Who's afraid of China?
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http://news.webindia123.com/news/showdetails.asp?id=110717&cat=India
CPI-M wants rethink on Indo-US agreements:-
Bangalore | August 27, 2005 12:25:06 PM IST
The Communist Party of India-Marxist (CPI-M) wants the India-US pacts on military cooperation and strategic alliance to be reconsidered, saying Washington only sees New Delhi as a counterweight to China.
As part of the Left Front's nationwide campaign against the newfound closeness between India and the US, CPI-M general secretary Prakash Karat Friday night denounced the agreements.
He said the agreements went against the common minimum programme (CMP) of the ruling United Progressive Alliance (UPA), which the Left Front supports from outside.
"The Congress-led UPA adopted the CMP for guiding its government. The CMP mandates India to pursue an independent foreign policy and promote multi-polarity in international relations," Karat said at a seminar on "Relationship with India and America," organised by the CPI-M and student unions here.
"Our contention is the wider Indo-US joint statement, signed during Prime Minister Manmohan Singh's visit to Washington last month, and the (earlier) Indo-US defence policy have gone against the letter and spirit of the CMP."
Terming the defence agreement, signed by Defence Minister Pranab Mukherjee and US Defence Secretary Donald Rumsfeld in June, as a betrayal, Karat said it was wrong on the part of the UPA to have first agreed to such a pact without taking the nation into confidence and keeping the parties supporting it in the dark about its contents.
"Though the defence minister stated he was going to the US on an exploratory visit, he returned after signing a 10-year framework agreement in Washington. This is a serious matter as such a pact on defence matters has far-reaching implications on our national security. In a democracy, we simply cannot accept it.
"We find the UPA government following in the footsteps of the previous National Democratic Alliance (NDA) government, which carried out secret negotiations with the US for over 15 months, involving then foreign minister Jaswant Singh and US assistant secretary of state Strobe Talbott," Karat recalled.
Karat said after signing a similar agreement in 1995 to train Indian armed forces, conduct joint exercises and exchange programmes, the US put the defence cooperation on the back burner after the Pokhran nuclear tests in May 1998.
"Post 9/11, the US again started warming up to India and restored military training so as to have access to our armed forces. It followed it up by sending its troops for joint strategic exercises and jungle training in Mizoram and high altitude training in the Ladakh region.
"We consider the latest agreement as a continuation of the military collaboration process. By signing it, we have accepted to be part of the US global strategy and join the US in its Asian strategy. Why Rumsfeld suddenly has this new love for India as against (earlier) bitter hostility towards us?
"We all aware that the US has a close and strategic relationship with Pakistan. Why this sudden change? We believe in the new strategic doctrine of the US, its main and long-term target is China, to contain China and prevent it from gaining parity with the US in terms of economic or military strategic strengths.
"In this new doctrine, the US sees India as a counter weight against China. It underlies the new American approach to draw India into military and strategic collaboration to fulfil its global designs," Karat told about 500 participants.
While complimenting the prime minister on a successful visit to the US, Karat regretted the Indo-US joint statement.
"Being a major developing country and the world's largest democracy, how can India be a strategic ally of a unipolar country like the US?
"This agreement is against the CMP's foreign policy of maintaining and promoting multi-polarity with other countries the world over."
(IANS) -
http://za.today.reuters.com/news/newsArticle.aspx?type=businessNews&storyID=2005-08-28T102638Z_01_BAN837532_RTRIDST_0_OZABS-ENERGY-CHINA-VENEZUELA-20050828.XML
China to keep Venezuela oil deals low-key - report
Sun Aug 28, 2005 12:27 PM GMT
(Repeats to reach wider audience
BEIJING (Reuters) - Venezuela and China signed a spate of new oil deals after a high-profile visit this week, but Chinese oil major CNPC plans to keep the relationship low-key until concrete progress is made, an official paper reported.
During Energy Minister Rafael Ramirez's visit to China, the world's number five oil exporter allocated state-controlled CNPC rights to survey a block in the Orinoco oil belt, Venezuela's PDVSA, also a government-owned firm, said.
