Gid

AN IIPM THINK TANK & GREAT INDIAN DREAM FOUNDATION JOURNAL
A B&E MONTHLY SUPPLEMENT, JUNE-2011
Great
R E T H I N K E D I F Y
The
DETONATING DRAGON
12
What the Liberals tell us about the rise of China

LAGGING LEGITIMACY
16
Indian Dream
Era of Geo-Political to a sustainable Geo Legal ord Geo-Legal order

NUMBER NUMBS
34
Critical failures in statistical assessment statist and how to avoid them in future
D E L I N E A T E
THE POWER PRISM

THE GROWING POLARIZATION OF THE WORLD THE CAPITALIST BLOCK, THE ISLAMIC BLOCK AND THE COMMUNIST BLOCK
A N A RI N DAM C HAU DH U R I & P L A NMA N ME D IA P R E SE N TATION
Reign of Terror: With the recovery of skeletons near a former ministers residence, questions about CPMs murderous ways come to the fore
on ly
20 1 1 13 JUN - 19 JUN
11 Rs ` 05
DICTATORSHIP OF THE SYCOPHANTS

ARINDAM CHAUDHURI ON THE GOVERNMENTS ION IN THE ACT RAMLILA GROUND
t h e s n a t i o n
t g r e a t e s
n e w s
w e e k l y
RR R TE
WITH THE RECOVERY OF A SKELETONS NEAR S FORMER MINISTER RESIDENCE IN E, WEST MIDNAPOR T BOU QUESTIONS A S CPMS MURDEROUE WAYS TO SILENC OPPOSITION DURING ITS 34YEAROLD REGIME COME TO THE FORE
eign of R
NO.1 IN
S L A N GU A G E H AL R E AC R 14 N E A R T H N I N E G I ON 1 I M AG A Z I N E O NO . ya & Punjabi
REGIONAL REACH
ese, jarati, Marathi, Assam Telugu, Malayalam, Gu il, Kannada, Bhojpuri, di, Urdu, Bengali, Tam In English, Hin
EWS T H E ON L Y N
Ori
SMART INDIAN
The First Newsweekly In Global Media History In 14 Languages!
THE NEW ADDICTION OF THE
IIPM: THE FUTURE IS HERE

Since its incorporation (1973), IIPM has been an institution with privileged traditions, in the diversity of its fraternity, its global outlook, its world class research and its commitment to alternative national economic planning process. It can be said, without much oversimplication that there are no underdeveloped economies. There are only under managed countries. Japan 140 years was ago was an underdeveloped country by every material measurement. But it very quickly produced management of great competence, indeed of excellence. The policy inference is that management is the prime mover and development is the consequence. At IIPM, every one considers that development is a matter of human energies rather than economic wealth. And the generation and direction of these human energies is the task of management. Accordingly, we formed The Great Indian Dream. Unlike any other dream, this is one dream which each one of us are determined to realise and that too in our own lifetimes. Each bit of cynicism and condemnation from pessimists makes us evolve even stronger and determined. All our endeavours and initiative is towards realisation of this dream, where in we produce committed bare foot managers and entrepreneurs who are needed by nation, on an insistent basis. As an educational institute, we aim at initializing a three dimensional personality in IIPMites, viz. Pursuit of knowledge in economics and management Commitment to economic, social, political and technological upliftment of masses and Cultivation of taste for literature, ne arts and etc. Economists often have limited access to the practical problems facing senior managers, while senior managers often lack the time and motivation to look beyond their own industry to the larger issues of the global economy. It has set before it the twin tasks: to reorient education and research towards the needs of both the private and public sectors and to establish the link between the National Economic Planning and the development of private enterprises in Indian economy. IIPM dares to look beyond, and understands that what we teach today, other adopt tomorrow. IIPMs service output (education, research and consulting,) is a unique combination of two distinct disciplines: economics and management. Through this integration, IIPM helps guide business and policy leaders in shaping the Indian and global economy, bringing together the practical insights of industry with broader national and global perspectives. A hall mark of IIPM is that it is armed with the comparative advantage of engaging the committed, passionate and brightest management post graduates and undergraduates, who pursued the education at IIPM and subsequently joined it, to realise the dream. IIPM alumni, spread across the globe, holding crucial decision-making positions in the corporate sector, are bonded by the one ideology of making a positive difference, turning that ideology into a movement itself. The Great Indian Dream is another humble initiative towards the realisation of the same and more distinctly, engaging the broader publics and pertinent stakeholders.
SEARCH, SIEVE, SCHEME...

In economics, like in everyday existence, it is imperative to hear, perceive and consider what others have to say. Each issue of The GID brings together a selection of important contributions on a particular theme, authored by some of the brightest minds in different areas of Indian economics. The provocation for publishing these issues arises from the fact that over the years economic journals have become copious, exclusive and expensive. Most of the journals and a good many of the books have gone beyond the cerebral and nancial reach of general students and other scholars. It is for them that these issues are primarily being raised and debated here. Much about India is transparent enough. One does not require detailed criteria, cunning calibration or probing analysis to pinpoint Indias problems and recognise its antecedents. There is in fact much that is perceptible about India. But not everything about India is even if simplistic is so simple. The learned reader would appreciate the fact that India is like an elephant that looms too large to be grasped within a distinct structure and paradigm the constituent parts of which would fail to reveal the entirety. Obviously and observably, no suggested solution to any protracted and complex socio-economic problem will satisfy all sides and stake-holders evenly. Consequently, there exists an enormous diversity in economic thinking and perspectives, as is also reected in the viewpoints of different expert contributors in this issue. The intended outcome of this exercise is to facilitate the invention, improvement, deliberation and dissemination of innovation in economic thinking and national economic planning, insisting merely on well-grounded, open and unbiased debates, without predetermined outcomes. It is impossible to do justice to the entire eld of Indian economics in a single issue. The topics selected for this issue are those which are of critical and immediate importance to India. Majority of them were freshly and exclusively written. Encapsulated, it is a constructive attempt aimed at helping India actualise its promises and potential. The editors hope that this issue of GID proffer the reader a avour of dynamism and excitement and persuade her/him to participate in the journey towards realising The Great Indian Dream. At the same time, it illuminates the terrible, practical problems of India and Bharat.
ACKNOWLEDGEMENTS
The IIPM Think Tank likes to thank all the internal faculty who have been instrumental in coordinating with many authors all across India and according their unstinted support. The assistance of Prof. R. Krishnan (IIPM Chennai), Prof. Amlan Ray (IIPM Lucknow), Mr. Robin Thomas (IIPM Ahmedabad) and Mr Angshuman Paul has been more valuable than, perhaps, they realise.
CREDITS
FOUNDER : Dr. M. K. Chaudhuri EDITOR-IN-CHIEF: Arindam Chaudhuri MANAGING EDITOR: Prasoon.S. Majumdar DEPUTY EDITOR: Sray Agarwal CONSULTING EDITORS: Prashanto Banerji, K K Srivastava ASSISTANT EDITOR: Mrinmoy Dey RESEARCH FELLOWS: Akram Hoque, Mufaddal Poonawala, Amir Hossain, Sayan Ghosh GROUP DESIGN DIRECTOR: Satyajit Datta SENIOR DESIGNER: Shantanu Chatterjee DESIGNER: Karan Singh, Vikas Gulyani SENIOR ILLUSTRATOR: Shantanu Mitra IMAGE EDITING: Vinay Kamboj PRODUCTION MANAGER: Gurudas Mallik Thakur PRODUCTION SUPERVISORS: Digember Singh Chauhan, Soumyajeet Gupta, Satbir Chauhan CHIEF MARKETING ADVISOR: Amit Saxena THE GID ONLINE: Neel Verma, Anil Kumar Sheoran, Christopher Mani PRINCIPAL OFFICES
Satbari, Chandan Haula, Chattarpur, Bhatimines Road, New Delhi - 110074 IIPM Tower, Junction of , 32nd Road & S.V. Road, Bandra (W), Mumbai - 400 050 IIPM Tower, 419 100ft. Road, Koramangala, Bangalore - 560 034 IIPM Tower, 893/4, Bhandarkar Road, Deccan Gymkhana, Pune - 411 004 IIPM Tower, 145, Marshalls Road, Egmore, Chennai - 600 008 IIPM Tower , 19, Inqulab Society, gulbai Tekra, Off C.G. Road, Ahmedabad - 380 015 IIPM Tower, 6-3-252/2, Erramanzil, Banjara Hills, Hyderabad - 500 082 ADDITIONAL THINKING www.theindiaeconomyreview.org www.iipmthinktank.com www.iipm.edu www.iipmpublications.com www.arindamchaudhuri.com www.thesundayindian.com www.thedailyindian.com www.businessandeconomy.org www.gidf.org www.planmanconsulting.com PRINTED BY: Rolleract Press Servies, C-163, Ground Floor, Naraina industrial Area, Phase-I, New Delhi - 16 DISCLAIMER :
All efforts have been taken to ensure the veracity of the information contained in the research, however the IIPM Think Tank expressly disclaims any and all warranties, express or implied, including without limitation warranties of merchantability and tness for a particular purpose, with respect to any service or material. In no event shall the IIPM Think Tank be liable for any direct, indirect, incidental, punitive, or consequential damages of any kind whatsoever with respect to the and materials, although the reader may freely use the research and material provided, the IIPM Think Tank retains all trademark right and copyright on all the text and graphics.
(F)ACT SHEET
The Tri-polar World: Paradigm Shift in Economic Systems and the New World Order Prasoon S. Majumdar........................................................................................ The 70mm Revolution Sray Agarwal ...................................................................................................... What the Liberals Tell us about the Rise of China Patrick Corcoran................................................................................................. From Geo-Political to a Geo-Legal Order Rabin Majumder ................................................................................................ How Relevant is Huntington Today? Saumitra Mohan ............................................................................... ................ Rise of South-South Economic Flows Raj Aggarwal ...................................................................................................... Global Polarization and the World Order Anand Teltumbde ........................................................................................... The Shifting Power Blocs: Age of New Empires Abdullah Shahnewaz....................................................................................... Critical Failures in Statistical Assessment Dev Kar................................................................................................................. Offshoring and Indias Export Development in Services Klimis Vogiatzoglou.........................................................................................
Cover Design by: Pragnesh Patel
05 06 12 16 18 22 26 30 34 38
We are keen to hear from anyone, who would like to know more about IIPM Publications. You can e-mail on sray.agarwal@iipm.edu or alternatively call at +91 9818244963
THE INDIA ECONOMY REVIEW
Editorial
The First Words and The Last Word
THE TRI-POLAR WORLD: PARADIGM SHIFT IN ECONOMIC SYSTEMS AND THE NEW WORLD ORDER
Prasoon S. Majumdar, Managing Editor
ost the end of the cold war of 90s, the world has gone through a considerable change. The world today is just not divided on the capitalist and communist blocks, but more than that the kind of transformations that has gone about within the champions of either economic systems. No doubt, the world today is more fragmented than what it used to be during the cold war but then the growing polarization of the world is undoubtedly changing the erstwhile power-equations. Besides, challenging the power equilibrium, the emerging blocs are also on a perpetual evolution and that too quite radically. Even couple of decades back it would have been a dichotomous to even think of an socialist America, Capitalist China and a capitalist and democratic Middle East. Who would have ever thought that markets would weigh so heavy on the American economy that President Obama would have to bail it out with a staggering $787 billion stimulus package a phenomenon which was never indoctrinated within the American system. The very concept of market being able to regulate itself with governments meddling with it was challenged upside down. After decades of market driven prosperity, Wall Street went through its worst crashes forcing the government to put the economy back on track. Not just the world but for the rst time, even the Americans observed an alienAmerican-concept of their money being used for bailing multi-billion dollar worth companies a practice that is customary in socialist nations, where the State intervenes to support its sick companies through mobilization of nancial resources. Just like what happened in the United States of America is so non-American, what has been happening in China is so non-Chinese. Post the 1998 nancial crisis, China adopted free market concept to fortify their economy. In the next phase, in 2006 China lifted its IPO suspension and worlds second largest IPO was offered worth $21 billion by the Industrial Bank of China. And eventually in 2007, the Shanghai Exchange appeared out as the second largest stock exchange. Today the private sector owns more than 60 percent of total industrial production. Chinas market revolution has conceptualised a com-
pletely novel model that is a hybrid of socialism and capitalism, albeit with Chinese characteristics. Amidst all these, the recent uprising in Middle-East has brought a paradigm shift in the region. With socialnetworking sites, internet and modern thinking being the cornerstone of the revolution, the region which was akin to autocracy have been increasingly adopting modernity that were historically and traditionally not part of the lifestyle of the region. The rising new middle class, the capitalist mindset, and spirit of freedom, are not only bringing about a new wave in this region but is also transforming the cultural legacy of this region. Turkey, for that matter, is a case in point. Today, Turkey is living example that had correctly struck a balance between cultural & religions values and modern businessfriendly environment. However, the reasons for the ongoing radical transitions could be anything but the agenda is mostly common and that is to consolidate positions in the new world order. For nations who are not directly a part of this process are increasingly forming strong bilateral allegiance with either of these blocks. There is a clear visible and distinct line that has been increasingly evolving between the American, the Chinese and the Middle East blocks. Though the idea is to either retain economic supremacy or to attain the same, is being instrumental in causing this tectonic shift. The new world order or shall I say the three emerging blocks is not only changing the political landscape of the world, but it is also impacting bilateral trade and geopolitics to a large extent. Though it is too early to say, whether it is for good or not so good, but one thing can be said for sure that the poles are moving, and the world is becoming increasingly tri-polar... Happy reading. Best,
Prasoon S. Majumdar
THE GRE AT INDIAN DRE AM
POWER PRISM
THE 70MM REV

