Bush’s Ports Affair


Finally Dubai Ports World has decided to transfer US ports business to a “US entity”. Bush must have felt relieved along with his colleagues (both for and against the ports deal). They must have patted each other for effectively creating a drama around the deal that achieved two ends – it has homogenised and ‘jingoised’ the American opinion to a certain degree, while giving a softening touch to the warrior image of Bush.



Dinner with George and Manmohan: Bush in India


The Joint US-India statement issued after the meeting between President Bush and Prime Minister Singh on March 2 clearly reflects the Indian approval of the principles on which the US hegemony is established globally. The five sections, in which the statement is divided, to summarize the broad areas of cooperation, enumerate the basic concerns of the US hegemony, and India’s willingness to cooperate.

Full Text: http://counterpunch.org/chandra03032006.html

Bush’s Passage to India: Why Does India Carry His Water?


A few days from now, Bush will go to India and reaffirm his newfound love, becoming the only Republican President to visit India after Nixon. Bush and his ‘mouthpieces’ are quite vocal about their need of India – to compete with the EU, to check China, to control unpredictable regimes and to expand the war on terrorism etc. But it is quite interesting to note how India’s consistent positive response to these advances is generally taken as paradoxical, or else simply as succumbing to ‘external’ pressures. However if we take notice of the transformation of Indian capitalism and of the aspirations of the Indian ruling class, we can easily find the reason behind this mutuality.

India has already expanded its interests beyond South Asia and other neighboring economies. It has business assets and interests to secure both in developed and underdeveloped worlds. In fact, Indian capital has been ‘flying’ through legal and illegal routes since 1956 when the Birla group of companies made a large-scale investment establishing a textile mill in Ethiopia. In the late 1970s-early 1980s, the phrase “third world multinationals” was popularized to differentiate them from the first world multinationals. It was generally perceived that unlike the latter, which were motivated by the firms’ internal growth process, third world multinationals were products of demand-side bottlenecks, the statist restrictions on monopolistic and trade practices, other imperfections and distortions created by the state and political forces. This argument is negated by the fact that the companies going abroad where mostly those who had profiteered in the phase of ‘interventionism’. They were firms having “a diverse and established presence at home”. As one scholar from that period, Rajiv Lall noted in his study “Multinationals from the Third World: Indian Firms Investing Abroad” (Oxford University Press, 1986): “These firms tend to be part of large industrial houses with a conglomeration of holdings that give them an imposing rule in the Indian market.”

However, until 1978, majority equity participation in firms abroad was generally prohibited. Despite this, the Indian firms investing abroad managed to retain management control. After that, the pace of capital export has been unceasingly maintained, with its tremendous unimpeded nature in the post 1991 phase. The post-1991 scenario has rendered new directions to the Indian “export of capital”. The State itself has emerged as a leading segment in this trade, concentrating on sectors that allow a smooth process of capital accumulation domestically and internationally–energy and finance, being true to its role of expressing the general conditions of accumulation and devising overall economic strategy.

The energy requirements of India’s economy have been constantly increasing and as a result indigenous corporate oil interests have evolved, which initially were restricted to brokerage in export and import. But as the regulation for the outflow of Indian capital for investment and acquisitions abroad has been eased out, there has been heavy investment to ‘proactively’ secure energy supplies from abroad. Indian oil companies, especially, Oil & Natural Gas Corporation­Videsh Ltd (OVL), are acquiring assets in oilfields in Russia, Latin America, the Middle East and ex-Soviet Central Asian republics. India is particularly using its erstwhile non-aligned image to gain access to the African oil and gas fields – Chad, Niger, Ghana, and Congo in particular. In Sudan, it has already made its largest investment acquiring the assets from a Canadian company, which left Sudan after human rights organizations charged it of committing genocide in Darfur region. On this front, once again, China is India’s main competitor and collaborator, as both have been trying to ‘secure their energy supplies’ in the context of bigger players.

One may point out that these are still public sector endeavors. However, on the contrary, there have been increasing efforts to open up India’s energy market for private investment, and domestically it is already in place now with Reliance Industries Ltd (RIL) and other private corporates expanding themselves in petroleum and power sectors. Further, at the present fluid state of India’s capitalist expansion, the public sector leadership provides a systematic character to the expanding tentacles of Indian capitalism. Because of the specific character of property relations and rent system involved in it, the oil sector is totally different from other industries and requires state-to-state relation for any negotiation to succeed. In the present state of uncertainty in the energy sector internationally, even if India further liberalizes this sector, its international expansion will remain largely a government affair. Further, especially after 1991, state companies in India have been increasingly corporatized, independently competing for the access to finance and capital markets, and strategizing on their own expansion. The corporatist character of the state-owned enterprise brings together several individuals, having interests and aims distinct from the State, who make contributions during the course of development of the enterprise in the capacity of managers and investors. The State is only the initial investor of the enterprise, while its subsequent expansion is dependent on factors internal to it and its presence in the market. Eventually the state’s ‘share’ is effectively reduced, and the enterprise acquires an independent character similar to the private sector. This leads to crises–on the one hand, the state and the managers are frequently in conflict, and on the other, the state control is de-legitimized.

In fact, the crisis is already evident in India. The Indian government and the managers of its Public Sector Undertakings (PSU) are increasingly at loggerheads over risk assessment etc. For example, OVL’s commitment to corporatism and market is coming increasingly in conflict with its political directors. Recently, OVL had successfully bid a 45 percent stake in a Nigerian oil and gas field. It was the only case where it could beat the Chinese. But in the end it had to face, as some OVL officials put, “a huge embarrassment” and “a loss of credibility” because the government turned down its proposal at the very last moment on the ground of it being “risky”. This must be understood in the context of the political debate over divestment in the profit making PSUs. It remains a very contentious issue. Moreover, the left support to the present Indian government has moderated the Indian state’s intensive neo-liberalism, scuttling its recent vigor. Therefore, it needs to put stop to the statist expansion in the energy sector by other means, by playing the political game of calling the investments risky, and motivating the private corporate sector to come up. Besides this, a private-public partnership in the energy sector is already in place, domestically with private oil companies like RIL, while internationally with “diasporic” capital like Mittals.

Recently, some analysts have argued that India’s expansionary involvement with oil-producing countries for securing energy supplies itself is risky as these countries are in conflict with the United States over human rights or non-proliferation issues. And the latter will tolerate India’s alliances only to the extent they are trade-focused. A “diasporic” apologist of the Indian submission to the “American Imperium”, Economist Deepak Lal (Business Standard, November 15 2005) argued that this risk “could involve not merely putting the “Gurkhas” on the oil field, but in essentially taking over the country”. Quite unabashedly, he argues, “If these foreign investments are to be made on a commercial basis by an Indian oil company, it would be best to privatize the state-owned companies and let them then decide whether such investments are in their commercial interest.” However, he concedes, “The Indian government could justifiably use its diplomatic clout to help [a private investment project] fructify”. Does not this diplomacy include an employment of “gunboats and Gurkhas”?

Besides energy, another sector where the “public” is supposed to be in command in India is the banking sector. Indian banks too have been buying assets in Africa and Asia. Significantly, this expansion is a typical case of what was classically conceptualized as “finance capital”–a merger of banking and industrial interests. These state-run banks have been providing financial resources to overseas Indian projects, both private and public. More importantly, they are involved in giving loans, credit lines and other financial helps to fragile economies for infrastructure building and other industrial projects on the condition that they will employ Indian firms. In other words, the banking sector expansion has been an important vehicle in exporting Indian capitalist interests overseas, and also reclaiming the Indian “diasporic” interests, as they are increasingly using these financial institutions to their advantage. The “public” nature of this expansion gives it a ‘systematicity’, which otherwise would have been lost in the global market. Further, it creates a direct linkage between the Indian state and capital.

However, “most outward FDI goes to the manufacturing sector, especially, pharmaceuticals”, and non-financial services that account for as much as 36% (UNCTAD, “India’s outward FDI: a giant awakening?”), and here it is the private sector that reigns. Definitely, whether “public” or “private”, they involve imminent “risks”. However, these risks can be India’s asset too. On the one hand, the unstable polities in countries hosting these investments legitimize India’s political intervention to secure its economic assets and interests. In the post-9/11 political parlance, this is what is termed as overseas “security interest” of a powerful country. The recognition of this ‘interest’, the ability to legitimize it by manipulating ‘global opinion’ and forming favorable international alliances constitute the criteria for becoming a power.

On the other hand, India’s mastery of ‘unreliable’, and ‘rogue’ polities, and its ability to forge indigenous clients in those polities make it a worthy partner for other global powers whose recent hyper-interventionism has reduced their own ability in this regard. Conflicts in Afghanistan and Iraq have further attested this inability of the US hegemony, at least–political forces against which wars were waged in these countries were erstwhile US allies. These conflicts are symptomatic of the crisis of the US hegemony more than the unipolarity of the post-Cold War era. Unlike the ideology of the “Soviet threat”, the post-Cold War ideologies of human rights and non-proliferation could not form the legitimate basis for forging international alliances, since the duplicity of the “global powers” on those same accounts are too apparent. In fact, the orientalist bases of these ideologies have further curtailed the First World’s ability to directly manipulate political forces in the “third world”. At this juncture, ‘mediocre’ powers like India could become relevant interfaces between the two worlds, for perpetuating and sustaining global capitalism and its political structure.