The two also signed a preliminary deal for a joint venture to develop fields in the eastern Zumano region, and discussed cooperating in technical areas like drill manufacture and heavy-crude handling, the firm added in a statement.
However the Chinese company seemed keen to play down the deals with a country known for ambitious development plans. Spokesman Liu Weijiang said only that they had been signed, China Daily reported.
"Liu did not elaborate on the content of the agreements, saying CNPC would remain low-key before any concrete progress has been made," the paper said in its weekend edition. The Chinese firm published only a four-line statement on the visit, while PDVSA provided a detailed account of several deals.
The two countries aim to increase Venezuelan imports to over 300,000 barrels per day in coming years, from an average of under 70,000 bpd in the year to date, PDVSA said without giving detailed dates.
"The purpose...is to cover 15 to 20 percent of total crude imports to be made by China," the statement said.
However with China already sucking in a average of 2.45 million bpd in 2004, Venezuelan imports would have needed to be near 370,000 bpd last year alone to meet even the lower end of that target.
Venezuela sells most of its crude and products to the giant U.S. market -- where it has an advantage over Middle-Eastern and African producers because of its proximity.
But left-wing President Hugo Chavez frequently clashes with Washington and is looking to new markets like China and India for the oil production it plans to bring on line in coming years, even though analysts say the cost of shipping crude further afield could prove problematic.
The Orinoco block allocated to CNPC is the 640 square kilometre Junin 4, and the Chinese firm will quantify and certify reserves estimated at 20 billion barrels, PDVSA said.
When the survey is completed, the two firms will discuss a joint production project, to be combined with a refinery in China.
The Zumano area where the two firms have a preliminary agreement to form a joint exploration and production firm has remaining reserves of around 400 million barrels of light and medium crude, and 4 billion cubic feet of gas, PDVSA said.
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http://biz.yahoo.com/ap/050819/all_business.html?.v=1
China Today Differs From Japan in 1980s
Friday August 19, 2:08 pm ET
By Rachel Beck, AP Business Writer
ALL BUSINESS: China Today Differs From Japan in 1980s, May Be a Tougher Force to Reckon With
NEW YORK (AP) -- It sounds like history repeating itself: The United States faces a huge trade deficit with an Asian country, which is also under intense scrutiny for its interest in buying U.S. assets and having a currency many deem undervalued.
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Today, that best describes how China is viewed. Two decades ago, Japan came under U.S. criticism for its growing global presence, and that spurred all sorts of protectionist talk out of Washington.
The Japanese hysteria eventually died down as the country fell into a long recession. But don't look for that to happen with China, where its politics combined with its potential for growth may make it a far tougher force to reckon with going forward.
China has drawn the ire of many countries because of the vast amount of T-shirts, toys and everything else that it is exporting at lower prices than many local markets' products.
The United States' trade deficit with China hit $162 billion last year, making it the largest imbalance ever recorded with a single country. This year's deficit is already running 32 percent above last year's pace, and political pressure is heating up to put tighter restrictions on imports from China.
American lawmakers have blamed some of this on China's undervalued currency. They threatened to impose punitive tariffs on China if it didn't switch to a more flexible currency system rather than have the yuan trade at a fixed exchange rate that was pegged to the U.S. dollar -- which has kept its export prices low.
In July, China announced it would gradually let the yuan rise in value against a basket of currencies, though some critics say that its move isn't enough.
And Chinese companies have come up against great resistance when expressing interest to acquire U.S. assets. Their bids this summer for American oil and gas company Unocal Corp. and appliance maker Maytag Corp. didn't ultimately result in any deals, but such interest was seen as a sign of greater Chinese ambition in the global marketplace.
All this China-bashing is reminiscent of the talk directed at Japan in the 1980s, when fuel-efficient Japanese cars were gaining popularity with U.S. consumers while the Japanese were buying up American companies as well as trophy U.S. real estate.
Back then, the U.S. trade deficit with Japan was ballooning, and there were many claims that Japan was keeping its currency artificially low to boost its exports. To fix that, U.S. politicians demanded that Japan either strengthen the yen, or face trade sanctions.
