MAY 11, Saturday

Delhi Edition

* Front Page

Supreme Court extends Ayodhya mediation till Aug. 15





Supreme Court extends Ayodhya mediation till Aug. 15

Panel claims ‘progress’ in talks; next meeting with stakeholders to be held in June

Krishnadas Rajagopal
NEW DELHI

A five-judge Bench, led by Chief Justice of India Ranjan Gogoi, on Friday gave the Supreme Court-appointed mediation committee time till August 15 to continue with its efforts to resolve the prolonged and strife-ridden Ayodhya title dispute.

“We do not want to short-circuit the mediation process. We will extend the time in order to enable the committee to complete the task assigned to it,” Chief Justice Gogoi addressed the parties in the courtroom.

Interim report

The committee filed an interim report, dated May 7, with the Constitution Bench.

Sources said the panel conveyed that “progress” was being made in the talks, and it was meeting with the parties. The next meeting is in June.

The panel of mediators comprises former Supreme Court judge Justice F.M.I. Kalifulla, as Chairman; spiritual leader Sri Sri Ravi Shankar; and senior advocate Sriram Panchu, a pioneer in alternative dispute resolution, as members.

The court sent the dispute for mediation on March 8 in a bid to heal minds and hearts. It gave the panel an initial deadline of eight weeks.

The eight weeks was the time given to the Muslim parties to examine the accuracy and relevance of the Uttar Pradesh government’s official translation of thousands of pages of oral depositions and exhibits in the title suit appeals pending since 2010 in the court. In fact, the court had invoked Section 89 of the Civil Procedure Code to propose mediation as an “effective utilisation of time” during the interregnum.

“The report says the mediation process is on… We are inclined to grant them [the panel] time,” Chief Justice Gogoi remarked.

The committee held several rounds of mediation with the stakeholders in Faizabad district, and the mediation proceedings were held in camera.

The court had stressed the need for “utmost confidentiality” in the mediation to ensure its success.

No reporting by media

It had gone to the extent of opining that the media should refrain from reporting the mediation proceedings. “We are of the further opinion that while the mediation proceedings are being carried out, there ought not to be any reporting of the said proceedings either in the print or in the electronic media,” it said.

The CJI had expressed the hope that mediation might spell a peaceful end to the volatile dispute between the members of the two religious faiths.

The court took the step despite objections raised by some Hindu parties that their faith in Lord Ram’s birthplace is “non-negotiable”.

The Bench had explained that the Ramjanmabhoomi-Babri Masjid case “is not about the 1,500 sq ft of disputed land, but about religious sentiments. We know its impact on public sentiment, on body politic. We are looking at minds, hearts and healing if possible”.

The court allowed the appellants to file objections in the translation of over 13,900 pages of documents that are part of the case as evidence.




Karnataka law on SC/ST promotion quota upheld





Karnataka law on SC/ST promotion quota upheld

Petitions lack substance, says Bench

Legal Correspondent
New Delhi

The Supreme Court on Friday upheld a Karnataka law which grants reservation in promotion and consequential seniority to the Scheduled Castes and the Scheduled Tribes in government services in the State.

A Bench of Justices U.U. Lalit and D.Y. Chandrachud declared that the multiple petitions challenging the Karnataka Extension of Consequential Seniority to Government Servants Promoted on the Basis of Reservation (to the Posts in the Civil Services of the State) Act, 2018, “lack in substance.”

The law protects consequential seniority from April 24, 1978.

Countering arguments that reservation in promotion would affect administrative efficiency and erode merit, Justice Chandrachud, who wrote the judgment, observed that “establishing the position of the SCs and STs as worthy participants in the affairs of governance is intrinsic to an equal citizenship.”

Selection method

The judge said “administrative efficiency is an outcome of the actions taken by officials after they are appointed or promoted. It is not tied to the selection method itself.”

The argument that one selection method produced officials capable of taking better actions than a second method must be empirically proven, he said.




Why no FIR on Rafale deal complaint: SC





Why no FIR on Rafale deal complaint: SC

legal correspondent
NEW DELHI

Justice K.M. Joseph on Friday asked the government why there was still no FIR registered on a corruption complaint made to the CBI in October last year in connection with the 36 Rafale jets deal.

“Question here is whether you are obliged under the law to register an FIR when a complaint is made,” Justice Joseph asked Attorney General K.K. Venugopal. The queries came during a two-hour hearing at the end of which the Bench, led by Chief Justice of India Ranjan Gogoi, reserved the Rafale review petitions for judgment.

The complaint was made in October under various provisions of the Prevention of Corruption Act. Justice Joseph referred to a Constitution Bench judgment in the Lalithakumari case, which held that the police or a statutory authority like the CBI was duty-bound to file an FIR and investigate a complaint. If later no prima facie case was made out, the probe could be closed and a copy of the report given to the complainant.

However, the complaint filed by review petitioners with 70-odd pages of documents is yet to be acted upon.


* Nation

Assam cites SC ‘pressure’ to arrest ‘declared foreigners’





Assam cites SC ‘pressure’ to arrest ‘declared foreigners’

Police have detained some 130 ‘illegal migrants’, almost all of them Bengali-speaking Hindus and Muslims, since mid-April

SPECIAL CORRESPONDENT
GUWAHATI

Stung by the accusation of witch-hunting from Bengali organisations, the BJP-led government in Assam has said it is under pressure from the Supreme Court to detain people declared “illegal migrants” by 100 Foreigners’ Tribunals in the State.

The Assam police’s border wing has since mid-April rounded up some 130 “declared foreigners” who were absconding. Almost all of them are Bengali-speaking Hindus and Muslims.

Officials said this was expected after the Supreme Court pulled up the Assam government for its laxity in catching absconding or missing people declared foreigners by the quasi-judicial tribunals that base their judgments on the Foreigners’ Act of 1946. But organisations primarily representing Bengali Hindus — believed to the BJP’s vote bank in Assam — have not taken kindly to the “targeted drive”.

‘Ex-parte judgments’

Most of those arrested are from districts in western and north-central Assam such as Barpeta, Dhubri, Goalpara, Baksa, and Udalguri. “These poor Hindu Bengali citizens have been arrested on the basis of ex-parte judgments despite having enough citizenship proof,” said Kamal Choudhury, president, All Assam Bengali Youth Students’ Federation. He warned that his organisation members would be forced to hit the streets against the “hypocrisy” of the government if the harassment of Bengali Hindus continues.

Utpal Dey, vice-president, All Assam Bengali Suraksha Samiti, said: “There is a plan to destroy Bengalis, whether Muslim or Hindu. People are targeted whimsically and marked foreigners and D-voters,” he said.

“We have nothing against the Bengali Hindus and Muslims. We are trying to speak to their organisations to underline our helplessness. We are under pressure from the Supreme Court almost every day to take action regarding the declared foreigners,” an adviser to Chief Minister Sarbananda Sonowal said.

A group of lawyers handling cases of people declared illegal migrants has sought a probe against one Gaurav Choudhury who took to social media saying a Bangladeshi can be identified by face and language. Mr. Choudhury’s Facebook profile says he works at a Foreigners’ Tribunal.



