateful to India for the support rendered during the war of 1971, without which it is broadly agreed the independence of Ba ngladesh could not have been achieved, at least within that limited time - frame of nine months, yet ironically developments linked to such a role also contained elements that would render the future relationship between the two countries full of complexities

    Working Papers: 170 : Conflicts in South Asia: Causes, Consequences, Prospects

    S D Muni 26 March, 2013
    Studying conflicts is a big intellectual enterprise. More than 60 per cent of the top 100 think - tanks listed in the University Pennsylvania survey in 2012 study conflicts and issues related to conflicts. These conflict studies concentrate mostly on inert - state wars and intra - state armed conflicts. 2 The conflicts generated by great power interventions or the imperatives of global order receive only occasional or incidental atten tion. This area of conflict studies would perhaps gain in salience as the phenomenon of “Arab Spring” spreads to other regions, and as interventions invoking “Responsibility to Protect” within the United Nations framework are more frequently taken resort to as was evident in Libya or could be tried in Syria. For yet another reason, the role of “global political conditions” needs to be factored in seriously in the study of conflicts.

    Working Papers: 169 : Financing Infrastructure in Bangladesh – Some Options

    Ishraq Ahmed 12 March, 2013
    The inadequacy of economic and physical infrastructure - with respect to both financing needs and quality itself - is a common characteristic in developing countries. The World Bank has estimated that developing countries need about US$ 1.1 trillion in annual infrastructure expenditure through the year 2015, of which low-income countries need the greatest share - 12.5 per cent of their GDP. 2 Establishing a comprehensive fina ncing framework - which will meet developing countries' infrastructure needs and in the process cover investment, maintenance and repair costs - poses significant challenges for policymakers. To attract foreign direct investment and achieve long-term growth, it is imperative that there are an efficient transport system nationwide, modern telecommunication systems and reliable supply of energy and water. The investment required for improvin g infrastructure is massive -various estimates have pointed out the need for considerable investment in developing countries. For instance, the International Energy Agency (2003) estimated that developing countries would have needed to invest US$ 120 billion in the electricity sector annually from 2001 to 2010 and US$ 49 billion for water and sanitation from 2001 to 2015.

    Working Papers: 168 : India’s Regional Security Cooperation: The Nehru Raj Legacy

    C Raja Mohan 7 March, 2013
    The paper explores the logic of co ntinuity in independent India’s security policy from where the British Raj had left off . Much like the Raj, Nehru’s India sought to provide security to its smaller neighbours. Although the British Raj and the newly independent Republic of India were differ ent political regimes, they were responding to the enduring geographic imperatives and the burdens that c a me with being a large entity with significant military capabilities. Newly i ndependent India was indeed less powerful than the Raj thanks to a much we aker economic base, the partition of the Subcontinent, and a geopolitical environment shaped by the Cold War. Yet the first decade after independence saw Nehru sustain the Raj legacy as the provider of security in India’s neighbourhood. As India becomes on e of the leading economies of the world and a significant military power, that tradition is gaining a fresh lease of life and a broader sphere of application than its immediate neighbourhood.

    Working Papers: 167 : Dhaka-Moscow Relations: Old Ties Renewed

    Iftekhar Ahmed Chowdhury 6 March, 2013
    On 30 May 1919, the great Bengali poet Rabindranath Tagore, following the massacre perpetrated by British troops at Jallianwala Bag h in the Punjab, renounced his knighthood through a letter written to the Viceroy, Lord Chelmsford. Tagore stated that his action was motivated by a desire “to give voice to the protest of millions of my countrymen suppressed into a dumb anguish of terr or”. 2 On the broad canvas of India’s struggle for freedom, it was but a small act. But Tagore shared the sentiment of another contemporary literary genius from a distant part of the globe, Leo Tolstoy of Russia, who had argued that true life is lived through tiny actions that occur. Both great men struggled against oppression through their articulations, wrote of war that savages societies, and peace that humankind constantly seeks to achieve. This was evidence of the intellectual bond that tied Russia and Bengal, then, and which continued to percolate down through ages.

    Working Papers: 166 : India’s Security Cooperation with Myanmar: Prospect and Retrospect

    C Raja Mohan 21 February, 2013
    In the first - ever visit to Myanmar 2 by an Indian defence minister, A K Antony travelled to Nay Pyi Taw for two days from 21 January 2013. Antony's trip to Myanmar followed the visit by Manmohan Singh to that country in May 2012, the first by an Indian prime minister in nearly 25 years. Altho ugh no major agreements were signed during his visit, Antony's brief sojourn in Myanmar underlined Delhi's political commitment to deepen security cooperation between the two countries. India and Myanmar have had defence contacts going back to the early - 19 90s, when India began a constructive engagement with the military rulers of Myanmar. The scope of the defence engagement was, however, significantly constrained by the international isolation of Myanmar and India's own ambivalence about Myanmar's internal political situation. The political reforms in Myanmar since 2011 and the growing international engagement with this important eastern neighbour have freed Delhi from some of the earlier constraints. The paper locates India's defence diplomacy with Myanmar in a historical perspective, reviews the expansion of bilateral security cooperation in the last two decades and examines the near - term prospects.

    Working Papers: 165 : US Role in the 1971 Indo-Pak War: Implications for Bangladesh-US Relations

    Iftekhar Ahmed Chowdhury 15 February, 2013
    The year 1971 witnessed a major redrawing of the map of South Asia. It saw the emergence of a new nation, which a few decades down the line became the world’s sixth largest country in terms of population, the third largest Muslim State, a democracy, albeit a volatile one: Bangladesh. It was a bipolar world in those Cold War days, with two preponderantly dominant superpowers: the United States and the Soviet Union. After years of perceived exploitation by Pakistan of its eastern wing, East Pakistan, a rebellion, or a ‘struggle for liberation’ as the latter liked to call it, had flared up, with initially tacit and later overt support from the regional pre-eminent power, India. It obtained the backing of the Soviet Union. Pakistan, led by its military ruler, President Yahya Khan, a General, endeavoured to suppress the uprising which eventually led it into a war with India. The ‘Bangladesh Movement’ was being led by the Awami League (which had massively won the 1970 elections but was being denied transfer of power by a combination of Yahya and the Pakistani leader Zulfikar Ali Bhutto), whose head Sheikh Mujibur Rahman, was incarcerated in Pakistani prison. Despite many predictions, its superpower ally the United States did not come down in its support unlike India’s superpower ally the Soviet Union.

    Working Papers: 164 : President Obama’s World in His Second Term

    Shahid Javed Burki 6 February, 2013
    The 2012 US elections showed clearly how rapidly America was changing. There was demographic change and perceptible changes in beliefs and attitudes. Several minorities – the African-Americans, the Latinos, the Asian-Americans – were on the way to collectively becoming a ‘majority’. There was increasing willingness to accept such tabooed practices as gay marriages and the legalisation of the use of marijuana. Those who wanted public policy to be cognisant of these developments voted overwhelmingly for Barack Obama and gave him another term in office. Those who wished America to stand still opted for Mitt Romney, the Republican candidate. After Obama won the 2008 election with the slogan “yes we can” and presented himself as a candidate of change, there was much that was expected of him. But he ran into a solid wall built by the Republicans. In 2012, Romney campaigned for keeping America where it had been for decades. However, as Philip Stevens of the ‘Financial Times’ wrote a few days after Obama’s triumph, “piling up support of protestant white men in the south does not amount to a winning strategy.”2 Obama was on the right side of American history


    Working Papers: 163 : Economic Inefficiencies in Farm-Market Linkages in Agriculture Value Chain in India: Problems and Solutions

    Anshul Pachouri 28 December, 2012
    ndian Agriculture sector is the backbone of Indian Economy which employs more than 50% of the total wor kforce. The percentage contribution of Agriculture sector in India's GDP is around 14%, which is growing by just merely 2.8% for the period of 2011 - 12. The growth of Agriculture sector is extremely important for India to ensure food availability and sustai ning rural livelihood. The agriculture value chain of India is suffering from many bottlenecks which lead to low income to farmers and high inflation in food - prices. The paper focuses mainly on the horticultural commodities like fruits and vegetables val ue chain and studies the different inefficiencies in the agriculture value - chain of India focusing on farm - market linkages. This paper presents the different reasons of these inefficiencies in the present value chain and possible remedies for the same.

    Working Papers: 162 : Northeast India-Southeast Asia Connectivity: Barrier to Bridge

    Laldinkima Sailo 16 November, 2012
    Despite being the only part of India that provides land connectivity to Southeast Asia, the Northeast Region (NER) has received very little or negligible attention under New Delhi's Look East Policy. In fact, the region was not considered a part of the policy for many years but there has been a change . Today, the Northeast Region is portrayed as an important foc al point , and the development of this region is often cited as one of the main objectives of the Look East Policy. Indeed, the impression about the region has transformed from that of a barrier to a bridge between India and Southeast Asia. This paper trace s the internal dynamics, the Government of India's attitude towards the region and the external factors that have led to this transformation.

    Working Papers: 161 : Transition in Afghanistan: Winning the War of Perceptions

    Shanthie Mariet D'Souza 30 October, 2012
    A decade after the military intervention that dislodged the Taliban - Al Qaeda combine, peace and stability continues to elude Afghanistan. There is still no consensus in Western capitals on what constitutes the ‘end - state’ in Afghanistan. The Western public's frustration with a long - drawn war has coalesced with the global economic slowdown, the Euro c risis and the pressures of electoral campaign politics in the United States – thereby complicating the efforts for the long - term stabilisation of Afghanistan. Premature announcements of exit and dwindling financial assistance have added to the Afghan anxie ties of being ‘abandoned’ once again. This paper brings to light the divergent perceptions among the key stakeholders in Afghanistan and in the international community (IC) on the trajectory of the ‘inteqal’ (transition) process. The paper argues that the war in Afghanistan is essentially a war of perceptions on progress made thus far. This widening gap in perceptions is bound to complicate the transition and long term stabilisation process

    Working Papers: 160 : Small States in UN System: Constraints, Concerns, and Contributions

    Iftekhar Ahmed Chowdhury 24 October, 2012
    Small states in the global system are seeking to organise themselves effectively in the international scene. They face many challenges and constraints but also possess the potential to contribute to better global governance. The study notes Singapore's role in this regard and examines the contributions of two South Asian small-states, namely Bhutan and the Maldives in the creation of global norms. If present political trends continue, the paper extrapolates that the number of small states will grow.

    Working Papers: 159 : Obama Administration’s Pivot to Asia-Pacific and India’s Role

    S D Muni 29 August, 2012
    US strategy to extricate itself from unwinnable conflicts in Iraq and Afghanistan and ‘rebalance’ its position in the Asia - Pacific region was announced by President Obama in November 2011. Under this strategy the significance of the Asia - pacific region, pa rticularly China, as a fast growing and speedily rising region , is emphasi s ed to underline US re - engagement with the region. India, because of its impressive economic growth and strategic position in the Indian Ocean and the Malacca Strait areas , is seen a s a key partner in this strategy. India looks favourably towards this strategy owing to its own concerns about an assertive and militarily powerful China. The extent and pace of India’s participation in the US strategy would , however , be defined by the con siderations of India’s own strategic autonomy in the region and China’s behaviour towards its border dispute and India’s strategic priorities in the immediate neighbourhood.

    Working Papers: 158 : China-South Asia Strategic Engagements – 3 Sino-Myanmar Relationship: Past Imperfect, Future Tense

    Sudha Ramachandran 23 August, 2012
    n May 2011, Myanmar's 3 new President, U Thein Sein visited China, making it the destination of his first state visit si nce assuming the presidency in March. In doing so, he signalled that Myanmar's new, quasi - civilian government, like the military junta before it, would continue to give priority to China in the hierarchy of its foreign relations. Reiterating what several of his predecessors have said since 1988, Thein Sein declared during the visit that Myanmar's relationship with China is the'closest and most important diplomatic relationship' for Myanmar (Bhatia 2011).

    Working Papers: 157 : China-South Asia Strategic Engagements – 2 Bhutan-China Relations

    Mathew Joseph C. 23 August, 2012
    Geographic location plays an important role in determining the foreign policy choices of countries. This is invariably true despite the size and resources available to countries. Countries which are fortunate to have access to seas are distinct in many way s from the landlocked states in this regard. If the state is landlocked, small in size and not so rich in terms of resources, the fate of such a state would be all the more precarious. Bhutan belongs to the afore - mentioned category of small landlocked stat es.

    Working Papers: 156 : Which Way is Pakistan Heading? – 3

    Shahid Javed Burki 21 August, 2012
    In this concluding part of the three Working Papers on the grim Pakistani situation as of midAugust 2012, “the positives” on the economic front are examined. These include the decision to decentralise a significant part of economic decision-making from the centre to the provinces. This was done by amending the Constitution. The recent thaw in the economic relationship with India is also viewed as a highly positive development. If this results in a relatively free flow of trade between the two countries, that alone could add as much as 2.4 percentage points to the rate of growth in Pakistan’s GDP. The large Pakistani diaspora in three continents and the remittances they send back to the homeland is another positive. In 2011-12 the capital flow from this particular source was equivalent to seven per cent of the national income. The fourth positive discussed in the paper is the extent to which women are acquiring education and skills. This has enabled many of them to play important roles in some of the modern sectors of the economy. Women have also begun to perform important entrepreneurial roles, particularly in the sectors of education, communication, and microfinance. The paper also discusses some of the strategies the country could adopt to put an end to the uncertainties that affect the performance of the economy.

    Working Papers: 155 : Which Way is Pakistan Heading? – 2

    Shahid Javed Burki 21 August, 2012
    This Working Paper, the second of a three-part series, examines the performance of Pakistan's economy since 2008. In February of that year, elections were held that brought to power in Islamabad a political party -- the Pakistan People’s Party (PPP) -- which was resolutely opposed to the rule by the military. Its main preoccupation in the first few months of its rule, therefore, was to force General Pervez Musharraf to give up the presidency. This goal was achieved in August when the president resigned. A month later Asif Ali Zardari, the PPP’s co-chairman, was elected to the office vacated by Musharraf. Once in full political power, the party governed poorly. It allowed the country’s economy to slip into a recession that has lasted for five years, the longest in history. The paper suggests that, while some external factors and natural disasters damaged the economy, bad management was the main reason for the economic downturn. Poor governance not only resulted in increased corruption but also in allowing serious electricity and natural gas shortages to take a heavy economic toll. With corruption increasing the cost of doing business and with severe shortages of some vital inputs, there was a significant decline in investment by the private sector. At the same time the country’s relations with the United States deteriorated to the extent that there were calls in America for suspending all aid to Pakistan. The result was a sharp decline in the badly-needed external capital. The country failed to make the adjustments needed in its fiscal policy to compensate for the decline in external flows by increasing domestic resource mobilisation. This meant that public sector investment also declined. The two combined – declines in private and public investments – means that slowdown in the rate of economic growth is likely to persist for some time. In sum, the paper suggests that the economy has been driven to the edge of an abyss from which it needs to be pulled back. That will require concerted action on a number of fronts

    Working Papers: 154 : Which Way is Pakistan Heading

    Shahid Javed Burki 21 August, 2012
    Which way is Pakistan headed? The question is important not only for the citizens of Pakistan but also for the country’s immediate neighbours. It is important also for the entire world. A recent book authored by David E. Sanger, who covers the United States’ global strategic interests for The New York Times, has some interesting observations about how the administration headed by President Barack Obama viewed Pakistan as the relations between the two began to sour3. He wrote that by the end of 2011, the American President had come to the conclusion that Pakistan was the world’s most dangerous place. Not only was there a great deal of internal turmoil in the country, Pakistan also had the world’s fourth or fifth largest nuclear arsenal. If Pakistan collapsed and if internal divisions within the country’s army split it apart, the security of nuclear weapons could not be ensured. It would be catastrophic if these weapons of mass destruction fell into the wrong hands. Pakistan’s security was, therefore, of interest and concern for the entire international community. The country remained unsettled after the long rule by the military and the beginning of a new political order. There were significant changes made in the Constitution that led to the grant of greater autonomy to the provinces. There was also repeal of Basic Law that had given the president powers to dismiss the prime minister and dissolve the national and provincial assemblies. In spite of this change, President Asif Ali Zardari remained in effect the main executive authority. The economy continued to perform poorly with the 2007-12 downturn being the longest-stretching recession in the country’s history. Pakistan remained dependent on external capital flows to maintain even the low level of investment in the economy. But these flows became less certain as relations with the United States deteriorated in 2010-11. And the rise of Islamic extremism remained unabated. This paper, presented in three parts, examines how the various systems – economic, political and social – developed over time in Pakistan and how they were being shaped as 2012 draws to a close, and attempts to answer the question: Which way Pakistan appears to be headed at this time? The first part sets the stage for the analysis that follows and also analyses the development of the political order after the military left the scene in March 2008

    Working Papers: 153 : China-South Asia Strategic Engagements

    Ma Jiali 14 August, 2012
    South Asia is att racting more and more concerns in the international political arena , and it is China's close neighbour in the southwest . International political observers generally agree that South Asia is not only the subcontinent closely adjacent to China but also the w restling field full of geopolitical competitions, while it is also more of a breeding ground for terrorism in recent years . It goes without saying that China has huge strategic interests and security concerns in this region indeed. Therefore, China needs an approach to properly handle the relationship between it and South Asian countries ( as a whole) in order to ensure its own strategic and security interests.

    Working Papers: 152 : Iran’s diplomacy towards Afghanistan: A stabilising factor

    Didier Chaudet 12 July, 2012
    Iran is often seen only as a ‘rogue state’ by the Un ited States (US) and its Western allies. But the idea that one of the oldest civili s ations is now ruled by ‘ mullahs ’ with no rational vision of international affairs is rather simplistic. The fact is that, even if some in the Iranian political elite can be seen as ‘hawks’ or leaders of a nationalist ‘neoconservative’ movement, Tehran is rather pragmatic in international affairs. Of course , the Islamic Republic can be protectively aggressive if it is provoked or feel s threatened, but its first goal is to pr otect itself as a regime and as a nation. The best example of this can be seen when one takes a close look at the Afghan istan - Iran relationship. What can be seen in the recent past as well as in the post - 9/11 period is that the Iranian thinking towards its neighbour is dictated by a sense of realism . In that perspective, Iran can be a force for stability in Afghanistan immediately after 2014... if old wounds and Washington’s tensions with Tehran do not come in the way.