Answering some objections

There are two points that can be raised regarding the “export of capital” from India–that it is quantitatively insignificant, and that the biggest host of the Indian export is the United States and other First World countries.

Regarding the first point, the export is not so insignificant, as the ratio of outward to inward Foreign Direct Investment (OFDI/IFDI) is significantly high and increasing, amounting to around 20% in 2005, while in 1997 it was less than 6%. However, even if we concede this point what matters more is the ability and will of a State to defend the rising interests from this insignificant amount–how does this OFDI shape up the character of Indian capital and state, irrespective of its amount? How much it has affected India’s relationship with the Nepalese, Sri Lankan and other neighbouring economies and polities? How much it has defined India’s intrusion in the African economies (like Sudan, Libya, Nigeria)? How much it has helped in evolving India’s aggressive oil interest, especially since OVL has invested in many African and ex-Soviet Central Asian republics’, Vietnamese, even Cuban oilfields? How much it has defined the active Indian interest in the oil price war, in lowering the “differential oil rent” accrued by the oil economies, and hence how much it has shaped the Indian hobnobbing in the Middle Eastern politics, its vote on the IAEA resolution on Iran?

As far as India’s investment in the US, which hosts the largest chunk, is concerned, it makes the Indian economy (like many other economies) dependent on the ups and downs in the American market. Since Indian capital is just one of the many players here, the Indian state’s task as the protector of its capitalist class (Non resident Indian (NRI) or non-NRI) is to provide it an edge in the competition. This makes the Indian state, furthermore, subservient to global coalitions. On the whole, the OFDI brings Indian capital and state in the consortium of global imperialism, which is presently under the police administration of the US (this status of the US is defined economically, politically and historically.

Cartoons, Anti-Semitism and the “Aestheticisation of Politics”

Pratyush Chandra

The way the European press and politicians behaved on the issue of the publication of “anti-Islamic cartoons” can really be interpreted as, a Haaretz journalist puts, “a new breed of anti-Semitism. But the Semites, in this case, are not Jews.” (1)

It is worth pondering, why did these European “cartoonists” choose to indulge in this sort of “freedom of expression” at the time when they knew it would be volatile to do so. Either it was an act of sheer cheap commercialism, or it had a political meaning – a journalistic contribution in the hegemonist World ‘War on terrorism’. This “contribution” serves one major purpose – to provide an ideological sustenance to this war, by creating and homogenising “the enemy”, and of course its mirror image – a homogenised West, the land of the “advanced” people terrorised by the “backward” Orient. What is happening now seems to evidence the designs.

There might have been wider underlying international political economic reasons that brought Hitler to power, but the ideology of anti-Semitism was essential for its sustenance. Today’s Western mode of dubbing all movements of self-determination in the Middle East (which goes against the interests of the Western Powers) as “Osama’s conspiracy” is not very dissimilar to “the Myth of the Jewish World Conspiracy and the Protocols of the Elders of Zion”. The myth of “Osama” (if we separate it from Osama the man, if he is really one) itself can sustain the Western militancy and its regional cohorts throughout the globe for a long time to come, not only against the “Islamic” forces, but also, and more so, against any “rogue” states and movements (leftists or nationalists).

For example, already, now and then ‘journalists’ report about Osama’s “shadows” emerging in different places in the Indian subcontinent. One was sighted in Sri Lanka with the Liberation Tigers of Tamil Eelam (LTTE) just after 9/11.(2) Moreover, the Indians have traditionally found Pakistan’s Inter-Services Intelligence (ISI)’s involvement in every uncomfortable movement of ‘self-determination’ within its territory, and after 2001, it has become synonymous to Al Qaeda’s involvement. Interestingly, nowadays ‘reports’ regularly come about ISI’s role in the radical left movement of India too. It has already been ‘spotted’ in Nepal’s communist upsurge. And of course, through ISI, it’s Al Qaeda that operates!!! So the target is set and reasoned!

In the case of Hitler, anti-Semitism of one sort (with the ghost of “the Elders of Zion” and their protocols) could enable him to invade regions with negligible Jewish population or influence, and to be on continuous war. Now, it is anti-Semitism of another sort (with the ghost of Osama and his audiovisual tapes) that provides reason to the global ride of the international ‘security guards’ to wage their ‘crusades’. The time is not far when we will find Osama’s shadow roaming in Latin America too. Or, may be it has been already spotted, and the “investigative report” is awaited.

The timing of the publication of these cartoons is very important to understand their significance – the ongoing war in Iraq and the ensuing discomfiture, continuing embarrassment of the Europeans over their ineffectiveness in the Middle East (lately on the Iranian issue), humiliation in their efforts to outrun the Americans throughout the globe, the Hamas victory… The First World rulers have many reasons to be upset. Their anxiety is heightened by their inability to completely monopolise critical information, whose unhindered transmission despite all kinds of borders and boundaries erected through international negotiations, intellectual and material property rights have virtually recreated an alternative world of commons. The ‘ dynamic’ reproduction of the ruler’s real self in its ever-changing forms by the immense ‘horde’ of ‘commoners’ is bound to make him anxious, and this is what forces him time and again to aestheticise politics – to occlude critique. And what else is the ‘official’ function of the media? What else can be the function of these cartoons? To force the readers, viewers and listeners to “think with one’s blood’. And that’s what they are doing.


(1) Bradley Burston, The New Anti-Semitism, cartoon division, Haaretz (February 6, 2006)

(2) Osama hand in glove with LTTE, The Times of India (September 22, 2001),

The India-China relationship – What we need to know

Pratyush Chandra

Every ‘bold’ and ‘independent’ step by a ‘third world’ government is seen as congenitally progressive and even anti-imperialist. Any ‘third world’ alliance is welcomed on the ground that it will develop multi-polarity in the ‘unipolarising’ world. Today, in India at least the middle class “progressives” have the tendency to visualise every dinner party between Delhi, Peking and Moscow to be progressive and a step against imperialism. While trivialising the very notion of imperialism as a world system, this nostalgia for an “anti-imperialist” statist cooperation has made our “progressives” remarkably moody – the Indian state’s apparently contradictory, adulterous relationship with the US hegemony seems to negate the promise revived by Manmohan’s courting of Putin or the Chinese leadership. The simultaneity and intensity of all these relations put our “progressives” totally out of mind, making them giddy.

They must be really sick, if they come to feel the potentiality of anti-imperialism in business ties, as recently in the partnership between ONGC Videsh Ltd (OVL) and the China National Petroleum Corporation (CNPC) for jointly bidding for promising projects. This particular partnership is definitely significant not only for the energy supplies to India and China, but also perhaps for global energy politics. But to consider it as challenging the global hegemonies is undoubtedly a maddening extrapolation.

It is true that India and China both are major players in the world market, and the global polity cannot be understood by ignoring their activities. But it must be admitted that their position is largely, if not solely, dependent on the cheap labour-force and its vast reserve army (regimented by the informalisation of labour markets along with the statist integration of ‘labour aristocracy’). Their underdevelopment has been a boon in this global rise of these economies. It has carried the segmentation of labour market to an unprecedented level, along with a multiple diversification of the demand structure. These are the gifts of the “differential of contemporaneousness”, as Sidney Pollard would call it. (1) Do we want to term this rise as “progressive”?

Further, the Indo-Chinese “collaboration to compete” is already in place in various international and regional trade, business and political forums, both struggling against the protectionist west and claiming low labour and environment standards as their comparative advantages. Even though global capital on the whole – western and indigenous capital and multi-nationals – is effectively using these advantages for its expansion, its identitarian heterogeneous configuration forces a competition that requires cornering of each other through shifting coalitions.

With regard to the Sino-India cooperation, three points are very important. Firstly, its political manifestation need not exactly pattern with the economic. In fact, all international alliances and cooperation in the phase of neoliberalism tendentially seek to ‘depoliticise’ the economic management. Are we not used to frequent statements from businessmen and politicians that call for not mixing ‘national’, ‘pragmatic’ economic interests with politics? However, “depoliticization is highly political” – it puts the economic management beyond the effects of political uncertainties that mar political systems today, especially democracy. In effect, this means putting economic instruments beyond the possibility of democratic control, beyond any reciprocal effects of the social fallouts of capitalist competition and collaboration. (2) There is a high probability that we will see political and border conflicts between India and China intensifying with the increasing economic cooperation. In fact, the reformist China has been very efficient in depoliticising its international relations and also its labour market, by carving a near-ideal panopticon (Bentham’s “confinement house”) out of the Chinese society, as “mechanism of discipline, secure management of a multitude and extraction of labour”. (3). Only a rampant depoliticization of all economic relations – i.e., by forcing labour to surrender – China could achieve its “global rise”. The said Indo-China cooperation is developing in this context.