Fani’s fury creates four new mouths in Odisha’s Chilika Lake





Fani’s fury creates four new mouths in Odisha’s Chilika Lake

Experts studying its impact on the ecosystem

Staff Reporter

Officials said Chilika Lake’s salinity had gone up.K.R.DEEPAK

BHUBANESWAR

The extremely severe cyclone Fani has created four new mouths in Chilika Lake, Asia’s largest brackish water lake, connecting to the Bay of Bengal, officials said.

Chilika Development Authority (CDA) officials have started studying the impact of saline ingression into the lake.

“Chilika lagoon had only two active mouths — the point where it meets the sea before Fani hit the Odisha coast on May 3. Four new mouths have opened due to wave energy with high tidal prism,” said Susanta Nanda, Chief Executive, CDA.

Salinity surge

While three new mouths have come up between the two functional mouths near Sanpatna and Arakhakuda, a smaller mouth has been noticed on the northern side.

“In the meantime, a lot of sea water is entering Chilika Lake. We are now monitoring its salinity level at different stations. If sea water ingression goes up, fish migration will increase and the biodiversity will get richer. But its long term impact is something we will have to keep a watch on,” said Mr. Nanda.

When asked if the rise in salinity would alter Chilika’s ecosystem, he said: “Three of the four sectors are more or less marine ecosystems. The rise in salinity will lead to increase in productivity. Chilika Lake is a mixture of saline and fresh water. We will keep observing and consulting with experts.” The three new mouths may ultimately merge with the two functional mouths, Mr. Nanda added.



Chandrayaan-2 will carry 14 payloads from India





Chandrayaan-2 will carry 14 payloads from India

ISRO aims to land Vikram in unexplored lunar south pole

special correspondent,
Bengaluru

Chandrayaan-2, the lunar lander mission planned to be launched during July 9-16, will have 14 Indian payloads or study devices, a mission update of the Indian Space Research Organisation (ISRO) has said.

The 3,800-kg spacecraft includes an orbiter which will circle the moon at 100 km; a five-legged lander called Vikram that will descend on the moon on or around September 6; and a robotic rover, Pragyan, that will probe the lunar terrain around it.

ISRO said all three modules will carry payloads but did not specify them or their objective. The orbiter alone will have eight payloads or instruments. The lander will carry four while the rover will be equipped with two instruments. “All the modules are getting ready for the Chandrayaan-2 launch,” a recent update had said, mentioning only 13 payloads.

ISRO has chosen a landing area at the hitherto unexplored lunar south pole, making it the first agency to touch down at the south pole if it succeeds in its first landing attempt. Chandrayaan-2 will be India’s second outing to the moon. ISRO will send the mission on its heavy lift booster, the MkIII, from Sriharikota.

In October 2008, the space organisation had launched its orbiter mission Chandrayaan-1 on its PSLV booster. The spacecraft had 11 payloads. One of the U.S. payloads shares credit with Chandrayaan-1 for confirming the presence of water ice on the moon. Before that, the Moon Impacter Probe carrying the Indian tricolour image was made to hard-land on the lunar south pole.




Why no FIR on Rafale deal complaint: SC





Why no FIR on Rafale deal complaint: SC

In fact, the trio — union ministers Yashwant Sinha, Arun Shourie and advocate Prashant Bhushan — had moved the Supreme Court primarily seeking a direction for a fair investigation into their complaint.

Mr. Venugopal replied that a complaint would be investigated if it prima facie showed ingredients of an offence. he said the Rafale deal was not just another contract for a highway or a dam.

A combative government also took offence when Justice Joseph asked it to provide records of the deliberations made by the Indian Negotiating Team (INT) after three of its domain experts wrote a stinging eight-page dissent note concluding that the Narendra Modi government’s Rafale deal for 36 jets was not on “better terms” than the offer made by Dassault Aviation during the procurement process for 126 aircraft under the United Progressive Alliance government.

‘Concerns settled’

The judge’s question came after Mr. Venugopal told the Bench that though these members had dissented initially, it was later settled in a collegiate manner. The government’s affidavit said, “The concerns raised by members of the INT were deliberated, recorded and addressed, while ensuring utmost integrity and transparency in the process, allowing opinions to be freely expressed, recorded, discussed and, if necessary, modified”.

But Justice Joseph persisted in his request for the records. “I will produce the records if Your Lordships ask me, but I have to say you have no jurisdiction to ask. Your Lordships are taken in by these selective media leaks based on documents obtained through theft. You are listening to them and saying ‘we will certainly ask for this and this document’,” Mr. Venugopal retorted.

Finally, the CJI intervened to bring peace and told the lawyer that “we would tell you if we want these documents”.

Mr. Venugopal said the government was under no obligation to produce the gamut of documents simply for the reason that the court did not ask it to do so. A “mistake” in interpretation found in the December 14 judgment upholding the Rafale deal cannot be the basis of review, he said.

Advocate Prashant Bhushan countered by asking how the government “anticipated in the Supreme Court in November 2018 that the CAG report, which was presented in February 2019, would redact the Rafale pricing details?”



A-G says he wrote to SC seeking a ‘different’ panel in CJI case





A-G says he wrote to SC seeking a ‘different’ panel in CJI case

Denies media report on differences between him and the govt. after letter

Krishnadas Rajagopal

Attorney General K. K. Venugopal, left, and Chief Justice of India Ranjan Gogoi.File photoFile photo

NEW DELHI

Attorney-General (A-G) K.K. Venugopal, the Union government’s highest law officer, on Friday told The Hindu that he had written to Supreme Court judges about the constitution of a committee quite “different” from the one which was eventually formed under Justice S.A. Bobde to examine the sexual harassment allegation against Chief Justice of India (CJI) Ranjan Gogoi.

“I had written a letter for a committee different from the one that was constituted,” he said over the telephone.

Mr. Venugopal said he had written in his personal capacity on April 22 saying the committee should be composed of retired judges. He described reports that “serious differences” arose between the government and him after the letter, as “untrue and baseless”.

The Justice Bobde panel was formed on April 23.

The Justice Bobde committee, which eventually gave a clean chit to the CJI, had Justices Indu Malhotra and Indira Banerjee as its members.

Justice Malhotra was inducted into the panel after Justice N.V. Ramana, the third in seniority in the court, recused himself from the panel, following a complaint by the woman that he was close to the CJI.

Twist in the case

The panel had proceeded ex parte after the complainant, a former employee of the court, withdrew from its proceedings on April 30. The panel refused her a lawyer or a support person. Its report is confidential and has not been shared with her. It found that there was “no substance” in her allegation.

Mr. Venugopal’s letter follows a communication reportedly by Justice D.Y. Chandrachud that the woman ought to be represented by a lawyer, or the committee should appoint an amicus curiae.



‘Conversations on alliances will take place after the polls’






Interview | Jyotiraditya Scindia

‘Conversations on alliances will take place after the polls’

The Congress general secretary says, ‘Let the chips fall where they will … Certainly, the people are looking for a change’

Damini Nath

On the campaign trail in Guna in Madhya Pradesh, incumbent MP Jyotiraditya Scindiasays the UPA++ is in a much better position than the NDA++.

You just addressed a gathering where you reminded the crowd of what you have done in the past 17 years as the Guna MP. What is at stake for you this time? Is this election any different?

There are two different things at stake for me — one is at the national level and one is at the local level. At the national level, what is at stake to me is our country’s concept of freedom and liberty, of upholding the truth, of upholding the Constitution, and the way that the Constitution is being trampled upon today. Every Constitutional institution today is being compromised… At the local level, its a continual journey, it is a journey of development and progress. I have a vision in mind for this whole area and I am working on that vision.