    Working Papers: 150 : India’s Electoral Laws, Political Corruption and the Supreme Court

    Ronojoy Sen 14 June, 2012
    There are two facts about Indian politics that merit urgent attention. First, the number of Members of Parliament (MPs) in the Lok Sabha or Lower House (which is directly elected by the people in a first-past-the-post system) with criminal records is striking. In the current Lok Sabha – which came into existence in 2009 – the number of MPs with criminal charges against them is 162, which work out to nearly 30 per cent of MPs having either criminal cases registered against them or pending in court. The more crucial figure is that 76 MPs, or 14 per cent of the total number of MPs, were charged with criminal cases that could attract imprisonment of five years or more. In the earlier (2004) Lok Sabha, the picture was not much better. There were 128 MPs with pending criminal cases against them, out of whom 58 had serious criminal cases registered against them.2 This has led to the perception, as the Supreme Court puts it, that the ‘law breakers have become the law makers’.

    Working Papers: 149 : Whatever Happened To ‘Land Reform’

    Robin Jeffrey 8 June, 2012
    The paper traces Indian policy towards land use and ownership from pre-independence times till today. It notes that ‘land reform’ – an ill-defined term – began to disappear from political platforms and policy agendas from the 1970s and offers, as a heuristic device, four naive explanations. In dealing with each explanation, the paper exposes its inadequacy and analyzes essential features of land questions in India. The paper concludes that by the first decade of the 21st century ‘land’ for various socio-economic groups had become ‘real estate’ – a platform for people to buy, sell and build on, not a place on which to live and grow food.

    Working Papers: 148 : Economic Reforms in India: Perpetuating Policy Paralysis

    Amitendu Palit 29 March, 2012
    This paper examines the current state of economic reforms in India and the phenomenon of policy paralysis leading to almost complete lack of progress on reforms. It studies the qualitative aspects of reforms in India over the last couple of decades and explains how these have changed over time. It discusses the r ole of coalition governments, an increasingly regressive political economy and lack of strong political leadership in fostering the policy paralysis and expects the latter to prevail in the foreseeable future.

    Working Papers: 147 : India’s Unilateral Tariff Withdrawal for South Asian Countries

    Pratima Singh 20 March, 2012
    This paper studies economic integration in the South Asian region using an India - centric approach. It recommends that the gains from India withdrawing its tariff on imports from South Asian countries hugely outweigh the losses for the region. The four bila teral trade relationships analysed cover India - Pakistan, India - Bangladesh, India - Sri Lanka and India - Nepal. The Indo - Pakistan relationship shows Pakistan’s exports to India contribute much less to India’s total imports than to Pakistan’s GDP. The benefits of India unilaterally withdrawing tariffs, thus, are much greater than the costs. Similarly, the India - Bangladesh trade relationship, despite having many complementary characteristics, is not very well established. India announced duty free access to some textile imports from Bangladesh in September 2011 3 and should be encouraged to declare ‘zero tariff’ rates on all major Bangladeshi imports. The India - Sri Lanka relationship, despite having a Free Trade Agreement (FTA), is restricted in many ways. Similarl y, the Indo - Nepal trade relationship, despite a 60 year FTA, is still protectionist in nature. It is important that these protective criteria be removed in favour of improving trade between the countries. Each of the countries mentioned in the paper will g ain immensely if India opens up its borders to their ex ports. These gains will outweigh the minor losses for India which will be more than compensated for by its increased goodwill. Economic integration is important to maintain stability in this region and the four bilateral relationships described above are crucial.

    Working Papers: 146 : India’s Unilateral Tariff Withdrawal for South Asian Countries

    Pratima Singh 17 March, 2012
    T his paper studies economic integration in the South Asian region using an India - centric approach. It recommends that the gains from India withdrawing its tariff on imports from South Asian countries hugely outweigh the losses for the region. The four bilat eral trade relationships analysed cover India - Pakistan, India - Bangladesh, India - Sri Lanka and India - Nepal. The Indo - Pakistan relationship shows Pakistan’s exports to India contribute much less to India’s total imports than to Pakistan’s GDP. The benefits o f India unilaterally withdrawing tariffs, thus, are much greater than the costs. Similarly, the India - Bangladesh trade relationship, despite having many complementary characteristics, is not very well established. India announced duty free access to some t extile imports from Bangladesh in September 2011 3 and should be encouraged to declare ‘zero tariff’ rates on all major Bangladeshi imports. The India - Sri Lanka relationship, despite having a Free Trade Agreement (FTA), is restricted in many ways. Similarly , the Indo - Nepal trade relationship, despite a 60 year FTA, is still protectionist in nature. It is important that these protective criteria be removed in favour of improving trade between the countries. Each of the countries mentioned in the paper will ga in immensely if India opens up its borders to their imports. These gains will outweigh the minor losses for India which will be more than compensated for by its increased goodwill. Economic integration is important to maintain stability in this region and the four bilateral relationships described above are crucial.

    Working Papers: 145 : Stabilising the Neighbourhood? : India’s Flip Flop Approach to Maldives Crisis

    S D Muni 16 March, 2012
    ISA S Working Paper No. 14 5 – 16 March 201 2 469A Bukit Timah Road #07 - 01 Tower Block National University of Singapore Singapore 259770 Tel: 6516 4239 / 6516 6179 Fax: 6776 7505 / 6314 5447 Email: isassec@nus.edu.sg Website: www.isas.nus.edu.sg Stabilising the Neighbourhood? : India’s Flip Flop Approach to Maldives Crisis S D M uni 1 It has gradually dawned on the Indian policy mak ers that neighbourhood is strategically critical for India’s stability, development, security and also its regional and global aspirations. Since the beginning of this century, a clear admission of this reality has been articulated officially ; from foreign secretaries to the prime ministers. An independent group of strategic analysts in their latest report says: Interstate politics in South Asia has direct spill - over effects into domestic and regional politics in India. India’s ability to command respect i s considerably diminished by the resistance it meets in the region. South Asia also places fetters on India’s global ambitions. 2

    Working Papers: 144 : From Isolation to Partnership: The Evolution of India’s Military Diplomacy

    C. Raja Mohan 28 February, 2012
    On the face of it, ̳military‘ and ̳diplomacy‘ belong to two very different realms. Diplomacy is peaceful interaction between nations aimed at resolving differences and promoting cooperation. If diplomacy is the first line of engagement between states, military is seen as the last and i nvolves use of force. The connection between diplomacy and use of force, however, should not be seen as two ends of a spectrum. States have long used demonstration of military capabilities and threats of use of force as instruments to boost negotiating le verage with other states. ̳Gunboat diplomacy‘ is a well - established tradition in modern statecraft.

    Working Papers: 143 :Sino-Pakistan Strategic Entente: Implications for Regional Security

    Rajshree Jetly 14 February, 2012
    Sino - Pakistan relations stand out as one of the few enduring friendships that have withstood the pressures of time and shifting geo - strategic conditions. This paper discusses the defence and security dimensions of the Sino - Pak relationship which have been based on shared strategic interests and geo - political goals. It analyses some of the important political and geo - strategic issues affecting this relationship. The paper also looks at the regional and international dimensions, in particular the relevance of India and the United States to Sino - Pak relations. It examines the trajectory of Indo - US strategic ties and the downward spiralling of US - Pak relations which triggers its own logic on Sino - Pak security dynamics. The paper argues that as long as India - Pak istan peace process remains grounded on the issue of terrorism and Kashmir, and Pakistan ' s relations with US are a downward spiral, Pakistan would continue to view China as its most strategic ally in counterbalancing India, and to some extent the US. China will also have an inherent stake in shoring Pakistan ' s political and military stability in terms of its long - term security interests in the South, Central and Western Asian region, and checking the rising presence and power profile of the US. Finally the paper concludes that notwithstanding some strains and pressures in the relationship, Sino - Pak friendship will endure in the foreseeable future.

    Working Papers: 142 : Moving to Europe: Bangladeshi Migration to Italy

    Md Mizanur Rahman and Mohammad Alamgir Kabir 6 February, 2012
    Reformation of immigration policy in Italy has paved the way for the emergence of some non-European emigrant communities in Italy including Bangladeshi community. This study addresses the Bangladeshi migration to Italy by highlighting the context of immigrant reception in Italy, characteristics of Bangladeshi emigrants, their channels of migration, role of intermediaries in the migration process, the economic cost of migration, and inflows of remittances and their implications for family dynamics in Bangladesh. This study draws from the Bangladesh Household Remittance Survey conducted by the International Organisation for Migration (IOM) - Dhaka in 2009. The study reports that opportunities in the Italian labour market translate into increased opportunities for the migrant families left behind in Bangladesh.

    Working Papers: 141 : Migration between South and Southeast Asia: Role of Interstate Cooperation

    Rupa Chanda 2 February, 2012
    Asia is the second most important host region for international migrants, next only to Europe. According to United Nations statistics, in 20 10, the region was host to 61 million international migrants, or 29 percent of the world's migrant stock. Asia has exhibited the highest growth as a host region for migrants in the 2005 - 10 period with an annual average growth rate of 2.1 percent in the sto ck of migrants hosted by the region during this period. 3 Asia is home to some of the most important destination and source countries for migrant workers in the world. The significance of Asia as a source region for migration is also indicated by the fact t hat several Asian countries figure among the leading recipients of remittances in the world.

    Working Papers: 140 : Migration between South and Southeast Asia: Overview of Trends and Issues

    Rupa Chanda 2 February, 2012
    International migration is an important facet of globalization today. There were an estimated 214 million international migrants in 2009, constituting around 3.1 percent of the world's population, up from around 82 million in 1970, reflecting the huge increase in international migration flows over the past few decades. 2 An interesting feature of this migratio n is the growing importance of South - South migration flows. It is estimated that around 47 percent of migrants from developing countries migrate to other developing countries. The number of migrants in the South has increased by 75 percent over the past 40 years, with the true size of South - South migration estimated at around 74 million. 3 Hence, South - South migration is almost as large as South - North migration and developing countries and developing countries are confronted with policy challenges as both so urce and host nations.

    Working Papers: 139 : America’s Asia Policy

    Shahid Javed Burki 13 January, 2012
    The groundwork for America’s new Asian approach, released as a part of its new defence strategy was prepared in the three visits the United States President Barack Obama has taken to the continent. In each of these the American leader’s position shifted, taking him slowly towards where he stands today. In the first visit in November 2009, centred on a visit to China, he was prepared to welcome Beijing to the front row of global policymaking. In the second, he welcomed India’s rise and expressed his country’s willingness to cooperate with New Delhi to craft a new world order in which the two large Asian powers, China and India, will play stabilising roles. In the third visit in November 2011, the American president began to articulate a policy aimed at containing China and making Asia a central American preoccupation. Now with the release of the Defence Strategy the United States has signalled a major shift in its geographic focus. It will now give more attention to Asia, in particular to the Pacific region. This paper examines the strategy and the implication of this move by the Obama administration for the South Asian subcontinent.


    Working Papers: 138 : India’s Engagement with Afghanistan: Developing a Durable Policy Architecture

    Daniel Norfolk 12 December, 2011
    Calls for a regional approach to stabilise Afghanistan have not been accompanied by serious efforts to analyse the evolving motivations and strategies of regional actors. Occupying a unique position as Afghanistan’s leading regional development partner, India is poised to play an instrumental role. The development partnership between India and Afghanistan, which e merged in the wake of the United State ( US ) invasion in 2001, has been recalibrated according to a revised conception of India’s own strengths and limitations in its region and a sober reassessment of geopolitical realities. Built into this revision is a measured accommo dation of Pakistan. While India may now succeed in carving out a strategically viable place for itself, the ability of India to achieve its goals in Afghanistan crucially depends on its capacity to leverage regional cooperation.

    Working Papers: 137 : Inclusive Growth:How is India Doing?

    John Harriss 29 November, 2011
    Inclusive growth was the over-arching objective set in India’s 11th Five-Year Plan for the period 2007-2012; and the aim of this paper is briefly to review evidence and argument about India’s progress towards realising this vision. Prime Minister Manmohan Singh, in his Foreword to the Plan document, wrote of the need to ensure that ‘income and employment are adequately shared by the poor and weaker sections of our society’, and there is – unfortunately - a lot of evidence suggesting that this is not happening. Rather there is evidence in support of the view that India is characterised by extensive exclusion of labour. Data from the National Sample Survey show that productive jobs are not being created at anything like the rate required for ‘inclusive growth’ to be realised, and it is possible that there is even an inverse relationship between economic growth in India, and productive employment. The agricultural economy, meanwhile, remains both inefficient and inequitable. Recent developments in India’s policies for social protection – such as the National Rural Employment Guarantee scheme – may perhaps be understood as reflecting the failures of ‘inclusive growth’.

    Working Papers: 136 : Does Labour Migration Bring about Economic Advantage?

    Md Mizanur Rahman 20 September, 2011
    This paper revisits the assumed economic advantage of temporary labour migration. The widely shared sentiment that temporary migration brings about economic advantage for migrants and their families often is a function of income differentials between two countries. This study argues that opportunity for temporary employment in a high income country does not necessarily translate into economic advantage for every individual migrant and his or her family in a low income country. This study addresses the undercurrent of risks in the international labour migration process and its implications on family economics. This study draws from the experiences of Bangladeshis in Saudi Arabia. It reports that migrants often undertake international migration at great costs of their own, incurring large debts, risking personal savings and family assets, and accentuating income risks and capital constraints, while the remittances are meagre in the repair of such family economics.

    Working Papers: 135 : Pakistan and Patrons: The United States, PR China and Saudi Arabia

    Ishtiaq Ahmed 20 September, 2011
    Many Asian and African polities entered into alliances with the two main superpowers of the post-Second World War era – the United States (US) and the Soviet Union – in the hope of getting economic and military aid. Some chose to tread a middle path by joining the NonAligned Movement (NAM). Pakistan initially entered into an alliance with the US, followed by alliances with the People’s Republic of China and Saudi Arabia to assert itself in relation to the much bigger and more powerful India. However, the alliances placed Pakistan in a relationship of dependency vis-a-vis its three patrons. This paper examines the implications and ramifications of such dependency for Pakistan in the wake of the 9/11 terrorist attacks ordered by Al Qaeda on the US and especially in the aftermath of the killing of Osama bin Laden by US Special Forces in Abbotabad, Pakistan.

    Working Papers: 134 : Manmohan in Bangladesh: The Visit Revisited

    Iftekhar Ahmed Chowdhury and M. Shahidul Islam 13 September, 2011
    The visit by Indian Prime Minister Manmohan Singh to Bangladesh in September 2011 was billed as his most important foreign policy initiative of the year. It was to have been a paradigm for resolving intractable relations between neighbours, a model to be emulated in other similar situations. Instead, it fell a victim to the complexities and idiosyncrasies of India's domestic politics, and became what many saw as much ado about little. Some key agreements were not signed, despite public expectations rendering this important event one of more protocol than substance. The article analyses the reasons why. The essay points to some structural issues of centre-state relations in India that will require to be addressed with regard to foreign policy questions, particularly in terms of relations with other nations in the region. It examines how perceived national self-interests can often override even the closest of personal rapport as between Prime Ministers of Bangladesh and India. One simple but profound lesson learnt from this episode is that one must not undertake major initiatives with regard to inter-State relations, even between the best of friends, without the most thorough preparations. Nonetheless, the authors give the visit a mixed grade, and argue that if an appropriate follow-up mechanism is put in place even now, there would be potentials for advance on whatever had been achieved, which while little now, can grow into much over time

    Working Papers: 133 : An Approach to Forecasting Market Demand in India

    S Narayan, Sarin Paraparakath, Asha Abraham & Deepa Karthykeyan 12 September, 2011
    One of the characteristics of growth in emerging economies is the sharp growth in steel consumption resulting from public investment outlays in infrastructure, coupled with outlays in construction as the economy expands. The last decade's healthy growth of the Indian economy has led to steep rises in the consumption of steel. This paper is an attempt to econometrically analyse the growth in market demand for steel in India using aggregate sectoral demand patterns. It seeks to project demand-supply gaps up to 2014 - 2015. The results would be of interest to academics and for business.

    Working Papers: 132 : Recruitment of Labour Migrants for the Gulf States: The Bangladeshi Case

    Md Mizanur Rahman 6 September, 2011
    Recruitment constitutes an important part of the process of temporary labour migration in Asia. Existing literature explicitly suggests that the rapid development of recruiting agencies and migrant networks has accelerated the growth of labour migration in Asia. However, most existing literature tends to focus on either the role of agencies or the role of networks in the recruitment process, not both simultaneously. Likewise, the economics of recruitment is almost inseparable from labour recruitment in Asia but it remains an area of peripheral interest in existing literature. This study argues that a holistic approach, meaningfully combining migrant networks and recruitment agencies, to highlight both the operational and economic aspect of recruitment, is needed to better understand the complexity of migrant recruitment dynamics in Asia. Focusing on the recruitment experiences of Bangladeshi migrants in the GCC states, this study examines the operational as well as economic aspects of recruitment. This paper reveals how migrant networks and recruitment agencies adapt to the changing practices of recruitment to funnel migrant workers to the GCC countries. Further, it explains how constellations of interests at different points in the system create the conflicts and contradictions throughout the recruitment process.

    Working Papers: 131 : How Well Has South Asia Coped With the Global Financial Crisis: Monetary Management, Regulation and Market Discipline

    D. M. Nachane and M. Shahidul Islam 1 September, 2011
    The global financial crisis affected most economies primarily through three channels– declining trade volumes, exchange rate pressure and asset deflation. The paper focuses on the impact of the crisis in the four major economies of South Asia viz. Bangladesh, India, Pakistan and Sri Lanka and how by a combination of swift actions on the monetary, fiscal and exchange rate fronts the worst consequences of the crisis were averted. The regulatory and supervisory systems in these four economies are then benchmarked against certain desirable norms, which have emerged out of post-crisis international deliberations. It is felt that South Asian regulatory systems perform fairly well vis-à-vis these norms. The paper also discusses three major unresolved issues on the regulatory and supervisory dimensions. With regard to the Principles versus Rules-based regulation controversy, it recommends that a more promising and safer course of action would be to make the existing (rules-based) system more flexible and dynamic. Secondly, with a view to strengthening market discipline, several new initiatives seem to be in order, the most important being the switchover to a riskbased premium of deposit insurance. Finally, the paper discusses the crucial issue of independence of regulators and supervisors from official (government) interference and market “noise”, in executing their mandate of financial stability. The authors are of the view that the future success of financial reforms in South Asia will be crucially contingent upon how successfully the regulatory architecture adapts to the twin dictates of financial development and financial stability, the extent to which market discipline can be usefully deployed as a pillar to support this architecture; and the degree to which regulatory and supervisory independence is not compromised.

