Archived Bulletin

Issue No.46 of 2018

Issued on Nov. 25, 2018

China’s poverty reduction vs others’

by Neelam Deo, Director, Gateway House

Source: https://www.gatewayhouse.in/the-poverty-reduction-experience-examined/

China recently celebrated 40 years since it began its successful poverty reduction effort, at a conference in Beijing. While lauding China's efforts, experts do recognise that different formulations work for different countries.

On November 1-2, a conference on poverty reduction, ‘International Forum on Reform and Opening Up and Poverty Reduction in China’, was held in Beijing as part of the Chinese government’s elaborate celebrations to mark 40 years since Deng Xiaoping (1904-97) opened up the economy. In that time, over 700 million people have been lifted out of acute poverty into the middle class in China. That is an achievement worth recognising and reviewing. And the Forums organisers, the China Development Bank, the National Institute for Global Strategy of the Chinese Academy of Social Sciences (CASS) and the International Poverty Reduction Centre in Beijing, did just that.

In a display of its clout with international financial institutions, the opening ceremony had a message from the secretary general of the United Nations, followed by a keynote address by Jim Yong Kim, president of the World Bank Group. Other notable speakers at the opening included Jin Liqun, president of the Asian Infrastructure Investment Bank, and K.V. Kamath, President of the New Development Bank (NDB).

I had the opportunity to participate in one of the Forum’s sessions which focused on the Chinese experience of
poverty reduction as well as the efforts underway in other developing countries.

My panel had the clunky and somewhat mystifying title, “Poverty Reduction in the New Era: China’s Poverty Reduction Concepts and Innovative Practices”. Almost all the invited panelists were from Africa and Asia, with no representation from the developed countries – perhaps because they have not endured abysmal poverty for decades now. The invitees, me included, expressed admiration for the Chinese achievement, unprecedented in human history, through the early focus on reforms in agriculture, education and health.
The Chinese participants attributed their country’s achievements to the wisdom of the Chinese Communist Party, particularly the current president Xi Jinping. They explained the government’s current strategy of “precision targeting”, which involves drilling down to identify the counties, and even individuals, remaining in poverty, and working on their upliftment. This strategy is expected to enable China to achieve the Sustainable Development Goal – the total eradication of poverty by 2020 – ten years ahead of schedule.

Since most of the remaining 30 million poor are in remote minority provinces, such as Xinjiang and Tibet, the Chinese experts explained the need to “change mindsets”, and “change geographies” along with vocational training. This sounded uncannily like the explanations the Chinese government is offering to counter widespread media reports of the incarceration of very large numbers of Uyghurs in vocational and reskilling camps in Xinjiang.

I spoke of how the Indian government’s role in poverty eradication has been critical in bringing down the Below the Poverty Line (BPL) population to less than 20% in 2018. But over time other stakeholders from civil society, corporations and religious organisations and Non-Resident Indians (NRIs) supplemented the government programmes in diverse areas including health, education, empowerment of women and employment generation.

Thus, while successive governments brought in legislation, conferring “rights” to food, education, housing and clean water, the instruments of intervention have evolved in collaboration with diverse players, and latterly, through the application of new technologies for improved distribution systems.

The Mid-day Meal Scheme is a prime example of collaborative efforts. First launched in Tamil Nadu in the 1970s by then chief minister M.G. Ramachandran as a political freebie, it successfully improved the health and
education outcomes of children, especially girls. It also helped reduce the rate of population growth by raising the age at which girls were married and went on to have fewer children.

This idea has since been taken countrywide: NRIs from the IT sector who made good in the U.S. adopted it under the rubric of the Akshay Patra scheme. They first worked on improving the targeting and delivery processes. Then they expanded the coverage to around two million children by working with local institutions in 12 of India’s 29
States.