Many people say they want you to represent Guna, but they want Narendra Modi as Prime Minister. How do you see this dichotomy? Has the Congress been able to present an alternative?

Well, I think that I cannot dismiss or discredit the opinions that you have sought because those are real, first-hand opinions. But, I think, probably those opinions will be in the minority, as opposed to the majority, because people have also seen through the false promises of the Modi government, whether it was the ₹15 lakh in all bank accounts or 2 crore jobs or the doubling of MSP [minimum support price] across the board. So, I think people are looking for change and the fact that the Congress has a track record of putting in place whatever it promises, like the MGNREGA [Mahatma Gandhi National Rural Employment Guarantee Act] programme, or the Bharat Nirman programme and the Right to Information (RTI) Act. All of these facts have built up the hopes and aspirations for the public towards the Congress.

The BJP’s supporters say the election is about Mr. Modi. What issues are resonating with the voters?

The proof of the pudding will be out on May 23. Let the chips fall where they will. Certainly, people are looking for a change.

You have recently said that no party will get a majority on its own and that a ‘UPA++’ government will be formed. Given that allies will be important, how do you see the Congress’s handling of this, particularly the Bahujan Samaj Party (BSP), whose chief Mayawati is angry over the BSP’s Guna candidate joining the Congress?

It’s not only the Guna [BSP] candidate that has supported the Congress. Even in the close-by Rajgarh constituency, the BSP candidate has supported the Congress. So, what’s the difference between Guna and Rajgarh? On allies, that conversation will take place post-May 23. I think we are in a much better position, UPA++, compared to an NDA++, but again, that is my hypothesis, which will either be corroborated or put aside on May 23.

On the recent remarks by Mr. Modi on Congress president Rahul Gandhi and the late Rajiv Gandhi and family vacationing on a warship when the latter was Prime Minister.

See, Mr. Modi and the BJP have nothing to say on the real issues that affect the people of India. The real issues are agrarian distress, rampant and large-scale unemployment, lack of security for women, rapid rise of intolerance in our country, fallout of notebandi (demonetisation) and the Gabbar Singh tax [GST]. If you notice, none of these issues are resonating in his campaign. So, the BJP is going back to what we were taught in Class III, the principle in mathematics of the lowest common multiple (LCM). The BJP’s LCM is Hindutva and its jumlawadi (false promises) nationalism and that is what the BJP regresses to every single time because, in five years, they have done nothing.

Name one scheme that they have rolled out, which is not what they have received in legacy from the UPA government.

As the Congress general secretary for western Uttar Pradesh, can you say what the impact is on the Congress following its exclusion from the alliance with the BSP and the SP? Won’t you cut votes?

The fact is that we are fighting on the ground on our own, we have taken that call. We are rebuilding the Congress party in U.P. and you will see the result of that in terms of vote share and number of seats. That’s the reality today and that doesn’t mean all doors are closed for the future. But, [on] that decision, when we come to that crossroads, then we’ll talk about it. There is no point in talking about it now because we are fighting the election on our own strength and they are fighting on their own strength.

There is chatter among locals that the BJP may try to break the Madhya Pradesh government. Are you concerned?

They [the BJP] certainly may try and do what they are best at, which is is murdering democracy. They have done that in Goa and a couple of other States. They can certainly try and they have been trying in Madhya Pradesh for the past two-three months. But all I can say to them is: Mungerilal ke haseen sapne (proverbially unrealistic dreams).

What is your take on Rahul Gandhi as Prime Minister. Will it be acceptable to allies?

Rahul Gandhi has all the qualities [required] to make a very dynamic and powerful Prime Minister for our country, and I certainly believe that he is the most able to lead the country forward. On May 23, I hope that in the UPA (United Progressive Alliance) government, Mr. Gandhi is chosen by the constituents of the UPA to lead the country forward for the next five years. We are not the BJP, where we decide for everyone. The UPA is chaired by Sonia Gandhi and all the constituents of the UPA will sit together and decide who their leader will be. For the Congress, we have already taken that decision and that decision is Rahul Gandhi.



The long and short of an extended election





The long and short of an extended election

How U.P. is coping with 7-phase polls

The seven-phase election in Uttar Pradesh could mean a level-playing field for all players but with a slight edge to the BJP.

While the common voter is in general indifferent to the schedule, those who spoke to The Hindu said the longer the election, the better it was for the ruling party.

K.K. Patel, a research scholar in Prayagraj, who is opposed to the BJP, says the calendar suits the ruling party as it allows it time to showcase its micro-level work through its army of workers. “This helps them clear any anti-incumbency as the party workers can cover more area. In our area, they are talking even about the newly built roads,” Mr. Patel says.

Amar Deep, who works for a printing agency, says the schedule has caused fatigue and affected business as the model code of conduct restricts movement of vehicles.

He believes that though it is difficult for the BJP to keep the “voter enthusiasm” high, it gets a chance to counter-attack the Opposition. “Masood Azhar was declared a terrorist just before the fifth phase. It would have helped the BJP. I am sure something else will pop up before the May 19 voting,” Mr. Deep says.

R.D. Tripathi, a senior Lucknow-based journalist, says the schedule suits the BJP and the alliance of the SP and the BSP. Both sides are getting time to hold rallies in a “relaxed” manner and the extra time allows the parties to do better “micro-level planning”.

While some observers believe that the schedule suits the BJP as it allow its star campaigner Mr. Modi to cover more area, Mr. Tripathi says the alliance is at no clear disadvantage.

Unlike the BJP, which has been holding rallies and meetings much before the schedule was announced, the SP-BSP alliance started their joint campaign late. Their first rally in Saharanpur was held on April 7, just four days before the first phase.

SP MLC Udaiveer Singh, however, says the schedule drawn is suited to the BJP’s strategy of campaigning effectively nationally. “So that he [Modi] gets a chance to reach everywhere.”

He says it boosts the popular perception that “democratic institutions are being misused”, but adds that the schedule would not fetch the BJP votes. “Votes come from work, and Modi has lost all credibility.”

However, the advantage for a caste-based and well-organised party like the BJP cannot be ignored, though BJP spokesperson Chandramohan downplays it saying it is “not a matter of loss or gain”.

Sanjay Singh, who heads the UP Election Watch, an NGO that tracks polls, says the long schedule allows parties more time to prepare but puts stress on people as the code restricts development.



* Editorial 1

Resolving India’s banking crisis





Resolving India’s banking crisis

Acceleration in economic growth is not possible without addressing the problem of non-performing assets

The government that assumes office after the general election will have to crack a serious and unresolved problem: India’s banking sector. To do so, it needs clarity on how the problem arose in the first place. Only then can it discard simplistic and ideologically-driven solutions in favour of those that can be effective.

Non-performing assets (NPAs) at commercial banks amounted to ₹10.3 trillion, or 11.2% of advances, in March 2018. Public sector banks (PSBs) accounted for ₹8.9 trillion, or 86%, of the total NPAs. The ratio of gross NPA to advances in PSBs was 14.6%. These are levels typically associated with a banking crisis. In 2007-08, NPAs totalled ₹566 billion (a little over half a trillion), or 2.26% of gross advances. The increase in NPAs since then has been staggering. How did this come about?