    Working Papers: 130 : An Outsider’s View of Some Issues in Contemporary Indian Foreign Policy

    David M. Malone 26 August, 2011
    Anand Giridharadas wrote in 2009 that India is ‘a country harder to describe than to explain, and easier to explain than to understand’, and that ‘India is a place for seeking, not concluding’. 2 This is a profoundly true but also humbling observation for a non- Indian author addressing a topic such as Indian foreign policy.

    Working Papers: 129 : India’s Engagement with ASEAN: Beyond Trade in Goods

    Shankaran Nambiar 26 August, 2011
    India has actively engaged the Association of Southeast As ian Nations ( ASEAN ), reaching a zenith with the signing of ASEAN -India Free Trade Agreement (AIFTA) on 13 August 2009. Further, India has plans for bilateral free trade agreements ( FTA ) with select ASEAN member nations. Broadly speaking, the comparative advantage of ASEAN member countries is in manufacturing, while that of Ind ia is in services. Hence both ASEAN and India can exploit their relative strengths . The paper will seek to look beyond trade in goods to flag 2 other areas that might offer scope for br oader engagement in the future . The p aper argues that trade in services , security, the environment and infrastructure offer wider opportunities for collaboration between ASEAN and India.

    Working Papers: 128 : Inflation in India: An Empirical Analysis

    Pratima Singh 10 May, 2011
    High inflation in India has become a major issue with both academ ics and policy makers . It is one of the big gest hindrances to growth and a major policy challenge for incumbent governments . This paper analyses trends in infl ation over the past five years, particularly food inflation, and examines the demand and supply side factors behind surging food prices . It argues that demand for several food items in India exceeds their current suppl ies , and leads to high p rices. It further contends that this demand - supply imbalance is attributable to structu ral inefficiencies , including distribution of food products. Pointing out that monetary policy responses are unlikely to prove effective in reducing food prices, the paper emphasises on the importance of increasing agricultural productivity and reforming retail trade policies for long - term results.

    Working Papers: 127 : South Asia: Policy Responses to the Global Crisis

    S Narayan 9 May, 2011
    The impact of the economic crisis of 2008-09 was felt significantly in the economies of South Asia. Demand for exports and foreign investments fell in the real economy as well as in the financial markets. This led to a softening of domestic demand in the consumption sectors, leading to a slowdown in the growth of these economies. The economies in South Asia have now recovered and the problems of 2009 and 2010 have been left behind. Policy interventions that were adopted in the different countries varied not just due to differing macroeconomic considerations, but also because of the political economy considerations in these countries. This paper attempts to examine these interventions, their causes and effects.

    Working Papers: 126 : Shaping the Coordinates of India’s Trade Policy Architecture

    Amit Shovon Ray 21 April, 2011
    India’s trade policy architecture has undergone a phenomenal metamorphosis over the last six decades. The objective of this paper is to understand the ‘factors’ that have shaped India’s trade policy architecture at various junctures in its development path. In particular, the paper will identify whether domestic economic compulsions or international economic environment have played the key role in determining the coordinates of India’s trade policy architecture over time. The paper broadly concludes that India’s trade policy architecture has remained by and large homegrown, dictated by domestic imperatives, both economic and political, rather than by the forces of the international economic order. Even at the WTO, India’s stance has been shifting rather dramatically, but much of it may be linked to India’s ‘self interest’ as opposed to international compulsions.

    Working Papers: 125 : The Future of Financial Liberalisation in South Asia

    Ashima Goyal 19 April, 2011
    The paper defines financial liberalisation, distinguishing between liberalisation of domestic financial markets and capital account convertibility. It then examines the stages and the strategy of Indian financial reform. The Indian strategy followed a well thought out sequence whereby full capital account liberalisation was to come after deepening domestic markets, and improving government finances. One alone is dangerous without the others. The experience of the global crisis has validated the Indian strategy and also shown that foreign entry has benefits but cannot resolve all issues. Deepening domestic markets and better domestic and international regulation is a necessary prerequisite for full convertibility. The direction of future liberalisation should be such as meets Indian needs of financial inclusion, infrastructure finance, and domestic market deepening

    Working Papers: 124 : India, Afghanistan and the ‘End Game’?

    Shanthie Mariet D'Souza 14 March, 2011
    New Delhi, in recent times, has been confronted with some hard choices in Afghanistan. A decade - long policy of providing huge humanitarian and developmental assistance, which has accrued tremendous go odwill among the Afghans, is now perceived to be in imminent danger of being dis rupted and overwhelmed by the United States (US) dec ision of conditional withdrawal. This is in addition to the recently shifting discourse of negotiating with the Taliban, whi ch is interpreted as an upsurge of Pakistani influence in Kabul. The choice for India was never whether it should sta y engaged in Afghanistan or not. E ven in the face of repeated onslaughts on its personnel and mission , India was committed to staying the c ourse . However, decision making to that extent has become even more d ifficult given that the West appears to be in a hurry to bring its ominous gamble in Afghanistan to a close. It is thus timely to take stock of India’s role a nd interests in Afghanistan. I t is also useful to explore various policy options in the evo lving scenarios of limited down sizing or even complete withdrawal of interna tional troops from the conflict - ridden country.

    Working Papers: 123 : Comparing the ASEAN and SAARC Frameworks

    Syeda Sana Rahman 7 March, 2011
    Asia has experienced an explosion of regional trade agreements (RTAs) in recent years particularly in East and Southeast Asia. Production and institutions across these regions have become further integrated due to these RTAs. The domain of integration now extends to South Asia with India and other South Asian economies getting connected to East and Southeast Asia through formal trade arrangements. Proliferation of RTAs has revived the debate on multilateralism and regionalism. While most regional economies figure in the multilateral framework of the World Trade Organization (WTO), their pursuit of RTAs has raised questions over whether they repose greater faith in regional trade networks. The Economics and Trade Policy research cluster at ISAS organised a workshop at Singapore on 20 October 2010 on „Trade Policies in South Asia and Southeast Asia: Encouraging Regionalism?‟ that examined different aspects of the theme including comparative dimensions of trade frameworks, bilateral trade relations and country perspectives on regional trade. The papers are being brought out by ISAS as a working paper series. This paper is the second in this series

    Working Papers: 122 : Pakistan after the Floods: Prospects for Stability and Democratic Consolidation

    Ian Talbot 10 February, 2011
    This paper uses the summer floods of 2010 as a lens to examine Pakistan's worsening econ omic, security and governance issues since the February 2008 elections. It initially explains the background to the inundations which displaced 20 million people, caused massive damage to infrastructure and threatened to suppress an already sluggish econom ic rebound from the world recession. The politicisation of the circumstances surrounding flooding is discussed along wi th its historical significance. The paper then reveal s how the natural disaster exacerbated the multi - faceted challenges facing the Pakis tan Peoples Party (PPP) - led coalition. It also discusses the political impact of President Asif Ali Zardari's absence from the country at the time of the national calamity. The paper also lays bare the fact that the Government had inherited a declining eco nomic and security s ituation from the Musharraf era and then that structural economic and governance problems can be traced back to much further in Pakistan's history.

    Working Papers: 121 : India’s ‘Look East’ Policy: The Strategic Dimension

    S.D. Muni 1 February, 2011
    India’s ‘Look East’ Policy (LEP) did not begin in the 1990s. It has evolved in four different waves over centuries. The first wave of cultural and commercial engagement between India and its extended eastern neighbours lasted until the 12th /13th century. To this was added a strong strategic dimension by the British Empire in India during the second wave. The leaders of independent India, particularly Nehru, took the lead in launching the third wave by focussing on East Asia as an important part of India’s policy of Asian resurgence. However, the imperatives of the Cold War, intra-Asian conflict and rivalries, and India’s weaknesses on economic and military fronts did not let its Asia policy blossom.

    Working Papers: 120 : China’s Play in South Asia

    Shahid Javed Burki 20 January, 2011
    This paper examines the changing nature of China’s involvement in the South Asian mainland in light of the back-to-back visits by Chinese Premier Wen Jiabao to India and Pakistan. The Chinese leader was in New Delhi on 15-17 December and in Islamabad on 1719 December 2010. These visits were the subject of two past ISAS briefs in 2010.2 This paper takes a longer-term view of Chinese interest in South Asia in the context of the way the country perceives its role in the global economy and the international political system. The global system is in a state of considerable flux; while the economic dominance of the United States (US) in the global system is declining, that of China and India is increasing. The way these three countries play out their roles on the international stage will have enormous impact on the world economy and the structure of international politics. Pakistan, a substantially smaller economy, which at this time is faced with serious economic strife and security issues, will also have its part on the global stage. In fact, because of its geographical location and also having become the epicentre of Islamic extremism, Pakistan finds itself in the middle of this large-power triangle. The direction it takes could be influenced by China, India and the US.

    Working Papers: 119 : Women Empowerment in Bangladesh: The Rise of the Other Half

    M. Shahidul Islam and Suvi Dogra 6 January, 2011
    Increasing freedom around the world, especially women's freedom, is one of the hallmarks of the current wave of globalisation. Some analysts project that this could further intensify and favourably transform societies across the world. The economic and socio-political conditions of women in South Asia are not unique. Within the regions, Sri Lanka emerged as a pioneer of sorts in terms of the process of women empowerment. However, Bangladesh too has made significant strides in recent years. It has outshone some of its South Asian neighbours, including India, as far as women empowerment is concerned. The country's achievements in this regard are unparalleled in the Muslim world, bar Indonesia.


    Working Papers: 118 : Wto And Rtas: How The ‘spaghetti-bowl’ Impacts On Global ‘trade-meal’

    Iftekhar Ahmed Chowdhury 12 December, 2010
    The WTO generates more passions in debates or discussions on it than most other international organi s ations. This is largely because, more than most other bodies , it is concerned with the daily bread and butter issues affecting the common man. It is also because m any do not see it as very different from the ‘rich man’s club’ it replaced, the General Agreement on Tariffs and Trade ( GATT ) . In reality, however, it is different , both in terms of mandates and membership. It is based on certain principles championing fre e - trade, and it lays down agreed rules for trade in goods and services. It has also acknowledged the role of ‘development’ in fostering trade, a nd the ‘ uneven playing field’ that many members confront. While it was meant to enforce universal norms, over ti me , a large number of RTAs and cross - regional Free Trade Agreements ( FTAs) have been threatening to erode its effectiveness. This ‘spaghetti’ or ‘noodle - bowl’ phenomenon is receiving impetus from the impasse created in the current ‘Doha Round’ of Trade Ne gotiations. Asian RTAs are , however, more politically - driven, and therefore should be seen as WTO - consistent. In fact , concepts such as the massive FTA of the Asia - Pacific, to be realized by 2020 as discussed at the APEC Summit in Yokohama in November 2010 , will be a powerful factor in stabilizing Trans - Pacific political and strategic relations. As of now, they are not seen as threatening ‘core ’ WTO principles , though a modicum of their erosion is inevitable, and WTO rules allow for such regional FTAs , unde r certain conditions. Indeed, th ey are helping the growth o f an Asian consciousness and integration at a time when the contin ent is being seen on the ‘rise’, leading perhaps someday to the fruition of the concept of an ‘Asian Home’

    Working Papers: 117 : Mission, Money and Machinery

    Robin Jeffrey 25 November, 2010
    This paper provides readers with the context for the remarkable and sustained expansion of India's daily newspaper industry since the 1980s and the acceleration of that expansion in the twenty-first century at a time when daily print journalism in much of the world has declined. Covering a hundred years of the daily newspaper industry, the paper focuses on three themes: the ideas and motivations of the people who create newspapers, the financing of those newspapers and the technology through which they operate. The time-frame divides itself into four periods, each with identifiable and significant characteristics. In the first (1900 to 1920), from the time of the Viceroy, Lord Curzon to the ascendancy of M. K. Gandhi, English-owned newspapers slowly introduced industrial practices and journalistic conventions as they had evolved in Britain. A few Indian-owned English-language newspapers took up some of these innovations, but no Indianlanguage newspapers adopted such practices. Profit and ideology co-existed, but the largest and most influential (mostly British-owned) papers were more concerned with profit than preaching.

    Working Papers: 116: Structure and Agency in the Making of Indian Foreign Policy

    Sumit Ganguly 21 November, 2010
    India's foreign policy since independence has evolved in three distinct phas es. In the first phase, which lasted until 1964, it was mostly ideational. Between 1964 and 1990, it was a peculiar amalgam of ideational rhetoric and increasingly Realist behaviour . Since the end of the Cold War, it has all but embraced Realist premises with occasional rhetor ical nods toward its ideational past. This paper traces the source s of these changes and attributes them to an interaction of structure and agency.

    Working Papers: 115 : The Threat of the Geeky Goonda: India’s Electronic Voting Machines

    Robin Jeffrey 12 October, 2010
    The paper examines the controversy over the reliability of India’s Electronic Voting Machines (EVMs). Since the national elections of 2009, there have been allegations that the 1.4 million small stand-alone EVMs can be – and according to some protagonists, have been – doctored or rigged to allow election results to be falsified. The paper outlines the charges and describes the formal procedures under which the EVMs have operated for more than 10 years. It concludes that there is no convincing evidence that the machines have been rigged in India. It points out that any comparison with the networked, centralised electronic voting systems of the United States (US) and Europe, which have fallen into disfavour, are inappropriate. However, it is clear that if technically skilled people were to have ready and widespread access to EVMs, they could introduce external components that would enable the machines to be manipulated. Such manipulation would require large numbers of trained and reasonably adept conspirators who would have to escape the notice of or suborn both election officials and agents of rival parties. This is an improbable scenario. The Election Commission of India (ECI) has not however, met the allegations as ably and openly as it might. The Commission should not only be constantly testing, monitoring and improving existing EVMs, but also researching and costing methods that could add a paper trail to the current paperless process that could be used to verify election results.

    Working Papers: 114: India and China: Emerging Dynamics and Regional Security Perspectives

    Rajshree Jetly 29 September, 2010
    India and China, both heirs to ancient civili sations, have emerged today as the two most powerful and influential Asian nations in terms of their economic capab ilities and geopolitical standing. The two erstwhile adversaries have rec ognised the need for casting off the baggage of history and residual mist rust and have embarked on the pa th of building a new pragmatic partnership. However, despite th e recognition that coope ration may be in their mutual interest, this will be easier said than done. Sino-Indi an relations have always been complex with multilayered regional and global dimensions, which have complicated their bilateral relationship. Even as India and China have traversed a long road from being friends to adversaries to pragmatic partners, a factor which has been constant in the conduct of their affairs, is the fact that they are neighbours and geopoliti cal rivals who have as much to gain from each other as to fear from the other.

    Working Papers: 113 : From ‘Asia’ To ‘Asia-Pacific’: Indian Political Elites And Changing Conceptions Of India’s Regional Spaces

    Sinderpal Singh 28 September, 2010
    Existing discussions of regionalism in Asia reveal diverse ideas of Asia’s composition, with a lack of agreement about which states should be included/excluded in representations of ‘Asia’. This paper seeks to engage the debate by looking at the case of Indian political elites and their efforts to frame India’s own regional space within these larger questions on regional spaces in ‘Asia’ and the ‘Asia-Pacific’. It aims to locate contemporary representations of India’s regional space in a comparative historical framework by looking at India’s earlier tryst with different regionalist projects like the Asian Relations Conference (ARC), New Delhi, in 1947 and the Afro-Asian Conference, Bandung, in 1955. It would be argued that such similarities/differences in Indian representations of its regional space over time can be related to how Indian political elites have sought to negotiate Indian state identity, and as a result, India’s role beyond its own borders from the time of its independence in 1947.

    Working Papers: 112 : The 18th Amendment: Pakistan’s Constitution Redesigned

    Shahid Javed Burki 3 September, 2010
    In the midst of all the economic and political turmoil in the country, or perhaps because of it, Pakistan’s political forces of many different colours and ideologies have come together to reshape the 1973 constitution and create a new political order. The constitution was disfigured by a number of amendments inserted into it by military leaders who wanted to create a much more centralised structure than was permitted by the available constitutional framework. The end result was to give the country a hybrid system of governance that operated a presidential system within the guise of a parliamentary structure. There were problems with the system thus created. It had a president at the apex who was responsible to no one other than himself (or perhaps to the army high command) and provinces with only small amounts of authority. There was a consensus among the political forces that the system had to be changed. This was done with the adoption of the 18th amendment to the constitution on 19 April 2010. This was aimed at achieving the following two objectives. Firstly, to revert executive authority to the prime minister and his cabinet and hold them accountable to parliament. Secondly, to allow much greater autonomy to the provinces. This paper discusses how this amendment was processed and how its content will change the system of governance.

    Working Papers: 111 : The Maoist Insurgency of Nepal: Origin and Evolution

    S.D. MUNI 28 July, 2010
    Nepalese revolutions, both at the apex and the grassroots, have been characterised by violence. The paper examines the rise of Maoism in Nepal, which was influenced by India’s Naxal movement of the 1960s. In Nepal’s eastern Terai region of Jhapa, sections of communists experimented with the Maoist concept of ‘people’s war’ by unsuccessfully taking up arms in May 1971. The end of the cultural revolution and the demise of Mao Tse-tung resulted in a split between the Maoists, echoes of which can still be heard. Although the decade long ‘people’s war’ fought by the Maoists brought about the downfall of the monarchy in 2006, a clear vision for making their revolution a success still eludes them. The paper examines factors that have fuelled the Maoist insurgency, including poverty, illiteracy, scarce economic opportunities and increasing economic disparities.

    Working Papers: 110 : South Asia’s Economic Future with or without Economic Integration

    Shahid Javed Burki 14 July, 2010
    South Asia has reached the point in its economic and political development from where it can make sustained and steady progress. This will help the region achieve the rates of economic growth that have brought about fundamental changes in the eastern part of Asia. For that to occur, intra-regional trade needs to play a significant role. This paper uses a simple econometric model to estimate the benefits that can accrue to the countries in the region if more trade were directed towards Asian destinations, in particular towards South Asia.