Power blocs have exploited their cinemas to the tee to propagate their supremacy some did it successfully and some ignored it at a large
THE IIPM THINK TANK
PATRONISING PROPAGANDAS
EVOLUTION
POWER PRISM
SRAY AGARWAL
Deputy Editor, The IIPM Think Tank
he motion picture industry is not merely concerned with nancial prots and return on investments but is engaged in weaving entertainment to inuence public reaction and opinion on vital issues and latently streamline propagandas. The motion picture is one of those few medium that can create convergence of various senses and present them to promulgate political or diplomatic agendas in form of art, or shall I say entertainment. The African-American director Spike Lee once said about his lms, Im just trying to tell a good story and make thought provoking, entertaining lms. I just try and draw upon the great culture we have as a people, from music, novels, and the streets. American lm industry has always been a front-runner when it comes to worldclass and technologically advanced movies, but they had also been a frontrunner in propaganda-based releases. Hollywood never misses an opportunity when it comes to showcasing history from the US point of view. Movies on incidents like Pearl Harbor and Vietnam War were scripted in a manner that not only established American supremacy but also made the viewers comprehend the entire episode from Americas perception. Tweaking and distorting history and facts to showcase the positivity of American and America as a sole saviour has largely been an agenda of movie-makers in Hollywood. After Cold war movies made by US were all with an aim to portray a need for unipolar world with power nucleus at US. Most of the movie production house drafted scripts in a way that directly or indirectly propagated Americans (or white-skinned people) to be of good morale while black skin to be otherwise. Anything that was wrong always had a link with either Middle-East or communist and at the end it was an
American who came for the rescue. Take for instance, the movie Casablanca which depicted Americans with hitherto unseen bravery and valiant efforts to save hapless Europeans from Nazis and quietly ignored the enormous sacrices made by the Russians and others. The list does not condense here. Movies like Rambo II (and even other Rambo series), True Lies, Top Gun, Black Hawk Down, to name a few, not only showed American version of war and terrorism but also received active support and assistance from military and defence experts. The facts get fortied when one watches movies like Pearl Harbor, Bad Company or The Recruit, all produced under the banner of Walt Disney. All of these movies got huge assistance from the US government, Pentagon and the CIA. And this verity gets even more evident after scrutinising the prole of the Board member John E. Bryson who is also a director of The Boeing Company (one of the US largest defence company) and the Walt Disney Company (one of the biggest movie production house of US). In credit list of the latest ick, the Iron Man, Boeing got a special mention for its special contribution. Disney for that matter requires special reference here. Not only their movies, but even their animation series had pro-American and anti-Arab agendas. Be it cartoon like Aladdin or movie like Finding Nemo, the positive character always had American ascent and were white skinned while the negative character had Arabic ascent (although the language was English) and were black skinned. This was in spite of the fact that never had these characters travelled to US or for that matter had nay linked with American culture. The same is true for almost all their movies and animated series. This entire practice of propagating supremacy touched its height
during the heart of the cold war. Films, in those times, were made with heavy anticommunist themes. In the same light, a series of seven propaganda lms named Why We Fight was released by United States government to justify American involvement in the world war II. Movies like Deterrence (March 10, 2000), not only talks about US nuclear supremacy but its one-sided staunch attitude. The movies concluded with a message that at any point of time, US has right to attack any nation (even nuclear attack) as US is supreme and its US that will eventually win. The last few decades of Hollywood was a part of larger perception-building exercise of US government that not only focused on establishing US supremacy but also tainted other budding nations and lower the morale of various other noncapitalist economies. Hollywood indiscriminately portrayed what America and likes wanted the world to read and the writing on the wall was clear its American way or its wrong. Fighting Americans at par, at least in this sphere, were the communist nations. Communist nations also tapped the same media for propagating their supremacy and establishing their polarity over the world. For the beginning, these two nations aped each other in order to prove themselves more powerful, and this is evident in their movies as well. On one hand where they attacked each others philosophy then on the other hand, they also promoted their own agendas. The baggage of bourgeois was the last thing that the erstwhile communist block nations would have liked as form of art or other component of media. Therefore
THE IIPM THINK TANK
PATRONISING PROPAGANDAS
creators of theatre, art, literature and other forms of creative pursuits invariably struck a dissonant chord with the authoritarian communist regimes as freedom of expression carries with it the seed of opportunity of dissent and consequently must be leashed. Moreover they smell foul of bourgeois culture that was abhorred by the communists. However, the movie was a relatively new medium at the time most communist regimes came to power, and was complementary to their cause of disseminating information and molding the perception of the masses. The communists also pioneered documentary lm production that suited their goal of inuencing their population at a time when media reach was much lower. To lead the way in propaganda lms was Soviet Union. In 1922, Lenin proclaimed that movies were the most important form of art, as it could reach the illiterate masses that otherwise could have been cut-off from Marxist-Leninist propaganda that was so important at that time. Whatever be the motive of Lenin in promoting lm industry, a tortuous hurdle was transpired as Stalin became the general secretary of the central committee and consequently Soviet censorship ofce came into existence! Thus government control and government trajectory was proving to be
HOLLYWOOD INDISCRIMINATELY PORTRAYED WHAT AMERICA WANTED THE WORLD TO READ ITS AMERICAN WAY OR ITS WRONG
complete death knell for creative freedom. Even though Soviet Union started churning out propaganda lms, they were at least futuristic like Soviet Toys released in 1924 by Dziga Vertov which was the rst Soviet animation lm and in the same year the same person produced a 58 seconds animation to provide tribute to Lenin. Later on more animation lms followed with bizarre propaganda against capitalists, with lms like Interplanetary Revolution, directed by Nikolai Khodataev, Zenon Komisarenko and Yuri Merkulov, that showed battle between communists and capitalists in spaceships using ray guns, where communist heroes were blowing up capitalist villains! However with change of guard, and Stalin coming to power; he concentrated on matching American quality in lms, and championing his resolve was Ivan Ivanov Vano who produced classics like The Snow Maiden in 1952 and Someone Elses Voice in 1949. These lms despised Jazz (an important part of American entertainment), and extolled lifestyle of peasants! After Stalins death, the quality of Soviet lms could not match up with the Americans, although the propaganda went on through 1970s and 1980s. The tenor during this period was more resentful as one of the lm showed unemployment and misery in US and superiority of Communism per se! The Communist regime is over long back in Russia and other constituents of Soviet block, but it is enduring in China, with propaganda movies coming out one after another. However, there is a dichotomy in China between Maos era and the more progressive era that followed, the government doesnt know what to do with Maos image - if anything they want to alter that! The outlook of Chinese government has changed from Maos time, and the government wants to portray that through their lms! In 2009, a lm called Founding of Republic was released that commemorated the birth of Peoples Republic and celebrated the victory of civil war by the Communist Party of China. Nonetheless unlike in Maos time they did not demonized Guomindang, though ideological difference was highlighted. In 2010, another lm called Aftershock was released showcasing the peasantry life in the pre-earthquake time that struck China in 1976. A healthy and peaceful life of peasants and laborers form the cornerstone that epitomizes a typical communist regime, which was attributed in the lm. However, it was not shown, that China refused help from outsiders in the earthquake, even though it did not have the required facilities to do it on its own. In Hungary, after the Communist regimes usurpation of power in 1948, every script and nished movies had to pass the acceptance of totally government controlled bureaucracy that continued till early 1990s! Moreover, the theme of the scripts must have had a clear demarcation between good (that is communism) and evil (which is off course exploitation of capitalism)! Some of the notable propaganda lms produced are Sunday Romance by Bakaruhban in 1957, and Merry-Go-Round by Krhinta in 1955, with both framing their plot on class conict. In Poland too civil rights were restricted after communists took over and they pushed only their own ideology through lms. In 1945, Antoni Bohdziewicz produced a lm that was banned because of his rightist inclination, so much so - that even his workshop was closed down and handed over to the next generation of lm makers corresponding to the leftist ideology. So, the leftist evangelists started producing communist-mouthpiece movies like Mlodosc Chopina by Aleksander Ford in 1952, where he incorporated all the right mix of leftist anthology showing life of a Polish piano composer as friend of the working class! Amidst these two blocs, the third most
POWER PRISM
sought-after bloc the Islamist bloc was the only one who relatively failed to exploit this medium of media to popularize their way of governance. Despite the presence of around 48 Muslim majority countries, Muslim Cinema (an answer to Hollywood) is still not well known commodity to the rest of the world. Sanctions and instability in the region has not allowed this eld of art to prosper. However, defying the odds the trio of Iran, Egypt and Turkey seems to stand out as the most inuential countries among all of the middle-east lm making nations. Film making in this region is a quite non-conventional career option, more so due to stringent laws of the land that are not only staunch but to some extent ironically adverse to freedom of art & expression. Take for instance the cases of well known lmmakers like Jafar Panahi, Mohsen Makhmalbaf, Golshifteh Farahani, Mohammad Nourizad to name a few, being detained in the jail or being attacked by vigilante mobs, for their lms message or content are plenty in these countries. Any kind of attack on religion, through any form of art, is absolutely prohibited. This kind of atmosphere encourages only pro-Islamic movies. Every region tries to promote their ideology and culture through different media like cinema and the new Muslim world is no exception. The Kingdom of Solomon (released on 7th October 2010 in Iran) an Iranian made lm (directed by Shahriar Bahrani) based on certain events in the life of Prophet Solomon is a perfect exam10
THE IIPM THINK TANK
ple of such kind of movies. First of all, it was a very interesting choice of personality to make a lm upon considering he is a prominent gure in three religions Islam, Christianity, and Judaism. The plot was obviously based on the Islamic view of Solomon as a sinless human being which contradicts the views of the other two religions. The movie depicted the effect that sin can have on an individual and on society on a whole. Solomon came to rid the society of sin and to guide people on to the path of virtue. The movie cleverly talked about the good aspect of Islamism and to some extent tried and established the need for global Islamic supremacy. Another documentary lm named Budrus (1st premiered on 13th December 2009 in Dubai International Film Festival and released on DVD on 10th May 2011 in the US) directed by Brazilian lmmaker Julia Bacha told a story of an on-going non-violent protest movement on the West bank of the Palestinian Territories by Palestinians Muslims (who are often portrayed as fanatics by the western media) and created good impression about the Islamism. The Message AKA Mohammad, Messenger of God (released on 9th March 1977 in New York) a lm based on the life of Prophet Mohammad directed by Moustapha Akkad showed the origin of Islam. The lm was highly controversial and faced stiff resistance from the Hollywood and had to go outside US to raise production money which was nally offered by well-known Libyan leader Muammar al-Gadda, for all the obvious rea-
sons. In the Kingdom of Heaven (release 2nd May, 2005 in UK) a lm made in Muslim minority country and directed by Ridley Scott faced with Christian aggression, the lms Arab leader, Saladin, demonstrated enormous tolerance and portrayed Islam as a merciful religion. Critics argue that the plot was based on Osama Bin Ladens Version of History and the romanticized view of the crusades propagated by Sir Walter Scott in his book The Talisman (published in 1825) and historically inaccurate. Similarly, in Robin Hood: Prince of Thieves (1991), Azeem played by Morgan Freeman was a Muslim who helped Robin Hood ght the evil doers, eventually saving his life. In The 13th Warrior (1999), Antonio Banderas played a courageous Arab traveler, who helped a group of Scandinavian adventurers in a battle with a tribe of cannibalistic raiders. In the French lm Days of Glory (2006) Arab-Muslim soldiers fought for France and the Allies during World War II both the director and main cast were Muslim. The documentary named The Muslims I Know (2008) by Pakistani-American producer/director Mara Ahmed actually depicted good aspects of Muslims and that true Muslims are not like militant jihadists. Cinemas face resistance from the conservatives as they feel lms opposes the beliefs and values of Islam and the Middle East for that matter (except for Egypt) failed to acknowledge and comprehended the power of movies and lms in spreading their thought process. If they want to promote Islamism in the entertainment media they have to cater to the larger masses and have to come up with much more movies. Historically art has been the most sought-after medium of communicating with masses, especially when it comes to expressing agendas that are political and diplomatic. But with advent of technology, movies have emerged as the best tool in its category especially given its reach and inuence. And in coming years, this one medium would play a major rule in streamlining and altering global-perception about power that be. (With reserach assistance from Mrinmoy Dey & Sayan Ghosh of The IIPM Think Tank)
THE INDIA ECONOMY REVIEW is now
THE GREAT INDIAN DREAM

TO TAKE FORWARD THE PHILOSOPHY OF COMMITMNET TO OUR GREAT NATION EPITOMISED IN THE PATH BREAKING BOOK
THE GREAT INDIAN DREAM
A N
I I P M T H I N K T A N K & G R E A T I N D I A N D R E A M F O U N D A T I O N J O U R N A L
POWER PRISM
WHAT THE LIBERALS TELL US ABOUT THE RISE OF CHINA

United States cant confront the challenges of the 21st century single-handedly and should work together with China in various global issues
PATRICK CORCORAN
Research Associate, Public Affairs Council, Washington
he liberal paradigm, which I might add is essentially informing the Obama administrations position on US-China relations, was surmised very effectively by a keynote address given by Deputy Secretary of State James B. Steinberg at the University Of Southern California U.S.-China Institute in September 2009. Steinbergs address began by him quoting numerous policy makers and academics that indicated the United States (or any state for that matter) could not confront the challenges of the 21st century single-handedly and both states should embrace the benets that occur from cooperation. As China continues to grow economically and militarily, the United States should work together with China, rather than spurn or try to dictate to the Chinese precisely the ways in which we believe the Chinese should be interacting (i.e. sanctions against Iran or increased pressure on North Korea) within the
international community. Steinberg argued similar policymaking should follow suit for India and Brazil, while protecting our own national interests. This, I believe, is one of the key strategic challenges of our time. And the key to solving it is what I would call strategic reassurance. The crux of his argument rests on the assumption that Chinas continuing rise will not be threatening to the security concerns of other states, and upset the status quo in the region or elsewhere. Steinberg, apart from assuming this, also sought some sort of an ofcial Chinese government statement on their policies. Liberals claim, if China were to make a statement of policy intent, it would probably embrace a benign and partnership-like policy with the United States and the region. To their credit, although distinguishing rhetoric and fact is the most difcult of tasks, the Chinese government recently held a press conference, the goals of which was to
12
THE IIPM THINK TANK
DETONATING DRAGON
di dispel any notions of poor military tr transparency. Chinese military spokesm man Geng Yansheng said at the confe ference, Our press conference aims to spread important information ab about Chinas national defense and m military building in a timely manner, an and to help the world better underst stand Chinas armed forces. The co conference was not only geared for th the international community, but it w was stated that informing the Chinese pu public was just as critical. The two m main issues of military concern addr dressed Japans concern of Chinas ex expanding naval forces and the USTa Taiwan alliance, particularly arms sa sales. Both issues were downplayed in im importance, and Chinese overall milita tary strength was described as being ex exaggerated. Can the United States ex expect China to be completely forthri right on this issue? Can states afford to accept such a position? Steinberg also indicated that most st states worry about the same threats as ot others, using this notion of shared bu burden as another motivating factor fo for cooperation (and more importa tantly increasingly unmotivated factors fo for conict). Steinberg listed several ar areas in which the United States and C China could share (or is the United St States trying to move the burden onto C Chinas shoulders?) the load. The nu number attached to the point is Steinbe bergs suggestions; however, I have ad added my own critique of what he sees as burden sharing.
POLICY TOWARDS NORTH KOREA

