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Rising geopolitical and geo-economic tensions are the most urgent risk in 2019

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The world’s ability to foster collective action in the face of urgent major crises has reached crisis levels, with worsening international relations hindering action across a growing array of serious challenges. Meanwhile, a darkening economic outlook, in part caused by geopolitical tensions, looks set to further reduce the potential for international cooperation in 2019. These are the findings of the World Economic Forum’s Global Risks Report 2019, which is published today.

The Global Risks Report, which incorporates the results of the annual Global Risks Perception Survey of approximately 1,000 experts and decision-makers, points to a deterioration in economic and geopolitical conditions. Trade disputes worsened rapidly in 2018 and the report warns that growth in 2019 will be held back by continuing geo-economic tensions, with 88% of respondents expecting further erosion of multilateral trading rules and agreements.

If economic headwinds pose a threat to international cooperation, efforts will be further disrupted in 2019 by rising geopolitical tensions among major powers, according to the report. Eighty-five percent of respondents to this year’s survey said they expect 2019 to involve increased risks of “political confrontations between major powers”. The report discusses the risks associated with what we describe as a “multiconceptual” world order – one in which geopolitical instabilities reflect not only changing power balances but also the increasing salience of differences on fundamental values.

“With global trade and economic growth at risk in 2019, there is a more urgent need than ever to renew the architecture of international cooperation. We simply do not have the gunpowder to deal with the kind of slowdown that current dynamics might lead us towards. What we need now is coordinated, concerted action to sustain growth and to tackle the grave threats facing our world today,” said Børge Brende, President of the World Economic Forum.

In the survey’s 10-year outlook, cyber risks sustained the jump in prominence they registered in 2018, but environmental risks continue to dominate respondents’ concerns beyond the short term. All five of the environmental risks the report tracks are again in the high-impact, high-likelihood category: biodiversity loss; extreme weather events; failure of climate-change mitigation and adaptation; man-made disasters; and natural disasters.

Alison Martin, Group Chief Risk Officer, Zurich Insurance Group, said: “2018 was sadly a year of historic wildfires, continued heavy flooding and increasing greenhouse gas emissions. It is no surprise that in 2019, environmental risks once again dominate the list of major concerns. So, too, does the growing likelihood of environmental policy failure or a lack of timely policy implementation. To effectively respond to climate change requires a significant increase in infrastructure to adapt to this new environment and transition to a low-carbon economy. By 2040, the investment gap in global infrastructure is forecast to reach $18 trillion against a projected requirement of $97 trillion. Against this backdrop, we strongly recommend that businesses develop a climate resilience adaptation strategy and act on it now.”

Environmental risks also pose problems for urban infrastructure and its development. With sea levels rising, many cities face hugely expensive solutions to problems that range from clean groundwater extraction to superstorm barriers. Shortfalls of investment in critical infrastructure such as transport can lead to system-wide breakdowns as well as exacerbate associated social, environmental and health-related risks.

John Drzik, President of Global Risk and Digital, Marsh, said: “Persistent underfunding of critical infrastructure worldwide is hampering economic progress, leaving businesses and communities more vulnerable both to cyberattacks and natural catastrophes, and failing to make the most of technological innovation. Allocating resources to infrastructure investment, in part through new incentives for public-private partnerships, is vital for building and strengthening the physical foundations and digital networks that will enable societies to grow and thrive.”

At an individual level, declining psychological and emotional well-being is both a cause and consequence within the wider global risks landscape, impacting, for example, social cohesion and political cooperation. The Global Risks Report 2019 focuses explicitly on this human side of global risks, looking in particular at the role played by complex global transformations that are under way: societal, technological and work-related. A common theme is that psychological stress relates to a feeling of lack of control in the face of uncertainty.

This year’s report revives the Future Shocks series, which recognizes that the growing complexity and interconnectedness of global systems can lead to feedback loops, threshold effects and cascading disruptions. These “what if” scenarios are food for thought as world leaders assess potential shocks that might rapidly and radically disrupt the world. This year’s sudden and dramatic breakdowns include vignettes on the use of weather manipulation to stoke geopolitical tensions, quantum and affective computing, and space debris.

