Calibrating India’s Climate-Change Response

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A street in New Delhi, India with crisscrossing power lines shows one of the dilemmas facing the Indian government in its struggle to provide reliable electricity.
(Stanley Foundation/Amy Bakke)

India and other developing countries have consistently emphasized the notion of equity in the climate-change debate, advocating a “common but differentiated responsibility”—the principle that all states are obligated to address global environmental degradation, but not equally so.

This approach, however, is fast reaching its structural limitation since a number of countries, including some in the G-77 and the Alliance of Small Island States, are indulging Western lobbies that seek to dilute it and have already hinted at accepting a compromise.

Without the full support of developing countries including China, which is clearly distancing itself from the G-77 narrative, India will shortly find itself isolated without enough political weight to continue pushing for the common-but-differentiated approach. It has to rethink its equity-centric narrative without risking being politically outmaneuvered in multilateral discussions.

The narrative will need to be both progressive and inclusive, with a focus on accommodating fundamental realities in the implementation framework of the United Nations Framework Convention on Climate Change (UNFCCC), such as the fast rates of urbanization in the developing world, which will inevitably lead to changes in consumption and production patterns.

India should adopt a fresh approach to better align its domestic and multilateral commitments before 2015, when a large part of the world negotiates a global response to climate change under the auspices of the UNFCCC. Careful calibration by India’s new government, which was elected in May 2014, requires a series of actions: the articulation of a viable normative framework within which to place its climate-change response, the provision of modern commercial energy, enabling efficiency gains in large companies through market mechanisms, and investment in adaptation.

LOW-HANGING FRUIT
Despite a sustained thrust for energy access by previous Indian governments, elaborate planning has unraveled through poor implementation. Around 300 million Indians still do not have access to electricity, and millions more merely have notional access. While the electrification of a number of new areas has proceeded, the quality of electricity—essentially the number of hours in a day that grid power is available—remains highly variable. Moreover, the new government has to enable an energy transition not just to cater to the nominal needs of so-called light-bulb electrification, but also to enhance industrial competitiveness. For this, it will need to relentlessly pursue all viable energy options.

Although India’s energy basket is coal dominated, India does not produce enough of the material to sustain domestic consumption, and even if its development can be accelerated, domestic coal consumption will peak in a couple of decades. In the years ahead, coal imports will add a new degree of fragility to India’s fiscal stability. Even as the government renews attempts to overhaul the coal sector, development of natural gas supply chains—new port infrastructure for liquefied gas as well as pipelines connected to massive gas fields in nearby regions such as West and Central Asia—offers an unparalleled opportunity to scale up power generation. Additionally, unlocking domestic gas potential will also need some bold political leadership as it involves creating market-based pricing mechanisms to attract domestic and foreign investment. Indeed, gas has the potential to become India’s bridge fuel until other alternative energy sources can be mainstreamed.

While gas presents an opportunity for the medium term, reaping the low-hanging fruit must be an immediate priority of the new government. Creating the right market conditions can enable efficiency gains in large companies. Simply through demand-side management, energy consumption in the industrial sector can see efficiency improvements of up to 25 percent. Moreover, greater operational efficiency has virtually unlimited potential. Substantial energy savings are possible if financial-incentive mechanisms that employ market forces and reward such efficiency gains are promoted. Templates for such financial instruments already exist, such as the Bombay Stock Exchange’s GREENEX index, which tracks energy-efficiency performance of listed stocks. There is great equity in ensuring that the big corporations in India achieve energy and resource efficiency levels consistent with global best practices. It will also bolster India’s global position as it seeks equity while engaging with the richer and more-developed countries.

Perhaps the most critical area for India’s response to climate change must be adaptation. It needs to invest in actions against the imminent threats posed by climate change irrespective of how the global discourse progresses. Investments must be made through innovative channels, using a mixture of capacity-building programs, awareness campaigns, traditional solutions, and new technologies. A good example of an appropriate adaptation response would be to look at areas such as the financial engineering of insurance products to protect farmers from erratic weather patterns.