Another areas would be ending their nuclear program and working together for peace between the North and the South. However, China has shown little intention on trying to disarm the regime in North Korea because it views North Korea as a buffer between the mainland and the west.
AFGHANISTAN AND PAKISTAN BORDER SECURITY

Afghanistan and Pakistan border security is one more area, China being one of ve bordering countries of Afghanistan. However, Chinas own internal domestic dissent is a much more pressing issue of concern when compared with the stability of Afghanistan; they view it as a problem of the United States. The same is true for Pakistan, why would China want to involve itself in Pakistan when they know that India will serve as a balance against Pakistani aggression. In both cases, if the United States and Indian will be weakened in any way because of their involvement in South West Asia (causing resources diversion), why would we expect China to discourage that?
ANTI-PIRACY EFFORTS OFF THE HORN OF AFRICA

China is heavily invested in Africa, and because of their detached nonalignment foreign policy theory, i.e. do not interfere in the affairs of another country most notably in Sudan and Zimbabwe both of which have horrendous human rights records China continues to strike business deals, mainly for oil, and other resources. China has not shown any indication that they will shift their nonalignment policy to one of interventionist. In terrorism alone, we have seen China veto resolutions critical of the Sri Lankan government during their Civil War and their reluctance to sign onto sanctions against Iran. They will not sacrice their investments for human rights, but then again, what rising power would?
EN ENVIRONMENTAL CONCERNS
Fo For the rst time in Chinas Five Year Pl Plan history, they have included cutti ting domestic emissions as part of th their attempt to mitigate global clim mate change. However, China, along w with the United States, both have w weak records on environmental policy. C Chinas growth over the last two decad ades was not green in any sense, and fr from what I can infer, they will not st stie economic growth because of en environmental concerns, i.e. using co coal plants and an increased dependen ence on oil.
13
POWER PRISM
TRANSNATIONAL TERRORISM
China does not deal with their internal threats, why should we expect them to waste resources combating transnational threats? These are all lengthy and very complex goals that the United States has (the effectiveness is of which is arguable), and will assumingly continue to work with China on mitigating on. Although the notion of cooperation offers readers a much more positive outlook, it is important to note that cooperation, if it does happen, will only develop because of the strain on resources not because states choose to cooperate for the sake of cooperation alone. However, Steinberg did argue that there are several areas of concern for the United States, with a particularly emphasis on Chinese military spending and total technological modernization. In addition, There are many points of tension between the two powers: Taiwan, the South China Sea, military arms increases, and differences over nonproliferation issues. In economic terms, the trade imbalance has not been rectied, and the Renminbi remains inconvertible at too low a valuation. And the Chinese population does not yet fully benet from a greater consumption sustained by Chinese industrial progress. Steinberg presented a large part of the liberal thesis; however, there are varying perspectives within the paradigm itself. Liberals, particularly those who believe in liberal institutionalism, argue that the economic interdependence, in the era of globalization (especially between the United States and regional actors) combined with Chinas continuing, and in some cases, increasing participation in international institutions will soon trump any security competition between the two (or others) states. The Untied States and China are both members of approximately 70 different international organizations (some of which they are observer or member status, others are subsets of larger organizations). And by virtue of what liberals refer to as the democratic peace theory; the prospects
14
THE IIPM THINK TANK
for conict are extremely low, if not nonexistent. The participation in these organizations, when combined with strong diplomacy will mitigate any large scale source of conict between the two states. More specically, classical liberalism argues, that if marketization and democratization take place in China, the economic rise of China will not pose a threat to peace. In other words, Chinas changing domestic landscape (perceived emergence of a middle class through free market principles), will ultimately lead to democratization; the results of which would offset any security competition (regardless of their international institutional participation gures) between states involved in the economic relationship. However, classical liberalism is working off the as-
sumption that capitalism will produce a lesser authoritarian-like regime with a strong population who work off democratic principles, theoretically having some impact on the states decision making process and informing the dialogue on foreign relations more than China has today, if existent at all. Constructivists discard both the realist and liberal theories: the realist balance of power theory and liberal peace theory are both irrelevant. Neither one of these theories presents any insight on the potential for conict between the two states and instead argues that a shared identity will determine whether the two states view each other as threats. Also, China has adapted (and continues to) from an aggrieved Maoist revolutionary state to a developmental state and a good
DETONATING DRAGON
THE ECONOMIC RELATIONSHIP WILL BE THE MEANS, BY WHICH CONFLICT WILL BE AVOIDED BETWEEN THE UNITED STATES AND CHINA
global citizen, which, though its interconnectedness with the international community has accepted the norms and reaps the benets across the board thereby probably nullifying any future urge for conict. Although China may perceive itself as a victim of Western domination, it also perceives itself as a contributor, and ultimately a decider in world affairs, particularly economically. Liberalism and construtivism offer the international relations community different predictions on how Chinas rise will come to fruition. However, after a survey of the literature, it appears to me, that realism offers us the most comprehensive approach for the rise of China over the next generation. creasingly benecial. This point was echoed by soft power scholar Joseph Nye, In reality, China and the United States do not have deeply rooted conicting interests. Both countries, along with others, have much more to gain from cooperation. Liberals claim Chinas possible economic domination has to be understood in a different frame. The economic relationship will be the means, by which conict will be avoided between the United States and China, concluded that conict was still possible between the U.S. and China, but could be averted by progressive and rapid adjustments to each other. Steinberg conceded, Chinas economy has grown and its global interests have expanded, its military spending has quite naturally increased, and its capabilities have been extended at sea, in the air, and in space. Daniel Yergin wrote in Foreign Policy magazine, The math is clear: More consumers mean more demand, which means more supplies are needed. But what about the politics? There the forecasts are murkier, feeding a new scenario for international tension a competition, even a clash, between China and the United States over scarce oil resources. The bilateral reliance on oil is only part of the equation; let us not forget the economic relationship the United States and China also enjoy. Dan Griswold, an expert from the CATO Institute argued in lieu of the current calls from U.S. congressmen that China should be punished for purposely depreciating its currency value. Griswold argues against their claims, Chinas demand for U.S. exports was just as hot before it appreciated its currency beginning in 2005. From 2001 to 2005, when the Chinese currency was even more undervalued than it is today,
LIBERALISM AND ECONOMIC RELIANCE

The liberal theory, accepts the realist premise that states are important actors and conict is still theoretically plausible, but they do not dene the international community as anarchical, but restrained because of the existence of international institutions and rational decision making processes. Liberals also do not dene the states role solely through power or high politics. Liberals incorporate low politics, which in the case of US-China appears centered around economics and cooperation on various security issues within Asia and the world (some of which were listed in Steinbergs assessment). I want to rst address the how Liberals frame the economic relationship. Liberals claim these interests will stie the chances for conict because China will not rise in a belligerent way, The cost/benet ratio of ghting a war has been tilted away from war, which is very costly, and towards trade, which is in-
U.S. exports to China more than doubled. The share of U.S. exports going to China has been rising steadily, from 2.7% in 2001 to 6.6% in 2009. Within the military build-up, the United States is also urging a transparent build-up, assuming not only to know what Chinas arsenal is comprised of, but to reiterate its commitment to global security, not global domination. Adding to the security aspects, the tremendous economic reliance, twoway trade and investment, and slowing the demand (and not competing) for global resources will be another area of contention and concern over the next fty years, but nevertheless cooperation will prevail as the interests are mutual and not unilateral. Last, but certainly not least, working together to improve human rights and civil liberties within China, and openness to the growing technologies, mainly the internet and communications. This is obviously a very brief, sort of grand scheme of the major issues that the United States and China are, and will have to continue to deal with in the future, but nonetheless important for our understanding of the liberal position. The liberal position expresses concern about the future potential for conict but optimistically assume that the economic interdependence, along with some sort of societal connection and ones own perception as a global citizen rather than a nationalist, combined with the necessity (for states survival) for burdensharing will redirect the states willingness to cooperate. (PATRICK R. CORCORAN is a research associate at the Public Affairs Council and a research assistant at National Defense University. He is also an adjunct consultant with Consultancy Africa Inteland the international relations staff writer forInuentials Network. The views expressed in the article are personal and do not reect the ofcial policy or position of the organisation.)
15
POWER PRISM
FROM GEO-POLITICAL TO A
GEO-LEGAL ORDER
The most stimulating task is to strike a proper balance to ensure that Indian laws and legal structures should not get swayed away by the growing commercial intent of the globalization and polarization
RABIN MAJUMDER
Advocate-on-Record Supreme Court of India
LAGGING LEGITIMACY
ome nerves suggest that due to ever growing knowledge economy, the Stealth Miracle is sustainable in India, fuelled by achievements in education, demographic dividend, sound nancial system, growing services exports and a more sustainable buoyant manufacturing sector, amongst others. And India has emerged front bencher in quick learning this global reality. India, alongside much talked about energy security, now feel necessity of a legal security with robust legal systems and a diplomatic judiciary having direct focus to global economy and its pros and cons. Some argues that economic, social and legal handicaps are self reinforcing resulting in spatially concentrated poor g p y and creating a culture of poverty which cultu ure often cause justice ina e inaccessible to the poor and needy. It is often argued that o globalization is seen as harbinger of inn equality and it serves as a signicant ser rves limiter of the dominance of any single domi inan nation-state as well as that although glot balization is designed to advance the design ned interests of developed countries, howdevelop ped ever, its exploitative capacity is limited by cap factors that are largely external to core larg gely states. However, the age of post-industrie al globalization has br s brought signicant changes to the relationship between rich relati ions and poor states but lea t leaving a sharp polarization in the geo-politics. The modus geo o-po operandi of globalization has turned out globaliz zatio to be an essential part of the recent ecopa o art nomic reforms made in India. Globalizae tion in India is seen in the recent days n with companies expa expanding their horizons and to other nations. It is also argued that t globalization has pose manifold chalp posed lenges to the futur of judicial systems future o re in India, but it has provided an occasion p prov to challenge the status quo, which is a statu crucial disorder for seeking any reform r see with updated judic systems. It is felt cial judicial that the attitude of la o lawyers and judges will become serious for addressing seriou future experim experiments of geo-legally ment needed governanc governance. All through wo world, it is witnessed that incompa incompatibility between deatib mand and supply of laws and lesu upp gal procedures is responsible for procedu ures the creation of legal system with n
GROWING POLARIZATION HAS DIRECT INFLUENCE ON THE RULE OF LAW THAT CHALLENGES THE GLOBALIZATION
totally different standards and values. Until not very long ago, the law schools in India could do well as long as their program was focused on Indian law and issues relating to the countrys legal system. The legal system was centrally focused and now, the judiciary has to try and adjudicate matters ranging from matrimonial, commercial and other individual issues having cross-border effects. It appears that growing polarization has direct inuence on the rule of law that challenges the globalization. In fact, the appetite of Indian law scholars for understanding international and comparative law has meaningfully enlarged over the years in a situation that India is not only economically fertile democratic country but also has emerged legally fertile jurisprudence evidencing rule of law country. The globalization has necessitated effective and efcient judiciary supported by a fully charged legal system from a inadequately equipped time-machine as part of the global requirements at a speed at which the justice delivery system in India to act and react to the geo-legal requirements. It needs to oil its own machines to speed up, both in letter and spirit. If India does seriously committed to integrate itself with global economy, it will need to have economic policy which will impact on Indian legal systems as well, amongst others. And it is expected that in the process of integration, as said above that Indian legal systems should emerge and not submerge, would lead to harmonisation of international treaties for the smooth conduct of international trade. the legal systems of a country like India as well since it is one thing to try pizza/ burger in stead of roti/dosa than that Indian legal and judicial systems can assimilate itself with global requirements. India is seen as deep routed culturally reach nation where its adoptive legal systems have reached its epitome from where it can look out for a global tie-up horizontally. As witnessed that legal inequality has not only been accepted as a byproduct of the current form of globalization, it has served as a necessary component of the global order, thus, India needs self-preservation in all spheres of governance with transparency and diplomatic reform to otherwise crippled justice delivery systems which has caused thwarting of justice to the poor. The most stimulating task is to strike a proper balance to ensure that Indian laws and legal structures should not get swayed away by the growing commercial intent of the globalization and polarization. Indian legal systems and its judiciary need to emerge in the globalization and not submerge with international commerce and foreign legal systems. It has to make presence felt. A diplomatic political perspective of the Indian legal systems needs to be studied to coincide with geopolitical requirements of today which would reduce legal conict due to two culturally different legal procedures. (RABIN MAJUMDER is Advocate-onRecord in Honble Supreme Court of India. He is also Central Government Counsel in Central Agency Section of the Honble Supreme Court of India. He is also on panel of United Bank of India. The views expressed in the article are personal and do not reect the ofcial policy or position of the organisation.)
CONCLUSION
It may be safely submitted that globalization has created an economically polarized world that is unsustainable over the long term. And, to my mind, it has glooming impact of adversely affecting
17
SAUMITRA MOHAN
District Magistrate and Collector, Birbhum, West Bengal
HOW RELEVANT IS HUNTINGTON
There may not be a clash of civilizations in the strict sense of the term but there denitely is a clash of ideas today
TODAY?
POWER PRISM
t was way back in 1993 that Samuel P. Huntington, who died on 24th December 2008, had declaimed in Foreign Affairs journal that the post-Cold War conicts would not be ideological or economic, but cultural. He said, The local conicts most likely to escalate into major wars shall be those along the fault lines separating the civilizations from one another. The next world war, he further said, shall be a war between civilizations. Since Huntington came out with this thesis, reams have been written arguing for and against it. But any claim of a clash of civilizations springing from divergent religious beliefs represents an oversimplication of the reality. As Amartya Sen wrote in 2003, this single-dimensional categorization of human beings and the increasing tendency to overlook the many identities that any human being has trying to classify individuals according to a single pre-eminent religious identity is an intellectual confusion that can animate dangerous divisiveness. That is why, Huntington thesis has been called reductionist, over-simplistic and one-sided. Focusing just on the grand religious classication is not only to miss other signicant concerns and ideas that move people, Huntington also had the effect of generally magnifying the voice of religious authority. The insistence, if only implicitly, on a choiceless singularity of human identity not only diminishes us all, it also makes the world much more ammable. Even though George W. Bush said that there is no clash of civilizations and it is only a passing myth of history, the truth remains that today, a war rages between the forces of good and evil in one form or the other. There may not be a clash of civilizations in the strict sense of the term as posited by Huntington, but there denitely is a clash of ideas today. There are many groups which continue to terrorise the international civil society for the attainment of an ideational space they call their own. What binds together a globalized force of these extremists from many continents is a united hatred of liberal-democratic
values. Today, a coalition of all such evil forces seems to be taking shape. Many of these terrorists and terror groups have been functioning with impunity and more often than not, their activities have caught us unawares. And, one really fails to gauge the real motive or usefulness of many mindless terrorist killings or the purpose behind them. After all, whatsoever grievances they may have against the system, what do they wish to gain through violence and innocent killings? Be it naxalites or any other terrorist groups, they should ght a just war in a just manner through just means. Such means may include participation in electoral politics and subsequent formation of government to implement the ideas they espouse. See the examples the world over. All the places where the revolutionary forces were animated by their conviction of systemic change and employed violent means for the achievement of the same, they have all either vanished or accepted the inevitability of the values of liberal democracy. Be it Fascism, Nazism, Communism or any other ideology, they have all been overpowered by the values of
liberal democracy which gives choice to the people to shape their destiny as per their desire. While this victory of liberal democracy may not really have sounded the death-bell of ideology as claimed by Daniel Bell in his End of Ideology or by Francis Fukuyama in his End of History, it denitely warrants that other ideologies need to adapt themselves rather than be conned to a straitjacket. Now the point is that at a time when the world is increasingly becoming borderless as Keniichi Ohmae has been talking for quite some time and when the States sovereign power to defend its citizens and act as the overpowering sovereign, has been severely dented, how long can we continue to rely on the capacity of the nation-states to defend their citizens against such forces of darkness? It is increasingly felt that the concept of the nation-state has become archaic and we need to move beyond it to talk of a literally borderless world which can be truly globalized. The United Nations need to be given more teeth in such a world and the member states should be more than willing to cede it some pow-
20
THE IIPM THINK TANK
CLASH OF CIVILIZATIONS
ers if they want it to be effective. Todays global problems warrant a global response. Ergo, the nation-states need to coordinate their actions to ght common evils. Mind you even in these times of complex inter-dependence, it is inter-dependence only in trade which allows mobility of the capital, but not of the labour. Also, militarily there is hardly any interdependence as seen in preWorld War days. The interdependence matters more for the smaller states rather than the bigger ones who still continue to produce and consume 80-90 percent of their needs rather than exchanging the same in an inter-dependent world. Nevertheless, as observed by Kenneth N. Waltz, it is an abstract force which moves the world today. Things are seldom wished or directed to occur in a particular fashion; they just happen. Whether you want it or not, you are affected. Be it the operation of the capital market, the effects of a global warming or the operation of international terrorism, you are affected. You have to join forces with the other members of the comity of nations to survive or be ready
ALTHOUGH THE ENTIRE WORLD PAYS LIP SERVICE TO DEMOCRACY TODAY, THERE IS STILL NO GLOBAL CONSENSUS ON THE SELF-EXPRESSION VALUES
to perish. In fact, the sole problem with the extant world system appears to be the fact that many states continue to be mired in history as pointed out by Francis Fukuyama in his celebrated End of History theory. Such states are those who continue to deny basic freedoms to their citizens. The absence of an open society often gives rise to forces whose blinkered vision leads to negative channeling of human energies as experienced in case of terrorism. Although the entire world pays lip service to democracy today, there is still no global consensus on the self-expression values such as social tolerance, gender equality, freedom of speech and inter-personal trust that are crucial to democracy. The extent to which a society emphasizes these self-expression values has a surprisingly strong bearing on the emergence and survival of democratic institutions. Today, the divergent socio-political values constitute the real clash between the closed and the open societies everywhere. Many of these closed societies lack the core political values which are usually supposed to facilitate a representative democracy. They include separation of religious and secular authority, rule of law and social pluralism, parliamentary institutions of representative government and protection of individual rights and liberties as the buffer between the citizens and the power of the state. The World Value Survey reveals that at this point in history, democracy has an overwhelmingly positive image throughout the world. According to the latest Freedom House ranking, almost two thirds of the countries around the world are now electoral democracies. This is a dramatic change from the 1930s and 1940s, when fascist regimes won overwhelming mass approval in many societies, and for many decades, communist regimes had widespread support. Now that there seems to be a consensus that democracy is the best form of government. We need to ensure that the same becomes the form of government everywhere, if required, with necessary local modications. Benjamin Barber, a political scienctist, also said in 2003 that a war between Jihad and MacWorld (symbolizing todays liberal society) can be won in favour of the international civil society only with the untrammeled march of democracy on this planet. So, what we need today to secure ourselves against the marauding terrorists and extremists on the loose is a coordinated action among all the members of the Comity of Nations through the agency of a reinvigorated United Nations, while simultaneously trying to continue a dialogue with these forces of revisionism including terrorism, within the doctrinal framework of liberal democracy. The victory of the democratic discourse over the forces of darkness is the ultimate Holy Grail to be pursued by us. Huntingtons relevance shall lie in disproving his thesis. (DR. SAUMITRA MOHAN is a member of the Indian Administrative Service of 2002 batch and belongs to the West Bengal Cadre. He is presently posted as the District Magistrate and Collector, Birbhum in West Bengal. Before entering the IAS, he had worked as Assistant Regional Director with Indira Gandhi National Open University, as a Lecturer in Political Science with Meerut University and as a Journalist with the Press Trust of India. The views expressed in the article are personal and do not reect the ofcial policy or position of the organisation.)
21
POWER PRISM
RAJ AGGARWAL
Sullivan Professor of International Business and Finance, University of Akron, Akron, OH
RISE OF SOUTH-SOUTH ECONOMIC FLOWS

