THE INDIAN EXPRESS
- Counting children living with disabilities, in or out of school:
A UNESCO report notes how children living with disabilities are disproportionately left out of the education system in India as compared to the overall proportion of out-of-school children.
Some of its highlights:
78,64,636 children living with disabilities in India, making up 1.7% of the total child population. Proportion among boys (1.81%) than girls (1.58%).
3,68,697 five-year-olds living with disabilities. Of them, 27% attend educational institutions, 72% have never attended any; 1% have dropped out.
61% of CWDs aged 5-19 are attending an educational institution, compared to overall figure of 71% when all children are considered. 27% of CWDs never attended any educational institution, as opposed to the overall 17% for the entire child population.
There is variation among states in school attendance of 5-19-year-olds. Goa and Kerala have a higher percentage of children with disabilities attending schools. Odisha and West Bengal have more children with disabilities dropping out of school than the national average. Over a third of the children with disabilities in the Northeastern states of Arunachal Pradesh, Assam, Meghalaya and Nagaland have never attended an educational institution.
- What to look for in the Budget:
On February 1 this year, Prime Minister Narendra Modi had said: “This is an interim Budget. This is just a trailer of the Budget which, after elections, will take India on the path to development.” As Finance Minister Nirmala Sitharaman rises to present the full-fledged Union Budget for the current financial year, she faces the arduous task of showing the complete picture. On the one hand, voters who have returned the BJP-led government with a resounding majority expect that the full-year Budget would further expand the welfare measures announced in the interim Budget. On the other, India’s economic growth has faltered further since the presentation of the interim Budget, making it that much more difficult to come through on those promises.
Lower than expected tax revenues are a spoiler
The first key variable to watch out for is the Fiscal Deficit (as a percentage of GDP). Fiscal Deficit reflects the total borrowing requirement of the government. The previous Modi government had done a reasonable job of limiting fiscal deficit. For the current financial year too, the fiscal deficit had been budgeted at the 3.4% level. However, this number may see some change given the adverse revenue deficit (the excess of revenue expenditure over revenue receipts) for the last financial year.
As the table alongside shows, actual (A) revenue deficit for 2018-19 is worse than the revised estimates (RE) for the last financial year. That, in turn, is largely because of a massive gap of Rs 1.67 lakh crore between the expected tax revenues for the past year and the actual figures. This gap is mainly on account of lower revenues from GST, customs duty and corporation tax. The fall in revenues meant that both the actual revenue expenditure and capital expenditure were lower than the revised estimates for the last financial year.
It is clear that the finance minister would have to shore up total revenues, especially tax revenues, if she wants to meet increased expenditure demands. Without this balancing act, the fiscal deficit for the current year would likely suffer.
Nominal GDP growth is a worry
What makes this job more difficult for her is the fact that India’s economic growth seems to be decelerating; India has already lost its cherished “fastest-growing” major economy tag to China at the end of the fourth quarter in 2018-19 when the real GDP grew by just 5.3% — the slowest in 20 quarters. Almost across the board, observers, including the RBI, have rolled back India’s real GDP forecast for the current year. A crucial variable in this regard is the finance ministry’s assumption of the nominal GDP growth for the current year. The nominal GDP growth (that is GDP growth at current prices) is the most fundamental building block of the Budget-making exercise. The government’s assumption of the nominal GDP growth decides the revenue buoyancy, which, in turn, provides clarity about the possible level of expenditure it can afford, given a pre-stipulated fiscal deficit target. In the interim Budget, then finance minister Piyush Goyal had assumed a nominal GDP growth rate of 11.5%. However, if growth is faltering, this may have to be revised down. Doing so, in turn, would further bring down revenue projections, and by extension, curtail the government’s capacity to spend more. As such, the assumption about the nominal GDP growth is another key variable to watch out for in this Budget.
What about the welfare schemes?
Apart from these major macroeconomic variables, there are four key categories of data that would be keenly observed given the political economy surrounding them.
The first relates to the expected dividends from India’s central bank. For while now, the government and the RBI have been at loggerheads about the level of dividends that the RBI needs to provide the national exchequer.
The second relates to the overall disinvestment proceeds the government hopes to raise this year. This is crucial not just because of the monies that any disinvestment would bring but also for the signal it provides about the new Modi government’s intent to reduce government ownership in the broader economy.