TOWARD 2015
It is already clear that the new government is likely to rely on sustained economic growth as the primary instrument for responding and adapting to climate change. This, of course, has its own set of implications for India’s emissions, which are likely to increase before stabilizing in the long term. The twin objective for the government in New Delhi must be to peak India’s emissions as quickly as possible and to keep the peaking emissions as low as possible.

Therefore, at home, India will largely need to focus on rapidly building up generation capacity, using efficient coal-mining and combustion processes, exploiting opportunities that natural gas offers, and investing in green technologies and efficiency gains. At the global level, India must ensure that the 2015 negotiations do not impede its ability to offer a better life to its people or make the cost of the provision of lifeline services too steep. Both agendas must be pursued simultaneously.

Samir Saran is a senior fellow and vice president at the Observer Research Foundation. He has diverse experience in the Indian private sector and was actively engaged with regulators and policymakers during the 1990s as India undertook economic reforms. Saran held various senior positions at Reliance Industries, India’s largest business conglomerate. An electrical engineer by training, he has a master’s degree from the London School of Economics and Political Science and has been a fellow at the University of Cambridge.

Columns/Op-Eds, Non-Traditional Security, Politics / Globalisation

Knowing India’s nuclear credentials

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The HinduThe civil nuclear deal, hinged on one clear principle that India’s military programme would irrevocably be separated from the civilian one, was based on arriving at an outcome that would benefit all parties and enhance the global order. Picture shows the Jaitapur nuclear power project site. Photo: Vivek Bendre

Manufactured Western outrage ignores the reality that under the landmark 2005 India-U.S. agreement, the IAEA has unprecedented access to Indian nuclear facilities

There has been a concerted attack on India from the usual suspects in recent days even as it was entering into negotiations to formally accede to the Nuclear Suppliers Group. As if on cue, Jane’s Intelligence Review carried out a “(non)-exposé” of an Indian military nuclear facility in Karnataka. As exposés go, it was lame even by Jane’s standards. The nature of the facility and location have been publicly available since 2010. Yet, this new “exposé” was carried by all mainstream print news outlets and predictably sensationalised with everyone feigning alarm and anxiety. This manufactured outrage culminated with a sanctimonious editorial in The New York Times that was remarkable for the sheer incoherence of its own arguments. As the designated chief of the non-proliferation ayatollahs (with blinkers) and representative of a motley anti-India group in the U.S. that is shrinking ever so rapidly, this too was on expected lines.

Assault on credentials

Nevertheless, it is important to dismantle the uneasy arguments of this concerted assault on India’s credentials. The first proposition that must be taken issue with is the propagation of a falsehood that Pakistan and its reckless build-up of nuclear stockpile is somehow driven by India’s posture. While Pakistan’s careless impulse may be a result of more than one central factor, it is important to understand that this may have a lot to do with its suspicion of American intentions. The oft-quoted argument is that Pakistan seeks to equalise the conventional mismatch with India through a misguided reliance on numbers of strategic and tactical warheads. The irrationality and illogic of this behaviour has been proven by the fact that a country like North Korea has deterred both the U.S. and South Korea with explosions that may not even have been nuclear. Pakistan’s vertical proliferation has no mooring to India’s strategic programme — only to its own paranoia. The question is what fuels this? There is no denying the fact that Pakistan was able to obtain “nuclear immunity” for its sub-conventional activities against India with even 10 warheads. It may well be the fear of the U.S. that motivates its build-up today.

“New Delhi is already providing support to FMCT negotiation; its signature on the CTBT is linked to similar commitments by the U.S. and China”

One motivator is the pressure the U.S. has been applying on Pakistan (without success due to the China factor) to sign onto the Fissile Material Cut-off Treaty (FMCT), which will forever cap the Pakistani arsenal. Contrary to what the commentary would have us believe, the FMCT, instead of curbing fissile material, has demonstrably accelerated Pakistan’s programme. So much for flawed logic. The second is the fear of the American “Plan B”, which involves the seizure and confiscation of much of Pakistan’s nuclear arsenal. The former has driven Pakistan to enrich their extant stockpile of radioactive material to weapons grade at breakneck speed. The latter has ensured that Pakistan is rapidly weaponising its fissile stock, in order to disperse and complicate any such weapons seizure plans. These facts are well understood in Washington policy circles. The exposés and op-eds of the past weeks are for most just another edition of Aesop’s fables.