The relative decline of north-south trade and the rise of south-south economic ows seem to be moving the world closer to a multi-polar structure
ince the middle of the twentieth century, there has been a strong push for multilateral trade and investment agreements to lower barriers to international economic ows. These agreements have been spectacularly successful and have eliminated in many cases, or greatly
lowered in other cases, barriers to trade and investment ows globally. This global multilateral approach to global economic integration was carried out with the strong backing of the western world led by the US and its allies. This process was on the way to achieving a uni-polar integrated global economy
with the many attendant economic benets that arise from an integrated global economy. In recent years, tectonic forces of demographics, sustainability, technology, and globalization are forcing obsolesce in developed country business models and simultaneously leading to the emer-
GLOBAL GAPS
gence of challengers on the global stage of some large developing economies. Consequently, the process of global economic integration has slowed down considerably and seems to have stalled in recent years giving way to many bilateral and regional multilateral trade and investment agreements. There is considerable fear of re-polarization of the global economy with consequent loss of the benets arising from an integrated global economy. One possible reason for this re-polarization of the global economy is the rise of new economic powers such as the BRICs (Brazil, Russia, India and China) and the associated rise in SouthSouth trade and investment. According to Gordon Brown, the former Prime Minister of Britain, this rise of the economic south was a basic cause of the 2007-2008 economic crises and, further, it will continue to shake the world economy and likely cause additional crises (Brown 2011). The analysis presented here shows that traditional European, US, and other developed country dominance in trade and investment ows is being signicantly supplanted by trade and invest-
ment ows among developing countries. This rapid and signicant rise of SouthSouth economic ties is leading to a relative decline in European and US economic hegemony and perhaps the rise of a new Southern economic bloc. Further, this analysis indicates that the nature of the economic ties in this Southern bloc may be quite different than the traditional trade and investment ties dominated by the developed countries. Finally, it also seems that the rise of new economic powers and of South-South economic ows have to be accommodated by existing economic powers without disruptions. Such accommodations are likely to be challenging especially as existing multi-lateral institutions are inadequate to the task having been structured over seven decades ago when the global economic structure was quite different. Thus, this article calls for creative solutions in the form of signicant and major changes in existing multilateral institutions or the creation of other new institutions to accommodate the rise of the new economic powers on the global stage.
THE NEW GLOBAL ECONOMIC STRUCTURE

We live in an age of great discontent and important economic disruptions. Increasingly prevalent technologies of communication and transportation are leading to more frequent national and international clashes between lifestyles and economic classes and between freedom and modernity on the one hand and tradition and poverty on the other. Unprecedented tectonic forces of demographics, sustainability, technology, and globalization are changing the global economy in a number of ways and increasing the importance of the formerly under-developed countries.
FUNDAMENTAL FORCES CHANGING GLOBAL ECONOMICS

For some decades now, all businesses have been facing and dealing with a number of inter-related forces: demographics, technology, and sustainability not only impact each other, they are the fundamental drivers of globalization. Indeed, each of these forces interact and inuence each other in a complex brew specic to each country, industry, and
POWER PRISM
business. This essay contends that in dealing with the challenges of globalization, businesses must understand how globalization is inuenced by these three underlying driving forces, demographics, technology, and sustainability. Thus, effective business strategy must reect and integrate these underlying forces facing businesses. First, demographic changes are slow moving but inexorable. There is strong negative correlation between income and birth rates. While incomes are rising and birth rates declining in most countries, the aggregate world population is still rising albeit at a declining rate so that the current world population of about seven billion is expected to rise to nine billion by 2050 and possibly to 10 billion by 2100. While human ingenuity will undoubtedly nd new materials and resources as old ones are exhausted, it is likely that we have run out of the lowhanging fruit (e.g., free land, mass higher education, tech breakthroughs) in our quest for economic growth (Cowen 2011). Further even though birth rates are declining and life expectancies are rising everywhere, population growth is uneven across countries. The proportion of the elderly and retired as compared to the young and working age vary greatly across countries. For most developed nations, this dependency ratio is increasing rapidly while it is still generally declining in developing countries. These global and national demographic changes have important implications for scal policies and business strategies. Second, businesses face important changes related to sustainability and climate change mitigation. Regardless of the few remaining scientic skeptics, most businesses face multiple pressures to respond to sustainability and climate change mitigation issues. Indeed, while governments across the world have yet to agree on appropriate joint efforts in response to sustainability and climate change mitigation, many businesses (like Wal-Mart) and governments (like California), are taking the lead in using sustainability and lower carbon footprints to drive innovation and prots. Third, there are many changes related to technology. In fact, we are now tran24
THE IIPM THINK TANK
sitioning from the industrial age to the information age, with the focus is shifting from atoms to electrons and photons. Information and communication technologies are supplemented by new materials and business models that involve the deconstruction of value chains. Consumption is de-materializing with ever smaller proportions of income spent on heavy physical objects and ever larger proportions on intangibles. It is now possible and will soon be imperative to plan for and provide mass-customization in every business model. Further, given the automation of most routine work by computers in various forms, the nature of work itself is changing as it is less physical or observable. Human intellectual ability, now the main form of work, can be extended and sourced globally. Technology is transforming the way we do business and the nature of the products and services we consume. The makeup of our consumption is increasingly lighter and more electronic (intangibles) all materials are becoming lighter and stronger (e.g., carbon ber airplanes, titanium golf clubs) and high value consumption includes large quantities of weightless electrons and photons and consumer electronic products to process them (e.g., movies, music, and iPods; micro-processor enhanced light weight electric cars; etc.). This consumption mix, lighter and more
electronic, make it increasingly cheaper to ship it long distances and source it globally. The pace of technological change is unlikely to slow down. According to Moores Law, that has now held for over a quarter century, computing power continues to double in power and halve in cost every 18 months. Further, technology and the increasingly electronic nature of goods is reducing marginal costs so they are practically zero leading to new business models where some goods (e.g., e-mail) may be free but the resulting consumer attention and ability to sell them other goods is worth a great deal. This is indeed the business model being used by many of the most successful new age rms such as Google and Facebook. While some may argue that this is nothing new, as it is only an update of the old razor and razor blade model invented long time ago by Gillette, this business model is now being extended to a much larger range of goods such as air travel (e.g., Ryanair) and other intangibles, and increasingly to physical goods such as print newspapers and magazines (Anderson 2008). More generally, technology is changing value chains, i.e., technology changes where every business adds value, with some previously valuable locations declining in value-added activities while other locations rising in value-added
GLOBAL GAPS
activities. In order to understand the full impact of technology, all businesses have to de-construct the value chains of their products and services, and have to reengineer and focus on the new best places to add value, and perhaps, outsourcing other parts of the value chain to where value may be added more efciently. These changes in value chains are transforming whole industries and the international competitiveness of entire countries. Thus, we are seeing the continuing growth of domestic and international outsourcing and the growth of ever longer and more complex supply chains and generally more focused and less vertically integrated businesses. One aspect of value-chain transformation is the increasing economic possibility of mass customization where it is possible to provide customized products cost-effectively to the masses. Driven by advances in information technology, individual customer preferences and requirements can now be transmitted to production locations to produce output customized to the needs of individual consumers within ever shorter time periods. This phenomena of mass customization is most easily accomplished for intangible products and services, but it is becoming increasingly cost-effective for physical goods as well (e.g., the BMW plant in South Carolina already produces individually customized automobiles cost effectively for shipment to over a hundred countries). These fundamental transformations of value chains and business models are being driven by the continuing drop in information costs and the resulting decline in cross-enterprise transactions costs. Not all businesses prove to be equally adept at developing and implementing new business models to reect deconstructed value chains, and many of those that are slow or incapable will go out of business. Indeed, as businesses face these great challenges in the move from the industrial age to the information age, according to Money Magazine (June 2011, pp. 40-41) the average tenure of a company in the S&P500 is declining; it is now only 15 years, having dropped from 75 years in 1930 at the height of the industrial age-as another measure, 40%
of the S&P500 have been dropped over the last 10 years and this percentage is even higher for other indexes such as the NASDAQ 100 (66%) or the Russell 2000 (69%). Not only does technology help globalization by facilitating international communication and transportation, but globalization makes technology more valuable by providing larger global markets for any new technology. Thus, technology and globalization form a mutually reinforcing cycle that makes each more pervasive over time. Consequently, with the continuing rise of technology and declines in the importance of distance, every business faces increasing globalization. As noted briey, the nature of globalization is heavily inuenced by demographics, sustainability, and technology. For example, demographic forces are creating global imbalances in worker populations and in government
economy is facing signicant change. Tectonic forces of demographics, sustainability, technology, and globalization are forcing obsolesce in developed country business models and simultaneously leading to the emergence of challengers on the global stage of some large developing economies. One of the consequences of these changes is the need to smoothly accommodate the rise of the formerly developing economies and economic ows between them. In recent years, we are seeing a move towards a multi-polar world economy. In addition to North America, there is now at least the united EU. It is expected that in the near future these two poles will be supplemented by a third, the Asian pole with China, India, and Japan. Others believe that we are headed to a multipolar world economy. Indeed, the relative decline of north-south trade and investment and the rise of south-south
WE ARE HEADING TOWARDS A MULTIPOLAR WORLD WHERE, IN ADDITION TO US & EU, THE LIKES OF CHINA IS EXPECTED TO FORM A THIRD POLE
nances, the world economy faces sustainability and climate change challenges, technology is accelerating globalization and changing the nature of work. Finally, these forces of demography, sustainability, and technology, mean that many formerly economically backward and underdeveloped countries can now start growing rapidly and even leapfrog some traditional steps in the process of economic development. Indeed, the global economy is being re-oriented as the major emerging economies such as Brazil, China and India rise to become ever larger portions of the global economy. In fact the proportion of the global economy accounted for by the so called economies of the South, i.e., the developing countries is rising rapidly. economic ows exemplied by increasing Indian OFDI and economic ties with Africa seem to be moving the world closer to a multi-polar structure. If we are to avoid a re-polarization of the world economy and the attendant loss of economic welfare, we must take active steps to combat it. (DR. RAJ AGGARWAL is the Sullivan Professor of International Business and Finance and former Dean of the College of Business Administration at the University of Akron. He has received many honors including university-wide distinguished scholar and distinguished faculty awards, and has taught at Harvard, Michigan, and South Carolina. The views expressed in the article are personal and do not reect the ofcial policy or position of the organisation.)
CONCLUSIONS
After three-quarters of a century period of unprecedented growth, the global
25
POWER PRISM
ANAND TELTUMBDE
Management Consultant; Formerly: Managing Director and CEO of Petronet India Limited
GL BAL
POLARIZATION AND THE WORLD ORDER
It is the multi-axiality of polarizations, not mere polarity, which is most important in understanding polarization and its potential towards global change
olarization is dened as the tendency towards concentration at two opposing extremes (poles). It is the process by which a power distribution is altered through alignment and coalition formation. Sociologists are prone to use polarization when describing processes of social change as, for example, in Karl Marxs account of the polarization of capitalist societies into two great hostile camps of bourgeoisie and proletariat. The polarization between contending social forces is seen as a key cause of the end of many regimes, and many other decisive breakdowns of political order. Polarization subsumes unequal development but is not the same as unequal development. Unequal development has been integral with history since antiquity but it is only in the modern era that polarization has become the immanent byproduct of the integration of the en-
tire planet into the capitalist system. Polarization is a systemic process that divides population into two opposite camps, e.g., rich and poor, capitalist and workers, blacks and white and so on. When the contradiction between these two camps reaches its zenith, the system (society) undergoes qualitative transformation. This principle of dialectics led Marx to anticipate proletariat revolution, transforming the capitalist society into a socialist society. Whether one subscribed to this Marxist dialectics or not, polarization is always associated with the threat of change. Insofar as polarization in the world has been around for a long time, ordinarily it should have led to some kind of qualitative change. But, there is no such change in sight, either at the global level or at the level of nation state. This paper seeks to trace polarizations in recent history in order to understand
the relationship (or absence of it) between polarization and social change, primarily at the global level and extend the process to the micro levels.
POLARIZATION AND POLARITY