The third and related category is the overall budgetary allocation towards the recapitalisation of public sector banks. Again, not only will it have a bearing on the overall fiscal deficit and the government capacity to fund social welfare scheme, but also provide a window into the mind of the new government’s approach towards reforming inefficient public sector banks.
The last category would have to be the allocations to the flagship schemes of the first Modi government. In the last five years, and especially in the last two, the previous government had announced several welfare schemes such as PM-KISAN (direct income transfers for small farmers), income tax exemptions (for the lower middle class), pensions for the workers in the unorganised sector as well as the Ayushman Bharat scheme for providing healthcare cover to the poor. However, the allocations in many such schemes were considered inadequate in relation to the ambitious targets that had been set for them. For instance, for Ayushman Bharat, which is arguably the world’s largest health insurance scheme as it seeks to provide health insurance of Rs 5 lakh to 10 crore poorest families (that is 50 crore individuals), the current Budget allocation of Rs 6,400 crore is hardly enough.
- Economic survey rightly recognizes the main challenge: Reviving private investment:
For an economy in slowdown mode, the key to reviving the growth momentum is private investment, which is a function of the “animal spirits” of entrepreneurs. One must give credit to the Finance Ministry’s Economic Survey, unveiled a day before the presentation of the Narendra Modi government’s first Union Budget in its second innings, for recognising this basic truth. Although it does not explicitly admit it, the Indian economy is, indeed, today caught in a vicious cycle of investments not happening on the ground, jobs drying up and, in turn, impacting income and consumption. This is the opposite of what happens in a virtuous cycle, where “investment, productivity growth, job creation, demand and exports feed into each other and enable animal spirits in the economy to thrive”. The Survey is right that the macroeconomic stability indicators — whether pertaining to inflation, external current account or even fiscal balances — are much better than they were five years ago and it is time to “shift gears” to enable an average annual real GDP growth of 8 per cent for India to become a $5 trillion economy by 2024-25. But the key driver for it is investment — more specifically, private investment.
But how does one get firms to invest, which is ultimately a forward-looking activity? It basically requires the upfront costs of a project to be less than the present value of the expected rewards from the investment. The Survey has pointed out — which may not be in sync with the Reserve Bank of India’s views, at least till recently — that real rates of interest in India have increased significantly over the years and are high even on cross-country comparison. There is, therefore, need to lower the cost of capital. Further, it has argued that the country only needs a “mildly positive real rate”, which will not necessarily lead to lower savings. Savings are driven primarily by demographics and income growth: Both of these are favourable for India, given a rising proportion of its working population that will both earn more and save more.
There are other useful suggestions by the Survey that may be worth considering. The first is a redesign of tax policy, including for start-ups. High tax rates on corporate profits and notices received by new economy companies on angel funding from venture capital investors are certainly not a good idea. They need a complete review, especially in the current context where animal spirits are low. Reviving those spirits will present the biggest and most immediate challenge for the Modi government as it begins its second term.
- Constitutional concessions have failed to facilitate the Valley’s assimilation with India. The rules of engagement need to change.
It has been nearly three decades since the separatist movement in Kashmir, simmering beneath the surface right from the accession of Kashmir in 1948 itself, turned into a full-blown armed insurgency. It is a conflict that has led to three-and-a-half wars as well as this insurgency that is well into adulthood. Kashmir has been the stage for two nuclear armed neighbours to play their own 21st century blood-soaked version of the Great Game. It is a game that has been encouraged by, and has in equal measure, exasperated the great powers that have jostled for space and primacy through the Cold War and the post Cold War international order. Like Berlin, Beirut and Afghanistan, Kashmir too has come to occupy a strange place in geopolitics. Each one of us imagines and inhabits a different version of Kashmir. Not just geographically, but metaphorically too, Kashmir stands at the intersection of many different forces. Any solution that aspires for lasting peace has to grapple with this complexity. In the middle of this strategic and historical jigsaw puzzle, we who fight for the idea of India in Kashmir face some tough choices.
To get a first-hand feel of its contradictions, all one has to do is drive through the length and breadth of the Valley. There are daily traffic jams in Srinagar. The major highways and other arterial roads are choked with traffic. The entire Valley, especially the metropolitan area of Srinagar, is buzzing with construction activity. Barring the most remote mountains, all the dwellings that I have seen are twin storeys and made from construction materials that signal a minimum standard of economic well-being. Whatever is driving the militancy in Kashmir, it is certainly not economic deprivation.