Secondly, any global intervention on the basis of this cooperation will be more of a competitive-collaborative character designed to redistribute the booties gained in the areas where they compete, or more exactly for the “division of the rest of the world”, left by the “great powers”. They collaborate to compete, and their collaboration in the energy sector, where cartelisation is an inherent tendency, is exactly of this nature.

If we see counter-hegemony in India-China partnership, can we call the formation of OPEC as progressive, or anti-imperialist? OPEC was constituted by five oil-producing countries in 1960 to stabilise their own income against the earlier system of royalty arbitrarily fixed by the oil concessions. “The royalty rates …were exclusively geared to the extent of political domination of international oil companies and their governments with respect to this particular oil region.” (4) OPEC was formed as a collective body of rentiers to negotiate with Occidental companies, linking the oil rent system to oil price. However, at the time some did call it anti-imperialist, but considering its relationship with the non-OPEC ‘third world’ it hardly seems so. The collaboration of the OPEC countries individually and collectively with the global hegemony has been quite pronounced except over division of oil income, which is more like a conflict between landlords and capitalists, or an intra-capitalist class conflict, as there are local oil companies too. Further, there is hardly any political unanimity within OPEC except on oil dealings.

Similarly, the Sino-Indian collaboration internationally will be geared towards regions and sectors where they are unable to compete individually, and this collaboration does not require any mutual ‘political’ understanding, except a level of trust required for any business relationship. And, of course, a ‘political’ collaboration is required to the extent that it facilitates their collaborative business to fructify.

It is here that the last and most important aspect or implication of the ‘outward-oriented’ Sino-Indian relationship resides. The fruitfulness of this relationship as a rule will be determined by and will lead to an intensified intervention in the regions of this collaborative landing. It is nothing but chimera to imagine a peaceful Asia under the unlikely leadership of China and India. Particularly in the energy sector, the conflict between the ‘Indo-China nexus’ and OPEC will become more direct and intensive, which will be similar to the conflict between the West and OPEC, that of between ‘oil rentiers’ and oil companies. Nothing can prevent India and China, not even the ideology of “Asian Continentalism”, from collaborating with the West on the basis of this commonality of business interests, which does not take much time in getting politically translated into either active collaborationism or neutrality, or even armed conflicts (when intra-class conflicts intensify).

In some regions, the interventionist collaboration between India and China is already politically visible. In Sudan and other African oilfields, Chinese and Indian businesses have been remarkably coordinating with highly conflicting local hegemonies to stabilise their own interests, tempering and tampering the global aid and ‘humanitarian’ regime for these ravaged economies to their advantage. Further, these interventions are not totally devoid of militaristic component, as India (and China, too) has been involved in training local military personnel and supplying arms. In sharply fragmented and divided societies such interventions cannot have any other purpose but “neo-colonial”.

In South Asia, where India knows that any slackening on its part in any field can give the Chinese a tremendous advantage, and China is aware of the near impossibility of shaking off the Indian hegemonic influence on the region, the collaboration between them acquires a different level of intensity. Both require stabilising local polities and curbing any ‘nationalist’ hostilities for safe intrusion and spreading. More important in the region is to facilitate market integration and capital flow, for which infrastructure too should be provided for. China and India are aware of the futility of trying to negate each other in the region. Any attempt to shutting off each other is bound to fail and result into greater instability, as both have groomed their political agencies in all the regional societies for many years now.

Moreover, the nature of capitalist regulation from the firm level to the industry level, further up to the economy and to the global level has changed. It has transformed the character of “the division of the world between capitalist associations and great powers”. The corporate structure has intensified competition within a firm among diverse stakeholders and shareholders for greater share in profit. The same struggle is every moment transformed into greater collaboration that constitutes the firm. Similarly the “division of the world” is increasingly fluidised. Particular (national) capitals compete for attracting more and more profit, but they need to collaborate to compete with others or even to go on competing among themselves. The presence of India and China in South Asia and elsewhere too has acquired this dimension. They compete with one another, collaborate to compete with others, and collaborate with others to compete with one another. We cannot take one of these moments to be all defining as most analysts do when they analyse the rise of these two “Asian Powers”. Their analysis on the basis of one set of events is always negated by another, and they find India’s alliances with competitive powers contradictory.


(1) Sidney Pollard (1992), Peaceful Conquest: The Industrialization of Europe, 1760-1970, Oxford University Press, Oxford.

(2) Peter Burnham (2000), “Globalization, Depoliticization and ‘Modern’ Economic Management”, in Werner Bonefeld & Kosmos Psychopedis (ed.), The Politics of Change: Globalization, Ideology and Critique, Palgrave, New York.

(3) Massimo de Angelis (2002), “Hayek, Bentham and the Global Work Machine”, in Ana C Dinerstein & Michael Neary (ed.), The Labour Debate: An Investigation into the Theory and Reality of Capitalist Work, Ashgate, Hampshire.

(4) Cyrus Bina (1985), The Economics of the Oil Crisis: Theories of Oil Crisis, Oil Rent and Internationalization of Capital in the Oil Industry, Merlin Press, London.

Indian Politics in the context of the Iranian Crisis

Pratyush Chandra

The postponement of the decision to refer Iran to the UN Security Council has given the Indian rulers temporary relief. A few days back, India’s Foreign Secretary denied giving away any inkling about India’s stand if voting on Iran issue took place on November 24. (1) But did he or his superiors themselves have any hint of what they were going to do?

1 India and the Iranian crisis

Ever since India joined the Western powers led by the US in backing an IAEA resolution calling on the agency to consider reporting Iran to the UN Security Council if it does not meet its nuclear obligations, the Indian government has been going out of its way to explain its vote being in accordance with not only national but also Iranian interests. Its leftist allies are doing everything to make it apologetic for what it did on September 24, and to ensure that they do not repeat it again whether on November 24 or after. When the rightist opposition was in government it did not miss any opportunity to run behind the US wagging its tail. In fact, the consistency that we see today in the Indo-US relationship and its general acceptability are their gift to Manmohan Singh. However, the parliamentary logic forces even this spineless opposition to talk about non-alignment and anti-“imperialism” in its efforts to mobilise the alienated forces under its fold, and regain its spirit after last year’s electoral shock.

The government had always expected some international political development to take place that would help it avoid the voting. Increasing its pain was the Iranian endeavour to mix up the issue with the pipeline deal, which is still halfway. During the project’s Joint Working Group’s meeting in Tehran, Iran’s Deputy Petroleum Minister for International Affairs M H Nejad Hosseinian told the Indian delegation on October 24 “Iran expects that the esteemed government of India would compensate the past default by supporting Iran in the next meeting of the IAEA board of governors in November.” (2) Petroleum Secretary “had then replied that Iran’s demand was political in nature and it was difficult for him to comment on a political issue.” (3) Since then the desperate Indian government has been trying hard to convince Iran of its neoliberal lessons on the depoliticisation of economy learnt under the guidance of an Economist who happens to be the present Prime Minister, too, “to keep nuclear politics out of the Iran-Pakistan-India gas pipeline project and consider the latter as a purely commercial deal.” (4)

Finally, the US agreed to the Russian proposal allowing Iran to refine uranium at a key nuclear facility as long as more advanced work on the material was completed in Russia. Iran too promised to consider it. It is a face saving exercise for every party in the discussion. The Bush administration recognises “that its Iran policy, both tactically and strategically, was failing to resolve” the crisis and that it has been unable to persuade other Western powers, not even its otherwise faithful allies to refer the case to the Security Council. (5) Any unilateralism in these circumstances will be dangerous for the US. Militarily irresolute EU powers too wanted a resolution that did not force them to take a stand. However, the only negative aspect of such resolution for the US and other Western interests seems to be the strategic boost to Russia and China that this resolution entails – their ability to negotiate.

A similar face saving exercise was on in India – the possible resolution of the nuclear crisis or even delay in any decision in the IAEA in sight was a great respite. The international political exercise apparently seemed to second the government’s main argument in its efforts to convince its partners and others that what it did on September 24 was in national interest and in the interest of Iran too – giving time to Iran and others for negotiations. On the other hand, the official Left which has been trying hard to balance between saving its own independent political image and its desperate need to keep rightists out of power by supporting the government too will be able to continue balancing them consistently for some more time. When everything seemed safe, the government informed the Left what everybody already knew by then:

“At the eighth meeting of the United Progressive Alliance and the Left parties here, two days ahead of the crucial IAEA meeting in Vienna, the Government apprised the Left leaders of the progress made. The indication is that there is a possibility that there will be no voting and till now there has been no draft resolution suggesting that the matter be taken to the United Nations Security Council.”