"What is being said about China sounds like the same speeches and arguments that were heard about Japan. Back then, we had senators protesting on the steps of the Capitol" about foreign-made goods, said Milton Ezrati, a senior economic strategist at the money management firm Lord Abbett.
But while China today looks a lot like yesterday's Japan -- before its asset bubble burst and it headed into a prolonged economic slump -- Morgan Stanley global economist Stephen Roach sees big differences. "In terms of the scale of their economies and financial markets, China and Japan are like day and night," he said in a recent note to clients.
Among the distinctions: Japan's equity-market capitalization amounted to 41 percent of the world's total market capitalization in 1989; by contrast, China's equity markets currently account for only 0.5 percent of the value of global equity markets.
He also notes that China has a much more outward-looking growth and development model than Japan. In 2004, exports and imports combined equaled 74 percent of Chinese GDP, more than three times Japan's 23 percent share.
That is why Chinese currency reforms take on much greater importance, Roach said, pointing out that the Chinese might have learned from the Japanese to resist U.S.-led political pressure for currency revaluation. Japan ran into trouble in the late 1980s, in part by abdicating control over the yen and letting the dollar-yen conversion soar from 259 in 1985 to 121 by the end of 1987. Many blame that for setting the stage for an asset bubble that eventually collapsed in Japan.
"The last thing China wants is to go down that road -- placating U.S. politicians on the currency front while, at the same time, sowing the seeds of an increasingly dangerous liquidity bubble of its own," Roach said.
There are also significant political differences between the two. While the Chinese have been more open to foreign investment than Japan, there are some concerns that the communist political structure means that the Chinese won't embrace all kinds of foreign involvement such as an American company buying a big Chinese company.
In addition, Standard & Poor's chief economist David Wyss points out that China's huge population -- which he estimates is 10 times as large as Japan's -- means that China has the capability of taking over world production of just about everything.
So talking about China today as though it were Japan 20 years ago might not accurately size up the situation of this fast-growing empire. China's might just be beginning to build its power as an economic force.
To the dismay of many Americans, that will likely mean a bigger, bolder China to contend with for many years to come.
Rachel Beck is the national business columnist for The Associated Press. Write to her at rbeck(at)ap.org -
http://finance.news.com.au/story/0,10166,16397701-521,00.html
China rise rewrites rule book
From:
August 27, 2005
BHP Billiton's stunning profit captured both the dramatic global impact of China and the particular benefits it bestows on Australia. BHPB's bonanza was very much Australia's bonanza.
Striking was not just the sheer size of China's economic boom, and so its voracious appetite for raw material, revealed in the BHPB numbers. But also the speed with which it has erupted.
Even just three years ago when BHPB was bedding down the first results from its merger, no one could have and no one indeed did anticipate the coming size and speed of the China impact.
In 2002 group revenue was "just" $US15 billion.
In three years it's more than doubled, to $US32 billion ($42.2 billion). Profit has grown even faster - at the EBITDA level, from $US4.7 billion to $US11.4 billion.
With China leapfrogging Japan to become the company's single biggest geographic customer. Japan! The country on which BHP - and Australia - had built prosperity, running back over nearly 40 years, caught and supplanted in just a few years.
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China benefits BHPB - a pretty good proxy for Australia more broadly - in two direct ways. Obviously, what it actually buys and the price it pays.
The most striking example is iron ore to feed its exploding steel industry. The volumes it buys have been rising exponentially and, after the latest price negotiations, it is going to pay 70 per cent more on every tonne of those higher volumes.
The second benefit is less obvious but just as direct. The way Chinese demand is pushing up the price of all commodities. So BHPB, and Australia, gets the benefit on stuff it/we sell to someone else.
The most striking example is oil and gas. It is Chinese demand that is the new kid on the block - since the late-1990s rising Chinese consumption has been the crucial "swing factor" between global demand and supply of oil and gas, but especially oil.
Depending on which measure you use, China is somewhere between 5 per cent and 10 per cent of the global economy; and even in population terms is only a little bit more than 20 per cent of the world. Yet, it has been driving one-third of the increased global demand for oil.
This is also why oil, on its own but also as a proxy for all commodities, is tellingly important on two other fronts in which China again sits at the very centre.