Origin of the crisis

The answer lies partly in the credit boom of the years 2004-05 to 2008-09. In that period, commercial credit (or what is called ‘non-food credit’) doubled. It was a period in which the world economy as well as the Indian economy were booming. Indian firms borrowed furiously in order to avail of the growth opportunities they saw coming. Most of the investment went into infrastructure and related areas — telecom, power, roads, aviation, steel. Businessmen were overcome with exuberance, partly rational and partly irrational. They believed, as many others did, that India had entered an era of 9% growth.

Thereafter, as the Economic Survey of 2016-17 notes, many things began to go wrong. Thanks to problems in acquiring land and getting environmental clearances, several projects got stalled. Their costs soared. At the same time, with the onset of the global financial crisis in 2007-08 and the slowdown in growth after 2011-12, revenues fell well short of forecasts. Financing costs rose as policy rates were tightened in India in response to the crisis. The depreciation of the rupee meant higher outflows for companies that had borrowed in foreign currency. This combination of adverse factors made it difficult for companies to service their loans to Indian banks.

Tightening norms

The year 2014-15 marked a watershed. The Reserve Bank of India (RBI), acting in the belief that NPAs were being under-stated, introduced tougher norms for NPA recognition under an Asset Quality Review. NPAs in 2015-16 almost doubled over the previous year as a result. It is not as if bad decisions had suddenly happened. It’s just that the cumulative bad decisions of the past were now coming to be more accurately captured.

Higher NPAs mean higher provisions on the part of banks. Provisions rose to a level where banks, especially PSBs, started making losses. Their capital got eroded as a result. Capital from the government was slow in coming and it was barely adequate to meet regulatory norms for minimum capital. Without adequate capital, bank credit cannot grow. Even as the numerator in the ratio of gross NPAs/advances rose sharply, growth in the denominator fell. Both these movements caused the ratio to shoot up to a crisis level. Once NPAs happen, it is important to effect to resolve them quickly. Otherwise, the interest on dues causes NPAs to rise relentlessly.

This, in brief, is the story of the NPA problem. Since the problem is more concentrated in PSBs, some have argued that public ownership must be the problem. Public ownership of banks, according to them, is beset with corruption and incompetence (reflected in poor appraisal of credit risk). The solution, therefore, is to privatise the PSBs, at least the weaker ones.

There are problems with this formulation. There are wide variations within each ownership category. In 2018, the State Bank of India’s (SBI’s) gross NPA/gross advances ratio was 10.9%. This was not much higher than that of the second largest private bank, ICICI Bank, 9.9%. The ratio at a foreign bank, Standard Chartered Bank, 11.7%, was higher than that of SBI. Moreover, private and foreign banks were part of consortia that are now exposed to some of the largest NPAs.

The explanation lies elsewhere. PSBs had a higher exposure to the five most affected sectors — mining, iron and steel, textiles, infrastructure and aviation. These sectors accounted for 29% of advances and 53% of stressed advances at PSBs in December 2014. (The RBI’s Financial Stability Report does not provide similar data for the period thereafter.) For private sector banks, the comparable figures were 13.9% and 34.1%. Our rough calculations show that PSBs accounted for 86% of advances in these five sectors. By an interesting coincidence, this number is exactly the same as the PSBs’ share in total NPAs.

As mentioned earlier, infrastructure projects were impacted by the global financial crisis and environmental and land acquisition issues. In addition, mining and telecom were impacted by adverse court judgments. Steel was impacted by dumping from China. Thus, the sectors to which PSBs were heavily exposed were impacted by factors beyond the control of bank management.

Plans to prevent such crises

Wholesale privatisation of PSBs is thus not the answer to a complex problem. We need a broad set of actions, some immediate and others over the medium-term and aimed at preventing the recurrence of such crises.

One immediate action that is required is resolving the NPAs. Banks have to accept losses on loans (or ‘haircuts’). They should be able to do so without any fear of harassment by the investigative agencies. The Indian Banks’ Association has set up a six-member panel to oversee resolution plans of lead lenders. To expedite resolution, more such panels may be required. An alternative is to set up a Loan Resolution Authority, if necessary through an Act of Parliament. Second, the government must infuse at one go whatever additional capital is needed to recapitalise banks — providing such capital in multiple instalments is not helpful.

Over the medium term, the RBI needs to develop better mechanisms for monitoring macro-prudential indicators. It especially needs to look out for credit bubbles. True, it’s not easy to tell a bubble when one is building up. Perhaps, a simple indicator would be a rate of credit growth that is way out of line with the trend rate of growth of credit or with the broad growth rate of the economy.

Actions needs to be taken to strengthen the functioning of banks in general and, more particularly, PSBs. Governance at PSBs, meaning the functioning of PSB boards, can certainly improve. One important lesson from the past decade’s experience with NPAs is that management of concentration risk — that is, excessive exposure to any business group, sector, geography, etc. — is too important to be left entirely to bank boards. The RBI has drawn this lesson to some extent. Effective April 1, 2019, the limit for exposure to any business group has been reduced from 40% of total capital to 25% of tier I capital (which consists of equity and quasi-equity instruments). The limit for a single borrower will be 20% of tier 1 capital (instead of 20% of total capital).

Risk management

Other aspects of concentration risk remain to be addressed. Overall risk management at PSBs needs to be taken to a higher level. This certainly requires strengthening of PSB boards. We need to induct more high-quality professionals on PSB boards and compensate them better.

Succession planning at PSBs also needs to improve. Despite the constitution of the Banks Board Bureau to advise on selection of top management, the appointment of Managing Directors and Executive Directors continues to be plagued by long delays. This must end.

The task of accelerating economic growth is urgent. This is not possible without finding a solution to the problems that confront the banking system. There is ample scope for improving performance within the framework of public ownership. It can be done. What is needed is a steely focus on the part of the government.

C. Rangarajan is a former Governor, RBI. T.T. Ram Mohan is a professor at IIM, Ahmedabad. The authors are grateful to Siddharth Purohit for data support



New clouds over the Persian Gulf





New clouds over the Persian Gulf

Iran’s decision to withdraw partially from the nuclear deal is risky, and could play into U.S. plans

Iranian President Hassan Rouhani announced on Wednesday that Iran will withdraw partially from the landmark nuclear deal of 2015. Iran’s decision to reduce its commitments to the Joint Comprehensive Plan of Action (JCPOA), known as the P5+1 agreement, comes as a reaction to the U.S.’s attempts in recent weeks to reduce Iran’s oil exports to zero. As a response to U.S. sanctions, Iran is demanding that the remaining signatories of the deal — the U.K., China, France, Germany and Russia — ease the restrictions on its banking and oil sectors in the next 60 days. In case the five endorsers of the deal decide not to act in favour of Iran, the authorities of Tehran will remove the caps on uranium enrichment levels and resume work on the Arak nuclear facility.

Loss of patience

Iran’s plans are very clear, and they put an end to long and laborious multilateral negotiations which put strict limits on Iran’s nuclear activities in return for lifting most international sanctions. Undoubtedly, Iran’s decision comes as an expression of loss of patience with a deal that is providing very few of the promised economic benefits. But by resuming its uranium enrichment operations, Iran could be taking a huge risk, putting at danger its diplomatic relations with Europe and playing the game of the Trump administration that has been taking a hard line against Tehran.