The Global Risks Report 2019 has been developed with the invaluable support throughout the past year of the World Economic Forum’s Global Risks Advisory Board. It also benefits from ongoing collaboration with its Strategic Partners Marsh & McLennan Companies and Zurich Insurance Group, and its academic advisers at the Oxford Martin School (University of Oxford), the National University of Singapore and the Wharton Risk Management and Decision Processes Center (University of Pennsylvania).

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India – The US Promote National Defense – Security Cooperation

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US and Indian foreign ministers and defense ministers at a press conference after 2+2 Dialogue on 27/10 (Source: IANS)

In recent years, the India-US bilateral relationship has been more closely bonded, especially defense-security cooperation in various fields including nuclear technology, maritime defense and security, anti-terrorism in the region and in the world … has been continuously promoted, contributing to the development of an intensive bilateral relationship. This results from the demand for security strategy, economic, security and political interests of the two parties. The United States wants India to become its ally in the Indo-Pacific region, counterbalancing China’s growing influence, ensuring U.S. maritime security interests and a huge commercial arm market for the US. To India: a good relationship with the US will help India highten its position in the region; India also wants to rely on US power to increase its military strength, to watch out China and create pressure on Pakistan. In addition, India’s comprehensive diplomacy and the US’s regional strategy carried out simultaneously without overlapping, is conducive to strengthening the bilateral security cooperation for both countries.

It is evitable that in recent years, defense-security cooperation between India and the US has made remarkable progresses. After removing the Sanctions on India for nuclear testing in May 2018, the US and India announced the Joint Declaration on Civil Energy Cooperation between the two countries. Accordingly, the US will provide nuclear fuel and technology support for India to develop civil nuclear energy. This has opened the door for India to develop their nuclear weapons and improve military strength. The two countries also cooperate in many defense activities including ballistic missile defense, joint military training, expanding arms sales, strengthening military staff exchanges and intelligence, as well as loosening two-way technology exports.

To be specific: In January 1995, the two countries signed the “US-India Defense Relations Agreement”, stipulating that in addition to conducting cooperation on research and production of military weapons, the two countries also conduct exchanges between military and non-military personnel. In May 2001, the Indian government announced its support for the US to develop a ballistic missile defense system, and proposed to purchase the “Patriot 1 (PAC-3)” air defense missile system. In March 2005, during the Conference on Cooperation in Ballistic Missile Defense, the US, India and Japan agreed to set up a joint working group, to implement close cooperation on ballistic missile defense. In June 2005, the United States and India signed a 10-year military cooperation agreement, which not only required increased exchanges between the two countries’ armies, but also proposed to strengthen military cooperation regarding weapons production, and trading as well as ballistic missile defense. In July 2009, the two countries signed a “Comprehensive customer surveillance treaty” on defense, the US sold advanced defense technology to India. This treaty allowed India to obtain a “permission card” to buy the US’s advanced weaponry. In addition, the two countries also cooperate in counter-terrorism in the region and around the world, maritime security, and joint military exercises …

One of the activities promoting bilateral relations between India and the US was the “2 + 2 Dialogue” taking place on October 27, 2020 in New Delhi. Within the framework of this dialogue, India and the United States had shared exchanges of a free and open Indo-Pacific vision, embracing peace and prosperity, a rules-based order with  the central role of ASEAN, resolving disputes, ensuring the economic and security interests of all related parties with legitimate interests in this region … The focus on defense-security cooperation in this “2+2 Dialogue” is the signing of the Basic Exchange and Cooperation Agreement (BECA). The agreement allowed India to access accurate data, topographic images, maps, maritime and aviation data and satellite data on a real-time basis from US military satellites. Thereby, this will assist the provision of better accuracy for such weapons as cruise missiles, ballistic missiles and drones of India, and support the rescue operations during natural disasters and security strategy. The BECA is one of the four basic agreements a country needs to sign to become a major defense partner of the US. The other three agreements that India had previously signed with the United States are the General Security Of Military Information Agreement (GSOMIA),  the Logistics Exchange Memorandum of Agreement (LEMOA) and theCommunications Compatibility and Security Agreement (COMCASA) . These are “cornerstone” agreements allowing the armies of the two countries to fight together in the event of a conflict. Accelerating the signing of the BECA was just one of various ways India reacted to China threats, especially after the border clashes in Doklam (2017) and Ladakh (5/2020-now). India, the US, Japan and Australia were more active in the Quartet Meeting on October 6 in Tokyo. India also invited Australia to join the Malabar naval exercises with the US and Japan in November.