Samir Amin (1994) has conceptualized how polarization has changed with the evolution of the capitalist mode of production. In the mercantilist capitalism (1500-1800), it was in the form of dominant Atlantic centres, and the peripheral zones (the Americas). In the classical form of capitalism that followed mercantilism, after the industrial revolution, the peripheries extended to include all of Asia (except Japan) and Africa, which remained rural, non-industrialized, and as a result their participation in the world division of labour took place via agriculture and mineral production, and the centres were crystallized into core industrial systems as national auto-can-
26
THE IIPM THINK TANK
POLITICAL PARIT Y
tered systems which paralleled the construction of the national bourgeois state. These two characteristics gave rise to the ideology of national liberation with the goal of industrialization as synonym for liberating progress and, the goal of constructing nation-states inspired by the models of those in the core. This remained the dominant characteristic of polarization, which gave rise to two world wars, lasted up to the end of the Second World War. In the post-war period (1945-1990), the peripheries gaining their political autonomy and achieving some amount of industrialization, this characteristic weakened and commensurately saw progressive dismantling of auto-centric national production systems and then re-composition as constitutive elements of an integrated would production systems, the deepening of so called globalization. Each of these polarizations is further characterized by the number of autonomous centres of power in the international system, which is a function of the distribution of power only among major actors. It is usually referred to as polarity, which describes the nature of the international system in any given period of time. Although, the concept of polarity has been subject to imprecise and often diverse use, it does serve the purpose of depicting international systems in terms of their power dimensions as distinct structural variables, taking into account polarized patterns of conict coexisting with processes of power diffusion. Polarity, as Waltz (1975) suggests, has been the subject of a great deal of theorizing, much more so than any other aspect of the distribution of power. The conventional notion of polarity involves an ordinal scale ranging from unipolarity to multipolarity with bipolarity in between. Unipolarity is normally associated with the concept of hegemony, although that term connotes a form of dominance by a single country which is somewhat less direct than imperial rule. Multipolarity is frequently seen as a prerequisite for the operation of a balance of power system.
PROSPECTS OF WORLD REVOLUTION

From the polarization that began hapTHE GRE AT INDIAN DRE AM
27
POWER PRISM
pening from the third quarter of the 19th century, in terms of intensication of engagement of European core with peripheries, many theorists had developed notion of imperialism. John Atkinson Hobsoni, a British fabian socialist and Rudolf Hilferding, an Austrian born Marxist economist were to note this phenomenon as imperialism. Rosa Luxemburg another Marxist to explain imperialism as essentially embedded in the basic process of accumulation. Vladimir Lenin, who heavily relied upon the former two works and disputed the latter, in his study Imperialism, the Highest Stage of Capitalist Development (19151916) became the most inuential theorist of imperialism. His entire book is a study of imperialism as a stage in capitalist development. Immediately after the publication of the Lenins book, his own Bolshevik comrade, Nikolai Bukharin also published his study, Imperialism and World Economy (1917), with a favorable introduction from Lenin, which had world economy as a centrepiece for its analysis, while discerning the processes of imperialism. Lenin developed his theory based on concentration of capital into large monopolistic corporations integrated with and led by a few large nancial oligarchies. Lenin described how highly concentrated nance capital had come to dominate and control capitalism by the very late 19th and early 20th centuries in the US, Germany, France, and to some extent Britain. Lenin theorized that intensication of engagement of the capitalist countries with the periphery and the concentration of capital into large nancial oligarchies were intrinsically linked. The concentration of capital engendered inequality and loss of purchasing power with masses, which constrained aggregate demand levels in the capitalist core. The general population could not absorb the mass of commodities produced by higher levels of productive capacity. While the insufcient demand created continual realization crises, the rising price of raw materials threatened prots further. The falling rate of prot required economic expansion to open up new regions for investment, sources of raw materials, and new
28
THE IIPM THINK TANK
consumer markets, which in turn created acute competition between the imperialist blocks. Lenin dened imperialism as: capitalism in that stage of development in which the domination of monopolies and nance capital has established itself; in which the export of capital has acquired pronounced importance; in which the division of all territories of the globe among the biggest capitalist powers has been completed. He identied ve characteristics of imperialism: 1) The concentration of production and capital developed to such a stage that it creates monopolies which play a decisive role in economic life; 2) The merging of bank capital with industrial capital, and the creation, on the basis of nance capital, of a nancial oligarchy; 3) The export of capital, which has become extremely important, as distinguished from the export of commodities; 4) The formation of international capitalist monopolies which share the world among themselves; and 5) The territorial division of the whole world among the greatest capitalist powers is completed. Lenin saw in the longer term this process undermining imperialism, and thereby capitalism in the core through development of nation-state rivalry, culminating into inter-imperial wars. The costs and devastation of these wars would weaken core nation-states, not only because the losers would nd themselves with a diminished capacity to exploit the periphery, but because
nationalist movements in the periphery and anti-colonial wars would undermine the capacity of even victorious core nations to exploit the periphery. Once the core lost control over its colonies the imperium would stagnate domestically, which would raise the level of antagonisms between the bourgeoisie and the proletariat, leading to a social revolution in the core. The theorization had great strategic signicance for the world revolutionary project Lenin conceived. It assured the world proletariat that their emancipation was imminent. While those in core, (a section of which he called labour aristocracy, bribed by the capitalists) should shun their short term interests and ght the capitalists, those in periphery, should tactically shun class struggle and align with their bourgeois nationalist struggle in order to weaken the imperialists. The polarization seemed to conrm to this theorization inasmuch as the rst and the second World Wars proved the inter-imperialist rivalry. However, thereafter the imperialist camp adjusted itself and freed colonies from political control on their own, but without undermining capitalism in any manner. The resultant situation resembled Kautskian ultra-imperialism than Lenins imperialism and even conrmed that Lenins criticism of Rosa Luxemburg was somewhat misfounded. The Leninist theory of imperialism has not only failed to bring about world revolution, on the contrary, it has under-
POLITICAL PARIT Y
mined the class struggle, the prescribed instrument for it. It has unintendedly extended the lease of life to the capitalist system, and thereby prolonged the suffering of people. Indeed, the economic polarization all over the world is pervasive. International inequality, generally measured by comparing national per capita incomes, has been increasing with unprecedented pace. Countries with the highest per capita incomes in the early 1800s are still todays richest countries, indicating persistence in the structure of international inequality. In 1820 Western Europes per capita income was 2.9 times Africas; in 1992, it is 13.2 times. In the 1990s per capita incomes increased slowly but steadily in high income OECD countries, but many transition countries in Central and Eastern Europe, particularly the CIS, many parts of Sub-Saharan Africa and some countries in Latin America and the Caribbean experienced economic stagnation. Income surveys suggest that global inequality increased between 1987 and 1998. Some studies suggested that global individual incomes were converging until 1970 but thereafter they began increasing and returned in 1995 to the level of 1950. Cornia with Kiiskii studied the trends in within-country income inequality in 73 countries from 1950s to the mid 1990s. They found that in several countries inequality declined during the rst 20-25 years of the post World War II period following a decline in unemployment, stable earnings inequality and growing redistribution in the OECD and socialist countries and the introduction of programmes of land reform, educational enlargement and some redistribution in developing countries. This trend towards lower inequality came gradually to a halt in many countries. Starting
from the mid 1970s, and increasingly so since the early 1980s, frequent reversals in national inequality trends were observed in the OECD countries (beginning with the USA and UK) and the Latin American nations. This brief summary suggests that the declines in income inequality observed (with some exceptions) during the Golden Age were reversed over the last two decades, as country after country experienced an upsurge in income inequality. As a result, the trend of the domestic Gini coefcients has taken a more or less pronounced U-shape, with the turn-around year placed most commonly between 1980 and 1990. Only in nine small and medium-sized countries (such as Honduras, Jamaica, France, and Malaysia) is there evidence of a decline in inequality over time. Inequality remained constant in 16 countries including Germany, as well as in countries for which data from 1995 to 1999 show a perceptible deterioration of their inequality trend. This extreme economic polarization that is characterizing the present global order would ordinarily lead to breaking the ties that bind the social poles together and create the ideological foundations of revolution. But this does not seem happening. It only indicates that polarization or its polarity is important in consideration of preservation of world orders but inconsequential to changing it. The reason for this may be found in the assumption that polarizations along various dimensions necessarily cohere. While it is true that economics induced polarization gets reected in political polarization, but there are many other axes, particularly identitarian axes, which may not cohere with the former. Rather these identitarian axes are known to cross the material axes most times and weaken them. They escape attention of the polariza-
tion discourse, whether it is at the global level or at the local level. At the global level, along with the stark economic polarization, one nds polarizations along religious, national, ethnic and other identities. Take for instance, the clash of civilizations thesis of Huntington proffered at the time when economic polarization was reversing its historical trend for the worse, which had almost dominated the polarization discourse for almost a decade. After 9/11, and invention of Islamic terror, the polarization into Islamic and nonIslamic worlds is a more dominant discourse than the economic polarization. This is equally valid at the level of a nation, where class polarization is weakened by the polarization along identarian axes such as caste, community, language, region and so on. This has been the main reason for the paradoxical nding that when the necessity of change in global order is felt most, the forces that could bring it about are the weakest. Thus it is the multi-axiality of polarizations, not mere polarity, which is most important in understanding polarization and its potential towards global change. The forces of status quo have long recognized this principle and have successfully strategized to stave off the prochange forces. However, those who needed to know it most do not seem to comprehend it. (DR. ANAND TELTUMBDE is a writer, columnist and a management professional based in Mumbai. He has BE (Mech), MBA (IIM, A), Ph D (Cybernetics) and over 25 research publications to his credit. With over 30 years of rich experience in oil industry, he has been Managing Director and CEO of Petronet India Limited till recently.Presently he operates as free lance management consultant. Besides his professional career, he is well known in the activist circle as civil rights activist with rich contribution in that sphere. The views expressed in the article are personal and do not reect the ofcial policy or position of the organisation.)
EXTREME ECONOMIC POLARIZATION WOULD BREAK THE TIES THAT BIND THE SOCIAL POLES TOGETHER AND CREATE IDEOLOGICAL REVOLUTION
29
POWER PRISM
ABDULLAH SHAHNEWAZ
Research Intern, Bangladesh Institute of Law and International Affairs (BILIA)
THE SHIFTING POWER BLOCS:
AGE OF NEW EMPIRES