Another example is the transformation of one of the oldest poverty reduction measures undertaken in India – the Public Distribution System – by which successive governments tried to provide poor families food grains at highly subsidised rates. Unfortunately, only a fraction of the benefits did actually reach the deserving poor, with malnutrition remaining stubbornly high, especially among women and children. After a prolonged debate on the provision of benefits in kind (food) versus direct benefit transfer (money), the current government is using fintech to bring together the opening of bank accounts (Jan Dhan) for all with a Unique Identification number (Aadhaar) and transfer of financial benefits through mobile phones (JAM).

The government has increasingly involved Corporate India in poverty reduction, calling upon over 5,000 large firms to spend 3% of net profits on philanthropic projects, principally in the health, education and skilling areas. The Corporate Social Responsibility Act, which was passed in 2013, has helped formalise and scale up the welfare schemes that many companies were already engaged in.

Similarly, in the education sector, religious organisations play a significant role and often receive some financial support from the government. This applies equally to schools run by representatives of all the religions practised in India.
Other foreign experts at the Forum spoke about their own governments’ efforts to reduce levels of poverty. Speakers from war-torn countries emphasised the inescapable need for peace to enable attending to poverty reduction.

An African expert spoke of the new phenomenon of “premature deindustrialisation” due to the pressure to open up under-developed economies to trade, which allowed in a flood of consumer goods. He explained that by destroying small-scale local manufacturing, this also curtailed employment opportunities. The substitution of basic consumer goods with cheap imports was pushing back into poverty families which only a few years ago had managed to climb out of it through heroic individual efforts.

Many speakers emphasised the urgent need to generate employment. Developing countries find themselves with large, rapidly growing young populations. They have more education than their parents, are unwilling to work in agriculture and are unable to find employment in urban occupations. This is a recipe for social unrest.

While the pace of poverty reduction in India has been relatively slow it has been a more broad-based process, involving the government and numerous stakeholders.

Sri Lanka's Clash of Civilisations

by N Sathiya Moorthy, Director, Chennai Chapter of the Observer Research Foundation

Source: http://epaper.deccanchronicle.com/epaper_main.aspx#page111

Sirisena and Rajapaksa, who were both with the centre-Left Sri Lanka Freedom Party (SLFP) at one time, carry
their ‘son-of-the-soil’ imagery on their sleeves against the elite, English-speaking, ‘liberal imagery’
that Wickrermesinghe & Co are not tired of reiterating.

Exactly two weeks after he first plunged the nation into a ‘constitutional crisis’, Sri Lankan President Maithripala Sirisena has done it again, this time by dissolving Parliament, leading to fresh national elections close to two years earlier than due, in August 2020. With this he has at least removed the decisive uncertainty his first act of replacing Prime Minister Ranil Wickremesinghe with predecessor President Mahinda Rajapaksa had plunged the nation into.

At the bottom of it all was the dynamics and chemistry of personal relations between Sirisen and Wickremesinghe, given their socio-economic backgrounds, and also their Left-Right political divisions which continues to have some relevance in the country, decades after the founding nations of communism, namely, the present-day Russia and China, began moving away.

That said, the current crisis was written into the script, authored by the West (?), the day Sirisena defeated incumbent ex-boss Rajapaksa in the presidential polls of January 2015 and swore in Wickremesinghe as Prime Minister in a politically amoral way as his action now has been ‘unconstitutional’ to his critics at the very least. Citing the Sinhala original, which has an abiding supremacy in such matters, Sirisena has already clarified that his current action is sanctioned by the 19th Amendment to the Constitution, whose English version alone Wickremesinghe & Co swore by.
The reigning, Second Republican Constitution of 1978 was even otherwise flawed at inception as it was centred
on the personality of the late JR Jayewardene, then boss of the centre-Right United National Party (UNP) who was also a relation of Wickremesinghe. The more recent 18th and 19th Amendments were equally personality-driven, one to confer more powers and privileges on President Rajapaksa, and the latter to secure Wickremesinghe’s prime ministerial job after then President Chandrika Bandaranaike-Kumaratunga (CBK) had dissolved Parliament and ordered fresh elections before its five-year term, back in 2004. Suddenly, Wickremesinghe finds himself not only jobless but once again rootless, especially in terms of the earthiness of Sri Lankan politics.

