By Aryaman Bhatnagar
May 23 – India has reaffirmed its willingness to develop Iran’s Port of Chabahar during the seventeenth meeting of the India-Iran Joint Commission in Tehran. With an initial investment pledge of some $100 million, the move further strengthens the emerging partnership between the two countries in Afghanistan.
The Chabahar port is critical to India’s Afghanistan policy. In the absence of direct physical access to the country and a hostile Pakistan denying Indian goods transit, the Iranian harbor is the most viable access point India has to Afghanistan and the rest of Central Asia.
India has already signed agreements with Afghanistan and Iran that grants preferential treatment and tariff reductions to Indian goods bound for Afghanistan and Central Asia at Chabahar. It has helped build the Delaram–Zaranj Highway, which connects Iran to the main Kandahar-Herat Highway in Afghanistan, as well as a road from Chabahar to the Iranian border. Continue reading
Posted in Politics
Tagged India, Iran
By Amit Ranjan
May. 3 – In the Himalayas, two great powers are blaming each other for stirring tension. India says Chinese troops crossed the Line of Actual Control, the de facto border there. China claims it was merely responding to earlier intrusions carried out by Indian border guards. We don’t know who is speaking the truth. But “calculated” political tension has emerged.
The root of the Sino-Indian border dispute lies in the 1914 Simla Accord, signed by India’s British rulers and demarcating the border with Tibet. This “McMahon Line,” named after India’s foreign secretary at the time, is recognized by India but disputed by China which insists that Tibet was not a sovereign power. China invaded and conquered Tibet in 1950. Continue reading
Op-ed Commentary: Dr. David A. Owen
Apr. 19 – Every investment opportunity carries certain risks. Properly assessing these risks, however, can be difficult. A unique risk for those interested in investing in China is its neighbor, North Korea. How does one assess the potential risk of a seemingly unstable neighbor as in the case of North Korea? More specifically, how much risk does Kim Jong Un’s recent castigations actually pose for those interested in investing in China and the stability in East Asia at large? The answers may not actually be that complex.
North Korea has maintained a hostile posture in East Asia since its formation. During this entire period North Korea has been antagonistic towards South Korea, a self-proclaimed enemy of Japan (arguably not without cause considering historical relations) and a thorn in China’s side since at least the moment North Korea transitioned from a communist regime to one with more dictatorial attributes. Even though Sino-North Korean relations are not as hostile as the former two, they are still quite constrained, characterized by North Korean dependence on China and Chinese tolerance of an undesirable border state. Continue reading
The five-point formula put forth by newly-elected Chinese President Xi Jinping to bolster bilateral relations with India signifies once again that Beijing is increasingly going for a semblance of stability in relations with its largest neighbour, without making any strategic concessions on contentious issues.
By Reshma Patil
Mar. 25 – China’s new leadership wants to improve economic relations and maintain the uneasy pre-2008 status quo on strategic disputes with India. This message came through in the first policy statement on India from China’s new President Xi Jinping.
Xi’s five-point foreign policy proposal on India is overall a friendly overture in familiar wording. It is not a new or innovative policy shift. The statement signifies once again that Beijing is increasingly going for a semblance of stability in relations with its largest neighbour, without making any strategic concessions on contentious issues. Continue reading
Chinese premier Li Keqiang speaks with Peter Bonfield, chief executive of BRE Group, a British consultancy and research company, in Watford, England, January 12, 2011 (Department for Business, Innovation and Skills)
By Nick Ottens
Mar. 19 – China’s new premier promised on Sunday to launch a “self imposed revolution” to relax the state’s heavy grip on the management of world’s second largest economy which should also reduce corruption on the part of public sector workers.
Speaking in Beijing, Li Keqiang admitted that the process will be difficult.
“Nowadays, stirring up vested interests is more difficult than stirring up one’s soul. But no matter how deep the water is, we must wade through because we don’t have other options. It’s our nation’s fate and future that are at stake.”
Li made few concrete commitments beyond reducing regulations by a third, echoing the words uttered by his predecessor, Wen Jiabao, who called for continued “reform and opening up” of the economy in his final policy address to the National People’s Congress on Tuesday. Continue reading
Refuting all claims of a shrinking defence budget, the Indian Finance Minister announced a 5% increase in the defence budget for 2013-14. Coming at a time of increasing defence spending, and more recently, allegations of corruption during procurement, how can India put the new budget to effective use?
By Aakash Brahmachari
Mar. 5 – In an effort to dismiss any talk of compromising on defence, the Budget for 2013-2014 has increased India’s Defence Budget by 5% from last year to Rs. 2,03,672 crores ($42.5 billion). This includes Rs. 86, 741 crores ($16 billion) on arms acquisitions which is a hike of 9% over last year. Even as this will ensure India remains a leading arms importer, it will be a welcome relief if these purchases are not tainted by allegations of corruption.
Reports from the ‘Choppergate’ scandal indicate that middlemen were paid about Rs. 162 crores ($30million) to swing the decision in AgustaWestland’s favour.
This is worth about 4% of the Rs. 3,700 crores ($750 million) deal. A quick calculation reveals that if the rate of commission remains constant, middlemen stand to make Rs. 215 crores ($40 million) for every Rs. 5, 375 crores ($1 billion) worth of Indian arms acquisitions. In other words, though the new budget worth Rs. 86, 741 crores may be spread across different deals, it can still potentially net middlemen a commission of Rs. 3,440 crores ($640 million). In a nation of 1.2 billion citizens, that amounts to each citizen sharing a burden of about Rs. 20 ($0.5) for these commissions. Continue reading
Feb. 27 – The Chinese state news agency Xinhua has reported that Chinese troops have been undergoing intensive training near Yunnan’s border with Myanmar as fighting intensifies between Myanmar’s Government forces and the Kachin separatists. Some military shells have already landed in West Yunnan, leading China to step up its surveillance of the deteriorating situation.
Burmese civilians in the region have apparently been seeking shelter from family and friends in Yunnan to escape the fighting.
Peace talks have been held both in Chiang Mai in Thailand and in China’s border city of Ruili, however no progress appears to have been made by either side.
Training by Chinese troops has been stepped up following Chinese New Year with forces being urged to be “battle ready” and prepared for “real combat”, according to Xinhua. Continue reading
For the latest political news and analysis from South East Asia, visit 2point6billion.com. Stories are contributed by the foreign direct investment experts at Dezan Shira & Associates, who have offices in China, India and Vietnam.