As expected the government sought to convince its critiques that the postponement was the success of the diplomatic efforts to which it became a party by voting affirmatively on September 24. Finance Minister told the media, “The Government informed the Left parties of the progress made through diplomatic efforts. It was noted that the Government’s intention was to ensure that the matter remains within the jurisdiction of the IAEA”. (6)

2 Neo-liberal consensus and the foreign ministry

Ambiguity and opportunism have always constituted the bedrock of Indian foreign policy. Even during the Cold War, India’s choice for “non-alignment” was opportunistic rather than a matter of principle. Non-alignment allowed it a space to manoeuvre and bargain in the bipolar atmosphere. On the one hand, the already established strong capitalist interests in the country motivated the Indian state to establish channels that could facilitate their integration in the world market dominated by the West under the US. But, on the other hand, the lateness of capitalism in India kept it devoid of a systematic infrastructure for domestic capitalist expansion on the basis of which its capitalist interests could integrate and compete in the world market. The required support for this could come only from the Soviet camp, which envisaged a similar model for “national capitalist development” in third world countries. This dualism on the part of the Indian State made it opportunistic par excellence.

This opportunism has acquired new dimension in the post-Cold War liberalisation phase. The uneasiness that India feels today when it has to take a clear stand on international issues derives from the multi-layered, often contradictory, nature of its integration in international political economy. Its apparent opportunism is starkly reflected throughout its international dealings. Ever since it did nuclear tests in 1998, India seems to be caught in a schizophrenic existence, unceasingly oscillating between over-confidence and desperation. Events in the year 2005 evidence this eccentricity at least twice, earlier on the issue of Nepal and now on Iran.

Political analysts generally take this political behaviour at their face value. They fail to grasp the underlying stress and strain. Since Rajiv Gandhi’s open avowal to ‘neo-liberalise” the Indian economy with his New Economic Policy, there have been opportunities to test the words and deeds of almost all the major political fronts in the country. Since Rajiv Gandhi’s defeat in 1989, we have seen 8 Prime Ministers taking over (if we include the 13 days rule by Vajpayee in 1996). All these leaders despite their diverse political and ideological allegiances have been consistently wed to the basics of neo-liberalism. Finance Ministry has been remarkably consistent in its attitude throughout the two decades since 1985. Ideologies and ‘politics” have served to divert their social fallouts rather than to guide the overall policy designs.

The interior or home ministry along with the external affairs or foreign ministry takes on the tasks of making the ground fertile for the practice of neoliberalism. The Home Ministry has always been important for smoothening the track for capital accumulation by securing property relations and bringing material and “cultural” commons into the fold of these relations. However, less recognised is the fact that since the neo-liberalist economic policy is fundamentally designed to facilitate the entry and exit of capital and to administer the process of international capitalist integration, the External Affairs or Foreign Ministry eventually becomes the most active in this phase. Synchronising the global market dynamics and political reality is the major task undertaken through this ministerial coordination. The motivational glue is provided by keywords like pragmatism and the trans-political (de-politicised) notion of national interest. This pragmatism is nothing but a sanctified discourse to justify the “realpolitick” of making best of opportunities, or opportunism.

3. The crisis of mainstream left nationalism in India

The so-called experts on international relations and security issues have divided India’s international activism in two phases – the idealist phase and pragmatist phase, Rajiv Gandhi’s reign being generally considered the turning point. Despite being superficial and meaningless, this division sufficiently indicates at its purpose, which is simply to disparage the principle of non-alignment as utopian and to justify the pro-US tilt. Similarly these self-acclaimed ‘security intellectuals’ have redefined the all-accommodative notion of “national interest” in “Social Darwinian” terms. They have succeeded sufficiently in derailing the task of a serious inspection of the real context in which the Indian foreign policy is taking shape, of understanding it in terms of the continuity and change in Indian capitalist development.

Even the Left in India has been mesmerised by this ‘realpolitick’ definition of national interests, not trying to reinterpret them in terms of class and class interests. Eventually they too become prisoners of the supra-class nationalist ideology. This has been starkly evident in the ongoing debate on India’s “interest” in the Iranian nuclear crisis. The Leftists tried to assess India’s “national interest” in terms of ‘national’ material gains, the same basis on which the ruling elites are grounding their defence. Asking for an independent foreign policy in general, on this particular issue Prakash Karat, the general secretary of the Communist Party of India (Marxist), said, “If the Centre decides to vote against Iran, it should be viewed seriously as the focus should be on Indian interests, without succumbing to outside pressures”. And, hence, “India, which imports 70 percent of its oil, should maintain good relations with Iran and be alert of the designs of the ‘imperialists’”.(7) So the “focuses” are national sovereignty, “national interests” and pragmatism. Does any mainstream political formation differ on the primacy of these “focuses”? Does the Indian state deny them? In fact, by retelling all the known facts leading to India’s September 24 vote, the Indian government has been repeatedly showing that whatever it did was its own sovereign decision. Further, on the question of national material interests too, Indian policies pro-US tilt can be explained on the basis of India’s dependence on the Western (especially the US’) market and investment.

The mainstream presentation of ‘national interest” allows the hegemonic political economic interests to homogenise the ‘nation’ behind their designs. In a class divided and stratified society any such homogenisation ultimately harnesses the ‘people’ for the royal ride of the state and the ruling classes in pursuit of a “national” political economic expansion. Instead of recognising and sharpening the class conflict underlying the neo-liberal polity, while fighting its ideological transcendence in the discourse of nation and “national interests”, the Indian Left in its eagerness to become part of the ‘national mainstream’ is helping in conserving the national pomposity that characterises the Indian foreign policy, which politically sustains the Indian capital’s global pursuit. It seeks a nationalist compromise that can synchronise its “interests” with the State’s “national interests”. In the event of this uncritical acceptance of the political philosophy that underlies the Indian state policies, even anti-Americanism in the Indian leftist discourse is well utilised in supplying versatility and strength to the Indian state’s manoeuvrings and bargaining.


(1) Stand at Vienna will be in national interest, says Saran, The Hindu, November 17, 2005

(2) Iran’s armtwisting begins: fix Vienna mistake or else, The Indian Express, November 13, 2005

(3) Delhi will tell Iran: Keep N-politics out of pipeline, The Indian Express, November 16, 2005

(4) Ibid

(5) US backs Russian Plan to resolve Iran Crisis, The Washington Post, November 19, 2005

(6) Left apprised of stand on Iran issue, The Hindu, November 22, 2005

(7) PTI, India must have independent foreign policy: Karat, posted on November 20, 2005

Volcker’s Report Reread: Business, not Corruption

Pratyush Chandra

The Report on Programme Manipulation (Volcker Report) brought out by the Independent Inquiry Committee (IIC) into the United Nations’ Oil-for-Food Programme provides a graphic account of how Saddam Hussein’s regime struggled to “launder” a meager sum of 1.8 billion dollars in the span of more than two years. The Report seeks to demonstrate how Iraq had to manipulate the sanction regime and play on various companies and agencies involved in the OFFP to obtain that amount.

I Saddam meant business!

The timing of the Volcker Report makes it an efficient tool for providing legitimacy to the American occupation and delegitimizing the UN’s ability to act as a multilateral world power opposed to the unilateralist US. Despite this, one may commend Volcker and his associates for describing Saddam Hussein’s scheme in such minute details. It seems that they used every real, half-real fact to complete this picture, putting many politicians and businessmen, who shook hands with Saddam Hussein when he was Iraq’s head-of-state, in the range of ‘suspicion’. However, a brief scrutiny shows that the whole exercise is an exposition of what every petty businessman does to survive in the world of competition, monopolies and surveillance. Of course, the Iraqi ruling elite and its “national” oil bourgeoisie had to be smarter as, on the one hand, the eyes of the competitors in the fellow oil economies and Western corporate oil companies were constantly watching the effect of Iraq’s primitive “in kind” oil sale on their own “in cash” transactions; while, on the other hand, any slack would have only hastened the execution of “what was already written” – the pending invasion by the US.

Iraq tried to make good use of its only privilege under the OFFP, choosing its oil buyers. The Volcker Report complains:

“Yet the decision to allow Iraq to choose its buyers empowered Iraq with economic and political leverage to advance its broader interest in overturning the sanctions regime. Iraq selected oil recipients in order to influence foreign policy and international public opinion in its favor. Several years into the Programme, Iraq realized that it could generate illicit income outside of the United Nations’ oversight by requiring its oil buyers to pay “surcharges” of generally between ten to thirty cents per barrel of oil.”

Only this privilege provided Iraq a degree of economic sovereignty, which other countries enjoyed more amply. And what it did with this privilege was nothing different from other countries. Every country requires a friendly international atmosphere to survive and grow, and it utilizes every means under its command to build it, and Iraq had only one way to mobilize “international public opinion in its favor” – by selecting oil recipients. Others, too, do have this privilege, but they have more than simply this.

The Volcker Report notes that Iraqis started by appeasing US companies, but found no effect on the US government’s attitude towards Iraq. So they had to approach other Security Council members to influence international bodies, like Russia and France. But this did not mean that the US companies didn’t gain by these arrangements. The report itself finds, “a substantial volume of oil under contract with Russian companies was purchased and financed by companies based in the United States and other countries.” So it was really, business as usual!