Consequently, Iran might be economically isolated, but the message coming out from Russia is that Iran is not alone. The Kremlin has joined Tehran to accuse the U.S. of retreating from the nuclear deal, while approving Iran’s rolling back of some of the terms of the deal due to pressure from the U.S. Of course, the Russian gesture is not without some long-term interests for the Kremlin. U.S. sanctions against Iran will certainly result in the development of cooperation between Moscow and Tehran, but also with countries like Turkey which are important to American foreign policy.

This said, the goal of the Trump administration in applying the new series of sanctions is likely to hit the earnings of Iran’s major metals companies, such as Mobarakeh Steel and the National Iranian Copper Industries Company. This will have an immediate impact on the Iranian government’s revenues, but it will also deteriorate the balance sheets of Iran’s heavily indebted metals and mining companies. No doubt, this situation will be followed by mass unemployment, especially among blue-collar workers employed by state-owned enterprises who form the backbone of Iran’s economy.

Stoking unrest

It is no secret that last year the 2.5-million-strong government workforce did not get a raise while prices accelerated. To this end, the Trump administration’s “maximum pressure” policy on Iran aims directly to stoke social unrest in Iranian cities by creating labour strikes (in the Polish style of Solidarity back in the 1980s) within the metals industry. For Donald Trump and his aides, the outcome of their confrontation with Iran is clearly to deprive the Iranian regime of the funds it can use to impose its hegemony around West Asia, but also to put pressure on the everyday life of Iranian citizens. From the Trump administration’s perspective, the economic malaise in Iran should stoke protests sooner or later. But does this mean the beginning of the end of the regime of the Ayatollahs?

Things are more complex than they might appear. If we take a close look at the geostrategic situation of West Asia, Iran’s threat to violate the JCPOA is a very worrisome decision. Let us not forget that from Iran’s perspective, Mr. Trump’s America is considered a rogue state. As for the Trump administration, it considers the Islamic regime in Tehran as its Enemy Number One in West Asia. The recent announcement by John Bolton, Mr. Trump’s National Security Adviser, that the U.S. was dispatching an aircraft-carrier strike group and bombers to West Asia to protect American allies and their interests is an unmistakable attempt to intimidate the Iranian regime. Over the past few weeks, the White House has intensified its campaign of pressure and threats against the authorities in Tehran and the Iranian Revolutionary Guard Corps (IRGC). In Washington’s eyes, Iran is a rogue state because of its support of militant groups, its violations of human rights, and its pursuit of nuclear-related technologies.

But despite the sanctions, Iran continues to fund its proxies in the region, prepare missile tests and support the Syrian regime of Bashar al-Assad. Thus, at the point where things stand, it is very hard to imagine a turn towards negotiations, although some European countries might continue encouraging a return to diplomatic management of the Iranian crisis. There is little likelihood of any flexibility towards the Iranian regime from the American side till the November 2020 U.S. presidential election. Iran will certainly look for ways to inflict a cost on the U.S. directly or through militia proxies in the region. In that case, the scene will be set for military confrontation between Iran and the U.S.

Last but not the least, if Iran’s leadership is to successfully resist U.S. “maximum pressure”, it must do more than choose the military path. Those who oppose any unilateral U.S. military action against Iran can only hope that the Ayatollahs and the IRGC will not react violently to U.S. forces in the region and to its allies. In case that happens, troubled times are ahead for Iran, West Asia and the global market.

Ramin Jahanbegloo is Director, Mahatma Gandhi Centre for Peace, Jindal Global University, Sonipat



For a full bench





For a full bench

Progress in judicial appointment is welcome, but it is time for systemic change

The government and the Supreme Court collegium seem to disagree on recommendations for judicial appointments quite frequently these days. It has become routine to hear that some recommendations for High Court appointments, as well as elevation to the Supreme Court, have met with disapproval from the government. In such instances, it requires reiteration by the collegium for the names to be cleared. This need not always be a cause for concern if it is a sign of some serious consultation on the suitability of those recommended. However, it acquires the character of a controversy if the government’s objections suggest an oblique motive to thwart or delay the appointment of particular nominees. The latest development concerns Jharkhand High Court Chief Justice Aniruddha Bose and Gauhati High Court Chief Justice A.S. Bopanna, who were on April 12 recommended for elevation to the Supreme Court. The government had sought a reconsideration of the two names. The collegium has now repeated its recommendations, emphasising that there is nothing adverse against the two judges in terms of their “conduct, competence and integrity” and that there is no reason to agree with the government. Under the present procedure, the government is now bound to accept the recommendation. The Supreme Court is keen to fill up the current vacancies. It has also recommended two more judges, Justice B.R. Gavai of the Bombay High Court and Chief Justice Surya Kant of the Himachal Pradesh High Court, for appointment to the apex court. If all these four recommendations go through, the court will have its full complement of 31 judges.

While this will be welcome, some issues persist. In systemic terms, the advisability of retaining the collegium system of appointments is a major concern; and in terms of process, the huge number of vacancies in the various High Courts and lower courts is another. The process of filling up vacancies depends on the relative speed with which the collegium initiates proposals for appointments and makes its recommendations after internal deliberations, and the time the government takes to process the names. As on May 1, the total number of vacancies in all the High Courts is 396. It is true that the filling up of vacancies is a continuous and collaborative process involving the executive and the judiciary, and there cannot be a time frame for it. However, it is time to think of a permanent, independent body to institutionalise the process. The known inadequacies of the collegium system and the mystery over whether a new memorandum of procedure is in the offing are reasons why the proposal for a constitutionally empowered council to make judicial appointments ought to be revived — of course, with adequate safeguards to preserve the judiciary’s independence. The time may have come for a systemic and processual overhaul.



A fraught moment





A fraught moment

The U.S. and China need to take sustained steps to de-escalate tensions over tariffs

The U.S.-China trade war has flared up again after a deceptive lull over the last few months, when both sides were trying to negotiate a deal. Out of nowhere, President Donald Trump tweeted that he would raise the 10% tariff imposed on $200-billion worth of Chinese goods to 25%, starting Friday. That the Trump administration pressed ahead with the increase even as China’s Vice Premier Liu He was still in Washington for a second day of talks with U.S. trade officials only underscores the businessman-turned-President’s ‘take no prisoners’ approach to negotiations. China promptly promised retaliatory action, but was yet to spell out the measures. With Mr. Trump tweeting that “the process has begun to place additional tariffs at 25% on the remaining” Chinese goods worth $325 billion, the U.S. administration unambiguously signalled it was not going to be the first to blink. The latest revival in tensions between the world’s two largest economies elevates the risk of a global trade war to its highest level since the first signs emerged in 2018. The increase in tariffs imposed on goods crossing international borders essentially represents a new tax on a global economy already facing a slowdown. Last month, the International Monetary Fund trimmed its projection for global growth in 2019 to 3.3%, from a 3.5% forecast made in January, citing slowing momentum in “70% of the world economy”. IMF Chief Economist Gita Gopinath had at the time projected a pick-up in global growth momentum in the second half, predicated substantially on the “improved” outlook for U.S.-China trade tensions.