The first is the short-to-medium term sustainability of the China growth story; and more narrowly, but crucially linked, whether it will significantly up-value its currency.
The second is broader, longer-term and more opaque. Is it really different this time? Is what's happening in China and the impact on the world different from, say, Japan's growth story in the 1970s and 80s?
Arguably it is, both in its own terms, and because it's happening in a very different world, really to anything that was experienced in the 20th century. And it "works" so well with that different world.
First the currency. Macquarie Bank's Mark Tierney recently made the telling point of how the rising oil price provided reason alone to upvalue the Chinese yuan.
Because the yuan was fixed to the US dollar and oil is priced in US dollars, China has felt every penny of the higher oil price.
Up-valuation would in one stroke slash the imported price of oil. And cut the price of all commodity imports. Before considering second- and third-round impacts, it would be a win-win outcome for a company like BHPB and a country like Australia, along with China.
China would get its crucial raw material imports cheaper, but the prices to our exporters would not fall - at least, not in US dollars. What happened in A-dollar terms would depend on the impact on the $US-$A rate.
Arguably, it would also be a win-win as between the US and China. US exports and import-competing industries would become more competitive off a lower dollar.
But China would not lose as much competitively because of both the huge benefit of cheaper raw material inputs and its ability to manage - hold down - domestic costs.
In short, the "best-case" outcome could keep the global music playing longer, while being as particularly beneficial to us down here as the last couple of years have been.
If so, though, it would deliver pluses - strong demand and higher prices for our commodities; and minuses - probably even higher oil and petrol prices.
So what of the "bigger picture?" Is it different this time? And how different? Like BHPB CEO Chip Goodyear's once-in-a-century "super cycle", or something that is actually unique?
It has already been very different. The way China has interfaced with a world made in America, and made especially by Alan Greenspan through the 1990s and the extraordinarily low US interest rates post-9/11.
We have had sustained strong global growth and low global interest rates and yet no sign of the wages and inflation explosion that always accompanied and always terminated earlier periods of boom.
Inflation seems to have been confined to property, in just about every major economy; and those rising property values have in turn also sustained consumer spending.
The great disciplinarian, so to speak, has been China. Becoming the world's factory, it has not simply stopped the price of consumer goods in the developed world going up, but actually sent them down.
This, though, would not have been possible, or at least not able to have been sustained for so long, without the relentless march of technology in a globalised world, helping deliver continually cheaper and better goods.
That's why, I suggest, this time it really is different. We've never really had anything like China before - its unique mix of size, sophistication and poverty. Japan didn't come close, nor South Korea, Taiwan and all the other "little tigers" wrapped into one.
We've also never had a world like we have today, in which China is happening. The technology and globalisation in all its forms. Nor in particular, the architecture of and the flows through global financial markets.
To say that it "is different", is not to claim that it is therefore the boom that will never end. We have also never had all this happening in a world in which global oil supply is right at the edge of current, far less emerging, demand.
Or a world in which the US is running $US700 billion current account deficits. To say nothing of all the geopolitical issues.
What it does tell us, is to live with, if we don't fully understand, the unconventional and the seemingly unsustainable. That we are like BHPB, leveraged to the China/global upside.
In a reversal of the old truth that when America sneezed we caught cold; now, China gets prosperous and we, more especially a BHPB, get rich.
Hopefully, that when the music does stop, or pause, we are not as leveraged to the downside. But be alert to that possibility. -
http://www.bloomberg.com/apps/news?pid=10000080&sid=a4zUBGx7LWlU&refer=asia
Temasek to Invest $2.4 Billion in China Construction (Update2)
Aug. 24 (Bloomberg) -- Temasek Holdings Pte may double its investment in China Construction Bank to $2.4 billion as part of a plan to expand overseas and cut shareholdings in Singapore's slower-growing economy, people familiar with the proposal said.
Singapore's state-owned investment company offered to buy $1.4 billion of stock in China's third-largest bank before an initial public offering in October, said the people, who declined to be identified. Beijing-based Construction Bank last month said Temasek would invest $1 billion in the IPO itself.