As far as “surcharges” are concerned, they were ‘illicit’ because Iraq was exceptionally segregated from involving itself in the ‘licit’ price war in which its competitors were engaged. And even the Bretton Woods institutions (WB/IMF) would admit it is not illegitimate to ‘curb’ the laws if they put hurdles in the ‘natural’ dynamics of market and capital. What Iraq did was nothing exceptional for a businessman facing a legal system adverse to his business interests. It was doing what was best for it in the face of UN induced ‘market imperfections’.

The other source of illicit income obtained by Iraq was “kickbacks paid by companies that it selected to receive contracts for humanitarian goods under the Programme”. The Volcker Report notes that here too “political considerations influenced Iraq’s selection of humanitarian vendors”. Interestingly, the Report itself accepts the legitimacy of this kickback policy by stating that it “began in mid-1999 from Iraq’s effort to recoup purported costs it incurred to transport goods to inland destinations after their arrival by sea at the Persian Gulf port of Umm Qasr”. However, the Report complains that Iraq could have sought approval from the United Nations for compensation of such costs, without noting that under normal circumstances any intermediation in such bilateral arrangements are abhorred. So why will Iraq like any other country or even business entity not covet sovereignty in its contractual engagements? Why will it allow UN surveillance in whatever it does? Why cannot it have its own business secrets? Why will it not engage in profiteering in the limited ‘market’ and opportunity that it is granted?

What Saddam Hussein’s Iraq and agencies dealing with it did were the only ‘rational’ business options before them under the exceptional regime of politico-economic sanctions. Its few loopholes were the only source of opportunities available for them, from which, even the Volcker Report admits, Iraq could not gain much except a few billion dollars. Whatever else it could acquire under the Oil-for-Food Programme was just enough to survive in destitution – food, medicines etc. The Programme was not meant for the reconstruction of the economy destroyed by bombs and isolation.

II Committee’s Unintended Conclusion

Less known is another report brought out by a Working Group instituted by Volcker’s Independent Inquiry Committee, The Impact of the Oil-for-food Programme on the Iraqi People (7 September 2005), which explicitly puts the very purpose of the OFFP as its main negative aspect:

“The short-term approach of the OFFP, essentially as a relief operation, led to many missed opportunities for greater impact, and indeed to some actual harm. A more effective humanitarian approach would have aimed to restore productive capacity, repair infrastructure, generate employment, and use the extensive capabilities of the Iraqi people to support their own livelihood. The basis for the “relief” approach was presumably at first the perceived urgency of the deteriorating situation – food had to be supplied – but the opportunity to move towards support to livelihood was not taken, for reasons such as the policy of reducing the Government of Iraq’s access to hard currency.”

The so-called “corruption” in the OFFP was fundamentally linked with the struggle over the “access to hard currency”. The UN and the hegemonic forces were hell bent upon enfeebling the Iraqi economy by making it cash-stricken; while Iraq was determined to utilize whatever limited opportunities the loopholes in the OFFP granted it. It even went on offensive by attempting to cut on dollar’s seigniorage by selling its oil in euro. (The Observer, 16 February 2003) Against all these, the OFFP’s realpolitik was rendered ineffective.

Hence, the dual purpose of the Programme was to allow the Iraqi population survive, while inciting them against the ‘intransigent’ regime of Saddam Hussein by providing opposed images of this intransigence against the “humanitarian” external forces. When the lingering sanctions and hardships seemed to homogenize the society furthermore making the possibility of any internal revolt very remote, and Iraq was able to “corrupt” the realpolitik of the Programme, the Security Council’s bosses began finding it obsolete. As the Report on the OFFP’s impact clearly states, the Programme as a “relief operation” was a marvelous success on almost every humanitarian account despite administrative problems and “corruption”. But this success could never be a reason for its continuance. Hence, the invasion took place.

Defining "National Interests" in Indian Foreign Policy

Pratyush Chandra

There has been a tremendous growth in politico-intellectual interest in interpreting Indian foreign policy. On the one hand, journals and newspapers are overflowing with analyses of India’s international activism, and on the other, we find a rise in institutions or ‘think-tanks’ specializing in it, both within India and abroad. However, it can be effectively contended that there is rarely any novelty in the approaches taken by these intellectuals, institutions and politicians on the issue. Most of them are restricted to producing permutation and combination of preconceived and ill-defined notions of “national interests”, “security interests”, “terrorism”, “pre-emptive measures” etc. Even progressive and ‘counter-hegemonic’ discourses are unable to go beyond conceiving the Indian policies as those of a ‘comprador’ third world ruling class, submitting to external pressures. This leads to analyses limiting themselves to mere tautological descriptions of the policies, different only in tone and of course in humanist tenor, but rarely disputing on the basic foundations of policy-making, that inform even the rightist jingoism and centrist pragmatism.

1. Indian “National Interests” – the Left-Right-Center Combined

The domestic opposition to Indian rulers’ intervention in international politics today is broadly confined on the following lines:
(1) They are compromising on the “national interests”,
(2) They are coming under the “American pressure”,
(3) As the consequence of (1) and (2), they are betraying their erstwhile “Non-Aligned Movement” (NAM) comrades.

Such tenor of opposition itself provides the Indian state a viable framework to rationalize its position. It can restrict itself to demonstrating how “national interests” are being served and sovereignty is not compromised, that it is taking its own decision and is being treated as an equal partner in the international strategic forums; further, that it is “leading” its erstwhile NAM comrades by actively representing them and supporting their political and economic sovereignty. This is effortless defense since there exists no need to defend the basic premises of the Indian foreign policy. There is unanimity across-the-board over the sanctity of “national interests”, sovereignty, the principle of “not coming under any external pressure” and India as a leader of the “third world” or “NAM” countries. The opposition counts on the evidences on which these sanctified principles are being violated, while the government in power provides counter-evidence on the same lines.

Recent debates “on the Next Steps in Strategic Partnership (NSSP), the July 18 Agreement with the United States, the September vote in the IAEA and the recent deliberations of the Nuclear Suppliers Group (NSG)” are typically confined to this mode of discourse – whether led by the leftists, rightists or centrists.

Seemingly, there is no disagreement on India’s right to be a “Nuclear Weapon State” while remaining “committed to the goal of complete elimination of nuclear weapons”. Not long ago, when with the rightist Vajpayee government’s nuclear tests in 1998, political forces of all hues and colors not only refrained from criticizing the act, but on the contrary they fought to take the credit for promoting researches which led to India’s nuclear capability. Nobody apparently denies the ideal “that the best and most effective nuclear non-proliferation measure would be a credible and time-bound commitment to eliminate nuclear weapons from existing arsenals, including India’s own nuclear weapons” and that we should “have no desire to perpetuate the division between nuclear-haves and have-nots”. However still, the left, right and center all are guilty of aspiring to see India as “a permanent member of the Security Council”. They all want India to demonstrate “a growing capability to shoulder regional and global responsibilities”, and “focus … increasingly on trans-national issues that today constitute the priority challenges – whether it is terrorism or proliferation, pandemics or disaster relief”. Further, “we cannot sit out the debates on the big issues of our times. Our interests demand a vigorous and articulate diplomatic effort that explains our positions and advances our interests.”

The quotes above are taken from a single lecture by the Indian Foreign Secretary Shyam Saran on “Nuclear Non-Proliferation and International Security” (1), wherein, despite its usual diplomatic nature, he eloquently presents the unanimous aspirations of the Indian political elites. Everybody (left, right and center) will agree with him that India’s approach to nuclear non-proliferation [or on everything] should be “a consistent one, a principled one and one grounded as much in our national security interests as in our commitment to a rule-based international system.”

While defending the recent decisions by the Indian government and its agreements with the US, he says,

“There is a continuity and consistency in our approach that may sometimes be masked by the particularities of a specific decision…. What appears to some observers as inordinate external influence over our decision-making in sensitive areas is, in fact, rooted in our own well-considered and independent judgment of where our best interests lie. This is in keeping with our tradition of non-alignment… We must adjust to change, change inherent in our emergence as a Nuclear Weapon State, change inherent in the sustained dynamism and technological sophistication of the Indian economy, and, as a consequence, change in global expectations of India as an increasingly influential actor on the international stage.”(2)

As a bureaucrat who is supposed to be “above politics”, Shyam Saran is not wary of making it a point to stress on the continuity and consistency in the policies of the Indian state, always reminding of the consonance of the present left-supported ‘centrist’ government’s policies with those of the erstwhile rightist Vajpayee government. In his defense of the Indian vote on the IAEA resolution on Iran, he stressed in his press briefings:

“I do not think that you should interpret India’s position as being aligned on the Left or on the Right or aligned with this group of countries or that group of countries. I think India has all along taken decisions on issues of concern to itself on the basis of its own assessment, and on the basis of its own national interest. So, the question of this representing a shift in India’s policy does not arise.”(3)

And he is obviously not wrong. All depends on how you define the “national interests”. And on their definition there is hardly any difference between various parties involved in the debate. One side says the government serves them, other side denies it; but nobody seeks to describe what those interests are and which sections of the society determine them.