On the flip side, armed personnel wearing different shades of the uniform are visible at all major intersections and at major intervals on the national highways. Every few days, fierce gun battles take place in the few hotspots of South Kashmir. The moulvis keep spewing bile against India by reading out from sermons scripted for them by their handlers in the ISI. The Joint Resistance Leadership keeps calling for bandhs. However, post Pulwama and Balakot, the response to these bandhs has been muted. It is almost as if there is a collective, though muted, realisation that pushing things beyond the brink between India and Pakistan would be a disaster for the Valley. The bulk of the militant struggle appears to have shifted to social media. As on date, the jihad in Kashmir is 90 per cent virtual and 10 per cent real. This has to be the most unusual war zone that has seen almost three decades of violence and unrest. It is a puzzle where the pieces are constantly changing shape so that they never quite fit together.
Undoubtedly, these years of insurgency have extracted a terrible toll in human lives. As per official records, nearly 50,000 people have lost their lives. This includes nearly 23,000 militants, nearly 6,000 security forces and over 20,000 civilians. Clearly, this level of violence has imposed terrible costs, human, social and economic, on all sides. The current status quo, with its high levels of deployment by Indian security forces, and the occasional spectacular terror strike by jihadi terrorists, cannot be our final destination in Kashmir.
Broadly speaking, there are three options before us in Kashmir. The first is what I call the attrition-driven approach. In this approach, India does not make any changes to the constitutional relationship with Kashmir. But it maintains an unrelenting security posture in the Valley. That is to say the current status quo, which requires an extensive and expensive counter insurgency grid in Kashmir, is the lesser evil of all possible scenarios. According to this school of thought, India can easily live with the current level of casualties and economic costs involved in maintaining our presence in Kashmir. Eventually, the expectation is that a war-weary and traumatised population will tire out. It is further hoped that the lack of local support caused by weariness will persuade the jihadi separatists and their mentors in Pakistan to back off and the insurgency will fade away.
The second approach is one advocated by a very vocal section of our intelligentsia and civil society. I call it the abdication approach. According to this view, India has a very weak legal and moral case in Kashmir. It sees Kashmiris as perpetual victims and the Indian state and its agencies as permanent villains. Therefore, lasting peace in Kashmir can be achieved only by conceding all the demands of Kashmiri separatists, which may range from complete autonomy to outright independence or merger with Pakistan. This approach glosses over the views of the people of Jammu and Ladakh. It also ignores the repercussions for the idea of India. What impact would the secession of Kashmir have on other sub national aspirations based on ethnicity, language, and religion? And given that Islamist ideology has been a key driver of the militancy in Kashmir, what would it do to Hindu-Muslim relations in the rest of the country? The aftermath of such a separation would make the original Partition of India, with its million casualties, look like a picnic.
The third approach is one that was completely off the table for the first 70 years of independent India but is increasingly talked about. I call it the assimilation approach. It rests on the belief that the separatist sentiment that has been a feature of Kashmiri politics since 1948 and the militancy that has raged in the state since 1990, both draw sustenance from the constitutional arrangements, namely Articles 35 A and 370, that have defined Kashmir’s relationship with India. Without dismantling this structure, separatism and militancy will always strike a chord among a large section of the population in the Valley. Together, these Articles have frozen the demography and politics of the state and skewed it in favour of the Muslim majority from the Kashmir Valley. Some of them favour azadi, some favour a merger with Pakistan. And almost all of them have an issue accepting the idea of India. Unless this structural dominance of the Valley is dismantled, no amount of operational successes can end the raging fire of insurgency in Kashmir.
I would argue that the time has come to seriously consider the merits of the third approach. Could it lead to a period of extremely violent public protests in Kashmir? Probably. Does the Indian nation-state have the economic heft, the military resources and the international clout to get a grip on this prolonged period of unrest? Most certainly. It is heartening that for the first time in our general elections, the legal status of Kashmir occupied centrestage in public debate. The resounding mandate given to the government also appears to be a clear preference for altering the fundamentals of Kashmir’s relationship with India. The concessions agreed upon at the time of accession of Kashmir to India were given in the expectation that they would facilitate Kashmir’s complete assimilation. The four decades of separatist politics and three decades of violence that have followed prove that it was an unrealistic expectation. The time has come to change the rules of engagement, not just militarily, as we saw with Balakot, but also constitutionally. The idea of India cannot be held indefinitely hostage to the petulant fantasies of azadi.