The second issue has to be the demonstrated lack of understanding of the reality that shaped the landmark civil nuclear agreement between the U.S. and India. This nuclear deal was based on one clear principle — that India’s military programme would irrevocably be separated from the civilian programme. This was not an optimal solution for India or for the P5, but like all international agreements it was based on arriving at an outcome that would benefit all parties and enhance the global order. International Atomic Energy Agency (IAEA) Director General Mohammed El Baradei in an op-ed in the Washington Post, specifically welcomed the deal without reservation, his rationale being “either we begin finding creative, outside-the-box solutions or the international nuclear safeguards regime will become obsolete.” This is now accepted wisdom. The IAEA has gained unprecedented access to India’s nuclear facilities. India has accepted additional protocols this June, and has strengthened its own export laws. Significantly, the same journals and reports confirm that India’s own arsenal has remained stable over the period with no increases despite the turbulence in the neighbourhood. The benefits of bringing India inside the ‘non-proliferation tent’ are therefore vast, visible and tangible.

While these editorials and reports may very well have got their facts and numbers right, the analysis is so convoluted that the facts they quote cease to be relevant. The argument goes that India needs to sign the FMCT, the CTBT, and agree to mutual weapons reduction with China and Pakistan, since it is the nuclear deal with the U.S. that has set the cat amongst the pigeons. Here then is some measure of reality. India is already providing active support to the FMCT negotiations — it is a work in progress, not yet a concrete treaty. It has been Pakistan that has been blocking the work at the conference on disarmaments negotiations.

Additionally, India’s signature on the CTBT is explicitly linked to a similar U.S. and Chinese commitment. As long as they do not ratify these two treaties, India has a voluntary unilateral moratorium on testing. What is holding up Indian accession is U.S. and Chinese accession.

Experts in Beijing claim that China’s expansion and modernisation of its nuclear forces is being driven by the ill-advised and deeply destabilising withdrawal of the U.S. from the Anti-Ballistic Missile (ABM) treaty. This has nothing whatsoever to do with India.

India, therefore, is first being made the whipping boy for the failure of the American non-proliferation lobby in their own country and then it has to accept blame for the complex relations the U.S. shares with Pakistan and China that is driving these Asian allies to increase their arsenals. Can we get real, please?

(Samir Saran is vice-president and Abhijit Iyer-Mitra is programme coordinator at the Observer Research Foundation.)

BRICS, In the News, Politics / Globalisation

BRICS Development bank will be good for members,especially India-Strategic Policy Expert

BRICS, Columns/Op-Eds, In the News, Politics / Globalisation

First Xi-Modi meeting finds common ground

Global Times | July 20, 2014 19:33

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When India and China meet, the world watches” were the words Chinese President Xi Jinping used to capture the interest generated by his first meeting with India’s new Prime Minister Narendra Modi.

Whether the world was watching or not, the public in both countries keenly followed the first interaction between the two Asian leaders on the sidelines of the BRICS summit in the Brazilian town of Fortaleza.

The meeting passed the initial hurdle of establishing camaraderie between the two leaders. The images and videos that have found their way across the news and social media portrayed a favorable body language and easy chemistry. That the meeting, slated for 40 minutes, lasted nearly twice as long also signals the importance both leaders attached to this engagement.

The meeting can be captured in two words: pragmatic optimism.

That Modi chose to address the contentious border issue in his very first meeting demonstrated a sense of political realism. The Indian leader understood that such a vital element of the partnership cannot be swept under the carpet, even as the BRICS summit itself was gearing up to announce some very positive outcomes.

That Xi also chose to underscore the need for finding an early solution demonstrates their acknowledgement of the negative implications of this lingering border dispute on the larger relationship.