2. “Uses of Domestic Dissent”

This fact of unanimity makes all mainstream approaches on the Indian foreign policy merely repetitive. They rarely question the basic foundation of the policy decisions. One says “compromises”, other notes “cooperation”; one notes “subjugation”, other says “equal partnership” etc. But this discursive exercise has a definite ideological role. Howsoever, this exercise seems futile, it significantly emasculates any decisive domestic opposition to the Indian state as they combine in unity on making it evermore “stronger” in the name of challenging ‘external pressure’, giving ‘international leadership’, and serving ‘national interests’ etc. It is this unanimous ‘nationalist’ tone in the Indian politics that has left the Indian hegemonic [militarist] exercises complementing and supporting the expansion of ‘national capitalist’ interests internationally unchecked.

The Indian interventions in the politics and economy of its neighboring countries and elsewhere are universally termed self-conceited and ‘big-brotherly’, but not imperialist. Hence what is seen as required is simply correcting this ‘aberration’, making the Indian policy towards these small and weak neighboring countries more ‘responsible’. The preconceived notion of a ‘third-world’ country imposed on the late capitalist countries does not allow the analysts to perceive their leadership as serving ‘national’ political economic interests by maneuvering internationally.

Further, any gesture of confrontation with the First World is termed ‘anti-imperialist’. This ‘anti-imperialism’ stresses the importance of the reconstruction of a ‘non-aligned movement’ and ‘south-south’ cooperation. But it does not take into account the material basis of a state-to-state cooperation between the “third world” countries. It does not consider the contradiction inherent in the ‘nationalist anti-imperialism’ in countries like India. At the juncture when India owns 35 percent of the FDI in Nepal, when it is the biggest investor in Sri Lanka since 2002 and has Bhutan and Maldives as perfect clienteles, do we expect India to lead another NAM? And if it does, what will be its role? Will it not be similar to that of Germany’s in EU, howsoever subservient to the US or any other global hegemonic power? Backwardness or lopsidedness of the Indian capitalism and society does not stop it from becoming expansionist and imperialist.

The indigenous corporate capitalist interests (immaterial of the adjectives we might choose to characterize them) today frame the agenda for the Indian state in the international scenario, whether pro-US or otherwise. These interests are formidably conscious and mature, as can be seen from the way the Indian state and capital combines their various strategies – a militarist combination with the US-Israel nexus, supposedly “progressive” alliance with various “third world” powers in WTO, independent oil dealings with varied forces, investments in oil fields, offer of lines of credit to developing countries in Africa and Tsunami affected countries, pipeline diplomacy and readiness to militarily-politically support all these. We cannot simply isolate one aspect of the Indian capitalist interests and generalize it to grasp their hydra-like nature. Competition and collaboration are inherent in the capitalist political economy. Will it not be just and appropriate to use this same principle to assess the “Indian designs”? Or else, we will only support them asking the Indian state to be “stronger” and will convert the opposing voices to mere instrument in its international bargaining. (4)


(1) Lecture on “Nuclear Non-Proliferation and International Security” by Foreign Secretary Shri Shyam Saran at India Habitat Centre, New Delhi, October 24, 2005, Ministry of External Affairs, Government of India.
(2) Ibid.
(3) “Press Briefing by the Foreign Secretary on the events in UN and IAEA”, September 26, 2005, Ministry of External Affairs, Government of India.
(4) In fact in a recent article by Harish Khare such use of dissent has been proudly advocated. See Harish Khare, “Uses of Domestic Dissent in Foreign Policy”, The Hindu, October 26, 2005.

For a different interpretation of Shyam Saran’s lecture, see Siddhartha Varadarajan’s India submits to the Bush doctrine?

India’s “Persian Puzzle” – A Possible Solution

Pratyush Chandra

[The recent Indian vote on the IAEA resolution is being generally interpreted as a sign of the Indian state’s subservience to the US. However, the reality belies this simplistic analysis. At the risk of being labelled economic determinist, this article brings out some facts that indicate towards the growing expansionist interest of the Indian capital. It is this expansionism that drives the Indian state to defy its ‘non-alignment’ past and design its own game-plan, which at least for now coheres with the US global strategies.]

India has finally voted in favor of the International Atomic Energy Agency (IAEA) resolution on Iran. Everybody was speculating that at last an issue has come up that will break the pace and uniformity of the growing Indo-US relations. But India has made its choice clear in the world market of strategies and alignments. There are various lines of explanation that dominate the discussion on the rationale of India’s choice on the issue. The most prevalent one is of course based on the belief that the “third world” states are congenitally incapable of taking such decisions except under the pressure from the West. This view generally presumes these states to be ‘soft’ and their ‘national’ hegemonic interests to be weak, which can easily be swayed by the external pressures. Further, any gesture of confrontation between these states and the Western states especially the US is generally taken as potentially anti-imperialist. However, this view cannot explain the Indian case as it does not capture the basic political economic processes that are increasingly integrating the Indian hegemonic interests within the global strategic alignments and realignments.

The Official Justification

Even before voting for the resolution, the Indian government had been categorically stressing that there was “no difference in objectives between India and the United States vis-à-vis Iran even if the two sides differ on tactics”.(1) Further, even when India stressed on “diplomatic consultations to evolve an international consensus on how to deal with Teheran’s decision to continue its uranium enrichment programme”, it never wanted “another nuclear weapon state in its neighbourhood”.(2) Under these circumstances India’s vote must not be taken as a surprise.

The Indian foreign ministry is not wrong when it says that India’s vote on the resolution was actually in line with whatever had already been happening. This continuity is what constitutes the “evolutionary” foreign policy of India, as envisaged by its present Foreign Minister. The Indian leadership has consistently expressed all its international dealings in terms of “national interests”, “security interests”, etc. Once again, with regard to its vote on the IAEA resolution, the justification given by the Indian state is based on an ideological depoliticization of the so-called “national interests”. In the words of the Indian Foreign Secretary Shyam Saran:

“I do not think that you should interpret India’s position as being aligned on the Left or on the Right or aligned with this group of countries or that group of countries. I think India has all along taken decisions on issues of concern to itself on the basis of its own assessment, and on the basis of its own national interest. So, the question of this representing a shift in India’s policy does not arise.” (3)

However, it all depends on the way you define the “national interest” which under neoliberalism (the professed ideology of the Indian state at least since 1991) means nothing but what provides leverage to the Indian businessmen and their businesses.

The Context

While analyzing India’s strategic maneuverings internationally, the analysts very rarely note their economic dimensions. It is scarcely admitted that India’s relationship with other developing countries after 1991 has been increasingly based on the export of capital and the Indian investment abroad. And in most of the cases, such economic relationship has been simultaneously equipped with militaristic aid to those states. India has been offering credit lines to many Afro-Asian countries that they can utilize for infrastructure building and other business purposes with a condition that they will employ Indian companies. India’s ‘non-aligned’ past has allowed it to have a major share in the capitalist subordination of the backward economies in Africa and Asia. In fact, the rhetoric of non-alignment (“South-South cooperation”) plays an efficient ideological role in rationalizing the expansionist drive of the Indian capital. Recently after India refused the foreign aid for its own Tsunami victims, the Indian External Affairs Minister, Natwar Singh, while offering Indonesians “concessional credit for reconstructing roads, buildings, harbours, ten units of fully equipped hospitals”, rattled proudly that “they were lumping us with the others but now we are seen separate offering our help and assistance”. (4)

Definitely, since 1991 India has been consistently endeavoring to be recognized as a faithful ally of the US. Its nuclear graduation and global politico-economic interests have shown the US leadership that it is a force to be reckoned with, and its subordination provides one of the most reliable allies to oversee the Indian Ocean and meet up with China. In recent years the growing energy needs of the Indian capital has forced the Indian State to invest in the oilfields abroad – India has operating assets in Sudan, Vietnam, Iraq, Iran, Myanmar, Libya, Syria, Sakhalin Islands, etc. It has been acquiring competitive amounts of shares in foreign oil companies. All these make India a player in the global oil politics too both as an investor and a consumer.

The Indo-US relationship is thriving in this context, and has a clear-cut ‘material’ semantics. India requires not having a confrontation with the “global police” state when its capital is struggling to stabilize its share in the global pool of surplus value, of which a major portion comes from the American market and the Indian investment in the US. Further, by providing dual citizenship to the Non-Resident Indians (NRIs) recently, the Indian state has further increased its own responsibility of protecting NRI capital in exchange of ‘rent’ and the assurance of repatriation of profit.

In this scenario, apparently one may interpret the Indian vote on the IAEA resolution as an appeasement of the US-led ‘coalition’. But here too there is a vital interest of the Indian capital that is playing an important role. The recent pipline diplomacy between Iran, India and Pakistan is quite well known. It is impossible to interpret the Indian vote, which is unequivocally affirmative (not even abstention!) on a resolution that is meant to isolate Iran, without connecting it to the facts of the Indian ‘oil politics’ in general and its pipeline diplomacy with Iran in particular.