IMF chief Christine Lagarde and Ms. Gopinath, however, presciently warned that the world economy was poised at “a delicate moment”. Were tensions in trade policy to flare up again, it could result in large disruptions to global supply chains and pose downside risks to global growth, the IMF warned. Barely a month later, the world economy faces the very real risk of an escalation in this trade war where other countries, including India, can largely only wait and watch as the U.S. and China raise the pitch. While the U.S. may have genuine concerns about Chinese protectionism, the overall economic logic behind Mr. Trump’s trade policy still remains weak. The cost of these tariffs will, after all, eventually be borne by American consumers and could result in U.S. job losses too as the import of Chinese parts become uneconomical for smaller businesses. Indian policymakers would do well to closely monitor how the latest escalation in trade tensions pans out for global demand and international energy prices, given that the RBI has flagged oil price volatility as a factor that would have a bearing on India’s inflation outlook.


* Editorial 2

Picking up the pieces after Cyclone Fani





Picking up the pieces after Cyclone Fani

The cyclone battered Bhubaneswar and Puri last week, leaving behind a trail of destruction. Jacob Koshy and Satyasundar Barik report on the efforts by the government and relief teams to restore normalcy

Cyclone Fani killed at least 40 people in Odisha and injured 160. Penthakata village in Puri after the storm. (Below) Debris on train tracks at a railway station in Puri.BISWARANJAN ROUT/AFP

Shattered windowpanes, sturdy trees lying flat on the roads, and downed power lines are the prominent markers of Cyclone Fani, which pounded Puri and Bhubaneswar in Odisha on May 3. Three days after Fani, categorised as an ‘extremely severe cyclonic storm’, ploughed through the State killing at least 40 people and injuring 160, the streets of Bhubaneswar are filled with workers of the National Disaster Response Force, dressed in bright orange. Senthil Rao, 28, and five others have spent all morning trying to remove an uprooted banyan tree. “It is an old tree and has blocked an entire stretch of the main road. My work seems interminable,” Rao groans during a tea break.

This is Rao’s tenth tree since early morning. It’s largely due to the efforts of 600 teams of the State and Central disaster response forces that the city roads are navigable now. Tree trunks and branches have been swept into mounds and line the sidewalks and street corners. There are so many of them that the government has permitted anyone, with the means and the men, to cart them away and use them as fit without the usual tendering and bureaucracy.

There is little public and private transport on the streets; only the bulky JCBs can be seen in corners and inner streets. They are clawing out crumbled billboards and the remnants of carts and tyres from the rubble, and lifting logs. Santosh Rout, who manages a fleet of JCBs, says that he has been charging a 30% premium for the use of his machines. “The demand is very high. However, I hear there are nearly 30 teams of JCBs commissioned, so it looks like things will be normal in less than a week,” he says.

Fani, which started out in the Bay of Bengal in the last week of April, was quite unlike the typical storms that Odisha is accustomed to. From 1965 to 2017, the Bay of Bengal and the Arabian Sea collectively registered 46 ‘severe cyclonic storms’. More than half of them occurred between October and December. Seven of them occurred in May and only two (in 1966 and 1976) were recorded in April, according to data from the India Meteorological Department’s cyclone statistics unit. Before Fani, only one of them (in 1966) had actually made landfall over India.

While modern, meteorological record-keeping dates furious cyclones in Odisha to as far as back to 1831, to the average citizen, in contemporary times 1999 marked the turning point for the State. The cyclone that hit that year was catastrophic: it killed thousands, obliterated homes, and left a trail of destruction. The State was cut off from the rest of the country, and it was weeks before the magnitude of the tragedy hit home. Since then, Odisha has prepared itself in various ways to face such cyclones — by building specially crafted storm shelters and commissioning electric poles that are designed to withstand strong gales.

By May 1, the weather department was confident that Fani would be unforgiving, but not as powerful as BOB 06 (cyclones then didn’t have names) that had hit the port town of Paradip in 1999.

Capital without power

Since Bhubaneswar is bald without tree cover after Fani, the heat and humidity are more palpable than before. There is no power, to add to the woes, so the city after dusk is both dark and uncomfortable. While city-specific figures aren’t available, the State Disaster Management Authority estimates that at least 45,000 km of power lines and 11,000 distribution transformers have been destroyed by the cyclone.

Sarath Chandra, a hotel manager, says that normally in early May, when the tourist season is just beginning, his hotel is only about 60% full. “This time we’re nearly 85% full,” he says. “There are no outstation tourists. All of them are locals escaping the heat of their homes.” Chandra’s hotel is among those equipped with a diesel-generation set, which means that there is a steady supply of water and electricity.

“The air conditioner in the room doesn’t cool but being here is better than being at home,” says Dolly Patra, who is staying with her family at Chandra’s hotel. Her second floor flat, barely 3 km from the hotel, is a cauldron, she explains. Power is expected to return only after a fortnight, and water supply is irregular. When the cyclone howled through her apartment complex, she was scared for herself and her infant. “I was terrified that the asbestos sheets nearby would smash into my bedroom,” she says. After the storm she stayed put at home, but mosquitoes entered her home in droves and she was afraid that her child would fall sick. “I hope to get back home soon or move to a relative’s place. Staying in a hotel is expensive for us,” she says.

At the Secretariat of the Odisha State Disaster Management Authority (OSDMA), Bishnupada Sethi presides over a crew of officers who compile and coordinate information with district centres and the IMD. Details of damage, relief dispensed and lacunae are continually wired to Sethi’s office. While the unit’s coordination has earned plaudits — from Prime Minister Narendra Modi to the United Nations — Sethi says that in spite of the preparation and the “memories of 1999”, citizens were “mentally unprepared” for the impending disaster. “This is a State where cyclones recur. At the State level, there are plans and a standard operating procedure to deal with the eventuality. However, many were unprepared. In fact, many people refused to leave their thatched houses and go to shelters,” he notes.

Anger in Puri

Its stature as a capital city and the prevalence of concrete houses may have contributed to zero casualties, according to official figures, in Bhubaneswar, but the temple town of Puri, which is about 60 km away, presents a vastly different picture.

National Highway 316 that connects the two cities is smooth; it was spared Fani’s wrath. However, on both sides of the highway lie uprooted coconut trees and houses with holes in their tiled roofs. At least 21 deaths have been reported in Puri district.

Not far from the beach, where the sea is now placid, anger is growing at the government shelter near Talabaniya in Puri town. This pink building is one among the 879 constructed by the Odisha government across Puri, Cuttack and Khordha. The two-storey buildings, designed in 2004 with assistance from the Indian Institute of Technology, Kharagpur, are low-cost and capable of accommodating about 3,000 people. They are resilient to wind speeds greater than 200 kmph. The Talabaniya shelter is also equipped with an alarm and a horn. In the event of an impending storm, instructions are relayed to those living in thatched houses, or the homeless, to come to the shelter.

“There were warnings on the day before the cyclone struck and many of us came to the shelter,” says Pintu Pradhan, who works in a nearby hotel. “A day before the storm, we were given rice and dal. On the day of the storm we were given packed dry fruits, chuda (flattened rice) and gur (jaggery). There’s been no food ever since.” Pradhan’s house, along with the houses of about 700 others of the Biju Nagar slum, was reduced to rubble. Only those with “food security cards,” says Pradhan, were eligible for the Chief Minister’s relief package of ₹2,000 and 50 kg of rice per month as well as polythene sheets that could be used as roofs. There were families who lost everything in the storm and now have no food, water or jobs, he says.