Both countries surely realize that any further economic integration will inevitably hit the political wall if an early solution to this legacy dispute is not discovered.

While it may seem an onerous task, a degree of progress has already been made.

During the previous decade, a great deal of effort has been invested by the empowered special representatives to discover a mutually acceptable and creative solution. In fact, those in the know suggest that it is not impossible to finalize a settlement. What was lacking was the political leadership capable of implementing the same.

With two strong leaders, there exists a golden opportunity to move beyond the border defense cooperation agreement signed last year to one that is conclusive and sustainable.

However, the serious nature of the conversations around the border issue did not deter the two strong leaders from making a strong and optimistic case for deeper economic cooperation and coordination.

The leaders discussed an enhanced role for China in the Indian economic story. The new Indian leadership seems ready to invite large Chinese investments in industrial parks, infrastructure and other key sectors of the economy. At the same time, India seeks reciprocity from China by allowing more efficient and larger market access to Indian goods and services.

Both of these measures would help balance the current large trade deficit in favor of China.

The convergence in the positions of the two countries on most global economic and political governance issues helped the BRICS arrive at an acceptable framework for the new development bank and contingent reserve arrangement. This growing proximity was specifically established when Xi invited India to the APEC summit later this year.

These are early days for Xi and Modi. There are plenty of hurdles that will need to be managed. There is a whole universe of professional naysayers on both sides and in other parts of the world that will exploit negative developments.

Both leaders will have to carry along their security and strategic establishments with them; not the easiest groups to handle. They also have to manage and guide the public mood in favor of more robust ties with each other.

The recent interaction emphasized people-to-people relations and tourism, and perhaps that is one of the ways to do this.

But the crucial factor that can help transform this bilateral is Modi himself. For the first time, the Chinese will interact with an Indian leader who can be politically strong in safeguarding India’s sovereign interests, while at the same time being very welcoming in embracing China economically.

The author is vice president and senior fellow with Observer Research Foundation in Delhi. opinion@globaltimes.com.cn

Speaking

BRICS and India at the South Asia Focus

BRICS, In the News

नरेंद्र मोदी ब्राज़ील से क्या लाएँगे?

समीर सरन

उपाध्यक्ष, ऑब्ज़र्वर रिसर्च फाउंडेशन

मंगलवार, 15 जुलाई, 2014

ब्राज़ील में हो रहा ब्रिक्स शिखर सम्मलेन प्रधानमंत्री के रूप में नरेंद्र मोदी का पहला महत्वपूर्ण अंतरराष्ट्रीय दौरा है.

यह ब्राज़ील, रूस, भारत, चीन और दक्षिण अफ़्रीक़ा का संयुक्त मंच है.

इस यात्रा में मोदी पहली बार इन देशों के प्रमुखों से मुलाक़ात करेंगे. अपने दो दिवसीय दौरे के पहले दिन ही उनकी दो महत्वपूर्ण बैठकें हैं.

इस सम्मेलन के दौरान पाँच ऐसे मुद्दे हैं जो भारत की दृष्टि से महत्वपूर्ण रहेंगे.

इस यात्रा से नरेंद्र मोदी को क्या हासिल हो सकता है? जानने के लिए पढ़िए ऑब्ज़र्वर रिसर्च फ़ाउंडेशन के उपाध्यक्ष समीर सरन का विश्लेषण.

रिश्ते बेहतर करने का मौक़ा

यूक्रेन के मुद्दे पर रूस और यूरोपीय संघ के बीच एक तनावपूर्ण स्थिति बनी हुई है. वहीं पूर्वी एशिया के दूसरे देशों के साथ चीन के रिश्ते तनावपूर्ण चल रहे है.

ऐसे में रूस, चीन और भारत के संबंध काफ़ी महत्वपूर्ण हो जाते हैं.

सम्मलेन के बहाने द्विपक्षीय संबंधों को सुधारने का भी मौक़ा मिलेगा, चाहे वो भारत चीन के रिश्ते हों या भारत और रूस के बीच.

ब्रिक्स वित्तीय संस्थान?