- Geopolitical leverage is no more limited to a few countries. India too can project its soft power, take smart, fast decision:
Till the Soviet Union collapsed in 1989, it was a simpler world. There were two superpowers. Militarily, it was clear that no country could challenge either of them and the superpowers were very wary of each other. Both the countries competed ceaselessly in space and their nuclear might was unassailable. Economically, the US’s strength was on display but till the early Eighties, the economic power of Soviet Union was largely assumed, till it imploded. The US had much greater soft power with Hollywood movies, sports dominance and terrific universities that accepted the best from other countries; the Soviet Union lagged in soft power other than in the Olympic medals tally.
In such a world, countries aligned with one or the other superpower to different degrees. Post World War II, Japan, Germany and the UK were closely aligned to the US and other western European nations were also in the US camp through NATO. India’s non-alignment post Indira Gandhi became Soviet Union-leaning and the US moved closer to Pakistan as a check on the Soviets who had taken control of Afghanistan. One could have argued India made a bad choice, but frankly, we were not very exciting to the US and strong Soviet backing to India after the 1971 war allowed the liberation of Bangladesh.
The Nineties were a tough time in India. The collapse of the Soviet Union left us weak internationally and our economic policies had taken us into a major balance of payments crisis in 1991. This was a blessing in disguise as it forced us to review both our economic policies and our global alignments. With an IMF assisted structural adjustment programme, many parts of the economy were liberalised. After the initial pain, we slowly moved away from the import substituting industry model we had followed and became a more market-friendly economy.
The complete collapse of Afghanistan post the Russian retreat destabilised the country not least because of the actions of Pakistan, Saudi Arabia and US to install a friendly regime. In this mess, the Taliban emerged, much to the detriment of the world. This unfettered meddling in Afghanistan converted an anti-Soviet sentiment into an anti US (or more broadly anti-foreign sentiment) and led to the creation of Osama Bin Laden. The 9/11 attacks followed and with it the reassessment of Pakistan as an ally by the US. The ISI’s activities with al Qaeda and Taliban isolated Pakistan substantially at a time when India was looking for new friends and its economy started to look interesting.
THE HINDU
ISRO should embrace a civilian identity and, aided by legislation, form partnerships with the Industry and entrepreneurs:
rom a modest beginning in the 1960s, India’s space programme has grown steadily, achieving significant milestones. These include fabrication of satellites, space-launch vehicles, and a range of associated capabilities.
Today, the Indian Space Research Organisation (ISRO)’s annual budget has crossed ₹10,000 crore ($1.45 billion), growing steadily from ₹6,000 crore five years ago. However, demand for space-based services in India is far greater than what ISRO can supply. Private sector investment is critical, for which a suitable policy environment needs to be created. There is growing realisation that national legislation is needed to ensure overall growth of the space sector. The draft Space Activities Bill introduced in 2017 has lapsed and the government now has an opportunity to give priority to a new Bill that can be welcomed by the private sector, both the larger players and the start-ups alike.
ISRO’s thrust areas
Since its establishment in 1969, ISRO has been guided by a set of mission and vision statements covering both the societal objectives and the thrust areas. The first area was of satellite communication, with INSAT and GSAT as the backbones, to address the national needs for telecommunication, broadcasting and broadband infrastructure.
Gradually, bigger satellites have been built carrying a larger array of transponders. About 200 transponders on Indian satellites provide services linked to areas like telecommunication, telemedicine, television, broadband, radio, disaster management and search and rescue services.
A second area of focus was earth observation and using space-based imagery for a slew of national demands, ranging from weather forecasting, disaster management and national resource mapping and planning.
These resources cover agriculture and watershed, land resource, and forestry managements. With higher resolution and precise positioning, Geographical Information Systems’ applications today cover all aspects of rural and urban development and planning. Beginning with the Indian Remote Sensing (IRS) series in the 1980s, today the RISAT, Cartosat and Resourcesat series provide wide-field and multi-spectral high resolution data for land, ocean and atmospheric observations.
A third and more recent focus area is satellite-aided navigation. The GPS-aided GEO augmented navigation (GAGAN), a joint project between ISRO and Airports Authority of India, augmented the GPS coverage of the region, improving the accuracy and integrity, primarily for civil aviation applications and better air traffic management over Indian airspace. This was followed up with the Indian Regional Navigation Satellite System (IRNSS), a system based on seven satellites in geostationary and geosynchronous orbits.