The signing of BECA was a further institutionalization of the Indo-US strategic relationship to promote the two countries’ intensive cooperate on strategy and military, without pressure to become an official ally yet have benefits. Washington received interests in selling weapons to New Delhi, especially when conflict starts. New Delhi has attached more importance to US military equipment because of its transparent pricing, simple operation and maintenance, thereby reducing reliance on Russia for weapons. Currently, the total value of Indian weapons purchased from the US is more than 15 billion USD and is expected to double in the coming time. The US-India military cooperation, therefore, will be closer in the future.

Also at this dialogue, the two countries agreed to cooperate in dealing with the Covid pandemic, considering this a priority for bilateral cooperation in this period. Accordingly, the US and India will cooperate in RDto produce a series of vaccines, to expand access to vaccines, and ensure high-quality, safe, effective and affordable medical treatment between the two countries and on a global scale.

Currently, India-US defense-security cooperation is at its heyday in the history and is likely to develop further. This relationship has profound effects on the regional security environment, especially direct effects on China. As military forces grow, India will probably implement their military strategy “taking the Indian Ocean in the South, expanding power to the East Sea in the East, attacking Pakistan in the West, watching out for China in the North”, plus nuclear deterrence. This will worsen the fierce arms race in such regions as the South Asia and the Indian Ocean, leading to an imbalance of forces and add up a number of unstability factors in these regions.

In short, India-US defense-security cooperation is making remarkable progresses and has created impact on regional security, especially China and other countries with common interests in this region, including Vietnam. Therefore, the China-American-Indian triangle relationship is currently in an unstable state. In this scenario, it is suggested that countries actively identify issues relating to the this three military powers relationship and devise appropriate diplomatic strategies, balancing bilateral relations with major powers with disagreements to ensure national security and stability in the region.

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India-Pakistan LOC peace

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India and Pakistan have both announced to “strictly observe” the truce along the Line of Control and all other sectors “in the interest of achieving mutually beneficial and sustainable peace along the borders”. Such an announcement could not have emerged without Indian prime minister Narendra Modi’s imprimatur.  A hunch is that the move is an upshot of a nudge from the US president. This impression is fortified by several events that are accentuated by India-Pakistan entente (so called surgical strikes, 5000 ceasefire violations, hype about 2008 Mumbai attack and the one at Pathankot  airbase, so on). From Pakistan’s angle, India believed in might is right. And while it was open to compromises with China, it displayed a fist to Pakistan.

Need for a dialogue

In the past, peace at the LOC proved ephemeral as it was not backed up by sufficient follow-up. A dialogue is needed for the hour. It is a good omen that Pakistan is open to talks despite chagrin at abolition of the occupied state’s statehood.

Misconception about the sanctity of the India-Pakistan LOC vis-a-vis the Sino-Indian LAC

A common misperception is that the Line of Actual Control (LAC) is more sacrosanct than the LoC. For instance, India’s prestigious Indian Express explained: ‘The LoC emerged from the 1948 ceasefire line negotiated by the UN after the Kashmir war. It was designated as the LoC in 1972, following the Simla Agreement. It is delineated on a map signed by Director General Military Operations of both armies and has the international sanctity of a legal agreement. The LAC, in contrast, is only a concept –it is not agreed upon by the two countries, neither delineated on a map nor demarcated on the ground’.