    Working Papers: 109 : The Naxalite/Maoist Movement in India: A Review of Recent Literature

    John Harriss 8 July, 2010
    This paper reviews recent writing by and about India's Maoists, much of it from the pages of the Economic and Political Weekly, which has been the most important forum for informed reporting and commentary. An account is given of the recent history of the Naxalite/Maoist Movement, and of the ideology and tactics of the Communist Party of India (Maoist). Particular attention is paid to the findings, both of the few social scientists who have undertaken field studies and human rights activists who have had direct contact both with party cadres and village people amongst whom they move. These illuminate the relationships between the revolutionary movement and the people of those areas in which the Maoists have a strong presence

    Working Papers: 108 : The Global Governance Group (‘3G’) and Singaporean Leadership: Can Small be Significant?

    Iftekhar Ahmed Chowdhury 19 May, 2010
    Since the modern state system came into existence following the Treaty of Westphalia in 1648, nations have resorted to groupings among themselves seeking accretion of strength and power. This has led to conflicts through the centuries culminating in the two cataclysmic World Wars in the twentieth century. However, the creation of the ‘mother of all groupings’, the United Nations (UN) in 1946 has possibly averted, at least to date, another major manmade global disaster.

    Working Papers: 107 : Asia in the ‘Catch-Up’ Game: Part 2

    Shahid Javed Burki 10 May, 2010
    Two developments, the first decades old and the second very recent, have reshaped and are reshaping the global economic landscape. The first was the process of globalisation that reduced the distance among different economies in the world, not in the physical sense, but in the sense of easy flow of capital, trade, information and technology. Globalisation has produced a global economy, the like of which the world has never known and the process will continue to move forward the global economy.3 The future course of the world economy is one of the main issues addressed in the study. The second development was what economists and financial experts call the Great Recession of 2008-09 to distinguish it from the Great Depression that took such a heavy toll in the 1930s. What was „great‟ about this particular downturn in economic activity was that its origins were not in the normal working of the large economies that produce trade cycles with some frequency.

    Working Papers: 106 : Asia in the ‘Catch-Up’ Game

    Shahid Javed Burki 9 April, 2010
    Two developments, the first decades old and the second very recent, have reshaped and are re-shaping the global economic landscape. The first was the process of globalisation that reduced the distance among different economies in the world, not in the physical sense, but in the sense of easy flow of capital, trade, information and technology. Globalisation has produced a global economy the like of which the world has never known, and the process will continue to move forward the global economy.3 1 This is a revised version of an earlier draft which was discussed at an ISAS seminar, “Asia in the Catch-Up Game” held on 9 March 2010. Several helpful comments and suggestions made by participants at the seminar have been incorporated in this version. The future course of the world economy is one of the main issues addressed in the study. The second development was what economists and financial experts call the Great Recession of 2007-09 to distinguish it from the Great Depression that took such a heavy toll in the 1930s. What was ‘great’ about this particular downturn in economic activity was that its origins were not in the normal working of the large economies that produce trade

    Working Papers: 105 : Bangladesh-China: An Emerging Equation in Asian Diplomatic Calculations

    Iftekhar Ahmed Chowdhury 31 March, 2010
    The paper traces the evolution of Bangladesh-China relations over time and seeks to demonstrate that it symbolises an emerging equation in Asia's diplomatic calculations. These are the fruition of a consistent pattern in China's policy, entailing its pursuit to secure an ally in the South Asian region. They also pertain to the imperatives driving the forging of this alliance of a geographically smaller and strategically weaker, yet very active and potentially important, international actor, Bangladesh, seeking to buttress its sense of 'reinsurance' with regard to its twin goals of security and development

    Working Papers: 104 : India’s International Reserves: How Large and How Diversified?

    Ramkishen S. Rajan and Sasidaran Gopalan 3 March, 2010
    Asymmetric foreign exchange intervention by the Reserve Bank of India (RBI) has resulted in a sustained accretion of India's foreign exchange reserves. The reserve buildup in India has certainly been impressive, rising from around US$5-6 million in 1991, to nearly US$300 billion in mid 2008. In addition to addressing the issues of reserve adequacy, this paper examines the forms the reserves have taken (asset and currency composition), and the extent to which India's reserve holdings are diversified. The issue of reserve adequacy was made apparent during the 1990s and early 2000 when rapid reserve depletion became a defining and determining feature of the series of currency crises that hit emerging economies. There are several broad measures of reserve adequacy that are used in literature, which despite any theoretical backing, are useful broad benchmarks of a country's ability to manage a balance of payments shock. In order to assess the adequacy of India's stock of international reserves, the paper considers a few such standard measures such as the ratio of reserves-to-GDP, reserves-to-imports, reserves-to-short-term external debt and reserves-to-broad money (M2) and finds that India's reserve stock is more than adequate, placing them in a much better position than many other emerging economies.


    Working Papers: 103 : Vocational Education and India’s Skills Deficit

    Bibek Debroy 8 December, 2009
    The policy debate on revamping and reforming education in India usually tends to focus on elementary and secondary education (delivered through schools) and higher education, with little being said on vocational education. This is not to suggest that the skills deficit is not recognised. While there are 12.8 million new entrants into the workforce every year, the existing annual training capacity is 3.1 million. The government has developed a roadmap for reform but not without several shortcomings. First, government ministries and departments work in silos. Second, much implementation of the roadmap will remain a state subject and there is no guarantee that delivery will improve across all states. Third, though the roadmap incorporates possible private sector provisioning too, it is fundamentally based on expansions in the formal public training system. While the formal versus informal or organised versus unorganised dichotomy is often policy-induced, it is necessary to subsume successful examples of delivery in the non-formal and private categories too. Fourth, much hinges on improving vocational education in secondary schools. Therefore, at the moment, there is no particular reason for optimism.

    Working Papers: 102 : President Barack Obama in Asia – Searching the Basis for a Partnership

    Shahid Javed Burki 7 December, 2009
    United States President Barack Obama’s visit to Asia took him to four countries – Japan, Singapore, China and South Korea. The trip will have a lasting impact for at least two reasons. The American president gave up on the position taken by George W. Bush, his predecessor in the White House, that America would rule the international waves alone and would not share that space with any other nation. Instead, the new president went out of his way to invite Asia to join his nation to shape a new world order. He defined the twenty-first century as the Pacific century. Second, he singled out China as the United States’ partner in this enterprise. Implementing this design will not be easy. Already, the conservatives in his country have signalled their unhappiness with this change in America’s strategic thinking. And India, the other major Asian power, did not welcome President Obama’s call to China to help bring peace and prosperity to South Asia, a region New Delhi regards as its sphere of influence.

    Working Papers: 101 : Establishing Foreign Technical Training Facilities in India: The Option of Haryana

    Amitendu Palit and Sasidaran Gopalan 26 November, 2009
    A paper published by the Institute of South Asian Studies (ISAS) in September 2009 on"Skills Development in India: Challenges and Strategies" analysed the deficiencies in India's technical training infrastructure.2 The paper argued that expansive efforts to build skills in the country through the National Skills Development Project (NSDP) contain significant opportunities for foreign technical training providers. This paper probes deeper into such possibilities and aims to identify a specific location for establishing training facilities.

    Working Papers: 100 : India and Its South Asian Neighbours

    Rajeev Ranjan Chaturvedy and David M. Malone 26 November, 2009
    India shares land and maritime boundaries with eight countries - Bangladesh, Bhutan, China, the Maldives, Myanmar, Nepal, Pakistan, and Sri Lanka. If one sets aside China, the Maldives, and Bhutan - mostly at peace - six countries in India's immediate neighbourhood have been on the boil on and off for many years. This paper also includes a consideration of India's relationship with Afghanistan.

    Working Papers: 99 : Buddhism and the Legitimation of Power: Democracy, Public Religion and Minorities in Sri Lanka

    Darini Rajasingham Senanayake 26 November, 2009
    Buddhism has been associated with the philosophy and practice of compassion, tolerance, pacifism and ahimsa, or the avoidance of violence. The paradox of political and nationalist violence in modern Buddhist polities is particularly acute in Sri Lanka which has historically been viewed in the Theravada Buddhist world and canon as a Dhamma Dveepa (Island of the Doctrine), where the purer doctrine was to be preserved and flourish, since in India and Nepal, the birthplace of Buddhism and the Buddha Siddharta Gautama, the religion has had fewer adherents than Hinduism or Islam, and lacked state patronage. Since the Constitution of 1972, Buddhism has had a special place in Sri Lanka and, in recent times, the state, through its overseas diplomatic missions, has consciously projected itself as a Buddhist land and national heritage site, paradoxically, while engaged in one of the South Asian region's most violent armed conflicts.

    Working Papers: 98 : The Talibanisation of Pakistan’s Western Region

    Yasub Ali Dogar 24 November, 2009
    Ever since the invasion of Afghanistan by the United States and its allies in 2001, there has been a strong resurgence of pro-Taliban elements in Pakistan's bordering provinces with Afghanistan. The Durand Line which was delineated at the turn of the century segregated tribes and clans in such a manner that even families were divided. Its sanctity (legality) was never accepted by either the Afghan or Pakistani tribesmen.

    Working Papers: 97 : Civil Aviation in India: An Exploration in the Political Economy of Promoting Competition

    Rahul Mukherji and Gaurav Kankanhalli 18 November, 2009
    The civil aviation sector in India has witnessed remarkable growth in the last few decades. This paper aims to analyse the promotion of competition in this burgeoning sector with particular focus on the political economy of several key reform events. First, the economic ideas governing policy-making institutions such as the Prime Minister's Office were important. Second, the balance of payments crisis of 1991 was important for explaining change in the sector. Third, over time, bureaucratic politics within the sector, with certain ministries supporting and others opposing reorganisation, was a key factor underlying the pace of reform. Last but not least, the ideology of the party in power also made an impact on the promotion of competition in the sector.

    Working Papers: 96 : Bangladesh-India Relations: Some Recent Trends

    Mohd Aminul Karim 12 November, 2009
    Both Bangladesh and India have had their relations shaped by history, culture, geography, economics and, above all, geopolitics. While India is a geopolitical, economic and military giant involved in the affairs of the world, over the years Bangladesh has been struggling to ensure the sustenance and preservation of human security within its borders. India's contribution towards Bangladesh's War of Liberation in 1971 was critical to the latter's birth. However, events that followed the liberation of Bangladesh did not result in the continuance of cordial relations between these two countries as expected. There are a few fundamental issues between India and Bangladesh, such as land and maritime boundary demarcations, the sharing of waters from 54 common rivers, informal trade, transnational crime, and interference in internal affairs that have adversely affected their relationship. On an optimistic note, however, interpersonal relations and civil society contact groups between the two countries have increased. Both nations need to undergo a change in mindset, particularly at the political level. There is a need for greater understanding, dialogue, diplomacy, regional cooperation and less interference in each other's internal affairs. While it may be easy to simply list these issues, overcoming them would be difficult, mainly due to the overall geopolitical compulsions, the historical legacy, and the mutual mistrust in the region. India-Bangladesh relations would improve greatly if both parties recognise the need for greater political will to overcome the geopolitical compulsions, to appreciate the essence of regional (mainly economic) cooperation and to realise the benefits of peaceful coexistence. In assessing the challenges between the two countries and the need to overcome them, this paper will examine some recent trends, as well as explore a possible framework for the future direction of India-Bangladesh relations.

    Working Papers: 95 : India-China Trade: Explaining the Imbalance

    Amitendu Palit and Shounkie Nawani 26 October, 2009
    Merchandise trade between India and China has accelerated rapidly in recent years. China is now India's largest trading partner while India is also one of China's major trade partners. The rise in trade reflects an enhanced economic engagement between the two countries. A notable aspect of the growing trade, however, is its increasing imbalance. The balance of trade is not only in China's favour , but also exhibiting an increasing trend over time. This paper examines the relative competitiveness of Indian exports in the Chinese market as a key factor in explaining the imbalance in bilateral tr ade. The competitiveness of Indian exports is empirically assessed against those from the Southeast Asian countries , with the latter assumed as major competitors of Indian exports on account of the similarities in products exported and factor endowments.

    Working Papers: 94 : Non-Proliferation versus Disarmament: A Destabilising Dichotomy

    Iftekhar Ahmed Chowdhury 21 October, 2009
    The paper argues that the perceived dichotomy between non -proliferation and di sarmament in the nuclear -weapons debate that has stalled progress on both fronts is a 'destabili sing' one. In order for a breakthrough to occur after years of inaction, both must be addressed simultaneously and in various fora recogni sed and accepted by bo th the nuclear 'haves' , who emphasi se the former , and the 'have -nots' , who underscore the latter. These fora are the United Nations, the Conference on Disarmament and the Comprehensive Test -Ban Treaty (CTBT) Organi sation.

    Working Papers: 93 : Economic Integration in Asia: Trends and Policies

    Pradumna Bickram Rana 14 October, 2009
    Unlike in other parts of the world, such as Africa and Latin America, regionalism (or the adoption of regional cooperation policies) is a relatively new phenomenon in Asia. Aside from the establishment of the Association of Southeast Asian Nations in 1967, the South Asian Association for Regional Cooperation in 1985, and several efforts to promote intra-regional trade, few policy actions were taken by the Asian countries to promote regional cooperation with each other until the mid-1990s.

    Working Papers: 92 : Investment and Economic Opportunities: Urbanisation, Infrastructure and Governance in North and South India1

    Kala Seetharam Sridhar and A. Venugopala Reddy 2 October, 2009
    There are substantial disparities across India's southern and northern states (Bihar, Madhya Pradesh, Rajasthan and Uttar Pradesh) in terms of fundamental economic phenomena such as per capita net state domestic product, rural and urban poverty rates, and investment flows, with the southern states taking a lead over their northern counterparts. In this paper, we attempt to understand what factors have caused these differences. We examine human capabilities, skills and awareness, resources and the efficiency of their utilisation; extent of urbanisation; good governance, including law and order; and infrastructure across the two groups of states. With respect to the factors representing human capabilities - literacy, infant mortality, stock of graduates, enrolment in technical courses, population in working age group, number of higher educational institutions, and infrastructure such as installed capacity, households with electricity and telephone penetration, we find that the southern states have an advantage when compared to the northern states. The same is true with respect to factors indicating law and order, such as the proportion of cases pending trial in court.

    Working Papers: 91 : The Next Stage of Singapore-India Relations: Possibilities and Prospects

    Sinderpal Singh and Syeda Sana Rahman 24 September, 2009
    The history of relations between India and Singapore pre-dates their birth as independent nation-states. In the post-independence phase, relations between the two states have been subject to both low and high points, reflecting different degrees of engagement. In the last 15 years, however, Singapore-India relations have been on a relative upswing, characterised by closer association across a range of areas. This paper aims to provide an assessment of these more recent trends in relations between the two countries, looking at both traditional issue areas such as economic and defence-strategic ties as well as interrogating areas that are deemed relatively 'non-traditional' in nature, namely, education-knowledge transfer and building societal-level links between the two countries. This assessment will involve exploring both the future possibilities and potential pitfalls attendant to this bilateral relationship.

    Working Papers: 90 : The Pakistan Military: Change and Continuity under General Ashfaq Parvez Kayani

    Ishtiaq Ahmed 18 September, 2009
    The Pakistan military is the most powerful institution in the country. It enjoys the informal status as the guardian of national sovereignty and integrity of a state perennially rocked by political instability and, in recent times, by terrorism. Since the 9/11 terrorist attacks, Pakistan partakes in the United States-led “war on terror”. Such participation has earned Pakistan the wrath of Al-Qaeda, the Taliban and other extremist Islamist organisations. Terrorism against Pakistan by the extremists is the latest threat faced by the country. Therefore, the decisions, policies and strategies adopted by the Chief of Army Staff (COAS) to deal with internal and external challenges to the state are imperative to understanding Pakistani politics. The COAS has, in the past, also ordered the military to remain neutral during the February 2008 elections. On the whole, he has used his influence to dissuade politicians from resorting to confrontational politics that could once again lead to political instability in the country.

    Working Papers: 89 : Skills Development in India: Challenges and Strategies

    Amitendu Palit 17 September, 2009
    The Indian economy is widely expected to grow at sustained high rates over the next few decades and emerge as the second largest economy by 2050. These robust projections have much to do with the demographic profile of the country. India is slated to have one of the youngest populations in the world, with the bulk of the population figuring in the working age. Low dependency ratio and a surplus workforce put India at a strong comparative advantage vis-?á-vis most major economies. However, in order to utilise this 'demographic dividend' effectively, India needs to impart adequate and appropriate skills to its workforce.

    Working Papers: 88 : America’s Involvement in Afghanistan

    Shahid Javed Burki 15 September, 2009
    I launched my series of briefs on Afghanistan in the belief that it will matter a great deal for South Asia how the long-enduring conflict in that country takes shape in the coming weeks and months. Two South Asian countries – Pakistan and India – are deeply involved in Afghanistan, and so is the United States with which South Asia has a constantly evolving relationship. The United States’ failure or success will have consequences for South Asia. The two previous briefs were concerned with the presidential election held in the country on 20 August 2009. The result is still not known and the counting of votes is going on slowly. While the Afghans and the world wait for the result, the Americans have carried out yet another review of their strategy in the country. It was authored by General Stanley A. McChrystal, the new commander of the American forces in Afghanistan. His report is still working its way to the White House but it has been reported that it recommends a significant change in the United States’ strategy. The strategy suggests that while the Americans should provide more resources for winning the Afghan War, it should focus not just on defeating the Taliban but on winning the hearts and minds of the Afghan people. How the latter should be done will be an issue that will occupy the attention of the American policymakers for some time to come. While taking a pause in my “Afghanistan elections” Briefs, I will examine in this paper where the debate in America may take its Afghan policy, how it might influence the rise of Islamic extremism in Pakistan and how it could impact the rest of South Asia.