ब्रिक्स देशों के पास अब यह अच्छा मौक़ा है जब वो अपना एक अलग वित्तीय संस्थान और विकास का एक अलग मॉडल बना पाएं.

इस बार उम्मीद की जा रही है कि सम्मलेन के दौरान कंटिंजेंसी फ़ंड, ब्रिक्स विकास बैंक के गठन की औपचारिक घोषणा हो जाए.

जो देश इस तरह के कंटिंजेंसी फ़ंड का समर्थन कर रहे हैं वो वर्ल्ड बैंक और अंतरराष्ट्रीय मुद्रा कोष यानी आईएमएफ़ की मुख्य धारा में नहीं हैं.

आपसी व्यापार

व्यापार तीसरा बड़ा महत्वपूर्ण मुद्दा है क्योंकि अमरीका और यूरोपीय संघ के बीच खुले व्यापार का समझौता होने वाला है.

अगर यह समझौता हो जाता है तो वैश्विक सकल घरेलू उत्पाद यानी जीडीपी का 66 प्रतिशत आपस में सम्मिलित हो जाएगा.

इस समझौते का भारत, चीन, रूस और दक्षिण अफ़्रीक़ा पर असर पड़ेगा.

अमरीका और यूरोपीय संघ के बीच समझौता ब्रिक्स देशों के लिए एक बड़ी चुनौती है क्योंकि यह विश्व व्यापार संगठन की अहमियत को कम करने वाला है.

क्षेत्रीय सुरक्षा और स्थिरता

क्षेत्रीय सुरक्षा और स्थिरता एक महत्वपूर्ण मुद्दा है.

पश्चिमी एशिया में हालात काफ़ी चिंताजनक हैं. अफ़ग़ानिस्तान में राष्ट्रपति चुनाव को लेकर भी काफ़ी कड़वाहट है. अमरीकी फ़ौजें इस साल अफ़ग़ानिस्तान से वापस जा रही हैं.

भारत को अपने आर्थिक विकास के लिए इलाक़े में क्षेत्रीय स्थिरता और राजनीतिक शांति चाहिए.

भारत के लिए यह ज़रूरी होगा कि चीन और रूस इसमें उसका सहयोग करें.

पिछले पाँच सालों की समीक्षा

यह ब्रिक्स देशों की छठी बैठक है.

यह मौक़ा है जब भारत को पिछले पांच सालों में अपनी उपलब्धियों की समीक्षा करनी चाहिए, उसके बाद भविष्य की रणनीति तय होनी चाहिए.

लैटिन अमरीका के देशों से संबंध बढ़ाने का भी यह अच्छा मौक़ा है क्योंकि भविष्य में ऊर्जा और खाद्य सुरक्षा के लिए हमें इन्हीं देशों की तरफ़ देखना पड़ेगा.

(बीबीसी संवाददाता सलमान रावी से बातचीत पर आधारित)
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BRICS, In the News, Politics / Globalisation

India leading BRICS Bank bodes well for future says Samir Saran

BRICS Summit’s decision to establish a development bank gives a sense of achievement for India as well as fellow nations. India has invested the most in the Bank after much deliberation during the last years. Author and commentator Samir Saran says that with India having the bank’s stewardship, it is a welcome start to a financial institution such as the BRICS Bank. The Bank should not be seen as if it is in competition with other international financial institutions. Rather, it should be viewed as an additionality. BRICS Bank will cater to the scarcity gap, changing the ethos of financial institutions. The Bank’s headquarters being in Shangai should not deter India’s hopes as we will have the bank’s stewardship during these formative years and this will be fruitful to the economy.

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BRICS, In the News

Five emerging nations plan a development bank of their own

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by Mehboob Jeelani , Fortune

July 15, 2014, 9:53 PM EDT

Leaders of big developing nations hope to create an alternative to the World Bank and International Monetary Fund, as a sign of independence.

Leaders of five big emerging nations plan to create a bank to fund development projects plus an emergency reserve to counter the powerful World Bank and the International Monetary Fund.