Temasek, which has $55 billion of assets, wants to boost returns that averaged 3 percent in the past decade by investing in China's $1.65 trillion economy, which is 15 times the size of Singapore's. European and U.S. banks spent more than $6 billion buying stakes in China's lenders since 2003 to tap an economy that's grown an average 9.5 percent during the past two decades.
``Banks usually benefit more than other industries in a rising economy,'' said Kingston Lee, director of Nomura Asset Management in Hong Kong, who helps manage $15 billion of global stocks. ``There aren't many good investment opportunities in China and banking seems to be the last sector available.''
Singapore Base
Temasek said last year it had more than half its assets in Singapore, with China, Taiwan and Korea accounting for 6 percent of total holdings by the end of March. The Singapore government is forecasting economic growth of 3.5 percent to 4.5 percent this year, down from 8.4 percent in 2004.
Eva Ho, a Singapore-based spokeswoman for Temasek, declined to comment on investment plans. Fan Yifei, a Construction Bank spokesman, didn't return calls seeking comment. The bank last month said China SAFE Investments Ltd., its main government shareholder, planned to sell an undisclosed stake to Temasek.
Temasek has yet to obtain regulatory approval in China for the additional investment, the people said.
Bank of America Corp., the third-largest U.S. bank, is paying $3 billion for 9 percent of Beijing-based Construction Bank. Credit Suisse Group, Switzerland's second-biggest financial services company, plans to buy $500 million of stock in Construction Bank's IPO as its investment bank vies to help underwrite Asia's biggest IPO this year, people familiar with the proposal said yesterday.
HSBC
London-based HSBC Holdings Plc, Europe's biggest bank by market value, last year bought 20 percent of Bank of Communications, the nation's fifth-largest lender, for $1.75 billion. Shares in Shanghai-based Bank of Communications are trading at almost double the price paid by HSBC.
Royal Bank of Scotland Plc, Merrill Lynch & Co. and the Li Ka-shing Foundation on Aug. 18 said they agreed to pay $3.1 billion for 10 percent of Bank of China, the nation's second- largest lender.
Overseas banks are buying stakes in Chinese lenders and setting up credit-card and fund management ventures to tap the nation's record personal savings of $1.65 trillion. UBS AG, Switzerland's second-largest lender, in June said it plans to buy as much as $500 million of shares in Bank of China, the nation's second-largest lender.
Temasek owns 28 percent of DBS Group Holdings Ltd., Singapore's largest bank, and is expanding financial investments across Asia to reduce a reliance on the city state, which accounts for half of its assets. This year, it bought a stake in China Minsheng Banking Corp., a majority holding in NDLC-IFIC Bank Ltd. of Pakistan, and 15 percent of banking and property group Malaysian Plantations Bhd.
In the past two years, Temasek invested and sold stakes in 36 companies, realizing a gain of S$750 million ($449.4 million), according to its Web site.
China Investments
The company invested in the $30 million BioVeda China Fund, as well as the $100 million New Horizon Fund, both of which invest in companies in China, the Web site said.
Construction Bank's bad-loan ratio was 3.92 percent at the end of 2004, down from 9.25 percent a year earlier. Its capital adequacy ratio, a measure of financial risk, was 11.29 percent, more than the 8 percent required by Chinese regulators.
The bank has about $472 billion of assets and $422 billion of deposits. It accounts for 12 percent of total loans made in China and has 136 million individual deposit accounts at 14,500 nationwide branches.
To contact the reporter on this story:
Cathy Chan in Hong Kong at [email protected]
Last Updated: August 24, 2005 02:54 EDT -
http://www.japantoday.com/e/?content=news&cat=9&id=347452
Koizumi takes lesson from feudal warlords
Sunday, August 28, 2005 at 05:00 JST
OTSUKI, Yamanashi — Prime Minister Junichiro Koizumi on Saturday compared a power struggle within his Liberal Democratic Party to Japan's medieval civil war period, saying he has been surviving the party's power race due to what he learned from historical novels.
"When I was young, I read historical novels and learned how the warlords during the Sengoku era lived. I think that's why I have been able to survive the power struggle in the LDP Sengoku era," he said, citing Takeda Shingen (1521-1573), a military governor of Kai Province, now Yamanashi Prefecture, as one of the warlords who influenced him.