    Working Papers: 87 : Reforming India’s Education Sector: The Case of Elementary Education

    Bibek Debroy 14 September, 2009
    Elementary education in India is defined as Classes I through VIII and this is again sub-divided into primary (Classes I-V) and upper primary (Classes VI-VIII). The Indian Constitution was amended in 2002 through the 86th amendment. This stated that, “The State shall provide free and compulsory education to all children of the age of six to fourteen years in such manner as the State may, by law, determine.” In 2009, legislation was passed to give children the right to free and compulsory elementary education. The important strands of this legislation are the following: First, all children between the ages of six and fourteen have the right to free and compulsory education in a “neighbourhood” school. Second, no child can be held back, expelled or required to pass a board examination before the completion of elementary education. Third, schools cannot screen applicants at the admissions stage. Fourth, schools cannot charge capitation fees. Fifth, Kendriya Vidyalayas, Navodaya Vidyalayas, Sainik Schools and unaided schools will have to ensure that 25 percent of their students are from disadvantaged and economically weaker groups. New schools will not be established unless they meet these norms and existing schools have been given three years to comply. Sixth, other than Kendriya Vidyalayas, Navodaya Vidyalayas and Sainik Schools, government schools are exempted from penalties if they do not comply with the provisions. Therefore, barring these three types of schools, there is an effective abdication from the responsibility of delivering elementary education by the government. Seventh, the responsibility of delivering elementary education through neighbourhood schools is on state and local governments, with no clear division of responsibility between the two. There is a lack of accountability and no penalties are proposed on the authorities if delivery is not carried out. The idea is that specific academic authorities, like the National and State Advisory Councils will be established. Each school will also have a School Management Committee, with representatives from local authorities, parents and teachers. Eighth, all schools must comply with pupil/teacher norms and in addition, private schools also have to comply with physical infrastructure rules. However, the pupil/teacher norms are based on the total number of students, so that they allow for multi-grade teaching.

    Working Papers: 86 : The Integration and “Re-Centering” of Asia – Historical and Contemporary Perspectives1

    Pradumna Bickram Rana 9 September, 2009
    This paper argues that Asia’s emergence and integration after the Second World War is not without precedent. During the first eighteen centuries after the birth of Christ, Asia not only dominated the world economy but was also a well-connected and well-integrated region. These trends reversed during the 19th and the first half of the 20th centuries when Asia was colonised, and for another four decades after independence when South Asia adopted an inward-looking development strategy and isolated itself from the rest of Asia. Since then, South Asia has been reforming its economic policies and Asia has been re-emerging and reintegrating to regain its past status in the world economy. The paper also develops a research agenda to “re-center” Asia by linking South Asia with East Asia.

    Working Papers: 85 : An Economic Analysis of Bangladesh’s Foreign Exchange Reserves

    M. Shahidul Islam 7 September, 2009
    Following the rapid accumulation of foreign exchange reserves in recent months, there has been a growing interest in Bangladesh on the alternative uses of its reserves. However, different reserves adequacy measures based on global best practices confirm that its reserves holding is not markedly higher than what is required. The country's reserves stand higher than the adequate level only when one considers the current account aspects of reserves benchmark which is perhaps appropriate for the country as its financial system is still autarkic. The dynamics in its balance of payments account also supports the fact.

    Working Papers: 84 : Beating the Recession: Prospects from a Single Asian Market in Services

    Suparna Karmakar 20 August, 2009
    Given their historical colonial experiences and recent attainment of independence, unlike European countries, most Asian economies are fiercely independent and nationalistic in their economic and foreign policies. This is most noticeable in the case of services, although a regional approach to the sector has the potential to produce hugely beneficial economic gains in the medium term vis-?á-vis the growth and trade prospects in individual Asian countries. While the proposition for creating a single market in services for the Asian countries as a region may seem premature given that the talks for a comprehensive East Asian free trade agreement (FTA) are still in the future, rapid market-led implementation of an integrated regional services sector merits consideration given the ongoing economic crisis. Stylised facts from past experience seem to indicate that services could easily become an additional engine of growth for the region. However, given the small size of most of the economies in the region, for this engine to generate the necessary efficiency gains, the major countries of the Asia-Pacific region (starting with the 16 players of the East Asia Summit [EAS]) will need to operate as a single market. Dovetailing a strong services industry into the Asian integrated manufacturing economy will boost the efficiency of both sectors, as well as help the region to delink from its excessive dependence on the United States and European markets. Asia should look at a coordinated and cooperative model in developing services as the growth engine for the region and use the tertiary sector as a vehicle for a faster deleveraging of the regionÔÇÖs disproportionate dependence on merchandise exports. A case is made for greater voluntary and market-led rather than institutionalised regionalism in services.

    Working Papers: 83 : South Asia’s Public Policy Choices in a Fluid World

    Shahid Javed Burki 14 August, 2009
    I shall begin this paper with a short biographical note. I do this in order to explain why I have focused so much attention on the importance of history for understanding why people and nations behave in certain ways. Beliefs take a long time to form, but once they are firmly embedded in a society’s culture, history and social norms, it takes equally long to shake them off. By beliefs, I do not mean religious affiliations. My concern is with all beliefs – economic, political and social. Today, South Asia is a highly fractured society in part because of the way the area’s history has unfolded, causing people in the region to harden their attitudes towards one another. It is my contention that unless the people of South Asia begin to look at each other differently, they will not attain for themselves what has become possible by way of the enormous changes occurring around them. The restructuring of the global economic, financial, industrial and trading systems have opened enormous opportunities for the countries of South Asia. To exploit them, the countries have to learn to work together. However, history comes in the way. To cast off the burden it imposes on the societies of South Asia, it is necessary first to understand how it has affected the making of public policy in the region.

    Working Papers: 82 : Special Economic Zones in India: New Challenges for Governance and Public Policy

    Amitendu Palit 12 August, 2009
    India's Special Economic Zones (SEZs) have been shrouded by controversies. The most contentious debates have been regarding the acquisition of land for these zones. SEZs have highlighted existing ambiguities in the laws on land acquisition as well as the process for determining compensations. In more recent months, financial viabilities of SEZs have been under the scanner with certain zone developers contemplating exits due to poor economic prospects. The SEZ policy is also inviting criticism for having a myopic vision on urban management and constitutional identities of the zones. The paper examines some of the challenges to public policy and governance produced by SEZs

    Working Papers: 81 : Is India an East Asian Power? Explaining New Delhi’s Security Politics in the Western Pacific

    C. Raja Mohan 11 August, 2009
    New Delhi’s relationship with East Asia has come a long way from the early 1990s, when India launched its ‘Look East’ policy. While it continues to see the Association of Southeast Asian Nations (ASEAN) as the core of East Asia, India’s interests have broadened to include the Western Pacific as a whole. Although India’s economic ties with East Asia have yet to acquire the depth of China, the expectations of India’s superior economic performance and the prospect that it will emerge as one of the world’s four largest economies has created a sound basis for India’s relations with Pacific Asia. With faster economic growth, India’s military and strategic capabilities are becoming more consequential for East Asia. By embarking on a purposeful ‘big power’ diplomacy with the United States, China and Japan, building security partnerships with key regional actors and pursuing a vigorous maritime diplomacy, India is emerging as an important factor in the balance of power in Pacific Asia.

    Working Papers: 80 : International Aid, Peace-building and Conflict: Lessons from Aceh and Sri Lanka

    Darini Rajasingham Senanayake 4 August, 2009
    Global attention generated after the December 2004 Asian Tsunami disaster catalysed one of the most successful internationally-mediated peace processes in the world in Aceh, Indonesia, but it did not save the peace process in Sri Lanka. Rather, international aid contributed to a "no-war, no-peace" equilibrium in Sri Lanka that was brought to an end by the military victory of the government

    Working Papers: 79 : The South Asian Way: A Non-Conventional Approach to the Making of Economic Policies1

    Shahid Javed Burki 30 July, 2009
    In order to quicken the pace of economic growth and social development, policymakers in South Asia need to go beyond the conventional production function approach. According to that approach, capital accumulation and application of labour to more productive activities increase the rate of economic growth. The process goes on for as long as backward economies have labour surpluses. This is still the case in South Asia where the majority of the population lives in the countryside, mostly engaged in low productivity economic activities. The study of economic progress not only in developing countries, but also in developed countries, led to the realisation by some economists that knowledge was also a major contributor to growth. They brought it into the production function as an endogenous factor rather that keeping it out as an exogenous contributor. However, knowledge accumulation meant educating the work force and also providing skills needed by modernising economies. This is one of the many roles the state must play but has neglected in South Asia.

    Working Papers: 78 : The Bank Lending Channel of Monetary Policy Transmission: India and the Global Financial Crisis

    M. Shahidul Islam and Ramkishen S. Rajan 28 July, 2009
    Following the collapse of Lehman Brothers in September 2008, the global liquidity crisis affected the Indian financial market adversely. This was largely due to the sudden and large-scale reversals of the foreign institutional investments from the Indian market. However, as the crisis started to spread to the real economy and inflation subdued to some extent, the Reserve Bank of India (RBI) eased policy interest rates sharply and began a process of injecting large-scale liquidity into the financial system. As foreign and non-bank domestic sources of funding dried up, faced with severe refinancing risks, both big corporate houses and small businesses relied heavily on domestic banks as alternative sources of funds. This threatened to put intense pressure on Indian credit markets and brought into the spotlight the ÔÇÿcredit viewÔÇÖ channel of monetary transmission, particularly the bank lending channel

    Working Papers: 77 : Strategic Implications of the Global Economic Crisis for India

    Sanjaya Baru 27 July, 2009
    This paper argues that India's recent growth acceleration has only partially been hurt by the global economic slowdown. For this reason, and given the return of the Manmohan Singh government to power, India is expected to pursue policies that will restore the growth momentum. India will have to undertake governance reform at home and ensure a supportive external environment to sustain its rise as a 'free market democracy

    Working Papers: 76 : Financial Sector De-regulation in Emerging Asia: Focus on Foreign Bank Entry

    Sasidaran Gopalan and Ramkishen S. Rajan 22 July, 2009
    Over the last decade, many emerging Asian economies have been liberalising their financial sectors, including opening up their banking systems to foreign competition. This paper examines the extent of de jure and de facto changes in policies in selected emerging Asian economies on the introduction of greater foreign competition. For reasons of data availability, the focus of this paper is limited to selected emerging Asian economies, viz. India, China, Indonesia, South Korea, Malaysia, Thailand and the Philippines.

    Working Papers: 75 : Method in the Dragon’s Moods: Why China behaves as it does

    Iftekhar Ahmed Chowdhury 21 July, 2009
    This paper argues that, despite changing global scenarios, there is a consistency in how the People’s Republic of China sees and behaves vis-à-vis the outside world. Through its inexorable ‘rise’ in contemporary times it has been making nuanced adjustments of its tactical postures within the parameters of broad and abiding strategic goals

    Working Papers: 74 : Rescuing the Doha Development Round The Role of India and China in Multilateral Trade Governance

    Suparna Karmakar 13 July, 2009
    The World Trade Organization (WTO), with a much enlarged membership, has functioned very differently from its predecessor, the General Agreement on Tariffs and Trade (GATT). The old power centres within the multilateral trade regime have been joined by new power centres, especially from the emerging economies. The developing and the least-developed members are acting in coalitions to ensure that WTO deals meet their expectations and development concerns; however, they have not had similar success in agenda-setting yet. This paper examines the changing contours of the engagement of developing countries in the global trade regime, with special reference to the important role India and China can play in the 21st century WTO system of trade governance. It argues that emerging developing countries today need to pick up the leadership mantle and play a constructive role in furthering the cause of multilateral trade integration. This will be in the larger interests of protecting their international market access as well as the much needed domestic reforms. The paper tries to identify the roles and responsibilities of emerging hegemonic powers like India and China in the successful conclusion of the Doha Round.

    Working Papers: 73 : The Making of Indian Foreign Policy: The Role of Scholarship and Public Opinion1

    C. Raja Mohan 13 July, 2009
    This paper is an attempt to explore the relationship between international relations scholarship, Indian public opinion and foreign policy making in India. The paper assumes that all large nations, democratic or otherwise, need solid domestic political support for the effective pursuit of interests abroad. The internal support for the conduct of external relations rests on the existence of an ‘establishment’ that sets the broad terms for the ‘mainstream’ discourse on foreign policy; facilitates continuous and productive interaction between the bureaucracies making the foreign policy, the academia that expands and reproduces knowledge and expertise on the subject, the media, and the political classes; rationalises external policies as well as promotes alternatives to them; and defines and redefines national political consensus on foreign policy amidst changing circumstances and unexpected opportunities. The need for such an establishment is far more critical in large democracies, where the governments must continuously cope with volatile public perceptions and the imperatives of popular legitimation.

    Working Papers: 72 : From National Security State to Human Security: The Challenge of Winning the Peace in Sri Lanka

    Darini Rajasingham Senanayake 9 July, 2009
    Having won the three decade-long war against the Liberation Tigers of Tamil Eelam (LTTE), the Sri Lankan government faces a historic opportunity and challenge ÔÇô to win the peace in Sri Lanka. The LTTE was a symptom of a problem that had roots in the history of post-colonial state-building on the island. The rise of Sinhala Buddhist majoritarianism was accompanied by the marginalisation of the Tamil, Muslim and Eurasian (or Burgher) minorities, and it was hence that the LTTE began the struggle for a separate state for the Tamils. However, it morphed into a war machine. The issue of marginalisation of the minorities remains to be addressed.

    Working Papers: 71 : Maritime Power: India and China turn to Mahan

    C. Raja Mohan 7 July, 2009
    A recent Western visitor to a major annual security conclave in Singapore appeared utterly surprised at the extraordinary influence of the American theorist of sea power, Alfred Thayer Mahan. Most western naval analysts do acknowledge the huge influence of Mahan on the evolution of naval thinking across the advanced world from the turn of the 20th century to its early decades. Most Western analysts also believe that Mahan, once described as the evangelist of sea power, is now passé. The sense of absolute military superiority in the United States and the West during the recent decades has tended to reinforce the proposition that the new wave of economic globalisation has made the geopolitics of the kind espoused by Mahan as being largely irrelevant to the ordering of the modern world. No wonder then that the Western observer was recoiling at the “unwelcome” comeback of Mahan’s conceptions of sea power and geopolitics in Asia.3 The observer argues that while the understanding of sea power and its uses has evolved in the advanced societies since the days of Mahan at the turn of the 20th century, he “is now hugely admired in Asia’s two most populous powers. For China’s strategic planners, securing sea lanes against hostile powers has become perhaps the chief preoccupation. For India’s, it is the growth of China’s presence in its backyard, in and around the Indian Ocean. In both countries Mahan is pressed into service in one planning paper after the next”.

    Working Papers: 70 : The 2009 General Elections in India: An Analysis

    Paranjoy Guha Thakurta 3 July, 2009
    The fifteenth general elections to the Lower House of India's Parliament (Lok Sabha) were held in five phases spread over a month in April and May 2009, with its outcome declared on 16 May 2009. The elections witnessed the return of the incumbent Indian National Congress-led United Progressive Alliance (UPA) coalition to power in New Delhi for a second consecutive term.

    Working Papers: 69 : Monetary and Financial Cooperation in Asia: Making Sense Out of the CMI, CMIM, ABF, ABMI and ACU Alphabet Soup

    Ramkishen S. Rajan 18 June, 2009
    Ever since the currency crisis of 1997-98, there has been a great deal of interest in enhancing regional economic cooperation in Asia. It is important to keep in mind that economic regionalism is multidimensional nature. As noted by Kuroda (2005), economic regionalism can be broadly divided into four categories, viz. trade and investment; monetary and financial; infrastructure development and related software; and cross-border public goods (cooperation with regard to contagious diseases such as avian flu, SARS and swine flu, as well cross-border pollution such as the haze fires in Indonesia which affected many of its Southeast Asian neighbours). This paper concentrates on the issue of de jure monetary and financial regionalism in Asia. In other words, the focus here is on policy initiatives underway in Asia to enhance monetary and financial regionalism and the analytical bases for these initiatives, rather than on examining the actual level of financial and monetary links that already exists (which may or may not have been facilitated via regional policy mechanisms). A companion paper examines the de facto financial linkages within selected Asian economies (see Keil, Rajan and Willett, 2009).

    Working Papers: 68 : The Urdu Press in India and Pakistan – A Comparison

    Tridivesh Singh Maini 17 June, 2009
    Amongst the key binding factors between India and Pakistan, the Urdu language emerges as a significant one. While it is the national language of Pakistan, in India too, the generation of pre-partition individuals is most at home with the Urdu language. Interestingly, the current Prime Minister of India, Dr Manmohan Singh, does not know the Devanagari script and is conversant in Urdu. The same can be said of former Prime Minister, I. K. Gujral, who was more comfortable in Urdu. In fact, he was part of a committee to look into the promotion of the Urdu language in India. It would be pertinent to mention here that the Urdu language also played a crucial role in India's freedom struggle.

    Working Papers: 67 : Can Indian Think Tanks and Research Institutions Cope with the Rising Demand for Foreign and Security Policy Research?

    Sanjaya Baru 16 June, 2009
    India's relations with the rest of the world are increasingly being shaped by its economic and business interests.3 While the state remains the primary and decisive player in the shaping and articulation of Indian foreign policy, India's international relations are no longer constrained by government-to-government relations. Business and civil society engagement are in fact forcing the government to re-examine its own priorities and prejudices

    Working Papers: 66 : Outward Foreign Direct Investment from India: Trends, Determinants and Implications1

    Ramkishen S. Rajan 15 June, 2009
    While India has become an attractive destination for foreign capital, the country is also becoming a significant source of outflows. Many Indian enterprises view outward investments as an important dimension of their corporate strategies. The paper presents some data on the magnitude and composition of Indian outward foreign direct investment (FDI). It will also discuss the rationale for and the empirical determinants of overseas acquisitions by Indian companies. It will conclude with a broader discussion of the impact of the global rise of Indian companies on the Indian economy.

    Working Papers: 65 : Installing UPA-II: Balancing Interests and Affiliations

    S. D. Muni 11 June, 2009
    Anyone hardly expected a clear verdict in India’s parliamentary elections of 2009. Analysts and psephologists predicted a hung parliament with the two dominant coalitions of the United Progressive Alliance (UPA) , led by the Congress Party, and the National Democratic Alliance (NDA) , led by the Bhar atiya Janata Party (BJP) , winning almost a similar number of seats but still far fr om an absolute majority. It was argued that , in a hung parliament, government formation would be very complex as the two parties will have to poach parties from the “Third” and the “Fourth” fronts. The “Third Front” was mobili sed by the Left taking, beside s others, former NDA coalition partners such as Telegu Desham Party (TDP), led by Chandrababu Naidu of Andhra Pradesh; the All India Anna Dravida Munnetra Kazhagum (AIADMK) , led by Jayalalitha from Tamil Nadu ; and the Biju Janata Dal (BJD) , led by Navin Pa tnaik from Orissa. This group wanted to form a non -Congress , non- BJP government. The “Fourth Front” comprised former UPA partners, the Rastriya Janata Dal (RJD) of Lalu Prasad Yadav, the Lok Janshakti Party (LJP) of Bhola Paswan and the Socialist Party (SP ) of Mulayam Singh Yadav. They continued to claim affiliation with the UPA, though they had fallen apart from the Congress on the distribution of seats to be contested. They wanted to contest a larger number of seats on their own so as to strengthen their position in the post -election bargain within the UPA.