The non-polar world dominated not by one or two or even several states but rather by dozens of actors possesses plethora of power
he end of the cold war has not brought the end of history. On the contrary, as we move into the new millennium, the tempo of change is quickening. Global economic and cultural interdependence grow year by year. Economic expansion and the spread of industrialization continue, but most spectacularly so in the underdeveloped countries. The majority of the worlds population now live in cities and work for wages. Women increasingly are freeing themselves from patriarchal control. Denitions of the family and, indeed, gender are being transformed in some countries, while in other places tribal, ethnic, and religious authorities desperately attempt to reassert control. Economic inequality and environmental degradation worsen. Representative democracy and capitalism are apparently dominant everywhere and everywhere are being questioned as never before. The United States has dramatically ruptured the post-Cold War order by brazenly trying to assert itself as the single and undisputed world power. Its bid for imperial dominance is being contested by rival states and regions in Europe and Asia, worldwide popular opposition, and its own internal social and economic weakness. China and the rest
30
THE IIPM THINK TANK
POLITICAL PARIT Y
of the Asia have begun to rival the economic and, increasingly, the political supremacy of Europe and United States. History clearly has not ended. Indeed, the future has never been of greater concern to humanity, and yet it appears more confusing, less certain, and more pregnant with change than ever.
THE BONE OF CONTENTION: THE ATOMIC BOMB

The sudden detonation of two atomic bombs over Japan by the United States in August 1945 raised Soviet suspicions. The United States had not shared its secret of the new weapon, and the U.S. - British nuclear monopoly eroded whatever goodwill there had been. Advisers to U.S. President Harry Truman believed that the Soviet Union was a decade away from constructing its own atomic bomb, and some recommended that the United
States used its atomic arsenal to check Soviet aggression. Members of Manhattan Project, the clandestine U.S. nuclear program that had developed the bombs deployed in Japan, disagreed. It was J. Robert Oppenheimers opinion that the Soviets would end the U.S. nuclear monopoly in only four years and Oppenheimer was right. In 1949 the Soviets detonated their rst nuclear weapon (Wenger & Zimmermann, 2004).
THE FALL OF COMMUNISM: THE END OF HISTORY?

The important dimension of the end of the Cold War is the end of communism as a political force. Francis Fukuyama described the fall of communism in the Soviet Union as the end of history (Little, 1995). As he observes, what we may be witnessing is not just the end of the Cold War, or the passing of a particular period of postwar history, but the end of history as such: that is, the end point of mankinds ideological evolution and the universalization of Western liberal democracy as the nal form of human government (Fukuyama, 1992). The demise of communism is a phenomenon conned to Europe: but the trend within China would seem to indicate a move towards capitalism, if not liberalism and the remaining communist states (Cuba, Vietnam, and North Korea) are unable to provide an international alternative. One important question arises here: what the future of an alternative to capitalism is? In regard to this it seems that no programme of political challenge to liberal capitalism from the left now has any serious credit or support: the communist revolutionary challenge is exhausted (Halliday, 1995). After the fall of the Communist states in the Eastern Bloc, the world communist movement was arguably weakened. However, the political movement of communism survived the fall of the Soviet Union and the Eastern Bloc. Of the ve remaining communist states, China, Vietnam, and Laos have moved toward market economies but without major privatization of the state sector.
THE TRIUMPH OF CAPITALISM

It has frequently been argued in the af-
termath of the Soviet Unions demise not only that the West won the Cold war but also that the claims made in favour of capitalism have nally been vindicated. Francis Fukuyama in The End of History and the Last Man (1992) applauds the globalization of capitalism and sees the development as the end point of a rational working out of historical forces. By contrast, Wallerestein is acutely conscious of the oppression which exists in the prevailing system and seeks to identify anti-systematic forces which will help to move the world on to another phase beyond capitalism (Little, 1995). Wallerestein de nes the world economy as capitalist in form. But, in fact, he tends to see capitalism and world economies as obverse sides of the same coin. From Walleresteins perspective, the demise of communism cannot be construed in terms of the triumph of capitalism, neither can be seen to have precipitated any dramatic change in the structure of the world economy. But he does accept that the demise of communism will have an effect on the world economy. In 1944, through the establishment of World Bank Group, in the Bretton Woods City of USA, the whole international economic system was captured by a few powerful capitalist countries. Moreover the powerful, developed world established the international Monitory Fund (IMF), the World Bank, the General Agreement on Trades and Tariffs (GATT), the world trade Organization (WTO), the North American Free Trade Agreement (NAFTA) etc. In the name of trade liberalization, they only serve their own interests. Most of the developing countries can improve their poor economic conditions a few through the policies given by these organizations. Common sense and most academic thinking argue that a hegemons prime objective should seek to maintain the prevailing international system, but that is not the world in which we live today. Measured in any conceivable way, the United States has a greater share of world power than any other country in history. Positioned at the top of the hierarchy, the hegemon should want to maintain and solidify it. The current inTHE GRE AT INDIAN DRE AM
31
POWER PRISM
ternational system, although not necessarily perfect, is certainly satisfactory, partly because the United States has played such a large role in establishing it. No state can have a greater stake in the prevailing order than the hegemon, nor can any state have greater power to maintain the system. Although the 1992 Defense Guidance was drafted by neoconservatives and is often seen as foreshadowing current U.S. policy, the contrast between the two is actually quite severe. Few interlinked elements that have become central to contemporary U.S. foreign policy had little place in the draft document almost a decade earlier. First, current doctrine emphasizes that peace and cooperation can exist only when all important states are democratic. Because a countrys foreign policy reects the nature of its domestic regime, states that rule by law and express the interests of their people will conduct benign foreign policies, and tyrannies will inict misery abroad as well as at home. Second, a vital instrument to preserve world order is what the administration calls preemption but is actually prevention, including preventive war. In extreme cases such as Iraq, the United States has justied the use of force by arguing that even though Saddam Hussein did not have weapons of mass destruction (WMD) programs, he would have developed them when conditions were propitious. It was better for the United States to act rather than wait for this to occur (Jervis, 2006). The United States believes itself caught in a version of the familiar security dilemma. To make itself secure, it must impinge on the security of nondemocracies. Despite the intrinsic value it places on democracy, it might be willing to live in a mixed world if it were a safe one. Yet, such safety could not be guaranteed because nondemocracies will always threaten the United States. Although the current world system is unipolar, the situation resembles that of the Cold War, when the United States and the Soviet Union were mutually threatening and threatened because their contrasting ideologies and domestic regimes made each an inherent menace to the other. Ironically, the fact
32
THE IIPM THINK TANK
that the United States is a hegemon feeds its revolutionary impulse. Hope as well as fear, opportunity as well as threat are at work.
ISLAMIC BLOC: SEARCHING FOR UNITY

Islamic bloc to play a major part in world affairs is still beyond reality. We can easily trace that Islamic force was to occupy the vacuum space after the demise of communism as an anti-West entity. And in this broad debate two important elements are pivotal i) development through consumption ii) development through sacrice. As Islam believes in sacrices it does not allow reckless consumption thus Islamic force stands against market expansion viz. capitalist market economy. And this debate further got momentum by Samuel P. Huntingtons provocative and controversial thesis of The Clash of Civilizations. Huntington Argued For forty-ve years the Iron Curtain was the central dividing line in Europe. That line has moved several hundred miles east. It
is now the line separating peoples of Western Christianity, on the one hand, from Muslim and Orthodox peoples on the other (Huntington, 1996). The Muslim world denotes both Muslim majority countries and a transnational Muslim community that includes growing minorities within Western and other countries. This transnational community is incredibly diverse. Muslims some more pious, others more secular differ by race, ethnicity and social class, and are active citizens in very different national contexts. What binds a diverse Muslim world together is a shared religious identity based on monotheism, the prophethood of Muhammad, and the revelation of the Quran, however differently understood and lived (World Economic Forum, 2008). The disunity within the ummah is very apparent for all to see; Muslims are making false claims against one another, creating hostility, preaching hatred and even killing one another. The ummah is in a desperate situation and in dire need
POLITICAL PARIT Y
of reform. The Muslim world remains embroiled in a whole host of religious, social, political, economic, and cultural disputes. Without any real international inuence, despite the 57-member Organization of the Islamic Conference, great wealth, and large numbers, Muslims are mere spectators in world politics; Islam is synonymous with extremism; and Muslims are often labeled as terrorists. Such issues, as well as questions of media bias, the validity of the clash of civilizations thesis, Islamophobia, and realistic Muslim responses led to the debate of Muslim disunity. The current state of disunity has weakened the ummah and left it in a vulnerable position. This is why we see Muslims under attack in their own countries across the globe. In the wake of the current global political climate, Islam as an institution an ideology and a way of life, is being attacked. The occurrence of Islamophobia is rising and Muslims are nding it hard to ght back due to the lack of a unied and cohesive Muslim front.
THE AGE OF NONPOLARITY

The principal characteristic of twentyrst-century international relations is turning out to be nonpolarity: a world dominated not by one or two or even several states but rather by dozens of actors possessing and exercising various kinds of power. This represents a tectonic shift from the past. The twentieth century started out distinctly multipolar. But after almost 50 years, two world wars, and many smaller conicts, a bipolar system emerged. Then, with the end of the Cold War and the demise of the Soviet Union, bipolarity gave way to unipolarity an international system dominated by one power, in this case the United States. But today
power is diffuse, and the onset of nonpolarity raises a number of important questions. How does nonpolarity differ from other forms of international order? How and why did it materialize? What are its likely consequences? And how should the United States respond? (N. Hass, 2008) More recently, the nancial and economic crisis that hit the US economy beginning in Fall 2007 coupled with the rise of new great powers like China and India, and the resurgence of Russia have raised questions about the decline of Americas relative power. These doubts found ofcial expression in the National Intelligence Councils (2008) Global Trends 2025 report (Layne, 2009). World Out of Balance (Layne, 2009) is a forcefully argued rebuttal to arguments that American hegemony is waning and that unipolarity provokes other states to check US power. Contrary to the argument in World Out of Balance, a strong case can be made that the early twentyrst century will witness the decline of US hegemony. Indeed, notwithstanding their claim that unipolarity is robust and US hegemony will endure well into the future, Brooks and Wohlforth actually concede that uni-polarity is not likely to last more than another 20 years, which really is not very long at all (Layne, 2009). In contrast to multipolarity which involves several distinct poles or concentrations of power a nonpolar international system is characterized by numerous centres with meaningful power. In a multipolar system, no power dominates, or the system will become unipolar. Nor do concentrations of power revolve around two positions, or the system will become bipolar. Multipolar systems can be cooperative, even assuming the form of a concert of powers, in which a few major powers work together on setting
the rules of the game and disciplining those who violate them. They can also be more competitive, revolving around a balance of power, or conictual, when the balance breaks down.
CONCLUSION
History clearly has not ended. The world of 1945 has evolved dramatically, fundamentally and irreversibly. From Wallersteins perspective the demise of communism cannot be construed in terms of the triumph of capitalism and he further argued that the future remains open and he identied the emergence of antisystemic movements. Wallerestein has insisted that we are now moving into an era of disintegration of the capitalist world-economy in which the nal collapse of liberalism as a hegemonic ideology (Little 1995). Moreover, the economic crisis that hit the US economy due to waging several protracted wars in Afghanistan and Iraq coupled with the rise of new great powers like China and India, and the resurgence of Russia have raised questions about the decline of Americas relative power. Besides these powers shifting questions there are some other fundamental changes in world politics. These includes: A shift in power to global South (China, India, Brazil and other nations), The rise of transnational threats, The specter of weak and failing states, The proliferations of various terrorist groups, The mounting inuence of non-state actors, Evolving norms of sovereignty and intervention, The spread of regional and subregional organizations etc. And certainly these elements will inuence to form the future world governance system. (ABDULLAH SHAHNEWAZ is a Research Intern at Bangladesh Institute of Law and International Affairs (BILIA). He has completed both Honors and Masters in Peace and Conict Studies from the University of Dhaka. His elds of interests are Conict Analysis and Conict Resolution Procedures & Human Security. The views expressed in the article are personal and do not reect the ofcial policy or position of the organisation.)
RISE OF GREAT NEW POWERS LIKE CHINA AND INDIA HAVE RAISED QUESTIONS ABOUT THE DECLINE OF AMERICAS RELATIVE POWER
33
POLICY PERSPECTIVE POLICY PERSPECTIVE OLICY ERSPECTIV SPEC VE C
CRITICAL FAILURES IN
STATISTICAL ASSESSMENT
Correct and well-balanced assessments are essential as external creditors rely upon the quality, timeliness, and integrity of ofcial data in order to accurately price sovereign risks in lending to the country
34 34
THE IIPM THINK TANK
NUMBER NUMBS
DEV KAR
Lead Economist, Global Financial Integrity (GFI), Washington, U.S.A
35 5
POLICY PERSPECTIVE
his article brings out the gaps in the assessment of Greek ofcial statistics and suggests a way forward in avoiding such mistakes in the future. The reason why high-quality assessments are important is that users need assurance from an independent body that the country data they are using to make important decisions (e.g., to lend to the country) are reliable. An IMF study found that subscribers to its Special Data Dissemination Standards (SDDS) can expect to enjoy lower borrowing costs as a result of greater transparency and timeliness of data which are eagerly sought by external creditors. In fact, the study found that yield on new bonds issued by SDDS subscribers declined on average by close to 20 percent or by an average of about 55 basis points. Hence, accurate and reliable assignment of ratings under statistical assessments is critical for markets to assess sovereign risks and to price government bonds accordingly. To the extent there is a failure to assess statistical systems correctly, that failure has adverse implications for the formulation of policy. Also, all external creditors bear a loss while governments are lulled into believing that they can keep on borrowing at unrealistically low rates. This exacerbates the risk of a nancial crisis.
WARNINGS IGNORED AND OPPORTUNITIES MISSED