It provides accurate positioning service, covering a region extending to 1,500 km beyond Indian borders, with an accuracy greater than 20 metres; higher accuracy positioning is available to the security agencies for their use. In 2016, the system was renamed NavIC (Navigation with Indian Constellation).
With growing confidence, ISRO has also started to undertake more ambitious space science and exploration missions. The most notable of these have been the Chandrayaan and the Mangalyaan missions, with a manned space mission, Gaganyaan, planned for its first test flight in 2021. These missions are not just for technology demonstration but also for expanding the frontiers of knowledge in space sciences.
None of this would have been possible without mastering the launch-vehicle technology. Beginning with the Satellite Launch Vehicle (SLV) and the Augmented Satellite Launch Vehicle (ASLV), ISRO has developed and refined the Polar Satellite Launch Vehicle (PSLV) as its workhorse for placing satellites in low earth and sun synchronous orbits. With 46 successful missions, the PSLV has an enviable record. The Geosynchronous Satellite Launch Vehicle (GSLV) programme is still developing with its MkIII variant, having undertaken three missions, and is capable of carrying a 3.5 MT payload into a geostationary orbit. Compare this to the French Ariane 5, which has undertaken more than 100 launch missions and carries a 5 MT payload, with an Ariane 6 in the pipeline for 2020.
Developments in Artificial Intelligence (AI) and big data analytics has led to the emergence of ‘New Space’ — a disruptive dynamic based on using end-to-end efficiency concepts. A parallel is how the independent app developers, given access to the Android and Apple platforms, revolutionised smartphone usage. New Space entrepreneurship has emerged in India with about two dozen start-ups who are not enamoured of the traditional vendor/supplier model but see value in exploring end-to-end services in the Business-to-Business and Business-to-Consumer segments. However, these start-ups have yet to take off in the absence of regulatory clarity.
- New Space’ start-ups
The New Space start-ups discern a synergy with government’s flagship programmes like Digital India, Start-Up India, Skill India and schemes like Smart Cities Mission. They see a role as a data-app builder between the data seller (ISRO/Antrix) and the end user, taking advantage of the talent pool, innovation competence and technology know-how. They need an enabling ecosystem, a culture of accelerators, incubators, Venture Capitalists and mentors that exists in cities like Bengaluru which is where most New Space start-ups have mushroomed.
Equally, clear rules and regulations are essential. ISRO can learn from its 1997 SatCom policy which neither attracted any FDI in the sector nor a single licensee. A similar situation exists with the Remote Sensing Data Policy of 2001, amended in 2011, which too has failed to attract a single application. The 2017 draft Bill raised more questions because it sought to retain the dominant role of ISRO/Antrix as operator, licensor, rule-maker and service provider.
Another revolution under way is the small satellite revolution. Globally, 17,000 small satellites are expected to be launched between now and 2030. ISRO is developing a small satellite launch vehicle (SSLV) expected to be ready in 2019. It is a prime candidate, along with the proven PSLV, to be farmed out to the private sector. This requires giving it responsibility for AIT activities.
Years ago, ISRO launched the idea of Village Resource Centres to work in collaboration with local panchayats and NGOs but only 460 pilots have begun. Expanding this for rural areas is a formidable challenge but has the potential to transform rural India if properly conceived as a part of the India Stack and the Jan Dhan Yojana.
With the Ministry of Defence now setting up a Defence Space Agency and a Defence Space Research Organisation, ISRO should actively embrace an exclusively civilian identity. A new Space law for India should aim at facilitating growing India’s share of global space economy to 10% within a decade which requires a new kind of partnership between ISRO, the established private sector and the New Space entrepreneurs.
- Talking sanctions, Endangering peace:
More than a year ago, the U.S. unilaterally abrogated the Joint Comprehensive Plan of Action (JCPOA) and began to squeeze the Iranian economy using sanctions. The latest round of sanctions were announced in June. Iran announced a week later that it had exceeded a limit set by the JCPOA on its stockpile of nuclear fuel.
The U.S.-Iran conflict is often portrayed in the media as one that involves two flawed actors struggling for supremacy on a complex West Asian stage. But a closer look reveals a simpler underlying reality: the Donald Trump administration is using the U.S.’s clout in an old-fashioned attempt to assert the country’s hegemony; Iran is just doing whatever it can to resist U.S. pressure.