    Working Papers: 64 : Globalisation and South Asian Insurgencies: With Special Reference to the Tamil Tigers and the Nepal Maoists

    S. D. Muni 10 June, 2009
    Conceptually, globalisation is a process that has been evolving and unfolding itself for centuries. The spice trade, the Silk Road, colonialism and unregulated migration of people from one country to another were all parts of its various stages. However, globalisation, as is understood in the contemporary international relations studies, is only two decades old or even less. South Asian insurgencies, in this sense, are older than the emergence of globalisation as the buzzword in contemporary international politics and studies.

    Working Papers: 63 : The Roots of Bangladeshi National Identity: Their Impact on State Behaviour

    Iftekhar Ahmed Chowdhury 10 June, 2009
    The growth of the consciousness of the Bengali Muslims as a distinct social and political entity that found fruition in their carving out for themselves a separate and sovereign state in 1971 was the product of a historical evolution over a period of two centuries. Their past experience is important in as much as it continues to condition their external behaviour pattern even in contemporary times.

    Working Papers: 62 : Reshaping of the Global Economy: The Dawn of the Asian Century?

    Shahid Javed Burki 9 June, 2009
    This is a bad time for the world economy and it is an even worse time for the western financial system. However, this is a good time to speculate about the future shape of the global economic system and also how Asia may influence the shape of things to come. Is the current crisis a mere interruption in the process of global economic change that began a decade and a half ago when, with the process of globalisation exerting its force, the structure of production and the structure of international trade began to change? These changes propelled some large emerging markets, most of them in Asia, to the centre of the global economic stage. Or are we seeing, as some analysts have maintained, a change that will inevitably result in directing the global economy towards the direction it was taking before the current crisis began to take its toll? Some analysts have said that the “rise of the rest” – Fareed Zakaria’s phrase3 – may not, after all, actually be a rise but a temporary phase in the evolution of the global economy. They believe that the opportunities offered by globalisation will become constrained as the world’s rich countries make adjustments to the crisis that started in 2007 and is likely to turn the corner in 2010.4 I happen to agree with Zakaria

    Working Papers: 61 : South Asia: Overcoming the Past, Meeting the Challenges of the Present and Availing the Opportunities of the Future

    Shahid Javed Burki1 9 June, 2009
    This paper is the introductory chapter of a forthcoming book on the proposed title "Can Regionalism work for South Asia?" The book is a collection of essays in which individual pieces stand alone as contributions to the ongoing debate on South Asia's changing position in the global economy and in the evolving international political order. However, the essays can be read together as a book since one set of themes - an overall logic - constructs a case for how South Asia could take advantage of the rapid changes in the global economic, social and political systems. However, for that to happen, the countries in the region will have to discard the weight of history and work together as a region rather than as individual countries pursuing their separate interests.

    Working Papers: 60 : India’s Economic Engagement with Southeast Asia: Progress and Challenges

    Amitendu Palit 4 June, 2009
    The dynamics of India's economic engagement with Southeast Asia must be comprehended in the light of the contrasts existing in both India and the Southeast Asian region. India's states differ widely in demographic features, markets and natural resource endowments. Their populations vary from 60,000 (Lakshadweep) to 191 million (Uttar Pradesh). Per capita incomes also show fairly high dispersion, ranging from US$157 to US$1,733.3 Similarly, Southeast Asia comprises a diverse group of economies with different economic structures and levels of development. While the populations in these economies range from as low as 396,000 to 225 million, per capita incomes vary from US$215.60 to US$35,206.4

    Working Papers: 59 : The Tibetan ‘Uprising’ 2008: India’s Response

    S. D. Muni 1 June, 2009
    Tibet is a critical issue in the complexity of Sino-Indian relations. The criticality of this issue arises not only from the geo-strategic location of Tibet between China and India3 but also from the historical context of evolving Sino-Tibetan relations, and the humanitarian and cultural dimensions of this relationship. The criticality of Tibet’s link with China’s far-flung and restive western region of Xinjiang and the unresolved nature of Sino-Indian border make Tibet a potential flashpoint of conflict between India and China, just as Taiwan is a potential flashpoint in China’s conflict with the United States in the South China Sea.

    Working Papers: 58 : The New Democratic Wave and Regional Cooperation in South Asia

    S. D. Muni 19 May, 2009
    The South Asian region has experienced a democratic resurgence in the recent past. This has happened when countries in Africa and Asia have suffered a setback. According to the latest Freedom House Annual Report (2008), 34 countries performed poorly on the indicators of freedom and only 14 countries showed an improvement compared to 2007 (The National, 15 January 2009).3 West Asia and North Africa remained stagnant whereas sub-Saharan Africa and Central Asia suffered setbacks. If one looks at Southeast Asia, Myanmar continues to frustrate the democratic aspirations of the people and, even in Thailand, political developments have not been conducive to a healthy and sustained growth of democracy.

    Working Papers: 57 : India and Pakistan – The Economic Stand-Off

    Sajjad Ashraf 18 May, 2009
    Beginning as a single economic entity, Pakistan and India have drifted apart since their independence in 1947. The resumption of normal economic relations is now dependent upon the easing of the political stand-off between the two countries. Even though the leadership of both countries speaks of normalisation, the conditions attached by each are seemingly impossible to meet. And yet, there is a slow movement towards restoring direct trade links between the two countries. In Pakistan especially, politically-motivated opposition to the resumption of economic relations with India is particularly strong. In addition, Pakistani business houses used to making money based on an inefficient industry thwart the flow of cheaper goods from India. Consumers suffer. Following the laws of business and necessity, smuggling and third-party trade between Pakistan and India still makes up a substantial part of the two-way trade. The state loses revenue.

    Working Papers: 56 : Prospects for Afghanistan-Pakistan Relations

    Shakti Sinha 21 April, 2009
    Afghanistan-Pakistan relations and their implications for the wider world have been extremely complicated, much more than what should be normal bilateral relations between two neighbours. Relationships between any two countries, not just neighbours, are multifaceted but rarely are they so enmeshed as to make a bowl of spaghetti look simple. Relations between Afghanistan and Pakistan have been impacted by developments outside their borders and held hostage to developments spilling across their borders. Increasingly, Afghanistan has been at the receiving end, not unusual for an underdeveloped state with a weaker economy.

    Working Papers: 55 : State Building and Stabilisation in Afghanistan – Design Constraints to Effectiveness

    Shakti Sinha 15 April, 2009
    Afghanistan’s failure to stabilise continues to trouble Afghans and non-Afghans alike, since the consequences of earlier efforts led to unimaginable consequences. Researchers of many conflict-ridden societies cite the failure to govern as being ‘one of the main reasons for the spread of alienation, militancy and insurgency’, and identify the failure to govern to include the failure to provide basic facilities. This paper takes a look at the structure of the government that has emerged in post-Taliban Afghanistan, specifically whether its essential feature, a strong unitary state rooted in an executive presidency and a weak legislature with its unique electoral system, is conducive to establishing peace, stability and inclusive governance in the country. This would be examined with reference to the state- and nation-building experiences of modern Afghanistan, defined as the state which emerged after the second Afghan War (1878-1880), and the effect of the prolonged conflict over the past three decades. The impact of foreign interference, a lot of which has been direct [Russian invasion, Pakistani support for the Mujahideen in the 1980s and the creation of the Taliban later, United Nations’ (UN)-sanctioned United States (US)-led effort that overthrew the Taliban and continuing today] and the Afghan reactions to these interferences has had a major impact on the internal dynamics of governance as well as on the credibility of the state, not easily captured in formal structures.3

    Working Papers: 54 : Singapore’s Trade with China, Japan and India: Similarities and Contrasts

    Amitendu Palit and Sasidaran Gopalan 16 March, 2009
    Cross-border trade within Asia as well as with the rest of the world has been instrumental behind the emergence of the Asian region as the locus of global economic activity. Within Asia, Emerging Asia, comprising the economies of China, India, Hong Kong SAR, South Korea, Singapore, Taiwan, Indonesia, Malaysia, Philippines, Thailand and Vietnam, has been the most prominent trade entity. The share of Emerging Asia's trade in world trade has increased from 21 percent in 1990 to 34 percent in 2006, with Emerging Asia contributing around 40 percent of the total increase in world trade during the period.


    Working Papers: 53 : India and the World – Economics and Politics of the Manmohan Singh Doctrine in Foreign Policy

    Sanjaya Baru 14 November, 2008
    Apart from the diplomacy around the negotiation of the civil nuclear energy cooperation agreement between India, the 45-member Nuclear Suppliers Group (NSG), and the United States, the other foreign policy pre-occupations of Prime Minister Manmohan Singh have been the diplomacy associated with the building of an East Asian Community; the revitalisation of the South Asian Association for Regional Cooperation (SAARC), with a focus on normalising relations with Pakistan; and increased South-South cooperation, with a focus on development cooperation in Africa. Economic issues have been at the core of each of these initiatives. Singh's primary objective has been to improve the global and regional environment for sustaining India's growth process and overall development.

    Working Papers: 52 : Impact of Trade Liberalisation on the Efficiency of Textile Firms in India

    Sasidaran G. and Shanmugam K. R 9 October, 2008
    This study attempts to empirically investigate the implications of unshackling of the global textile trade, following the complete phasing out of the Multi-Fibre Agreement (MFA) in 2005, on the efficiency of firms operating in the Indian textiles industry. By employing the Stochastic Coefficients Frontier Approach, it estimates the overall and input specific efficiency values for 215 sample firms during 1993-94 to 2005-06. Results of the study show that the average efficiency declined over the years, indicating the presence of inefficiency in using inputs. We argue that the Indian textile firms failed to utilise their inputs efficiently during the phase of liberalisation which, if done, would have helped them to withstand and overcome the intense competition from other players like China. Given that there is a paucity of empirical studies dealing with efficiency of the Indian textile industry in the light of phasing out of the MFA, this study seeks to fill such gaps in the available literature.

    Working Papers: 51 : Mineral Fuel and Oil Trade between India and Singapore: Trends and Issues

    Amitendu Palit 9 October, 2008
    Bilateral merchandise trade between India and Singapore is growing at a robust pace. During the period 2003 to 2007, bilateral trade grew at an annual average rate of 32.5 percent. There are several factors driving this rapid increase in trade. These include a pick-up in the trend rate of growth of IndiaÔÇÖs gross domestic product and high import demand from a buoyant Indian industry, deeper penetration of Indian exports in Singapore market2 and an enabling trade framework provided by the Comprehensive Economic Cooperation Agreement (CECA).

    Working Papers: 50 : Coalition Politics in India: Types, Duration, Theory and Comparison

    E. Sridharan 23 September, 2008
    This paper is an attempt to compare and analyse the distribution of types, and the relationship between types and duration, of coalition and/or minority governments in India with those in long-standing democracies against the findings of the theoretical and comparative literature on coalition governments. Written in the context of (a) six consecutive hung parliaments since 1989, and the emergence since 1996 of very large coalitions of 9-12 parties; (b) the extreme paucity of systematic scholarly work on coalition politics in India, the focus of this paper is on the limited issue of coalition government types and duration, in comparative perspective.1 I also examine the use of an alternative definition of a coalition government that might be more meaningful in understanding party behaviour in the Indian context, and perhaps other large-coalition contexts.

    Working Papers: 49 : The Political Economy of the Middle Classes in Liberalising India

    E. Sridharan 22 September, 2008
    This paper is an update with new data to analyse the composition of the middle classes in India in the middle of the first decade of the twenty-first century, building on an earlier paper that was based on 1998-99 data, to understand the political sociology of economic liberalisation in India; specifically, to analyse whether the middle class, on balance, would support economic liberalisation, or support some policies in the process while tending to resist others, and why.1 The hypothesis is that the middle class is not straightforwardly a support base for economic liberalisation as often assumed, but that the larger the public employee and subsidised farmer component of the middle class, however defined, the more resistant it will be to at least some facets of economic liberalisation such as privatisation and de-subsidisation.

    Working Papers: 48 : Understanding India’s Regional Initiatives within Asia

    Rupa Chanda and Sasidaran G 15 August, 2008
    In the past two decades, most economies in the world have entered into various kinds of regional and bilateral agreements. These include free trade agreements, preferential trade agreements, economic cooperation and economic partnership agreements, among others, and are between countries with similar as well as vastly different levels of development, and both within and across regions. Since 1995, the number of notifications of such Preferential Trading Agreements (PTAs)2 to the World Trade Organization (WTO) has proliferated with the number exceeding 220 in 2005.3 However, the number of PTAs that have not been reported to the WTO is even larger. Of those that have been notified, a total of 185 agreements were concluded between 2000 and 2007 alone, or just under half the total number of agreements that were concluded during the entire twentieth century, indicative of the spurt that has been witnessed in regional integration in recent years

    Working Papers: 47 : Justice Delivery in India – A Snapshot of Problems and Reforms

    Bibek Debroy 31 July, 2008
    In attaining higher gross domestic product growth rates, legal reforms are now recognised as a critical ingredient. The Indian legal infrastructure needed reforms in any case, even if the post-1991 cycle of economic reforms had not occurred. However, liberalisation has provided an additional trigger. The word “law” has various interpretations. Consequently, the expression legal reform also needs to be pinned down. There are three layers in legal reform. First, there is an element of statutory law reform and there are three clear elements to statutory law reform – weeding out old and dysfunctional elements in legislation, unification and harmonization, and reducing state intervention. Second, legal reform has to have an administrative law reform component, meaning the subordinate legislation in the form of rules, orders, regulations and instructions from ministries and government departments. Often, constraints to efficient decision-making come about through administrative law rather than through statutory law and bribery and rent-seeking are fallouts. Finally, the third element of legal reform is what may be called judicial reforms, though faster dispute resolution and contract enforcement are not exclusively judicial issues.

    Working Papers: 46 : India-singapore Trade Relations

    Amitendu Palit 16 June, 2008
    Singapore is India's fourth largest export market and the country's biggest trade partner among the Association of Southeast Asian (ASEAN) states.2 The ASEAN countries account for 9.5 percent of India's total commodity exports. Within ASEAN, Singapore alone absorbs 4.5 percent of India's exports. On the other hand, Singapore is India's 10th largest source of imports. At present, it accounts for 3.27 percent of India's total commodity imports

    Working Papers: 45 : India’s Attempts at Regional Integration with South Asia and East Asia

    Bibek Debroy 26 May, 2008
    We begin this introductory section with a brief sketch of the South Asian background. The South Asian Association for Regional Cooperation (SAARC) is the largest regional organisation in the world, with India, Pakistan, Bangladesh, Sri Lanka, Nepal, Maldives, Bhutan and Afghanistan (since 13 November 2005) as members, and with China,3 Japan, South Korea and the European Union granted observer status and distant prospects of Iran eventually becoming a member.4 The present eight member states have5 a combined population of 1.47 billion, compared to the world population of 6.56 billion in 2005. Had the SAARC been counted as a single political entity, it would have been the largest entity in the world, judged according to the population criterion. India with 1.12 billion (17.07 percent of world population), Pakistan with 165.8 million (2.53 percent of world population) and Bangladesh with 148.96 million (2.27 percent of world population) are among the ten most populous countries in the world. Interestingly, in 1907, the global population was estimated to be 1.7 billion and British India (India, Pakistan, Bangladesh and Myanmar)6 chipped in with 264 to 314 million. To come back to the point, the SAARC region is the 7th largest land area in the world. National gross domestic products (GDP) are in home currencies and, for comparison purposes, have to be converted into a common currency, the typical numeraire being the United States dollar. This conversion can be done using the official exchange rate7 or purchasing power parity (PPP), the latter incorporating the idea that non-tradeables like services are relatively cheaper in developing countries and relatively more expensive in developed countries and conversions must take this into account for a fair comparison to be made. In PPP terms, the overall SAARC GDP was US$4,074 billion in 2005, making the SAARC the third largest economic entity in the world, after the United States and China

    Working Papers: 44 : Financing Rural Renewable Energy: A Comparison between China and India

    Huang Liming 23 May, 2008
    This paper analyses the current status of rural renewable energy in China and India, develops and employs an analysis framework to study the environment, channels, instruments and innovative mechanisms of financing rural renewable energy in China and India, and makes a primary comparison.

    Working Papers: 43 : Trade, Restructuring and Labour: A Study of the Textile and Apparel Industry in India

    K.V. Ramaswamy 8 May, 2008
    This paper investigates the impact of trade liberalisation and industrial restructuring on labour in India's textile and apparel industry. India has liberalised its trade policy and industrial regulations since 1991. This reform process has had industry-specific features that are often overlooked. They are particularly striking as in the case the textile and apparel industry. This industry, by its sheer size, in terms of employment, had always occupied an important place in the state policy that shaped its structure and in turn its performance over the years. What are the salient features of reform policies with respect to the textile and apparel industry? What are the features of the 'restructuring' that has taken place in the reform years? How this restructuring has impacted the local labour markets? What types of jobs have been created? Which segment of the textiles and apparel industry have prospered and benefited workers at the same time?

    Working Papers: 42 : Levels and Composition of Public Social and Economic Expenditures in India, 1950-51 to 2005-06

    R. Ramakumar 4 May, 2008
    This paper is concerned with analysing changes in the levels and composition of spending by the state in India on the social and economic sectors. This analysis is undertaken for the Central government and the State (provincial) governments separately. The “functional classification” of expenditures in the budget documents is used as the basis for the analysis. While the broad period of analysis in the paper is 1950-51 to 2005-06, there would be special emphasis on understanding changes in expenditure patterns in the 1990s and 2000s.

    Working Papers: 41 : From Condemnation to Strategic Partnership: Japan’s Changing View of India (1998-2007)

    Purnendra Jain 10 March, 2008
    Japan’s strong response to India’s nuclear testing in May 1998 sent the bilateral relationship to its lowest point in the postwar period. Loud condemnation, nationally and internationally, and the imposition of economic and diplomatic sanctions by Japan against India, produced a bumpy relationship through the late 1990s. Prime Minister Yoshiro Mori’s visit to India in August 2000 was a lubricant for smoothing relations considerably and set the precedent for visits to India by his successors Junichiro Koizumi (2001–2006) and Shinzo Abe (2006–2007). All three prime ministers preceding the current Prime Minister Yasuo Fukuda offered firm hands of friendship to India, with 2007 marking a bilateral Year of Friendship. The Japanese leaders sought to strengthen bilateral ties through new initiatives and programmes ranging from economic and cultural linkages to defence and security.