Not only do CBK, Sirisena and Rajapaksa belong to the centre-Left Sri Lanka Freedom Party (SLFP), barring the former, other top-rung leaders all carry their ‘son-of-the-soil’ imagery on their sleeves, against the elite, English- speaking, ‘liberal imagery’ that Wickrermesinghe & Co are not tired of reiterating. As Sirisena readily conceded soon after ‘sacking’ Wickremesinghe, this personality problem was among the causes for his drift with his Prime Minister, but then both of them were/are as secretive and deceptive as Rajapaksa has been relatively open. It’s a clash of civilisations, so to say!

Procedural problems
On Sirisena’s unilateral actions, be it of ‘sacking’ Wickremesinghe or now dissolving Parliament, the ‘international community’ (read: West) seems to have been convinced that the President may not be wrong, after all. However, after remaining quiet for a brief while, some of the western envoys whom Sirisena too briefed, like Wickremesinghe before him, began demanding that Rajapaksa face a trust / no-trust vote in Parliament, when it reconvenes after presidential prorogation on November 14. It was in line with Wickremesinghe-led UNP’s line, just as they had refused to acknowledge the latter’s ‘sacking’, earlier.

If Sirisena had originally targeted Wickremesinghe and his ministerial colleagues for usurping the ‘collective responsibility’ of the Cabinet by taking unilateral initiatives, there were reasons. According to his camp followers, Wickremesinghe & Co first committed Sri Lanka to international deals, including those on ‘war crimes probe’ at UNHRC, and the debt-equity swap-deal on Hambantota Port, with China, without explaining the contents in detail to the President and the entire Cabinet.

Even on the more recent Wickremesinghe offer for India to develop the Eastern Terminal of the Colombo Port, post-sacking, the Sirisena camp went to town, saying that the former had no business to give the kind of ‘ unilateral commitment’ he claimed to have given Indian counterpart Narendra Modi. They quarrelled openly in a Cabinet meeting last month, where Sirisena is also reported to have talked about an Indian intelligence agency plotting his assassination — a charge that he denied in a telephonic conversation with Prime Minister Modi.

If this much was on the administrative front, and Sirisena’s ‘sacking’ of Wickremesinghe was on the constitutional front, Speaker Karu Jayasuriya added his own cuppa by shifting gears on the President’s powers in relation to Parliament, at every turn. He first abided by the presidential Gazette notification on Wickremesinghe’s replacement, but soon changed sides, to say that his UNP boss continued to be Prime Minister. Likewise, from Rajapaksa having to prove his majority in the House on day one, he changed sides to say that Wickremesinghe would have to do so.

This gave a psychological advantage to Wickremeisnghe, which was not to the liking of Sirisena as much as it would have been for Rajapakasa. As if to ‘irritate’ Sirisena even more, Jayasuriya met with foreign envoys in his Parliament Chamber and also wrote to them separately, seeking their intervention to ‘restore democracy’ in the country. Sirisena openly declared that Speaker meeting with foreign envoys in a group and on Parliament
premises was not on, and declared that ‘replacing’ the Prime Minister was only one of the ‘weapons’ in his
armour, and he could use many others.

Numbers didn’t add up
There is no denying that despite best efforts, the numbers did not add up for Rajapasksa, despite his being a past master at the game from his first term as President (2005-10). At the time, he caused the cross-over of 20 MPs belonging to Wickremesinghe’s UNP, to bolster his majority and reduce dependence on the 39-member left- nationalist JVP (Janatha Vimukthi Peramuna) ally. He also got the JVP split in the process, taking over its cadre and whatever vote-based into his fold. It did not happen this time.

There is no denying that between the two, Rajapaksa is all for early polls, though not all his MPs and ‘ministerial colleagues’ sworn in by Sirisena (even hours before dissolving Parliament) may or may not share his optimism. In comparison, Wickremesinghe’s UNP optimism derives from the international support it has from the West, and also the traditional urban elite backers, who are shocked as much by a possible Rajapaksa return for a longer term as by Sirisena’s ‘unilateral and unconstitutional’ actions, which they thought was not possible under the 19th Amendment of 2015 — which it has not.