The Shah connection
The roots of this dispute can be traced back to 1953, when the Central Intelligence Agency orchestrated a coup to remove Iran’s elected Prime Minister, Mohammad Mossadegh. After instituting the rule of Shah Mohammad Reza Pahlavi, the U.S. encouraged him to establish a nuclear programme.
The U.S. built Iran’s first nuclear reactor in 1967. The Shah was clear that his ambitions went beyond nuclear energy, and extended to nuclear weapons. In 1974, he explained that Iran would acquire nuclear weapons “without a doubt, and sooner than one would think.” Nevertheless, the West continued to provide nuclear technology to his government.
After the Shah was toppled in 1979, the new government, under Ayatollah Ruhollah Khomeini, cancelled his plans for a large nuclear-energy sector, retaining only those facilities that had already been established. Khomeini also declared that nuclear weapons and other weapons of mass destruction (WMDs) were haram — forbidden in Islam. Whatever one may think about Khomeini’s government, his spiritual injunctions were taken very seriously. When Iraq attacked Iran with chemical weapons, with the tacit support of the Ronald Reagan administration, Tehran refrained from responding in kind despite having the requisite technology.
It is possible that during the Iran-Iraq war, some elements within the Iranian establishment started exploring the possibility of developing a nuclear deterrent. Even if this was the case — and the evidence on the matter is far from conclusive — these activities were definitely stopped by 2003. In the same year, Khomeini’s successor, Ayatollah Ali Khamenei, issued an unambiguous fatwa against nuclear weapons.
Soon after invading Iraq on the false pretext that it had WMDs, the U.S. attempted to build a similar narrative around Iran, which had established a modest programme to enrich uranium to fuel its existing reactors. The U.S. alleged that the fuel was intended for a bomb. These allegations were undercut by U.S. intelligence agencies themselves who reported that “in fall 2003 Iran halted… nuclear weapons… activities”. In 2015, after a multi-year investigation, the International Atomic Energy Agency (IAEA) went further, declaring that “activities relevant to… a nuclear explosive… did not advance beyond feasibility and scientific studies” and, as a “coordinated effort”, were only carried out “prior to the end of 2003”.
In spite of these facts, successive U.S. administrations imposed sanctions on Iran, demanding that it completely halt uranium enrichment. It was only during President Barack Obama’s second term that the U.S. sought a temporary truce, leading to the JCPOA.
The JCPOA recognised Iran’s right to maintain a civilian nuclear programme, but placed significant restrictions on its size and scope for 10 to 15 years. Most importantly, Tehran reiterated that “under no circumstances” would it “ seek… nuclear weapons.” The IAEA was granted unprecedented powers to inspect Iran’s nuclear activities, and has repeatedly verified Tehran’s compliance.
So, when the Trump administration ceased to abide by the JCPOA last year, this could only be interpreted as a message that the U.S. was not interested in arms control, but rather in initiating a direct conflict with Tehran.
An economy devastated
Over the past year, the U.S. has made threats, mobilised troops and warships, and provoked Tehran by flying military planes dangerously close to its border. However, Washington’s primary strategy has been to use economic measures as a weapon. It has prevented foreign entities from trading with Iran, devastating the Iranian economy.
India has also been hurt by these policies. Until recently, Iran was one of India’s largest oil suppliers. Even though Iranian oil came with discounts on freight, and favourable terms of payment, the Indian government obeyed Washington’s dictates and stopped purchasing oil from Iran in May.
India’s investments in Iran’s Chabahar port are nominally exempt from U.S. sanctions, but they have been damaged anyway since suppliers are reluctant to deliver equipment. The sanctions have also prevented ONGC Videsh, which discovered the Farzad B gas field off Iran’s coast, from pursuing its investments there.
Further, New Delhi has refused to explore several available strategies that could ameliorate the impact of sanctions. China has maintained some commercial ties with Iran by routing transactions through the Bank of Kunlun. U.S. sanctions on this bank have been ineffective since it is carefully insulated from the U.S. financial system. European countries have attempted to bypass sanctions through a special mechanism called INSTEX.
It is revealing that India has failed to join any of these initiatives or to develop its own solution. A few months ago, Prime Minister Modi boasted that India’s foreign policy had become “fearless, bold and decisive”. Is this fearlessness restricted to India’s interactions with its smaller neighbours, or is his government also willing to stand up to the biggest bully in the room and protect India’s interests from Washington’s destructive policies?