To understand Sino-Indian differences, one needs to peek into the Indian mind through books such as Shivshankar Menon’s Choices: Inside the Making of India’s Foreign Policy, Shyam Saran’s How India Sees the World, and A G Noorani’s India-China Boundary Problem 1846-1947.

The afore-quoted newspaper poses the question: “What was India’s response to China’s designation of the LAC?” It then explains India rejected the concept of LAC in both 1959 and 1962. Even during the war, Nehru was unequivocal: “There is no sense or meaning in the Chinese offer to withdraw twenty kilometres from what they call ‘line of actual control…” In July 1954, Nehru had issued a directive that “all our old maps dealing with this frontier should be carefully examined and, where necessary, withdrawn. New maps should be printed showing our Northern and North Eastern frontier without any reference to any ‘line’. The new maps should also be sent to our embassies abroad and should be introduced to the public generally and be used in our schools, colleges, etc”. It is this map that was officially used that formed the basis of dealings with China, eventually leading to the 1962 War’ (Indian Express, June 6, 2020, Line of Actual Control: Where it is located and where India and China differ).

India considers the LAC to be 3,488 km long, while the Chinese consider it to be only around 2,000km.

The LAC was discussed during Chinese Prime Minister Li Peng’s 1991 visit to India, where Indian PM P. V. Narasimha Rao and Premier Li reached an understanding to maintain peace and tranquility at the LAC. India formally accepted the concept of the LAC when Rao paid a return visit to Beijing in 1993.

The reference to the LAC was unqualified to make it clear that it was not referring to the LAC of 1959 or 1962 but to the LAC at the time when the agreement was signed.

India’s disdain of the LOC

India’s mindset on the LOC should change. The problem is Nehru never cared a fig for the disputed state’s constituent assembly, Indian parliament or the UN. This truth is interspersed in Avtar Singh Bhasin’s 10-volume documentary study (2012) of India-Pakistan Relations 1947-2007. It contains 3,649 official documents which gave new perspectives to Nehru’s state of mind.

In his 2018 book (published after six years of his earlier work), India, Pakistan: Neighbours at Odds (Bloomsbury India, New Delhi, 2018), Bhasin discusses Nehru’s perfidy on Kashmir.

LoC peace should lead to Kashmir solution

The tentative solutions include (a) status quo (division of Kashmir along the present Line of Control with or without some local adjustments to facilitate the local population, (b) complete or partial independence (creation of independent Muslim-majority tehsils of Rajauri, Poonch and Uri, with Hindu-majority areas merged in India), (c) a plebiscite to be held in five to 10 years after putting Kashmir under UN trusteeship (Trieste-like solution), (d) joint control, (e) an Indus-basin-related solution, (f) an Andorra island (g) Aland island-like solution and (h) permutations and combinations of the aforementioned options.

Another option is for Pakistan and India to grant independence to disputed areas under their control and let Kashmir emerge as a neutral country. An independent Kashmir, as a neutral country, was the favourite choice of Sheikh Abdullah. From the early 1950s “Sheikh Abdullah supported ‘safeguarding of autonomy’ to the fullest possible extent” (Report of the State Autonomy Committee, Jammu, p. 41).

Abdullah irked Nehru so much that he had to put him behind the bars. Bhabani Sen Gupta and Prem Shankar Jha assert that “if New Delhi sincerely wishes to break the deadlock in Kashmir, it has no other alternative except to accept and implement what is being termed as an ‘Autonomy Plus, Independence Minus’ formula, or to grant autonomy to the state to the point where it is indistinguishable from independence”. (Shri Prakash and Ghulam Mohammad Shah (ed.), Towards understanding the Kashmir crisis, p.226).

Sans sincerity and the will to implement, the only Kashmir solution is divine intervention or the unthinkable, nuclear Armageddon.

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New Wars

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Twentieth century was a century of great events and developments in every part of human life. The century is marked by the deadliest wars, deadliest weapons and unprecedented interconnectedness. The destructive power of A-bombs and the interconnectedness that transformed world into a global village infused traditional wisdom of conflict resolution with great confusions. New conflicts demanded new solutions. Globalization transformed the traditional theatre of conflict; war.