The Nature of India’s Oil Interests and the Global Coalition

Recently, while rationalizing the Indian nuclearization, the Indian Defense Minister noted:

“India is a heavily energy deficient country. Of all the variables that could hinder India’s economic progress, energy scarcity and dependence are probably the most serious. Seventy percent of our crude oil is imported. Per capita energy consumption presently is only 1/5th of the world average. Considering a high growth rate of around 8 percent of GDP per year in the coming years, growth of oil demand is projected to be 6 percent per annum. If so, dependence on oil imports could rise from 70 percent to 80 (percent), to 85 percent over the next two decades. It is therefore imperative for us to look for cost-effective and long-term alternatives to meet our energy requirements. Indian oil companies are currently actively involved in a search for energy in the form of oil and gas fields, pipelines, LNG, and other new and non-conventional sources. But most hydrocarbon resources underline our dependence on limited reserves and others for this critical requirement. They also carry scope for avoidable strategic energy rivalries.” (5)

The clue to India’s alignment with the US hegemony in the Middle East lies here. Its energy deficiency, yet the desire and ability to proactively make up for it, makes the Indian rulers a player in the Middle East conflicts. Major, yet low productive oil producing industrialized countries, including the United States (6) and oil deficient industrialized economies can influence the global oil price only by appeasing or isolating OPEC countries. Since a major determinant of the oil price today is the differential oil rent appropriated by the highly productive oil economies like those of the Middle East, “cost effective” energy appropriation requires reducing this rent. The bully tactics (“either with us or against us”) of the US and other Western powers in the Middle East has been mainly geared towards this purpose.

The increasing Indian investment in the oilfields abroad was definitely triggered by the need to satisfy the domestic energy requirements, but ultimately as it happens with all capitalist ventures, these investments eventually develop their own logic of earning profit. With increasing divestment in the state owned oil companies of India and intrusion of private capital, this becomes furthermore true. Hence, the need to minimize the differential oil rent, which the oil companies have to pay to the oil producing countries, becomes an important aspect of India’s international political intervention, too. So this unity of ‘economic’ interest serves as the background for the increasing Indian intervention in the Gulf politics and that too in consonance with the US hegemony and other non-OPEC powers. India’s readiness to refuel the American warships during the First Gulf War and later during the Afghan War all point out that there exists an Indian consciousness of possible material gains from its subservience to the US led coalition. However, because of a formidable domestic anti-imperialist opposition, until now the capitalist preference in India could not come out as openly as it has in the vote on the IAEA resolution.

It is worthwhile to note that that a major hitch in the Indo-Iranian negotiations on the proposed pipeline was also related to pricing. “India has taken the position that any price above the US$3 per million British thermal units (BTUs) currently being paid by its power and fertilizer sectors for gas on the international market is unacceptable. Iran, in contrast, appears to be seeking more than US$4 per million BTUs, a rate that will only go higher if Pakistani transit fees are added.” (7) This might have been one of the major reasons in persuading the Indian state to go with the scheme of the West, since the isolation of the Iranian regime and its consequent desperation to earn revenues in the midst of enveloping sanctions can make the Iranians more compliant to the Indian demands and increase the weight on the side of the Indians in the negotiations for the pipeline.


(1) The Times of India, September 16, 2005
(2) The Hindu, September 21, 2005
(3) “Press Briefing by the Foreign Secretary on the events in UN and IAEA”, September 26, 2005
(4) Indian Express, January 8, 2005
(5) Defense Minister Pranab Mukherjee’s Talk on “India’s Strategic Perspective”, Carnegie Endowment for International Peace, Washington DC, June 27, 2005
(6) Cyrus Bina, “The Economics of the Oil Crisis: Theories of Oil Crisis, Oil Rent & Internationalization of Capital in the Oil Industry”, Merlin Press, London, 1985.
(7) A.J. Tellis, “India As a New Global Power: An Action Agenda for the United States”, Carnegie Endowment for International Peace, Washington DC, 2005

Tsunami, Aid & Imperialism

Pratyush Chandra


1. The Tragedy Engineered!

Colin Powell while heralding the American aid missions for tsunami affected areas rightly summed up the American Spirit, “I think it does give to the Muslim world and the rest of the world an opportunity to see American generosity, American values in action”.(1) As if the Christian god has created the devastation to allow the American angels to show kindness, and the third world simpletons to hail the virtuosity, lordship and “freedom” of the Americans. That their wretchedness would make them understand that it is for their good that the Americans make war, as it is for them that now the Americans give aid, and that they must not hate America’s “freedom”. But it was William Blake who once said in one of his prophetic poems:

Pity would be no more,
If we did not make somebody Poor

You make us poor to serve us! Facts do sufficiently tell us that the enormity of the devastation caused by tsunami could have been avoided. Even if it was not consciously designed, the callousness with which the warning of the impending disaster was treated and disseminated is peculiar of the imperialist mind set and work strategy. Their techniques fail and targets are misfired only when others are victims, giving the imperialists opportunity to show off all those things what they say. It happened in Bush’s first tenure on 9/11 (he found a mission!) and it happened now during Bush’s second tenure.

The bulletins issued by the Pacific Tsunami Warning Center (PWTC) show a striking irregularity exclusively with regard to the particular “megathrust” earthquake that hit Indonesia on December 26 leading to the Tsunami waves. It had predicted and reported every small and big seismic event before that particular quake in the region judging their implications. However, this biggest earthquake was casually reported. Even when the warning was issued, it was selectively disseminated – “according to the statement of the Hawaii based PTWC, advanced warning was released but on a selective basis. Indonesia was already hit, so the warning was in any event redundant and Australia was several thousand miles from the epicentre of the earthquake and was, therefore, under no immediate threat.” Of course, “the US Military and the State Department were given advanced warning. America’s Navy base on the island of Diego Garcia in the Indian Ocean was notified.” The excuse came, “We didn’t have a contact in place where you could just pick up the phone.” But several Indian Ocean countries are members of the Tsunami Warning System! One witnesses the unprecedented activism of the US military in the region after the disaster, yet they did not care to disseminate their foreknowledge of the impending calamity!(2) Although the monopoly over information and its selective dissemination are necessary to remain powerful and are strategically very important to have an edge in the imperialist (politico-economic and military) competition in the era of “imperialism without colonies”, it would be premature to assess the degree of deliberation in this particular case, without the danger of being hounded as a conspiracy theorist (poor Ward Churchill!).

2. The Game Plan

The immediate effect of the Tsunami disaster was that it shifted the whole attention away from Iraq where the American imperialism was caught compromised and naked in bloody orgy. Lately the invasion in Iraq was increasingly marred by the revelation of sex ‘scandals’ and other heinous atrocities committed by the American torturers to humble insurgencies. Insurgencies themselves were on increase along with the intensification of global protests against the illegitimate elections. Moreover, the US needed other venues of expansion for further strengthening its strategic and political economic control globally, while its lesser allies went on with cleaning the mess it has left, and its competitors still coping with the shocks in the money market due to the dollar’s instability (showing their dependence on the US economy).

On the other hand, the European impotence was starkly evident right from the beginning. Initially, the European powers accused the US for being indifferent in providing aid to the devastated region, but later they were themselves left behind as militarist activism allowed the latter to be swifter and far more visible in the whole effort. The unilateral announcement of the coalition, with only Japan, Australia and India invited, came as a jolt to the European confidence. However, after a few days only, Powell announced that “the coalition will be disbanded and folded into the broader UN-led operations” as “it served its purpose”. In fact, “the “core group” was announced by President George W. Bush at his Crawford, Texas ranch on December 29 as he tried to dispel criticism that his initial reaction to the disaster was slow and the initial US financial aid of $15 million stingy.” (3) The “stingy” US made others feel stingier. The European countries were found concentrating “support in areas where their nationals have suffered more”.(4) Jeremy Seabrook rightly concludes, “For the western media, it is clear that a tourist’s tragedy is more important than that of the ‘locals’”. This is true not only of the media but even the governments there. They seem to believe that “in death, there should be hierarchy”.(5)

Further, the US (like its competitors) found a new veil of aid to cover its shame and new accomplices, like India and Sri Lanka, with old ones once again readied for the occasion. Regarding what foreign aid is, Hattori has rightly pointed out, “What most clearly defines foreign aid is the symbolic power politics between donor and recipient. Aid practice transforms material dominance and subordination into gestures of generosity and gratitude. This symbolic transformation, in turn, euphemizes the material hierarchy underlying the donor-recipient relation. In this process, recipients become complicit in the existing order that enables donors to give in the first place.”(6) Powell’s tenor in the statement quoted in the beginning starkly attests this conceptualization of the foreign aid. The tsunami tragedy provided US imperialism an opportunity to refurbish its old bases established at the time of the Korean, Vietnamese Wars and other occasions, and to articulate actively with regional forces and “powers” once again. It allowed the regeneration of the “donor-recipient” relation in the region, which was getting loose in the post-Cold War era. The regional ‘rentier’ interests that were once precious allies in the coalition against the Soviets went dissatisfied and independent due to a divergence of the imperialist concentration, and even posed threat to global hegemonies by fuelling fundamentalist populisms (which in essence diverted genuine popular anti-systemic sentiments). In the tsunami aid drive, these interests in Indonesia, Malaysia etc can once again be harnessed and militarized. On the other hand, the US military for the first time openly traversed through South Asia, which was relatively independent due to its ‘relative’ non-alignment. Thus, one can say that the Tsunami tragedy has allowed an overhauling of the “international” power relations in the region under the US hegemony.