    Working Papers: 40 : Commodity Boom and Inflation Challenges for Bangladesh

    M. Shahidul Islam 6 March, 2008
    Following the low inflation regime in the 1990s and early 2000s, many economies (net commodity importing countries, in particular) around the world are now facing exorbitant price hike in fuel and non-fuel commodities. The current wave of inflation has been eroding purchasing power of the low and middle income people in Bangladesh, as they need to pay much higher bills for food grain and other commodities. The Exchequer of Bangladesh, which absorbs the petroleum price hike significantly, is also under severe pressure as oil prices are now hovering around US$100 a barrel in the international market. According to the Bangladesh Bureau of Statistics, the overall inflation in Bangladesh was 8.66 percent on 12- month annual average and 11.21 percent on point-to-point basis in November 2007; whereas the food-inflation hit 13.83 percent in the same period. The concerned authorities in Bangladesh have taken several measures to contain the current inflation. However, some of their measures have proven to be countervailing and the ongoing inflation in the economy shows no sign of restrain.

    Working Papers: 39 : The Challenges of Institutionalising Democracy in Bangladesh

    Rounaq Jahan 6 March, 2008
    Bangladesh joined what Samuel P. Huntington had called the “third wave of democracy”1 after a people’s movement toppled 15 years of military rule in December 1990. In the next 15 years, the country made gradual progress in fulfilling the criteria of a “minimalist democracy”2 – regular free and contested elections, peaceful transfer of governmental powers as a result of elections, fundamental freedoms, and civilian control over policy and institutions

    Working Papers: 38 : Do Foreign Direct Investment Inflows Benefit the Major Sectors in India?

    Maathai K. Mathiyazhagan Dukhabandhu Sahoo 18 February, 2008
    Total foreign direct investment (FDI) inflows into India reached Rs.706.30 billion (US$15.73 billion) in 2006-07, with the largest share coming from Mauritius, followed by the United States, the United Kingdom, the Netherlands and Singapore. The sectors that received the largest share of total FDI inflows between August 1991 and March 2007 were electrical equipment and the services sector, accounting for 18.77 percent and 17.84 percent of total FDI respectively. These were followed by the telecommunications, transportation, fuels and chemical sectors.

    Working Papers: 37 : The Geopolitics Of Energy Security And Implications For South And Southeast Asia

    Rajiv Sikri 11 February, 2008
    The geopolitics of energy in today's world principally revolve around oil and, to a lesser degree, gas, both of which are not merely trading but geopolitical commodities. Global energy geopolitics will be principally shaped by the 'arc of energy', stretching from the Gulf region to the Caspian Sea, through Siberia and the Arctic region to the Russian Far East, Alaska and Canada. It is in this region that nearly 80 percent of the world's oil and gas, including potential reserves, are located. Asian countries, having the world's most dynamic economies, and comprising half the world's population, will remain dependent on energy from this arc. They will also be the principal consumers of energy from this region in the coming decades. The already complex traditional geopolitics of this region, marked by myriad inter-state disputes and instability, have been immensely further complicated by energy geopolitics and created enormous tensions and potential deadly conflicts.

    Working Papers: 36 : South Asia – Social Development: Country Perspectives and Regional Concerns

    Shobha Raghuram 30 January, 2008
    In this paper we present an overview of the social development profiles of the countries in the South-Asian region whose specific features we outline. Then we consider the region as it stands today in terms of contemporary development standards. The number of people afflicted by poverty and human deprivation is overwhelmingly large in South Asia - a region already marked by high internal migration, military conflicts and the attendant loss of life, and critical issues of livelihood and human rights. Out of the total of 1.3 billion absolute poor people in the world, 433 million live in South Asia. There are more people living in poverty in South Asia than the combined population in poverty in Sub-Saharan Africa, the Arab States, East Asia and the Pacific (excluding China), and Latin America and the Caribbean. Illiteracy rates in South Asia are two-and-a-half times these rates in the rest of the developing world: the adult-literacy rate in South Asia is 48 percent, the lowest in any region of the world. The proportion of malnourished children is three times as high and access to health-care facilities is one and half times as low as global averages for these figures of deprivation and destitution. Women in South Asia endure one-third of the world's maternal deaths. We focus on such standards of development in the countries of South Asia; and we trace the relationship between poverty and democracy here, and the roles of states and civil society in reaching high standards of governance. The situation in South Asia poses new challenges for the development of policy responses for the problem of poverty here.

    Working Papers: 35 : India’s Rise in the New Economy: Implications for Labour

    Jayan Jose Thomas 25 January, 2008
    This paper is an attempt to understand the key opportunities and challenges to Indian labour in the new, globalising economy. India is today a favourite destination for outsourcing of service sector jobs, particularly jobs in the information technology (IT) sector. There are also encouraging reports about India's growing expertise in high-technology industries. However, the concerns are many. The jobs created in India in the IT sector are not large enough to make a dent in the problem of unemployment and underemployment that the country faces. It is feared that multinational companies (MNCs) will corner the bulk of the benefits from the new economic changes, including outsourcing, and this will further erode the bargaining strength of labour globally. The rules for international trade, particularly the TRIPS agreement, have produced undesirable outcomes on firms and the poor in developing countries. They have triggered unprecedented levels of rural distress in many parts of India; they also threaten growth prospects of technology-intensive industries in India.

    Working Papers: 34 : The Skilled South Asian Diaspora and its Role in Source Economies

    Rupa Chanda 22 January, 2008
    Skilled migration has been the subject of much analysis and debate since the 1950s and 1960s. Eminent economists have time and again voiced concerns about the brain drain consequences of skilled migration and the erosion of human resource capacity in developing countries due to skilled migration. Such concerns have led to proposals for a "brain drain tax", that is, a tax on skilled migrants and for the establishment of a World Migration Organisation to manage migration flows in the interests of developing nations. While skilled migration continues and has been on the rise in the past few decades, the thinking on such flows has shifted significantly, away from the concept of brain drain to concepts of brain gain, brain exchange, and brain circulation. More and more countries are now looking at their skilled overseas diaspora as an asset that can be tapped for economic, social, cultural, and political gains. To a large extent, developments in the information technology (IT) sector and the diffusion of technology and knowledge that has been facilitated by diaspora groups in that sector, and the huge growth in remittances and investment flows from expatriate communities into many developing countries lie at the heart of this change in mindset. Hence, from preventing emigration of skilled workers, many governments have turned to examining ways in which they can leverage their diaspora networks and expatriate communities to their own benefit, in addition to exploring ways of better managing migration flows to serve their national interest.

    Working Papers: 33 : Flight to Freedom: Third Country Re-settlement Option for Bhutanese Refugees in Nepal

    Nishchal N. Pandey 16 January, 2008
    The first plane-load of the refugees could be arriving in the United States around the later part of January 2008', said Ellen Sauerbery, United States Assistant Secretary at the Bureau of Population, Refugees and Migration, during her trip to Nepal on 1 November 2007. She was referring to 106,000 Bhutanese refugees living in Nepal, 60,000 of whom the United States has agreed to re-settle on its shores.

    Working Papers: 32 : India in the Global Labour Market: International Economic Relations, Mobility of the Highly Skilled and Human Capital Formation

    Binod Khadria 14 January, 2008
    Beginning as a trickle in the 1950s, the skilled migration to the developed countries, that picked up in after the mid-1960s, gathered force with the more recent migration of the IT workers and, later nurses, contributing to the large presence of skilled Indian migrants in the labour markets of the United States, Canada, the United Kingdom, other European countries, and Australia-New Zealand. The Indian diaspora, which provides the overall basis of the size of this skilled Indian labour force in the global labour market, was estimated to be 20 million at the end of the 20th century and is now thought to have grown to 25 million. These figures also marks a positive reversal of the contemptuous sentiments expressed about the highly-educated or skilled knowledge workers supposedly ‘deserting’ India, as also about the indifference shown by the authorities concerned to the condition of the large scale labour migrants to the Gulf. With the genesis of this indifference rooted in the neutrality of the non-aligned movement spearheaded by Jawarhalal Nehru and later pursued by Indira Gandhi (when the destinations of the earlier Indian labour diaspora were the Caribbean, and South and East Africa), there is a novel international economic relations context here that poses a “double challenge” for public policy in India: one, to recognise and convince its diaspora of the strategic importance of migration, both as a challenge and an opportunity for India to view it as a tool of participation in the global labour market and; two, to rethink the process of human capital formation in India with a transnational perspective, so that it is redefined in terms of average labour productivity at home and incorporates the cooperation and collaboration of the migrants’ destination countries. Section 2 of the study is on the general contextual background of India, highlighting those aspects of the demographic, economic and dynamics of the internal/domestic labour market that have had a bearing on the evolution of the trends and policies of international migration from India that followed. Section 3 is devoted to the skilled and semi-skilled labour migration to the Gulf, beginning mainly as an overflow of the domestic labour market and in the light of the remittances it generates to India with the resultant implications for human capital formation. It also deals with the socio-economic impact of Gulf migration on the states of origin in India, with particular focus on skill and human capital formation in the state of Kerala. Section 4 is devoted to India’s transnational connectivity through high skill migration to the developed countries, including an analysis of how these connectivities have empowered the migrants to create capabilities to participate in the global labour market. In particular, it also highlights the socio-economic empowerment of Indian migrants in the developed-country labour market of the United States. Section 5 deals with the evolution of, and changes in the Indian thinking on migration and the policy debates and public discourse connected with them. Section 6 includes a list of measures undertaken by the Government of India with the aim of strengthening both international economic relations and for the participation of Indians in the global labour markets – mainly for the highly skilled, but also the semi/unskilled. The concluding section is a commentary on whether and how migration has changed society in India; contributed to its economic and social development, and empowered or could empower the country to face the challenge of international economic relations on the one hand and consolidating the base of human capital formation on the other. It also provides a discussion for evolving a methodology of how the Indian diaspora could be reclassified for analysing its role in the global labour market.

    Working Papers: 31 : The Political Economy of Military Rule in Pakistan: The Musharraf Regime

    S. Akbar Zaidi 9 January, 2008
    Writing about a political regime which has been in power for more than eight years at a time when it is at its weakest ever and is caught up in the throes of events and circumstances, largely of its own making one must add, is an intellectually challenging task, yet perhaps, hazardous academically. There is no question that the political events that have taken place since 9 March 2007 when President General Musharraf charge-sheeted Pakistan's Chief Justice of the Supreme Court and made him 'dysfunctional' as Chief Justice, have been unprecedented and of historic proportions, and perhaps may prove to be the second most important event since President General Musharraf took over power in October 1999 and which have had momentous repercussions on his rule and presidency

    Working Papers: 30 : Special Economic Zones In India: Recent Developments And Future Prospects

    Rahul Mukherji 8 January, 2008
    The author would like to thank Mr. Montek S Ahluwalia (Planning Commission, New Delhi), Mr G. K. Pillai (Ministry of Commerce and Industry, New Delhi), Dr S Narayan (Institute of South Asian Studies, Singapore), Dr Subas C. Pani (Ministry of Rural Development, Government of India), Mr L. B. Singhal (Ministry of Commerce and Industry, New Delhi), Mr Sambob (Government of Andhra Pradesh, Hyderabad), Mr Sadhu Sundar (Government of Andhra Pradesh, Hyderabad), Mr Pratap Madireddy (Government of Andhra Pradesh, Hyderabad), Mr P K Tripathy (Unitech, Gurgaon), Mr Ganesh Raj (Ernst and Young, New Delhi), Mr D. Madhu Babu (IL&FS, Hyderabad), Mr Velmurugan (Government of Tamil Nadu, Chennai), Mr Ajit Singh (Government of Singapore, Chennai), Ms Lee Lorling (Government of Singapore, New Delhi), Mr O. P. Vijayan (Ministry of Commerce and Industry, Chennai), Mr T. S. Vishwanath (Confederation of Indian Industry, New Delhi), Mr B. K. Subbiah (Mahindra World City, Jaipur), Mr B. P. Acharya (Government of Andhra Pradesh, Hyderabad), Mr Pradyumna Kumar (Gitanjali Gems and Jewellery, Hyderabad), Mr T. Wellington (Government of Tamil Nadu, Chennai), Mr M V Lawrence (Nokia SEZ, Sriperumbudur), Ms Madhumathi Kumar (Government of Tamil Nadu, Chennai), Mr M. S. Murthy (Kakinada SEZ, Hyderabad), Mr N. Sathya Moorthy (Observer Research Foundation, Chennai), and, Mr T. Sunil Reddy (Sri City SEZ, Hyderabad) for their valuable insights. My students, Mr Siddharth Pathak and Ms Priyanka, assisted in this research paper. The Institute of South Asian Studies provided valuable support and encouragement.

    Working Papers: 29 : India-Myanmar Relations – Geopolitics and Energy in Light of the New Balance of Power in Asia

    Marie Lall 2 January, 2008
    In light of India's changing foreign policy over the last decade, Indo-Myanmar relations have also changed radically. The reasons thereof pertain principally to four factors: the economic development of India's North East, India's increased interest in trade with ASEAN, India's search for energy security and increased Chinese involvement in Myanmar. This paper offers an in depth analysis of these issues, drawing on seven weeks of fieldwork during the summer of 2007 and over 50 interviews with officials and academics in both countries. The summary of the fieldwork is listed below. The paper concludes that, although today Indo-Myanmar relations have improved, India has, in essence, been too slow to develop this important relationship and is now loosing out to China.


    Working Papers: 28 : Nepal’s Shaky Peace Process: One Year On

    Nishchal N. Pandey 18 December, 2007
    21 November 2007 marked the first anniversary of the signing of the Comprehensive Peace Agreement (CPA) between the government and the Maoist rebels in Nepal. The signing of the CPA was followed, on 28 November 2006, by another important agreement - that of monitoring the management of arms of both the Nepal Army and the People's Liberation Army (PLA), with the United Nations taking on the responsibility of ensuring that the Maoist combatants remain inside designated cantonments while the Nepal Army stays in its barracks. The principal objective of the CPA and efforts of the United Nations were to bring the Maoist guerrillas into the political mainstream. This was to be achieved through the election of a Constituent Assembly. The end goal was sustainable peace in Nepal.

    Working Papers: 27 : Dynamics of Integration in India’s Policy Making: An Analysis of the Urban and Energy Sectors

    Indu Rayadurgam 20 November, 2007
    Cities and towns are becoming major economic, employment generation and revenue earning centres. These cities also host the maximum percentage of urban population. The contribution of services and industry relative to agriculture is a rough indication of the performance of the urban sector towards the gross domestic product (GDP). Urban Development in India is a state subject and the central government performs an advisory and coordinating role, apart from providing technical and financing assistance for promoting orderly urbanisation. The reason for this has been subtly elucidated in the Eighth Five Year Plan as 'The identification of regional urban systems was suggested on the basis of regional characteristics and the needs and functions of each town in its regional context'.

    Working Papers: 26 : Political Economy Of Iran-pakistan-india (Ipi) Gas Pipeline

    Marie Lall And Iftikhar A. Lodhi 23 October, 2007
    Energy security, meaning the sustainable and uninterrupted supply of energy at all times at an affordable price is in one way or another interlinked with a number of other global issues such as climate change, development, and most importantly armed conflict. Energy security not only affects the economic and foreign policies of countries but shapes regional geopolitics. No matter what alternative energy sources are developed in times to come, hydrocarbons (especially oil and gas) are likely to remain the bulk of energy sources for the foreseeable future. The uneven distribution of supply and demand of hydrocarbons in the world1, along with an unprecedented increase in demand from China, India and Pakistan's rising economies, will have repercussion, not only for the hydrocarbon markets but also for the geopolitics of South Asian region and the wider world.

    Working Papers: 25 : India’s Foreign Policy Priorities In The Coming Decade

    Rajiv Sikri 25 September, 2007
    India's foreign policy priorities in the coming decade will depend, in the first instance, on India's assessment of the likely evolution of the world order. Predictions are fraught with uncertainty. A study of history reveals that events often follow a non-linear path and that present realities and trends are, at best, a rough guide to the future. The world has been in flux for nearly two decades. The fall of the Berlin Wall in 1989 signaled the end of the post-World War II era. This momentous event, full of symbolism, signaled the defeat of the Soviet Union in the Cold War, triggered off the disintegration of sovereign states and emboldened the United States (US) towards triumphal and unilateral behaviour. A decade and a half later, it is clear that there has been no'end of history'. Nor is the rest of the world prepared to accept perpetual US global dominance. However, the casualness and arrogance with which long-established principles of international relations have been cast aside have saddled the world with the disastrous situations in Afghanistan and Iraq, and the global spread of terrorism.

    Working Papers: 24 : Capital Account Convertibility In India: Revisiting The Debate

    D. M. Nachane 24 August, 2007
    It is undeniable that in the last three decades, cataclysmic changes have been underway in the functioning and organization of the world economy. Following Went (2002-03), three changes may be singled out for special attention: (i) A phenomenal increase in the number of global markets for products and services (especially financial services). (ii) A growing role for "footloose"multinationals (a term owing to Reich (1992)) in the global economy. (iii) An enhanced role for supranational organizations (G8, IMF, BIS, WTO, OECD etc.) and regional associations (EU, NAFTA, ASEAN, etc.), with a commensurate emasculation of the role of nation states. While these developments are well recognized, a related phenomenon seems to have attracted relatively little attention viz. the unchallenged sway that the doctrines of new-classical economics1 and monetarism have acquired over the policy advice emanating from academic institutions, international "think tanks" and multilateral bodies. This mould of thinking translates into policy recipes such as export-oriented growth, privatization, deregulation etc. and are religiously followed by many emerging market economies (EMEs) and least developed counties (LDCs), (under "persuasion" from international organizations) with no attention to local conditions. The actual results of such policies are often mixed, and though the success stories are inevitably highlighted, failures tend to get under-reported and attributed to faulty implementation rather than the flawed advice in the first place.

    Working Papers: 23 : Public Investment Reversals, Inequality and Borrowing: Fiscal Policy in India

    Errol D'Souza 22 August, 2007
    With economic growth as a priority goal of the state it is a puzzle as to why public investment declined since the mid 1990s despite no significant reduction in fiscal deficits. This paper advances the proposition that public investment affects the returns to the distribution of factor endowments differentially. The rise in inequality then turns the attention of the state towards redistribution. Even when expenditures are financed by borrowing rather than taxation, increased inequality that creates pressures for redistributive transfers, crowds out public investment. Future income generation gets adversely affected by a reversal of public investment which makes creditors impose borrowing constraints on the state. This can take the form of the enactment of fiscal responsibility legislation.