In a report dated January 2010, the European Commission noted that in October 2009, Greece informed Eurostat, the European statistical agency, that the government decit for 2008 was revised upwards from 5.0% to 7.7% of GDP. The Commission noted the 5.0% gure was published and validated by Eurostat in April 2009. Revisions of the scal gap of this magnitude are undoubtedly sharp and according to the Commission, extremely rare in other EU member states. However, such revisions to Greek scal data have taken place at different times in the years prior to 2004, the Greek authorities misreported scal data in no less than 11 separate instances. The quality of scal data is not the only problem related to Greek statistics national accounts data are not much better. GDP gures have also been subjected to
36
THE IIPM THINK TANK
signicant revisions in the past. Given the pervasive problems with Greek data, the Commission opined that the governance and institutional setup related to Greek statistics needs to be analyzed in depth. Based on the information at hand, it seems that there were two main reasons for the frequent and large revisions to the government decit weaknesses in methodology and failures of the relevant Greek institutions in a broad sense, including the lack of independence of the national statistical agency and the General Accounting Ofce from the Ministry of Finance. The Commission acknowledged that the Greek authorities would need to rectify the methodological weaknesses and reform the statistical system by putting in place transparent and reliable working practices between the various government agencies in order to reverse the serious loss of condence in the reliability of Greek statistics. While much of the above analysis in 2009 benets from hindsight, the Commission noted that Eurostat has consistently contested the quality of Greek scal statistics for several years. The number and frequency of these reservations was much more than they were for other member states of the EU. For instance, in 2003, Eurostat found out that the Greek authorities were overestimating tax revenues by recording uncollected taxes that were much higher than assumed. As a result, Eurostat asked the Greek authorities to switch to a method of recording tax revenues based on another, more reliable and internationally approved method called time-adjusted cash. This recommendation was never carried out. The IMFs statistical assessment system called the Report on the Observance of Standards and Codes (ROSC) Data Module (henceforth Data ROSC) did not fare much better. The Data ROSC is supposed to provide a review of a countrys data dissemination practices against the IMFs standards. An IMF Data ROSC team that visited Athens in late 2002, published a report in early 2003 which provided an in-depth assessment of the quality of Greeces national ac-
counts, consumer price index, producer price index, government nance, monetary statistics, and balance of payments statistics. The assessment was carried out against the IMFs SDDS, which almost all members with relatively advanced statistical systems subscribe to. Such a subscriber must meet SDDS specications for coverage, periodicity, and timeliness of the data, and for advance release calendars, although a member may use the exibility options on up to two data categories that are not met at the time of subscription.
NUMBER NUMBS
THE NEGATIVE EXTERNALITY ASSOCIATED WITH FAULTY ASSESSMENT SYSTEMS TRANSLATES INTO A LARGER RISK FOR LENDERS
The IMF Data ROSC assessment failed spectacularly in concluding that the Greek statistical agencies have a legal and institutional environment that supports statistical quality. In fact, on government accounts which caused so much angst among creditors and international organizations such as Eurostat and the EU, the IMF report awarded the highest ratings (O=Practice Observed and LO=Practice Largely Observed) to almost all elements of data compilation. In fact, integrity of data compilation (covering such elements as professionalism, transparency, and ethical standards) got the highest ratings. Only two elements of scal data compilation got poor marks (LNO=Practice Largely Not Observed): the resources devoted to compilation and the accessibility to methodological notes on those accounts. As it turned out, these assessments were widely off the mark and failed to capture the essential problems with the unreliable and misleading Greek scal data. Ratings in other areas of statistics such as national accounts were also misleadingly generous. accuracy and reliability or in the subsequent update to that report in February 2005. Indeed, the fact that Eurostat found serious problems with the recording of tax revenues back in 2003, raised no ags in the 2005 Data ROSC update. Moreover, the overall tenor of the update was quite bland. In short, it represented another missed opportunity to ag serious breaches of methodology and the prerequisites of quality. The lesson here is that much better coordination among relevant international organizations responsible for statistical assessments needs to be implemented as a matter of the highest priority. Second, the IMFs Data ROSC teams rely too much on information provided by government statisticians. This mindset needs to change. For instance, the reports would be stronger if they were more forthright in their assessments even in the face of sharp dissention by the agencies assessed. In the authors experience, IMF Data ROSC assessments tend to shy away from critical commentary. Users not only need to see a frank discussion of outstanding issues but they need to be assured that the criteria underlying the ratings have been tightened greatly. The highest rating should be awarded sparingly and only after extensive discussion within the IMF and with other relevant international organizations. Third, the Data ROSC should assign a high priority to garnering the maximum feedback from both domestic and external users of the statistics. The users survey of the 2003 Data ROSC notes that the 17 users of scal data questioned the underlying methodology and wanted more detailed data on a timely basis. In hindsight, the users survey provided a clue to the serious problems affecting the quality of Greek scal data. It is clear that the users surveys should be given more prominence in future assessments and
that the sample survey should be extended to external creditors such as banks and other nancial institutions that participate in the government bond markets. Finally, the Data ROSC team must subject key balance of payments, national accounts, monetary, and scal data to rigorous consistency checks. The checks are particularly important for any country that subjects its macroeconomic data to frequent and signicant revisions. For instance, large revisions in the scal decit must be consistent with the monetary and balance of payments accounts. The area departments of international organizations the departments that are directly involved in policy discussions with the authorities must take the lead in ensuring that the statistical system is internally consistent.
CONCLUSION
There is an urgent need to improve the statistical assessment systems of the IMF as they are important to investors to accurately price sovereign risks. The negative externality associated with faulty assessment systems translates into a larger risk for banks and other nancial institutions that decide to lend debtor countries based on misleading data. Correct and well-balanced assessments are important because external creditors depend upon the quality, timeliness, and integrity of ofcial data in order to accurately price sovereign risks in lending to the country. The article suggests measures that can be implemented to reduce such negative externalities. While IMF assessments of statistical system serve many useful purposes, investors need to be aware that such assessments cannot always be perfect which calls for strong inhouse research to carry out in-depth analysis of the risks associated with sovereign lending. (DEV KAR is the Lead Economist at Global Financial Integrity (GFI). Dev was also a Senior Economist at the International Monetary Fund (IMF), Washington DC. The views expressed in the article are personal and do not reect the ofcial policy or position of the organisation.)
A WAY FORWARD
The Greek case highlights certain weaknesses in the current system of statistical assessments carried out by international organizations such as the IMF and Eurostat. For one, there seems to be a lack of coordination among them in overall assessments and in the assignment of ratings. As far as this author is aware based on his experience at the IMF, Data ROSCs are typically not discussed with the regional statistical agencies such as Eurostat. As noted at the outset, there were at least 11 separate instances in the years prior to 2004 when the Greek authorities misreported scal data. Yet, this simple fact was not reected either in the Data ROSCs strong ratings (O and LO) for data integrity, methodological soundness,
37
POLICY PERSPECTIVE
KLIMIS VOGIATZOGLOU
Research Fellow, Centre of Planning and Economic Research, Athens, Greece
OFFSHORING
AND INDIAS EXPORT DEVELOPMENT IN SERVICES
An extremely strong positive correlation between Indias inward offshoring activies and Indias exports indicates that exports are greater to those countries from which India receives a greater amount of offshoring activities
uring the last twenty years global economic integration has proceeded with accelerating steps and moved beyond simple trade relations among countries. This deeper form of globalization has with increasing intensity interconnected national economies and has created a global production and supply chain. In the literature as well as in the business world this phenomenon is known as offshoring and international production sharing. Offshoring arises when the production of a nal good or a service activity is sliced into several production stages / business activities which take place in different countries. The various intermediate inputs-business activities, resulting from each production stage at a different location, are combined in the last stage to pro-
duce the nal good or service. Here international trade in intermediate inputs is an integral part of the overall production process. Offshoring results from a rms (whether multinational or not) strategy with respect to the organization of production with the goal of minimizing overall costs. This strategic option is aided by low tariffs, open trade relations, low transport costs, substantial cross-country wage differentials, and new production technologies which allow the production process to be fragmented. Indeed, the existence of the above conditions is crucial for offshoring to take place. There is a considerable amount of accumulated evidence showing an increasing importance of offshoring activities (e.g. Bridgman, 2010; Molnar et al., 2007; Arndt and
Kierzkowski, 2001). Those are most importantly found in the clothing, automobile, and electronics sectors (Lall et al., 2004). However, offshoring has grown substantially in recent years also in other manufacturing industries, as well as in the service sector. Particularly for the case of the South and East Asian region, large intra- and extra-regional production sharing networks in SouthEast Asia have been formed and expanded (e.g. Machikita and Ueki, 2010; Hiratsuka, 2008). As a matter of fact, China has increasingly been involved in (inward) offshoring activities, and there is evidence suggesting that this involvement has played a key role in Chinas export development (e.g. Lemoine and Unal-Kesenci, 2004). Foreign-owned rms have relocated the labour-intensive pro-
38
THE IIPM THINK TANK
POLICY PERSPECTIVE
duction activities (such as assembly of the components) to China, and export their goods to the western markets from there. Thus, China has been transformed to a production, assembly, and export platform for foreign rms. More recently, other economies such as India and several South Asian countries have also achieved a signicant opening-up of their economy and improved their export performance. Most importantly, India, which resembles China in terms of country size, has emerged in the global Information Technology (IT) services sector as one of the major exporter of IT services in the world (e.g. Banga and Kumar, 2010; Bussiere and Mehl, 2008; Banik, 2007). In addition, India is increasingly becoming an international centre of IT-related research and development activities (e.g. Altenburg et al., 2008). The relatively little empirical evidence that exists seems to indicate that offshoring in Indias service sector has increased, and that the intermediate business activities of foreign rms that have been relocated to India have had a positive impact on the development of the service sector and its export performance (e.g. Kuruvilla and Ranganathan, 2008; Meyer, 2007; Patibandla and Petersen, 2002).
sector; that is, the supply and use sectors are the same) that India imports and uses in a given sector as an input from each source country. This indicates the extent of offshoring/ production sharing that occurs between the source/supply country and India (the host country). More specically, the reasoning behind this is that the source country (the country that relocates the given business activity/production stage that belongs to a specic industry to the host country) exports the intermediate production stage to India (and thus India imports it) in order to produce the subsequent production stages (those that are further in the production line of the given industry) in the host country. The offshoring related imported intermediate goods of India have risen signicantly during 20002010. Most importantly, offshoring in India occurs from the European Union (EU), China, Switzerland,
and the USA. In particular, we examine the trends in the nance and insurance service sector, the computer and information services sector, and in other business services. It is found that offshoring activities exhibit an upward trend in all service sectors. Offshoring is particularly pronounced in nance and insurance services, but computer and information services have increased signicantly over the 2000-2010 period, and have in recent years become equally important. It is also evident that offshoring in services occurs mainly from the EU and the USA.
INDIAS EXPORTS AND THE EFFECT OF OFFSHORING

Exports of manufactures show a signicant rise in all partner countries. Indias most important export destination of manufacturing goods is the EU followed by the United States. Hong-Kong and Japan con-
OFFSHORING DEVELOPMENTS IN INDIA

Given the importance of the subject matter, we analyze the development of offshoring activities in India (originating from several source countries) and its impact on Indias export growth over the 2000-2010 period. First, the offshoring in the manufacturing sector is examined. We obtain information on the offshoring activities of Indias major trade partners from the OECDs international trade in intermediate inputs inputoutput (IO) database for manufacturing goods and services. We calculate from this database the intra-industry intermediate inputs (those that occur in the same
40
THE IIPM THINK TANK
OFF TO THE SIDE
stitute also important export markets for India. Regarding exports in services, the export growth that has been achieved over 2000-2008 (latest available year for services) is even more impressive. The USA is clearly the most important export destination followed by the EU. Japan and Hong-Kong follow the list, but are much less signicant. It is interesting to examine the relation between Indias inward offshoring activities (originating from several OECD and other countries) and Indias exports. Thus, we rst conduct Pearson correlation analyses using cross-country observations on Indias offshoring source countries and Indias export partner countries for the years 2000, 2005, and 2010. This examination reveals whether or not Indias exports are greater to those countries from which India receives a greater amount of offshoring activities, or stated alternatively, whether the countries that engage more in offshoring in India are those that import more from India (and thus constitute Indias most important export destinations). This analysis is performed for both the manufacturing sector (correlating manufacturing exports and offshoring in manufactures) and the service sector (correlating service exports and offshoring in services). The results, indicate that there is a statistically signicant positive correlation between manufacturing exports and offshoring in that sector. However, this correlation is not strong (for 2010 the Pearson coefcient is about 0.48). On the other hand the positive correlation between service exports and service offshoring is highly statistically signicant and also extremely strong (there is almost perfect correlation with a coefcient of 0.96 in 2008). Thus, we nd evidence that the extent of offshoring and Indias export level move in the same direction. In order to examine this further and quantify the effect of offshoring, we estimate an appro-
THE POSITIVE CORRELATION BETWEEN SERVICE EXPORTS AND SERVICE OFFSHORING IS HIGHLY STATISTICALLY SIGNIFICANT AND EXTREMELY STRONG
priate panel-econometric model. The estimable equation is based on and derived from the ChamberlinHeckscher-Ohlin theoretical framework of international trade with vertical multinationals rms that engage in offshoring (Helpman and Krugman, 1987). 2003). Thus, an important policy implication seems to be hinted by our results coupled with some of the literatures ndings. Policies that promote a more extensive involvement in IT-related and other hightech offshoring activities (originating from advanced economies) may prove to be particularly benecial for the local technological capacity and export performance of India in the long-run. However, this prospect may heavily depend on the type of offshoring, the established international industrial linkages, the general macroeconomic conditions, and Indias overall education and technology policy. (DR. KLIMIS VOGIATZOGLOU is a Research Fellow at the Centre of Planning and Economic Research, Athens, Greece. He was also a Visiting Lecturer of Political Economics at the University of Continental Greece (fall semester 2007) and Visiting Professor of Economics at Seoul National University (academic year 2006-2007). He did his Masters in Economics from University of Manchester (2002) and did PhD in International Business & Economics, University of Patras (2005). His research interests lies mainly within the elds of International Economics and Aplied Economics, and include issues in international trade, FDI, industrial specialisation, economic geography, globalization and regional economic integration. in addition to these he has also wrote articles for various journals. The views expressed in the article are personal and do not reect the ofcial policy or position of the organisation.)
CONCLUDING REMARKS AND POLICY IMPLICATIONS