3. The Politics and Economics of the Indian Aid

India, which has been ever ready to respond to the slightest gesture from the US for military cooperation in the post-Cold war era, was flattered to find the open invitation to join the US led “tsunami coalition”. It did not wait to rethink its old stance to strengthen the UN, which is increasingly being used as toilet paper by the imperialist forces. However, what they call, “inter-operability” and “mil-to-mil” relations were already at place after 9/11, where they could jointly visualise, “The U.S.-India defense relationship has grown to a stage where the future is clear. It is one in which the two militaries can work in unison to combat the regional and global challenges of terrorism, administer peacekeeping and humanitarian action, keep the high seas safe for the movement of commerce and energy, take the lead in preventing the proliferation of weapons of mass destruction and be a force for stability in Asia.”(7) Joint military and naval exercises in the regions of insurgencies like Northeast India and in the Indian Ocean have already become frequent. Tsunami ‘coalition’ gives this cooperation an immediate purpose and provides an opportunity to legitimize the relationship. It creates, at the cost of the victims, an occasion to have an overview of the region and to build up the infrastructure necessary for pre-empting any future bellicosity in the region uncomfortable for the global power relations.

The snake charmers of non-alignment themselves seem to be charmed away by Bush’s infantile abracadabra of “strong partners”, “against evil”, “for virtues”. However, who knows better about the materialist function of such chants than we Indians whose ancestors would bring rain and grow plants using magical spells and incantations. The Indian ruling class has its politico-economic motive to go into the relationship with the cowboy. After India refused the foreign aid for its own victims, and the Indonesian President thanked India for its aid and assistance to Indonesia, the Indian External Affairs Minister, Natwar Singh’s rattled proudly that “they were lumping us with the others but now we are seen separate offering our help and assistance”.(8) But is this pride mere vanity? Does not the politics of foreign aid, which applies to the assessment of every other imperialist forces hold true for India too? Is India the only country devoid of any crass Shylockian motive behind “its gestures of generosity and gratitude”? Do they not euphemize the “material hierarchy”?

One pop intellectual in India, while writing an eulogy on the tsunami “coalition”, says, “The immediate motivation for the four-nation cooperation involving India and the U.S. is one simple fact that no one country can manage the consequences of the extraordinary disaster we are confronted with today.” But he himself provides the clue to the hidden motive – “India and the U.S. also want to ensure the security of energy supplies from the Gulf region. They also seek to ensure the safety of sea-lanes, which carry oil and a lot other commerce in the Indian Ocean. While these broad common objectives were recognised, there had been no real occasion for the two countries to actually work together in managing security in the Indian Ocean. The tsunami disaster has provided such an opportunity.”(9)

The Sri Lankan socialists perhaps know the meaning of aid in clearer terms. The United Socialist Party has demanded the withdrawal of all the foreign (American, British and Indian) armies that have arrived in the name of tsunami aid. They claim to have “received a very good response when they exposed the hypocrisy and true intentions of US imperialism and also of Indian imperialism. Both are allegedly deploying troops for humanitarian reasons but, in truth, are aiming for increased economic and military control in the region.”(10) For them the danger is quite evident as both the US and India have the similar reading of the ethnic conflict in Sri Lanka, where both have dubbed the LTTE to be terrorist.(11) Further, India has increasingly defined its “national security interests” in Bushist terms – perceiving every conflict in its neighbourhood and South Asia as threat to its security. It recently pulled out of the SAARC meeting explicitly citing the recent events in Bangladesh and Nepal as reasons.

In the particular case of Sri Lanka, India has sufficient political economic interests to take care of. “India has recently become an important investor as a result of the India–Sri Lanka Free Trade Agreement… Indeed, India was the largest investor in Sri Lanka in 2002.”(12) Further, with regard to the aid to Indonesia, too, the cat was almost out of the bag, when Natwar Singh met the Indonesian President. “Apart from the assistance sent so far, we could also offer them concessional credit for reconstructing roads, buildings, harbours, ten units of fully equipped hospitals”.(13) Washington Post saw India’s contribution in relief efforts as a sign of its emergence as regional power, and finds, “Although India still accepts some foreign aid, such help is declining in importance with the country’s rapid economic growth. In the last few years, India has begun to transform itself into a donor nation, offering lines of credit to developing countries in Africa and elsewhere.”(14) Hence, India is perfectly in line with the other imperialist forces in capitalizing on other people’s sufferings.

4. Conclusion

All shades of progressives, leftists and relatively conscious human beings booed when Bush talked about the American compassion and generosity. The tactic to divert attention from the brutality of Iraqi occupation was evident to everybody. Anti-imperialists consistently and timely exposed the real facts behind Bush’s rhetoric and Tsunami tragedy, while continuing to irritate the imperialists and their media hogs by not allowing them any rest and exposing their plans and blunders in the Middle East.

In the tsunami-affected regions, as in Sri Lanka, people are categorically stating that, “The tsunami aid which is a product of the sacrifices of the working people around the world should go to the needy people directly, as quickly as possible. All the reconstruction and relief distribution should be in the hands of democratically-elected committees of the affected people and the trade unions.”(15) Voices are being increasingly raised against the covert agenda of the new coalitions between the indigenous ruling interests and global hegemonies in the tsunami-affected regions. The Thai people are protesting the increased American military presence after December 26 and disapprove of the proposed build-up of the American military at Utapao air base and in the Gulf of Thailand, which were used in 1967 to station aircrafts for bombing North Vietnam.(16) Further, the Indonesian ruling elite had considered the American ‘humanitarian’ and military aid an opportunity to bring back political legitimacy and stability, similar to what the Americans visualized in it for themselves, according to one American historian, “an opportunity to try to move beyond the frustration of Iraq and pre-emption and tensions with the Islamic world… an area where the U.S., with its financial resources and its logistical capability, can work in a cause that no one can argue.”(17) But all these seem to be illusory at least till now; the corrupt polity in Indonesia seems to make things furthermore complex, while the Americans always find their dream of being welcome as liberators rebuffed – Vietnamese rebuffed it, Iraqis are continuing to do so, and even the tsunami victims, howsoever they are helpless, are not inclined to do any different.


(1) “Powell: US values in action”, CNN (5 January 2005), available at http://www.cnn.com/SPECIALS/2004/tsunami.disaster/

(2) Michel Chossudovsky, “Discrepancies in the Tsunami Warning System” (14 January 2005) available at http://globalresearch.ca/articles/CHO501C.html and “Foreknowledge of a Natural Disaster” (29 December 2004) available at http://globalresearch.ca/articles/CHO412C.html

(3) “US disbands India, Japan, Aus tsunami group”, posted on Indian Express website (6 January 2005) http://www.expressindia.com/fullstory.php?newsid=40427

(4) “EU downplays transatlantic row over Asia aid”, posted (5 January 2005) on http://www.eubusiness.com/afp/050105162445.jhwxapg9

(5) Jeremy Seabrook, “In Death, Imperialism lives on”, The Guardian (31 December 2004)

(6) Tomohisa Hattori, “Reconceptualizing Foreign Aid”, Review of International Political Economy 8:4 (Winter 2001)

(7) ‘People , Progress, Partnership – The Transformation of US -India Relations’, available at http://usembassy.state.gov/posts/in1/wwwhppp.html

(8) PTI, “Indonesia praises India for tsunami help”, Indian Express (8 January 2005), available at http://www.expressindia.com/fullstory.php?newsid=40490

(9) C. Raja Mohan, “India and the Indian Ocean: from isolation to multilateralism”, The New Nation, (7 January 2005), available at http://nation.ittefaq.com/artman/publish/printer_15238.shtml

(10) “Sri Lanka after the Tsunami”, The Socialist (22 January 2005), available at http://www.socialistparty.org.uk/2005/377/index.html?id=pp4.htm

(11) C. Raja Mohan, op cit. “India and America also now share the objective of peace and stability in South Asia. They have a joint interest in countering terrorism and extremism in the region. In Sri Lanka for example, New Delhi and Washington are both opposed to terrorism by the Tamil Tigers and seek to maintain the unity and territorial integrity of the island nation.”

(12) UNCTAD 2003 Investment Policy Review: Sri Lanka

(13) PTI, op cit.

(14) John Lancaster, “India Takes Major Role In Sri Lanka Relief Effort: Aid Is Sign of Nation’s Emergence as Regional Power”, Washington Post (20 January 2005). Available at http://www.washingtonpost.com/ac2/wp-dyn/A22194-2005Jan19?language=printer

(15) Same as in (8)

(16) “Tsunami Relief as a Subterfuge? The Pentagon Scrambles to Reenter its Old Thai Air Base”, available at http://globalresearch.ca/articles/SIR502A.html

(17) David E. Sanger, “Aid Summit Talks in Jakarta: U.S. Is Facing a Choice and an Opportunity”, The New York Times (02 January 2005), available at