    Working Papers: 22: Growth and Employment in India: The Regional Dimension

    K. V. Ramaswamy 21 August, 2007
    Regional inequality (spatial inequality) has emerged as a key issue in recent discussions of development policy. States within India differ greatly in terms of economic growth and employment potential. In this paper, I examine some aspects of this regional employment growth in India spanning the period 1983 to 2004/05. My analysis is confined to 14 selected major states in India accounting for 93 percent of the population. My results confirm widening inter-state disparities in income in the first quinquennium of the 21st century a continuation of the trend of the 1990s. Across the 14 states urban bias in employment growth is found with employment in urban areas growing faster than in rural areas. All states are found to be diversifying with the pace of diversification lower in low income states. A positive association is found between initial level of diversification and subsequent employment growth. Geographic concentration of skill labour is observed in the sector financial and business services. Regional employment growth in India is found to be urban, unorganized and low productivity jobs. A positive relationship between initial educational attainment and non-agricultural labour productivity growth is observed. Inter-State disparity in educational attainment is likely to be a binding constraint.

    Working Papers: 20 : Price Controls On Pharmaceutical Products In India

    S. Narayan 19 March, 2007
    In revising its drug pricing policies, the Government of India needs to balance its core responsibility to protect the health and welfare of the Indian people and the Nation's interest in sustaining the continued development of a world-class Indian life sciences capability. It is vital that the citizens of India, particularly the common man, have access to affordable medicines for treating the most common and important disease conditions. This is a core mission for any government. At the same time, unlike most nations, including even the most advanced OECD economies, India is a global competitor in the advanced life sciences. Our pharmaceutical industry is a world leader in international generics markets and has begun making serious inroads in innovative drug discovery. Indian scientists, doctors, and medical researchers have developed important, commercially-successful treatments for disease, including biopharmaceutical inventions which have been patented in the United States and Europe. Indian scientists and researchers populate the laboratories of the major U.S. and European multinational drug companies, and increasingly are being drawn home by opportunities in our own country. Accordingly, any pharmaceutical pricing policy must also advance India's capability to discover and develop advanced medicines

    Working Papers: 19 : Conceptualising The Typologies Of Indian Diaspora In International Economic Relations: ‘tinker, Tailor, Soldier, Spy’, Or A ‘great Off-white Hope’ Of The New Century

    Binod Khadria 26 January, 2007
    Prior to situating the issues of international economic relations, mobility of the highly skilled, and human capital formation in the broader context of "India in the Global Labour Market", I have, in this working paper, attempted to conceptualize some typologies for the Indian 'diaspora' as players or actors, and international relations as their playground or the field - an attempt that would help clearly defining and delimiting the universe of discourse .

    Working Papers: 18 : Knowledge Economies In India, China And Singapore

    Jayan Jose Thomas 26 January, 2007
    Recent news reports have frequently described India and China as "rivals and partners." 1 India and China are today experiencing some of the fastest rates of economic expansion in their recent histories. The two countries are often seen as rivals, racing with each other on the basis of their most visible source of competence: abundance and low cost of labour.2 However, economic advantages arising out of low labour costs are ephemeral, likely to last only until snatched away by a competitor country offering still lower wages. The real source of competence in the world economy lies in innovation. Therefore, for both India and China, performance in technology-intensive or knowledge-intensive industries will be the crucial test for long-term success.


    Working Papers: 17 : Infrastructure Strategies For Export Oriented Manufacturing And Service Zones In India

    Professor N. Viswanadham 16 October, 2006
    Manufacturing and service industries are now global and several transnational product and service companies have emerged over the last two decades. The advances in modular product design and flexible production process technologies, distributed organisational structures with multinational human resources, rapid advances in global transportation and information technology, combined with lowering of trade barriers by various countries have led to the proliferation of these company networks. Of these four issues, the last two are infrastructural and policy related issues and are in the domain of national governments. From the point of view of the company, wealth creation occurs when the products are competitive in the market and the economic policies and infrastructural issues are only a means towards this end. Thus policy-making should not be done in vacuum but with the due consideration to the product and the companies.

    Working Papers: 16 : Food & Retail Chains: Case Study Of Andhra Pradesh And Punjab

    Professor N. Viswanadham 9 October, 2006
    Andhra Pradesh comprises of 23 districts and has three well-defined regions viz., Telangana, Rayalaseema and Coastal Andhra. Geographically, it is the fourth largest state (276814 sq. km) in India. It is situated on the globe in the tropical region between 12014 and 19054 North latitudes and 76046 and 84050 East longitudes and is bordered by Maharashtra, Chhattisgarh and Orissa in the north, the Bay of Bengal in the East, Tamil Nadu to the south and Karnataka to the west2. The State has a coastline of 974 kilometres. It occupies 8.34 percent of the country’s geographical area and supports 7.37 percent of the country’s population (Census 2001). Andhra Pradesh is the fifth largest by population and has a population of 7.69 crore. Sixty-three percent of the total population is from rural areas. Andhra Pradesh's gross state domestic product for 2005 is estimated at $62 billion in current prices. Andhra Pradesh is a predominantly services economy: • 49 per cent of the total GDP comes from the services sector • Industry accounts for 27 per cent of GDP • Agriculture accounts for 24 per cent

    Working Papers: 15 : Food And Retail Chains In India

    Professor N. Viswanadham 6 October, 2006
    The time has come for Indian retailing. The signals are there all over. The newspapers, business press, the governments, the Chief Executive Officers of large corporations, all talk about it day in day out. The Indian economy is likely to continue its steady growth with enhanced share in global trade and steady agricultural outputs. Booming employment opportunities, rising urban disposable income and credit card ownerships, changing lifestyles and demographic profiles all are showing a favorable skew towards a rising consumerism culture, boding well for retailing growth. Consumer spending is clearly set to accelerate its pace. Demographics continued to show a positive skew to spur retailing growth. Consumers groups aged between 20-45 years are emerging as the fastest growing consumer group and the mean age of Indians is now pegged at 27, a mean age that reinforces spending across all the retailing channels of grocery, non-grocery and non-store. India's burgeoning middle class will drive up nominal retail sales through 2010 by 10 percent per annum. At the same time, organised retail is becoming more important. At present organized retail accounts for a mere 3 percent of the total; by 2010 this share will already have reached 10 percent. Thus most of India's growth in retail is in the future, not the past.

    Working Papers: 14 : Destination India For The Pharmaceutical Industry

    Dr Alka Chadha 4 October, 2006
    The drugs and pharmaceutical industry has an important place in the Indian economy due to its positive technological spillovers to other sectors of the economy. The industry grew at 7.2 percent and contributed 1.3 percent to the gross domestic product in 2004. It recorded US$4 billion in domestic sales (about 1.5 percent of the global pharmaceutical sales) and over US$3 billion in exports in 2003-04 (Government of India, Economic Survey, 2004-05). Thus, the pharmaceutical industry is a sun-rise industry with vast opportunities for both the domestic and foreign players. With the changes in the regulatory environment regarding patent laws, the spotlight is now on India for contract research, joint ventures and alliances.

    Working Papers: 13 : East Asia Summit And India

    S. D. Muni 3 October, 2006
    There is little dispute about the rise of Asia as the most dynamic region in world politics. This region accounts for nearly 60% of the world's more than 6.1 billion population and nearly $30bn of GDP that outweighs that of Europe. Asia commands global attention both for its economic growth (and potential for growth) as also the security challenge. Economic growth of the region is led by China and India, but many other economies are also growing fast. In security terms, it is not only the main theatre for the pervasive and, what seems to be an unending, global war on terrorism, but also is the region of persisting and protracted political and ethnic conflicts and insurgencies. Asia also poses the challenge of global security for being the continent where most of the emerging and aspiring nuclear weapon states are located. And then, there is the most haunting spectre in Asia of poverty and inequality, democratic denial and distortions, failed and failing states, human rights abuses and spread of HIV/AIDS and Avian Flu.

    Working Papers: 12 : Investing In The Indian Special Economic Zones A Background Paper

    Rahul Mukherji and Aparna Shivpuri Singh 30 May, 2006
    The Institute of South Asian Studies (ISAS) Background Paper describes the evolution and salient features of the Special Economic Zones (SEZ) Act (2005). It notes that substantial benefits accrue to these zones in the form of tax concessions, customs facilitation and policy stability. In return for these benefits, the Act stipulates that commercial units within an SEZ be net foreign exchange earners during a block of five years, beginning from the first year of commercial operations. This means that commercial units within an SEZ should earn US$1 over and above domestic sales during a five-year commercial period. The paper throws light on the definitional issues and regulatory concerns of the developers and commercial units operating within an SEZ. First, there are no clear benchmarks for successful implementation in the Act for developers. This grey area in the Act should redound to the advantage of a Singapore investor because the Ministry of Commerce and Industry (MOCI) will look at these issues on a case-by-case basis. The benchmarks need to be stated in the developer's plan to be approved by the Board of Approval located within MOCI. Profits to be made on the real estate side could be allowed if MOCI is convinced that enough is being done to develop the processing area and for attracting export oriented units. The regulatory checks on successful project implementation of commercial units within an SEZ are unlikely to increase transactions costs if the units are net foreign exchange earners. - Dr Rahul Mukherji is a Visiting Research Fellow at the Institute of South Asian Studies, an autonomous research institute within the National University of Singapore, and an Assistant Professor at the Centre for Political Studies, JNU. He can be contacted at isasrm@nus.edu.sg. Ms Aparna Shivpuri Singh is a Research Associate at the same institute. She can be contacted at isasas@nus.edu.sg. 1

    Working Papers: 11 : Appraising The Legacy Of Bandung: A View From India

    Rahul Mukherji 8 May, 2006
    This paper was presented at a conference on the theme, "Bandung Revisited: A Critical Appraisal of a Conference's Legacy", organised by the Institute of Defence and Strategic Studies, Singapore. It will be published in an edited volume on the legacy of Bandung. I am grateful to Evelyn Goh, Amitav Acharya, Sumit Ganguly and Partha N Mukherji for suggestions. I thank Tan See Seng for his prodding and patience. Anjali Mukherji provided timely editorial advice. My students Siddhartha Mukerji and Anvita Bhuvan helped with various aspects of the research. The Institute of South Asian Studies, Singapore, chipped in with valuable resources that aided the completion of this paper. The errors that remain are the sole responsibility of the author.

    Working Papers: 10 : Promoting Foreign Investment In India’s Telecommunications Sector

    Rahul Mukherji 4 May, 2006
    This paper explores the political economy of three significant policy decisions taken by the Congress – United Progressive Alliance (UPA) government between November 2005 and February 2006, which have improved the incentives for foreign investment in India’s telecommunications sector. This was a notable departure from the past when policies had clearly favoured domestic investment over foreign investment. The paper argues that these decisions occurred due to the increasing sensitivity of the Department of Telecommunications (DOT) to the needs of the relatively smaller Indian service providers, who were dependent on foreign capital. They were not driven by a crisis of investment or foreign pressure to change policies in India’s telecommunications sector. The political economy of this shift to foreign investment friendly regulations in the telecommunications sector suggests that economic reforms in India can occur in normal times. They depended to a large extent on the nature of the political economy that the ruling party was willing to support.

    Working Papers: 09 : CECA Implementation: A First Look

    Alka Chadha 7 February, 2006
    The Comprehensive Economic Cooperation Agr eement (CECA) was signed between India and Singapore on 29 June 2005 to promote trade and investments between the two countries. For the first time, India has signed an all-enco mpassing economic pact with any country so as to benefit from gains through trade and investment flows in areas of mutual interest. This is also the first time that India has notified a Free Trade Agreement (FTA) under Article XXIV of the General Agreement on Tariffs and Trade (GATT). While, the Agreements relating to goods and services are in accordance with the provisions under the World Trade Organization (WTO), the Agreement on financial services goes beyond the WTO commitments for both India and Singapore.

    Working Papers: 08 : Cost Efficiency Of Public And Private Hospitals: Evidence From Karnataka State In India

    Maathai K. Mathiyazhgan 27 January, 2006
    The main objective of this paper is to analyze the cost efficiency of the public and private hospitals in Karnataka State in India. This is estimated through the parametric and nonparametric methods by using the Hospitals Facility Survey (2004) in Karnataka State. The findings indicate that the choice of econometric approach did not make any significant difference in the results and they are robust. The analysis infers that (a) hospitals (both public and private together in the analysis) are cost inefficient in the State, which is due to technical and allocative system of resources of the hospitals; (b) the private hospitals appear relatively less inefficient than the public hospitals; and (c) the main determinants of the technical and allocative inefficiencies of the public hospitals are due to inappropriate interventions of inpatient days care, share of medical personnel, beds capacity, quality indices, and choice of the locations; while in the case of private hospitals, it relates only to beds capacity and quality indices. It means that the government hospitals will be out of voluntary health insurance schemes, (which are emerging with many options in the State), as a service provider as it lacks the cost efficiency in general and technical and allocative efficiency in particular. It calls for a standardization of public hospitals and improve the quality of healthcare services as an immediate attention in the State. Need based financing through "capitation fee" and an effective alternative payment mechanisms such as user fee with a protected social justice criteria for poor in the public hospitals are the worth considering options in the State. It is also suggested that the private hospitals need to maintain the quality of healthcare services under the emerging competitive environment; otherwise, it would be subject to financial vulnerability since it highly depends on the user fee payment of the patients in the State.

    Working Papers: 07 : Regulatory Evolution in Indian Telecommunications

    Rahul Mukherji 25 January, 2006
    The transformation of a business environment from a government monopoly dominated by the Department of Telecommunications (DOT) to one with private players and corporatized government owned entities like the Bharat Sanchar Nigam Limited (BSNL) in India is an interesting research puzzle. History has the tendency to perpetuate certain trajectories. The puzzle in the Indian telecom story is, how was competition in telecom service provision instituted despite historical advantages for the government's monopoly since colonial times?


    Working Papers: 06 : Impact Of Foreign Direct Investment On Indian Economy: A Sectoral Level Analysis

    Maathai K. Mathiyazhagan 17 November, 2005
    The main objective of this paper is to examine the long-run relationship of Foreign Direct Investment (FDI) with the Gross Output (GO), Export (EX) and Labour Productivity (LPR) in the Indian economy at the sectoral level by using the annual data from 1990-91 to 2000-01. The study uses the Panel co-integration (PCONT) test and the results demonstrate that the flow of FDI into the sectors has helped to raise the output, labour productivity and export in some sectors but a better role of FDI at the sectoral level is still expected. Results also reveal that there is no significant co-integrating relationship among the variables like FDI, GO, EX and LPR in core sectors of the economy. This implies that when there is an increase in the output, export or labour productivity of the sectors it is not due to the advent of FDI. Thus, it could be concluded that the advent of FDI has not helped to wield a positive impact on the Indian economy at the sectoral level. Thus, in the eve of India's plan for further opening up of the economy, it is advisable to open up the export oriented sectors so that a higher growth of the economy could be achieved through the growth of these sectors.

    Working Papers: 05 : Economic Treansition In a Plural Polity: India

    Rahul Mukherji 16 November, 2005
    How did India effect the transition from import substituting industrialization towards trade-led growth, in the context of a plural polity? It is argued that a pro-trade executive orientation at the time of a severe foreign exchange crisis can enable the executive to initiate significant policy change, if the executive takes advantage of the agreement with the IMF. Both the pro-trade orientation and the arrival of the severe foreign exchange crisis in 1991 are explained by tracing the process from India's path of import substituting industrialization. The exogenous shock, a temporary rise in oil prices in 1990, was less significant than the ISI driven fiscal deficit, for generating the balance of payments crisis. Path reversals need not depend largely on an exogenous shock, as a path may have a built-in tendency to get reversed. The argument highlights the strategic nature of the international and domestic bargaining tables and the need to consider them simultaneously rather than additively.

    Working Papers: 04 : Labour in the New Economy: An Indian Perspective

    Jayan Jose Thomas 19 September, 2005
    This paper is an attempt to understand the key opportunities and challenges to Indian labour in the new economy. India is today a favourite destination for outsourcing of service sector jobs, particularly in the IT sector. There are also encouraging reports about India's growing expertise in high-technology industries. However, the concerns are many. The jobs created in India in the IT sector - estimated to reach 2.4 million in 2008 - are not large enough to make a dent in the problem of unemployment and underemployment that the country faces. It is feared that multinational companies will corner the bulk of the benefits from the new economic changes, including outsourcing, and this will further erode the bargaining strength of labour globally. The rules for international trade, particularly the Trade Related Aspects of Intellectual Property Rights agreement, have produced undesirable outcomes on firms and the poor in developing countries. They have already triggered unprecedented levels of rural distress in many parts of India; they also threaten India's growth prospects in technology-intensive industries.

    Working Papers: 03 : Leading the Private Sector into the Indian Health Sector

    Maathai K. Mathiyazhagan 31 August, 2005
    The health sector in India is at the crossroads today. In line with economic progress and liberalisation, Indian states are pushing for reforms in the healthcare sector. The private health sector’s market size in India is enormous. It contributes to almost 4.2 percent of GDP of India’s total health expenditure (5.1 percent of GDP). In 2001, the ratio of hospital beds to population was 7 beds per 1,000 people. The public hospitals contributed 4 beds per 1,000 people. The ratio of physician to patients is 1:1,000 and every auxiliary nurse midwife has to serve around 4,707 people in the rural areas in India. Further, Indians travel on the average of seven kilometres for the physical accessibility of a primary health centre.

    Working Papers: 02 : Understanding Growth Opportunities in Indian States

    S. Narayan 29 August, 2005
    The recent Comprehensive Economic Cooperation Agreement between Singapore and India, the first such agreement that India has signed with any country, offers a unique advantage to businesses and industry in Singapore to be part of this growth process in India. Taking advantage of these opportunities, however, requires a deeper understanding of how things work in India, and the investment climate in different states of this vast country.

    Working Papers: 01 : Singapore – India Comprehensive Economic Cooperation Agreement: A Summary

    12 July, 2005
    Singapore and India signed the Comprehensive Economic Cooperation Agreement (CECA) on 29 June 2005 in New Delhi, India. It will enter into force on 1 August 2005. The ministers who are responsible for the negotiations under this agreement will meet within a year of the date of entry into force for a review. This document provides a summary of the key provisions of the agreement.