While Pradhan and several men, most of them daily wage labourers, rue the absence of primarily benefits, the women of Biju Nagar trek a kilometre to the grounds of the government technical training institute to collect fallen branches and twigs to use as firewood. The trunks are also useful to rebuild houses, one of them points out. Another group of women has congregated at the Puri Collectorate to protest against the unavailability of food and water. Due to the absence of an effective communication system, the promised welfare and supplies are not making their way to the people, says Shanti, one of the protesters. As part of relief measures, residents are eligible for up to ₹95,000 for ‘fully damaged’ structures and compensation for damage to agricultural and horticultural crop, and fisheries.

Balwant Singh, the Puri District Collector, who assumed charge on May 7, says the lack of power and telecommunication has hampered access to supplies. “There’s a standard operating procedure in place. Setting up free kitchens near shelters and restoring road connectivity are our immediate priorities. For all that we need to have the communication system with Bhubaneswar running smoothly,” he adds.

The problem of communication

With mobile phone connection down, the Collectorate, with its compound walls and plantations hit, is relying on a ham radio network. Ramesh Kuthumbaka, a Hyderabad-based advocate and an amateur ham operator, says he was called by OSDMA on May 1. “Two ham radio colleagues and I left Hyderabad and travelled 1,200 km by road in a Qualis to reach OSDMA and set up a ham network. We struggled to come here, there were strong winds. We reached on May 3,” he recounts. Another team of ham operators from Kolkata reached the Puri Collectorate and installed a radio station. “Since then we’ve been helping the State authorities with transmitting and receiving instructions. The Chief Secretary relied on our network. There was nothing else,” he claims. Kuthumbaka has skipped many meals. He complains of the lack of support from the district administration. “There doesn’t seem to be a well-thought-out plan. For instance, in spite of knowing fairly reliably by April 27 that Odisha would be hit, we were told only on the 1st,” he says. However, he will be present in Puri “as long as he is needed”.

Sethi points out that the “operational difficulties” and the sheer magnitude of the devastation would mean that returning to normalcy will take weeks. Nearly 100 million kg of rice was readied beforehand, yet distribution is tardy, he says. “We had to evacuate about 1.4 million people within 12 hours. Nearly 200 lakh SMSes were sent to various levels of administration — right down to the village heads of 14 districts,” he says. He explains why people were mobilised into action only by May 1: “Remember, this was after the election exercise, itself an arduous task, had just concluded on April 29. Officers and the administration are human too.”

Another challenge, adds Sethi, was to convince people to leave their homes and rush to the shelters. “Often they wouldn’t listen. We have seen it here every time there has been a cyclone. People say they will weather the storm and then they all suffer.”

In Brahmagiri town in Puri, a block-level official says that in the administrative block of Bhagawat Patna, nearly 27,289 people had to be evacuated. “Many of them refused to come, saying Lord Jagannath would keep them safe,” he recounts. “There were four deaths, but it’s not confirmed if they were specifically due to the cyclone.”

The custodians of Jagannath say they are dealing with their own worries. Fani didn’t spare the Jagannath temple in Puri, the mainstay of the town. One of the key idols is damaged and losses to some of the temple’s property amount to ₹5 crore, reckons S. Chatterjee, a temple administration official. However, the temple itself is not participating in any relief work or donating any of its corpus to the State to help with rehabilitation. The temple administration receives, on average, ₹2 lakh per day as donation but was expecting help from the government and individuals to prepare for the annual Rath Yatra in July. The long stretch of road, where the idols are carted, is largely clear. “Since the cyclone hit, daily offerings have plummeted. In the first two days, after the storm we barely got ₹700 on an average,” Chatterjee says.

In the artisanal village of Raghurajpur, on the outskirts of Puri, the 100-odd families skilled in the art of pattachitra (painting on palm leaf) while away their time. In their part of town, Cyclone Fani brought rain and destroyed some of the paintings. Each painting takes about a day to make, says Gauranga Maharana, an artist who is in the midst of painting a wood-carved swan when we meet him. “The winds and the rain were so strong that my paintings got soaked. Paintings worth nearly ₹20,000 have been damaged,” he says. Maharana, who traces his artistry to “several generations”, estimates that a usual summer day brings in close to a thousand tourists (Raghurajpur is a heritage village), but now with the State battered, the number of tourists, both Indians and foreigners, has dwindled.

The cyclones of May

Housed in a single-storey building, the walls of which are plastered with charts describing El Nino, warming seas and other climate phenomena, the scientists at the State headquarters of the IMD are working in the corridors and verandahs to escape the stifling heat. Habibur Rehman Biswas, the chief scientist of the department, says he hadn’t left the office for 72 hours straight after May 1. “Initially, we thought it would be a typical summer cyclone of the Bay of Bengal. We thought it would go either towards Andhra Pradesh or turn towards Bangladesh and Myanmar and miss the Odisha coast. We were wrong.”

Meteorologists note with worry that so-called recurving cyclones — ones that sharply turn eastwards — are becoming more frequent around the Indian Ocean. The IMD publicly disseminates information via a WhatsApp group that has senior district administration officials and media representatives. “We’re always getting inputs, but with power gone, it’s a bit slow. Still, there are other IMD agencies that pick up inputs and relay them. There will always be regular inputs, come what may,” he says.

With Cyclone Fani gone, Rehman doesn’t rule out the possibility of another strong cyclone. “There’s nothing which says that such a strong storm won’t lead to another one in a few weeks, though there aren’t immediate indications yet. May is usually when there are many more cyclones.”



* Foreign

Trump raises tariffs on Chinese goods





Trump raises tariffs on Chinese goods

Beijing says it ‘deeply regrets’ the U.S. decision and promises to take countermeasures

Sriram Lakshman
Washington

The trade war between the U.S. and China took a turn for the worse on Friday as the Trump administration increased tariffs on $200 billion worth of Chinese goods. Tariffs on 5,700 categories of goods increased from 10% to 25% at 12.01 am on Friday.

The tariffs went into effect just hours before U.S. Trade Representative Robert Lighthizer, Treasury Secretary Steven Mnuchin and Chinese Vice-Premier Liu He held a second day of talks in Washington on Friday. The session ended after about 90 minutes.

“They were constructive discussions,” Mr. Mnuchin told reporters as he left Mr. Lighthizer’s offices near midday. Mr. Mnuchin said the negotiations were done for the day.

Mr. Liu, the lead Chinese negotiator, told reporters at his hotel in Washington that the talks had gone “fairly well”.

Things have moved quickly over the past few days with tariffs kicking in days after Mr. Trump said they would, and five days after the administration notified the new rates in the Federal Register. This, despite Mr. Trump saying on Thursday that Chinese President Xi Jinping had sent him a “very beautiful letter” offering to “work together” and “get something done”.

The tariff rate on machinery and technology imports from China, whose value is about $50 billion, was already hiked to 25% last year in tit-for-tat tariff rounds between the two countries. Friday’s tariffs for the $200 worth of Chinese imports, “as part of the U.S.’s continuing response to China’s theft of American intellectual property and forced transfer of American technology,” was set to kick in January 1 as per a September 2018 announcement from the USTR, but it was held in abeyance as negotiations continued.

In the past, Mr. Trump had threatened to increase tariffs on the remainder of Chinese imports as well, a threat he reiterated on Friday. The U.S. imported $558 billion of goods from China as per the USTR, with $250 billion attracting 25% tariffs as of Friday.

New round

“The process has begun to place additional tariffs at 25% on the remaining $325 billion,” Mr. Trump wrote on Twitter.