Our nding of offshoring constituting an important determinant of Indias export development is in line with the empirical literature for both India (e.g. Kuruvilla and Ranganathan, 2008; Meyer, 2007) and other economies (e.g. Vogiatzoglou, 2011). Moreover, there is some evidence suggesting that developing countries that have become hosts of offshoring activities have witnessed to some extent a technological upgrade. In the case of China, the technological advancement that has been achieved in the Information and Communication Technology sector (Fan, 2008) seems to have been particularly facilitated by the countrys extensive participation in offshoring (e.g. Gaulier et al., 2007). More generally, there is also evidence indicating that international technological spillovers may occur to the domestic economy arising from industrial linkages with technologically advanced economies (Lopez-Pueyo et al., 2009). With regard to India, it has been found that there are signs of an improvement in the countrys innovation capability (Fan, 2008). Furthermore, R&D efforts and technology transfers from foreign-owned rms operating in India seem to have a positive effect on local rms and Indias exports (Hasan and Raturi,
41
CALL FOR PAPERS

The GID is a monthly journal featuring contents of academic and professional interest that are of utility to managers, policy makers, politicians, consultants, teachers and students in the areas of Economics and Management. It is a multidisciplinary platform for sharing and disseminating knowledge in the issues of education, health, poverty, unemployment, agriculture, industry, service, FDI, international trade, infrastructure and environment, pertaining to Indian economy. We passionately believe in the credo that we constantly seek to follow: rethink, edify and delineate. This enduring commitment has helped us foster and broaden the parameters of public policy debate and alternatives. Toward that goal, we strive to achieve greater involvement of the intelligent, concerned change agents (reform minded politicians, public servants, academicians, socially responsible firms, civil society organizations and citizens) in questions of policy and the ideation. In order to further augment value and provision a broad perspective to Indian economic problems, your knowledge and expertise in the above mentioned fields would be highly valuable to The GID. We would like the possibility of receiving a write-up from you, on a topic of your expertise and interest as per the under-mentioned guidelines. Guidelines For Contributors Content: Articles should be in the areas of education, health, poverty, unemployment, agriculture, industry, service, FDI, international trade, infrastructure and environment, pertaining to Indian economy, which are of contemporary interest and value to the esteemed and intellectual readers. The journal seeks to present an eclectic approach supported by empirical research or practical applications as necessary. Contents that demonstrate clear and bold thinking, fresh and useful ideas and solutions, accessible and jargon-free expression, and unmistakable authority and proficiency are those most likely to meet our readers needs. Reviewing Process: Each article is reviewed by the Economics Research Group (ERG). If found suitable, the same may be sent for another round of review before final acceptance. With prior information and consent, the editors reserve the right to modify and improve the manuscripts to meet The GIDs standards of presentation and style. The editors also have full right to accept or reject an article for publication. Editorial decisions will be communicated within a period of two weeks of the receipt of the article submission. Word Length: Articles should be of 2,500 to 3,000 words including abstract and references. Headings And Sub-Headings: Headings should be typed in capital and underlined; sub-headings should be typed in upper and lower case and underlined. References: References to other publications should follow the Harvard style. Figures, Charts And Diagrams: Use of figures, charts and diagrams should be kept to the minimum and text should indicate where the same will appear. All tables, charts, graphs should be typed on separate sheets. They should be numbered as Table-1, Table 2, etc. The graphs must have the minimum amount of descriptive text and the axes should be labeled with variable written out in full, along the length of axes. Abstract And Key Words: An abstract within 100 words and three key words should be submitted. Authors Bio-data And Photograph: A brief bio-data with full postal and e-mail addresses and a coloured photograph should be sent along with the articles. Copyright: Authors should warrant that their work is not an infringement of any existing copyright and will indemnify the publisher against any breach of warranty. The articles published in The GID will become the legal copyright of the publisher. The articles appearing in The GID are the personal responsibility of the authors themselves and do not reflect the views of the editor, principal or the Economics Research Group (ERG) or the sponsoring organization. The author(s) will receive a complementary copy of The GID in which their articles are published and this does not include postal/courier charges. Submission: The submission should be sent to Sray Agarwal at sray.agarwal@iipm.edu
PRAISE FOR THE GID

In my opinion, it has fulfilled its objective in presenting a comprehensive, up-to-date and clear exposition of the issues and concerns that are essential for understanding, evaluating and suggesting solutions to the important national economic problems. presented endeavour... I have taken the liberty of putting the copies that I had got along in the WTO library.
Mr. Shishir Priyadarshi, Development Division, WTO, Geneva

...The Great Indian Dream is a very informative document.
Mr. U.K.S.Chauhan, Director, Department of Agriculture and Cooperation, Ministry of Agriculture, New Delhi
Dr. V.L.Chopra, Member, Planning Commission, New Delhi

...I found it very useful material, which has dealt with the vital issues that we are facing in the field of education, health, poverty and employment. I would like to compliment all the authors as well as the editorial team for bringing out such a valuable publication.
...I laud your info base and analytical prowess; particularly your solutions vis-a-vis international experience...you may like to examine further from your side the aspects of futures trading in the perspective of the Indian farming community given your extant knowledge base in agriculture.
Dr. Arun Nigavekar, Chairman, UGC, New Delhi

If the purpose of a think tank is not merely to think issues through but also to ignite thinking among the readers, I think you have succeeded very well indeed.
Mr. Suvendu Ganguly, Deputy Director, Forward Markets Commission, Kolkata
I thoroughly enjoyed going through your recent issue of The Great Indian Dream it is undoubtedly a mammoth task of pulling together divergent perspectives on the critical issues of the nation
Mr. R.Badrinath, Director, Division of Trade Support Services, International Trade Centre, Geneva
Dr. Parth.J.Shah, Centre for Civil Society, New Delhi

The GID, a thematic compilation of economic thoughts, ideas, questions, answers and solutions...promises to usher in a potentially better, if not necessarily newer, dawn of economic policies that radiates the power to dispel the current darkness of socio-economic and socio political confusion... the review exudes qualified optimism about countrys prospects.
Modern India certainly needs more think tanks like yours... unlike most academic journals, yours is well-designed, readable and also conveys a sense of aesthetics and humour through the illustrations... it well reflects the high standards of the IIPM.
Mr. Brij Khindaria, President, Diplomatic forum for Business, Geneva

I have received the GID issue...very impressively put together with a lot of solid analysis...kudos to those who are bringing it out.
Mr. S.R.Kasbekar Senior Editor, The Financial Express, Mumbai

I have to say that the Great Indian Dream, 2005 Volume- III, is very impressive and the material is very good. I send all of you involved with it, my heartiest congratulations and wish you all the best.
Mr. B.S.Raghavan, IAS(Retired), ex-US Congressional Fellow, exPolicy Adviser to UN(FAO), ex-Adviser to International Commission on Peace and Development, ex-Director, Politician and Security Policy Planning, Government of India
The Lord Paul, The Rt. Hon. Lord Paul of Marylebone

Undoubtedly, it is of exceptional quality and amongst the best that I have seen in my interaction with similar organisations in different countries. I merely wanted to write to you and congratulate you and your institution on an extremely well researched and I am much impressed by the content and quality of the journal The Great Indian Dream and the wide range of issues it covers. The editors indeed fully deserve the title of think tank! Dr. V.M.Madiman Rao, Institute for Social and Economic Change,
Bangalore
PRAISE FOR THE GID

Thank you very much for sending me the Great Indian Dream 2007 on Indias Policy Deficit: Planning for Change. I appreciate the initiative taken by the IIPM Think Tank in this area. Dr. Indira Hirway, Centre for Development Alternatives, Ahmedabad Your publication is interesting and useful to us in our work. Mr. Mihir.R.Bhatt, Honorary Director, All India Disaster Mitigation Institute,
Ahmedabad
Dr. Gouri Pada Dutta, Chairman, Subject Committee (Health), State

Planning Board, West Bengal, Kolkata
I would like to Congratulate IIPM for bringing such critical policy issues to the forefront, especially as India and worlds other great economies tread on the path of globalization and economic liberalization. Your efforts at adding the human face to some very core management areas are indeed commendable.
Mr. Bharti Ali, Co-Director, HAQ: Centre for Child Rights, New Delhi
It is nicely designed and also rich in contents. Dr. Rudra Narayan Mishra, Gujarat Institute of Development Research,
Ahmedabad
We at IDEI do appreciate the efforts being made by your organization...GID which is committed to enhance public awareness of policy issues in economics and management and to engineer solutions that will fulfil the Great Indian Dream. Ms. Rajpreet Kaur, Program Support Officer, International Development
Enterprises (India), New Delhi
I have been reading it with great enthusiasm, interest and curiosity nonetheless. I would also like to congratulate you and your team for truly high-quality editions of the GID that are of the prime importance to the future of Indias thriving economy. Dr. Rok Spruk, Slovenia I have received your energy /environment special issue. I enjoyed reading it. This is one of the most comprehensive reviews available on the subject today... This number is timely and will serve as a basic reference for leading policy makers/planners in India. In fact, I can say that all your volumes are packed with information/ ideas for development workers. I wish you all the best in your new assignment. Dr. G.Poyya Moli, Member, CEM, IUCN & Member, SEAC & SHCC, Govt
of Puducherry, Reader, Department of Ecology & Environmental Sciences, Pondicherry University, Pondicherry
I like the content, which is extremely detailed but balanced and certainly offers a good non-ideological mix from leading authors.
Dweep.I.Chanana, UBS Philanthropy Services, a consulting unit of UBS

AG, Zurich
I managed to flip through the journal and found some of the articles very interesting ... GID has an interesting mix of articles and the photos and layout are also very well done.
Ms. Kumkum Dasgupta, Hindustan Times, New Delhi

They are highly informative, focusing on contemporary issues. Dr. Rajib Kumar Sahoo, Senior Economist, Canara Bank, Bangalore Presentation of IIPM Think Tank is really of high quality. Your team led by Dr. M. K. Chaudhuri and Prof. Arindam Chaudhuri deserve the appreciation from every one who has a vision and dream for a new innovative India. Hope your effort will become a path finder for innovative research workers.
I am impressed particularly with the varieties of issues that you have been able to cover in this publication. Thank you for this spectacular piece of work. Dr. Soumendra K. Dash, Chief Economist, CARE Ratings Ltd, Mumbai I find that the journal covers a wide range of subjects in Economics, and is very useful both for reference and research. Dr. Prabha Panth, Professor of Economics, Osmania University, Hyderabad
The copies of GID are excellently produced and its so nice to see that you have many new names from new institutions. Dr. PadmaPrakash, Editor, eSocialSciences

Gid

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Gid

Uploaded by

Copyright:

Available Formats

AN IIPM THINK TANK & GREAT INDIAN DREAM FOUNDATION JOURNAL

A B&E MONTHLY SUPPLEMENT, JUNE-2011

What the Liberals tell us about the rise of China

Era of Geo-Political to a sustainable Geo Legal ord Geo-Legal order

THE POWER PRISM

A N A RI N DAM C HAU DH U R I & P L A NMA N ME D IA P R E SE N TATION

DICTATORSHIP OF THE SYCOPHANTS

THE NEW ADDICTION OF THE

IIPM: THE FUTURE IS HERE

SEARCH, SIEVE, SCHEME...

THE INDIA ECONOMY REVIEW

The First Words and The Last Word

THE 70MM REV

THE IIPM THINK TANK

THE GRE AT INDIAN DRE AM

THE IIPM THINK TANK

THE INDIA ECONOMY REVIEW is now

THE GREAT INDIAN DREAM

THE GREAT INDIAN DREAM

WHAT THE LIBERALS TELL US ABOUT THE RISE OF CHINA

THE IIPM THINK TANK

POLICY TOWARDS NORTH KOREA

AFGHANISTAN AND PAKISTAN BORDER SECURITY

ANTI-PIRACY EFFORTS OFF THE HORN OF AFRICA

LIBERALISM AND ECONOMIC RELIANCE

HOW RELEVANT IS HUNTINGTON

THE IIPM THINK TANK

RISE OF SOUTH-SOUTH ECONOMIC FLOWS

THE NEW GLOBAL ECONOMIC STRUCTURE

FUNDAMENTAL FORCES CHANGING GLOBAL ECONOMICS

POLARIZATION AND POLARITY

THE IIPM THINK TANK

PROSPECTS OF WORLD REVOLUTION

THE SHIFTING POWER BLOCS:

AGE OF NEW EMPIRES

THE IIPM THINK TANK

THE BONE OF CONTENTION: THE ATOMIC BOMB

THE FALL OF COMMUNISM: THE END OF HISTORY?

THE TRIUMPH OF CAPITALISM

ISLAMIC BLOC: SEARCHING FOR UNITY

THE AGE OF NONPOLARITY

POLICY PERSPECTIVE POLICY PERSPECTIVE OLICY ERSPECTIV SPEC VE C

THE GRE AT INDIAN DRE AM

WARNINGS IGNORED AND OPPORTUNITIES MISSED

THE IIPM THINK TANK

INDIAS EXPORTS AND THE EFFECT OF OFFSHORING

OFFSHORING DEVELOPMENTS IN INDIA

OFF TO THE SIDE

CONCLUDING REMARKS AND POLICY IMPLICATIONS

CALL FOR PAPERS

PRAISE FOR THE GID

Mr. Shishir Priyadarshi, Development Division, WTO, Geneva

Dr. V.L.Chopra, Member, Planning Commission, New Delhi

Dr. Arun Nigavekar, Chairman, UGC, New Delhi

Mr. Suvendu Ganguly, Deputy Director, Forward Markets Commission, Kolkata

Dr. Parth.J.Shah, Centre for Civil Society, New Delhi

Mr. Brij Khindaria, President, Diplomatic forum for Business, Geneva

Mr. S.R.Kasbekar Senior Editor, The Financial Express, Mumbai

The Lord Paul, The Rt. Hon. Lord Paul of Marylebone

PRAISE FOR THE GID

Dr. Gouri Pada Dutta, Chairman, Subject Committee (Health), State

Dweep.I.Chanana, UBS Philanthropy Services, a consulting unit of UBS

Ms. Kumkum Dasgupta, Hindustan Times, New Delhi