So confident has Rajapaksa been since the nation-wide sweep for his breakaway Sri Lanka Podujana Peramuna (SLPP)-led ‘Joint Opposition’ in the February local government (LG) polls that he even called upon Wickremesinghe to help vote out his ‘mini-Budget’ later this month, the one sure, consensual way to have fresh elections under the amended Constitution. This is because on paper, Rajapaksa’s vote-share and that of Sirisena- led Sri Lanka Freedom Party /United People’s Freedom Alliance (SLFP-UPFA) vote-share in the February polls was a high 52 per cent (even by conservative estimates) against rival UNP’s 30 per cent. Despite the current turmoil and their roles in it, the Sirisena-Rajapaksa duo seems confident of retaining that vote-share in fresh parliamentary polls.

Indian pragmatism
Unlike in shared neighbour Maldives, where India played all its cards in the name of democracy, on the current crisis in Sri Lanka, New Delhi has been holding the cards close to its chest. The return of traditional Indian pragmatism seems to have influenced not only post-Cold War European friends, at least up to a point, of whom some were seen as scaling down their criticism of the Sirisena-Rajapaksa duo, until rumours of imminent dissolution of Parliament began doing the rounds on Friday, November 9.

The very day, India’s spokesman Raveesh Kumar said as much, indicating that New Delhi preferred working with
the Government that Sri Lanka gives itself, without indicating the preferred route — court, Parliament or people
— than jump to conclusions, which may not match the final result, as different from Indian expectations. After all, Sirisena did not meet with the expectations when India reportedly backed him for the presidency, nor was Wickremesinghe as much pro-India as he wanted to be believed, his leadership having readily agreed to the ‘debt- equity swap’ on Hambantota Port with China, without seriously looking at other options!

Japan, India leaders agree to step up defense, economic ties

by Mari Yamaguchi, Associated Press

Source: https://in.news.yahoo.com/japan-india-leaders-agree-step-defense-economic-ties-122750161.html

The leaders of Japan and India agreed Monday to step up their cooperation in defense, trade and a range or other areas amid China's growing influence in the region.

Japanese Prime Minister Shinzo Abe and his Indian counterpart, Narendra Modi, said they are expanding ammunition sales and high-level defense talks and joint military exercises.

"Relations between Japan and India have the biggest potential in the world," Abe told a joint news conference after holding talks with Modi. "A strong Japan benefits India and a strong India benefits Japan." Modi, through an interpreter, responded, "Without India-Japan cooperation, there will be no development in Asia into the next century."

India is one of the countries that Japan has reached out to form defense partnerships, as Tokyo seeks to expand its military cooperation beyond its traditional alliance with the U.S. amid China's increasingly assertive military presence in the region.

Japan in recent years has stepped up defense ties with Australia, New Zealand, the Philippines and other Asia- Pacific nations. Abe and Modi welcomed joint exercises by their ground, sea and air forces and the start of negotiations toward an acquisition and cross-servicing agreement, or ACSA, which would enable sharing of supplies and ammunition between the two militaries as a way to "enhance the strategic depth of bilateral security and defense cooperation."

They also signed a second-phase agreement for a Japanese super-express railway project in India.

Their meeting came immediately after a trip by Abe to Beijing, where he met with Chinese leaders, showcasing their improving relations. The Asian neighbors agreed to cooperate more in areas of common interest and concern. Modi has called for regional unity against protectionism. He arrived Saturday and was invited to Abe's vacation house near Mount Fuji on Sunday for private talks.

Concerns about China's expanding influence on the regional economy and U.S. trade policy are also bringing
Japan and India closer in their economic ties.

The two leaders reaffirmed their commitment to achieve a free and open Indo-Pacific. Abe pledged low-interest loans worth 316 billion yen ($2.8 billion) for seven infrastructure projects in India. Half of the amount would be allocated to the railway project in western India using Japan's "bullet train" technology, according to the signed documents.

Japan and India also discussed joint infrastructure projects in the region, including Sri Lanka.