The plan was announced Tuesday at the annual BRICS summit, an acronym taken from the name of the participating countries – Brazil, Russia, India, China and South Africa. The idea is to create an alternative to the major international lending sources so as not to be so dependent on them for money and as a symbol of political strength.

The development bank – funded with $100 from the five member states – will be headquartered in Shanghai and, in its first phase, headed by an Indian president. Although China will be bank’s largest donor, each nation will own an equal share of the bank and have an equal say in governance and policy making. Another $100 billion will be allotted to an emergency reserve fund.

BRICS countries account for 42% of the world’s population and represents $6.14 trillion in annual trade. They contribute roughly 20% of the world’s economy based on GDP.

The BRICS summit took place against the backdrop of Russia’s annexation of Crimea, a Russia-China natural gas deal and the change of government in India. The proceedings were therefore of utmost importance to the U.S from a foreign policy standpoint.

“I think the big message to me coming out of the summit is BRICS are trying to create a safety net that means if the U.S. and Europe tried to isolate and sanction one of them they have something to fall back on,” said Thomas Wright, a fellow at the Brookings Institution who focuses on international relations. “The most worrying parts are that they didn’t say anything critical of Russia on Ukraine. Basically they sent out a message that they had no problem with anything with what Putin was doing.”

BRICS was established just prior to 2008 financial crisis with Brazil, Russia, India and China. Two years later, they welcomed South Africa to the club. The member nations vary in their economic health and, in some cases, are undergoing economic problems. But they’ve found a diplomatic and political rationale to exist that Wright described as being based on the idea that “not to have all roads go through the West.”

While Russian President Vladimir Putin boldly expresses his views on BRICS—that he’ll press other emerging markets to find ways to prevent “sanction attacks” by the U.S.—other leaders are cautious about their response.

“Together we should think about a system of measures that would help prevent the harassment of countries that do not agree with some foreign policy decisions made by the U.S. and their allies, but would promote a civilized dialogue on all points based on mutual respect,” Putin said in The Moscow Times.

In the past, the BRICS have struggled to reach a consensus. First they could not agree on a candidate to head the International Monetary Fund or the World Bank in 2011 and 2012. Then recently India and South Africa signaled they may backtrack on a trade agreement initially endorsed by all five countries. Many experts perceived it as a group too “splintered” to make any change.

With today’s summit, BRICS managed to break that perception and move forward to realign the economic balance for future development. “It is an achievement for the countries who have not significantly sat on the high table on economic and political governance matters,” said Samir Saran, senior fellow and vice president at Observer Research Foundation, a New Delhi based think-tank. “It is going to create a new ethos of economic governance.”

BRICS, In the News, Politics / Globalisation

India lauds BRICS bank set up to counter Western hold on global finances Jul 16

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New Delhi, July 16 (ANI): Experts and leaders, on Wednesday welcomed the setting up of $100 billion BRICS bank and a currency reserve pool aimed at reshaping the Western-dominated international financial system. Leaders of the five top emerging markets in BRICS nations consisting of Brazil, Russia, India, China and South Africa, sealed the deal to foster financial and development cooperation and keep the monetary tap running in the face of a financial meltdown like the 2008 crisis. A senior researcher at the New Delhi-based Observer Research Foundation think-tank, Samir Saran, said bank would help emerging and developing nations to mobilize resources for infrastructure and development projects. BJP leader Subramanian Swamy, welcomed the setting up of the bank, adding that the previous Congress -led government had committed to the Chinese demand to have the bank being headquarted in Shanghai

Books / Papers, In the News, Politics / Globalisation

Samir Saran: Rebalance & Reform sets agenda for new Government

July 14, 2014, Monday, Niti Central

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Samir Saran along with Mr. Raja Mohan, Mr. Manoj Joshi & Mr. Ashok Malik, authored a different kind of a book. Usually these kind of books get stocked up in reference sections of an economist’s library, but this is out in the market. While speaking on the situation that the Nation has been through in the last decade, he says, “UPA’s lack of political direction has resulted in economic crisis”. The book suggests ways to rebalance and reform the political situation for a brighter future.