 War in twenty first century has acquired a whole new character. State which was once the almighty Leviathan has lost its monopoly over violence, its erosion of monopoly over violence from globalization transformed the character of war. Wars of today are not fought between states rather there is network of state and non-state actors which includes mercenaries, private security companies, hired thugs etc. Globalization has unleashed a plethora of problems by undermining state sovereignty. Globalization which was supposed to encourage cosmopolitan politics and cooperation ended up creating more divisions.

Mary Kaldore, professor at London School of Economics, is among the scholars who have acknowledged the impact of globalization on the character of war. In her book, New and Old Wars: Organized Violence in a Global Era, she highlights this change in character of war.  Highlighting the difference she wrote that new wars are different from old wars because of who fight these wars, for what reason these wars are fought, how these wars are financed and the way these wars are fought. Old wars were fought by states, financed by states, were waged for ideological purposes and battles were the defining character. However, in new wars; actors are networks of state and non-state actors, which are to a greater extent privately financed and direct confrontation between opposite forces is rare. Kaldor is of the view that this change in character of war is caused by globalization. Kaldor is of the view that this transformation is a consequence of globalization and disintegration of state.

 Along with globalization, clash of symmetrical opponents can destroy the world. Advent of nuclear weapons has changed the traditional military logic. In fact, any war according to old military logic is simply not beneficial anymore. War between nuclear powers will leave neither party at benefit. Since the costs of such victory cancel the benefits it holds. Avoiding direct war serves the political interest better than waging one. This change in military logic is evident from the change in tactics of wars of today. Today’s wars are fought through Guerilla and counter insurgency tactics are the tactics. Majority of the conflicts involves one state and one or more than one non-state actor. These are battles between wolves and shepherds where wolves attack the flock while shepherds try to save the sheep.

However, it is not the change in military logic and innovation of new types of weapons that have transformed the character of war. Rather transformation in politics is the defining element of this change. Politics of ‘new wars’ is Identity politics which is very different from politics of old wars.  Old wars were largely driven by ideological politics whereas new wars are driven entirely by identity politics. In words of Professor Kaldor, “identity politics is about right to power in the name of a specific group whereas ideological politics is about winning power in order to carry out a particular ideological programme”. Globalization prompted groups to securitize their identity. War for these actors is either a mean for keeping their identity or claiming in lands in the name of that identity.

 Another dimension of problems caused by globalization for the concept of war is proliferation of capitalism. The ideas of capitalism and free market motivated such actors who saw potential for profit in war. These actors established private security firms and were up for grab for the highest bidder. Companies like Titan and Blackwater are profit-maximizing companies whose only motivation is the accumulation of wealth. These institutions induced the concept of war with further complexities and legitimacy of violence further degenerated. These developments underline the need for a new conceptualization of war. To address these complexities and set the basis for future exploration, Kaldor defines war as a “mutual enterprise” rather than a “contest of wills”. The reason illustrated by Kaldor is that the latter makes the elimination of enemy the ultimate objective of war whereas former suggests that both sides are interested “in the enterprise of war rather than winning and losing for both political and economic ends”. Although it is very difficult to discern what means one employs for what ends, the protracted conflicts all around the world and the industry which these wars fuel paints a different picture a picture very close to the concept of war as mutual enterprise rather than a contest of wills.

War in nuclear age, where symmetry in capabilities will, eventually, lead to MAD, cannot have the same character it once had. Mankind frightened by the destructiveness of these weapons and compelled by their natural instinct to clash is trying to fight the new wars with new weapons according to old principles. This is commendable but not practical as this undermines the capabilities of new weapons by considering them just another weapon of war. Concepts of limited war show the appreciation of this reality. There political, technological and economical developments highlight the need for evaluation of old ideas and encourage the need for new ideas. As the aphorism goes “modern problems require modern solutions”, wars of today are modern and they require modern solutions as the traditional ones are not adequate enough.

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