Last week, U.S. officials familiar with the discussions had said China had backtracked on commitments, prompting Mr. Trump’s decision to impose the new round of tariffs.

China has said, via a Ministry of Commerce statement, that it “deeply regretted” the latest tariff development and has said it will take countermeasures.

American agriculture has felt much of the heat of the tit-for-tat trade war with China. Mr. Trump sought to assuage concerns on Friday. With an election looming in 2020, the President cannot afford to alienate farmers — most of the top 10 agricultural States were won by Mr. Trump in 2016. “Your all time favourite President got tired of waiting for China to help out and start buying from our FARMERS, the greatest anywhere in the World!” he wrote on Twitter.

Tariff increases will also mean U.S. firms paying more for Chinese inputs and those costs will be, at least in partially, passed on to American consumers.

(With inputs

from Reuters)




‘Regional infrastructure needed to combat terror’






Interview | Mariya Ahmed Didi

‘Regional infrastructure needed to combat terror’

Maldives Defence Minister says radicalisation a concern

, Meera Srinivasan

Colombo

The April 21 serial bombings in Sri Lanka not only shook the island, but also sparked considerable fear in South Asia, especially in neighbouring Maldives that is home to nearly 4,00,000 Muslims. Almost immediately after the Sri Lanka attacks, the island nation heightened security measures and began strengthening its response mechanisms to tackle a possible terror threat. Amid reports of dozens of Maldivians joining militant Islamist organisations abroad, the country is also taking steps to address radicalisation, which is a concern for the Maldivian government, says Defence MinisterMariya Ahmed Didi in an email interview.

As a close neighbour, how does the Maldives view the terror attack in Sri Lanka? You had tweeted about its impact on the region…

The terror attacks in Sri Lanka on Easter Sunday, carried out in multiple locations, are of extreme concern to the Maldives, and the entire region. The magnitude of the attacks, the level of coordination and the tactics chosen by the terrorists are alarming and indicate new levels of brutality to which terrorists may resort.

As a country predominantly dependent on tourism, we do not take these attacks within our neighbourhood lightly, and we are acting on these concerns with the urgent establishment of national-level, multi-agency security structures and measures.

Following the blasts, the Maldives appears to be gearing up for a possible security contingency. The National Defence Force and the police have been holding special emergency response exercises. Is the Maldives sensing a potential terror threat?

There is no specific or imminent terrorist threat detected. However, in today’s world, we can never really entirely rule out the possibility of one. Therefore, in the interest of vigilance, the Maldives National Defence Force (MNDF) and the Maldives Police Service have been holding joint, special emergency response exercises, testing various scenarios.

Similarly, other security organisations such as the Aviation Security Command, the Maldives Customs Service, and the Maldives Immigration have also heightened their security levels.

According to reports in the Maldivian media, over 60 Maldivian men, along with their wives and children, have travelled out of the country to join foreign wars, mostly in Syria. As per official records, how many Maldivians are believed to have joined Jihadist groups abroad?

It is difficult to give an official figure. It is an offence punishable by several years of imprisonment to engage in a foreign war. Therefore, those who have travelled to join foreign wars have travelled under the guise of travelling to friendly countries.

The National Counter Terrorism Centre (NCTC) gets its numbers from relatives and others who come forward and report that someone they know have travelled abroad to join foreign wars. The NCTC puts the current figure at 69, excluding women and children.

Does your government view radicalisation as a cause of concern? If yes, how are you responding to it?

Radicalisation of any sort, including religious radicalisation, is a concern for the Maldivian government. Religious radicalisation is addressed under the Religious Unity Act. Terrorism and violent extremism are addressed under the Anti-Terrorism Act. Two senior-level committees, the Counter Terrorism Steering Committee and the Counter Radicalisation Committee, ensure a whole-of-government and a whole-of-society approach to address this issue. This approach involves capacity building at the organisational level and conducting community empowerment programmes for vulnerable communities and other important social sectors such as the education sector, and the NGOs.

The government is currently working on designing and implementing a rehabilitation programme for radicalised individuals. At the operational level, the armed forces and the security agencies have been making efforts to enhance readiness and further build their operational capabilities to deal with the threat.

What, in your view, could be an effective regional response to such a threat?

With violent extremism, and the consequent manifestation of terrorism, plaguing our region, there is a greater need for regional cooperation. This threat has a spill- over effect, given the entangled and symbolic nature of the threat with other menaces, such as illicit trafficking, gun-running, and other criminal activities by non-state actors.

Therefore, the demand for regional collaboration is even more pressing. At the helm of such collaboration should be intelligence and information sharing, joint response capacity building, and, defence and security assistance and support. In light of the stark reality, we must constitute robust mechanisms and regional infrastructure with haste to counter the primary threat of terrorism.



Chelsea Manning freed from jail in contempt case





Chelsea Manning freed from jail in contempt case

Agence France-Presse

Chelsea Manning

Washington

Former military intelligence analyst Chelsea Manning was freed from a U.S. jail on Thursday after two months in custody — but faces a possible return to the lockup as soon as next week, a support group said.

Ms. Manning was jailed in early March for refusing to testify in a grand jury investigation targeting the anti-secrecy group WikiLeaks.

A judge in March ruled Ms. Manning in contempt of court and ordered her held not as punishment but to force her testimony in the secret case, a spokesman for the U.S. attorney in the Alexandria, Virginia federal court said at the time.

The support group, the Sparrow Project, said in Thursday’s statement that Ms. Manning was released following the expiry of the grand jury’s term. “Unfortunately, even prior to her release, Chelsea was served with another subpoena. This means she is expected to appear before a different grand jury, on Thursday, May 16,” Sparrow Project quoted Ms. Manning’s legal team as saying.

“It is therefore conceivable that she will once again be held in contempt of court,” and returned to jail, the legal team said. “Chelsea will continue to refuse to answer questions.”



Pakistan turns to science, infuriates clerics





Pakistan turns to science, infuriates clerics

Agence France-Presse
Islamabad

Imran Khan’s government has drawn the ire of conservative clerics with calls for a science-based lunar calendar to calculate the start of the holy fasting month of Ramzan in Pakistan, which faces an annual controversy over the date.

A cleric-led “moonsighting committee” announces when the fasting should begin, but for decades it has faced disputes over the accuracy of its decision.

“Every year on the occasion of Ramzan, Id and Muharram a controversy starts regarding moonsighting,” Science and Technology Minister Fawad Chaudhry explained in a video he tweeted on May 5, in which he recounted watching the committee use “old technology” — telescopes — to make their calculations.

“When modern means are available…, the question is why we should not use this latest technology?” he argued.

His Ministry will form a committee of scientists, meteorologists and Pakistan’s space agency to calculate the correct dates for the next five years with “100 percent accuracy”. However, the Prime Minister’s Cabinet can reject the calendar. In another tweet, he warned that decisions on how the country should be run “cannot be left to the maulana (clerics)”.

Mufti Muneeb-ur-Rehman, head of the moonsighting committee, warned that Mr. Chaudhry should stay in his lane. “I have appealed to Prime Minister Imran Khan that only the concerned Minister should talk about religious matters,” he said in a press conference in Karachi. “Every Minister who does not know the sensitivity of the religion, does not understand it, they should not get the free licence to comment on religious matters.”

He pointed out that the committee already has members from the space agency, and also works with the Meteorological Department.


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