© 2005 Kyodo News. All rights reserved. No reproduction or republication without written permission. -
http://www.japantoday.com/e/?content=news&cat=9&id=347400
Koizumi says Japan has no legal responsibility for sex slaves
Sunday, August 28, 2005 at 07:02 JST
TOKYO — Prime Minister Junichiro Koizumi said Friday the Japanese government has no legal responsibility toward the so-called "comfort women" who were forced into sexual slavery for Japanese soldiers before and during World War II.
"Our position is different from the South Korean government," Koizumi told reporters. "We have fully and ultimately resolved the issue between Japan and South Korea over the right to claim for prewar and wartime compensation in signing the 1965 treaty to normalize diplomatic relations." His remarks were in response to South Korea, which says the Japanese government is obligated to take legal responsibility for crimes committed during its 1910-45 colonial rule of the Korean Peninsula.
© 2005 Kyodo News. All rights reserved. No reproduction or republication without written permission. -
http://www.techworld.com/opsys/news/index.cfm?NewsID=4289
26 August 2005
Chinese president to pop in to see Bill Gates
By Sumner Lemon, IDG News Service
Chinese president Hu Jintao is planning to visit Microsoft's Washington headquarters during his upcoming state visit to the United States.
Hu is expected to visit the software giant's main site on 5 September, according to Lu Shouqun, president of the China Open Source Software Promotion Union and a long-time advisor to the Chinese government on technology matters.
During his visit, Hu is expected to be given a tour of a prototype "digital home" developed by Microsoft and will visit Bill Gates' house, Lu said.
Hu's visit to the US is part of a three-nation tour over September that will include Canada and Mexico. Hu will also attend the 60th anniversary celebrations at the United Nations during his trip. -
http://www.theage.com.au/news/business/chinese-team-on-fta-quest/2005/08/28/1125167552012.html
Chinese team on FTA quest
By Hamish McDonald
China Correspondent, Beijing
August 29, 2005
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CHINA has put its top trade experts on to a special team that will negotiate a free trade agreement with Australia, allaying concerns that the recent defection of Chinese diplomat Chen Hongyin in Sydney could affect economic ties.
Zhang Xiangchen, the acting chief of World Trade Organisation in the Chinese Commerce Ministry, will head the Chinese team working on the Australian FTA.
"It's good because Zhang and his team are very classy people and know their WTO policy backwards," said an Australian official here this week for the first substantive round of talks on the agreement.
With China embarking on free trade negotiations with other countries and regional groupings, there had been fears Chinese trade bureaucrats would be swamped with work.
Beijing is now discussing the services area of an FTA with the 10-member Association of South-East Asian Nations, having already concluded the goods sectors, and also is negotiating with New Zealand and Chile on bilateral FTAs.
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AdvertisementThe Chinese are also considering possible FTAs with India, the Gulf Co-operation Council states, and the Southern African Customs Union. All these negotiations are being handled by a different section of the Chinese Commerce Ministry. In three days of talks that ended on Wednesday, nearly 30 Australian officials sat down with some 50 Chinese counterparts drawn from different ministries to ask questions about each other's policies and practices affecting access to goods and services and investment.
While the Australian questions covered a very wide range, the Canberra officials were strongly interested in the level of indirect subsidies for inputs to the car industry, reflecting concern by Australian car companies that provincial governments were subsidising Chinese rivals through cheap facilities, preferential purchasing and cheap credit.
Chinese questions included many about the ambit of the Foreign Investment Review Board, with big Chinese corporations taking a more aggressive position on foreign acquisitions to secure raw materials. -
Wow , china is using money to buy over america's allies.
smart move.
Let's see how america reacts. -
http://niemanwatchdog.org/index.cfm?fuseaction=ask_this.view&askthisid=00134Originally posted by SMAPLionHeart:Wow , china is using money to buy over america's allies.
smart move.
Let's see how america reacts.
Will President Bush's 'one big idea' turn out to be a bad one?
ASK THIS | August 26, 2005
The presidentÂ’s longstanding desire for closer relations with India led to his dramatic proposal in July to share nuclear technology with India. But Brookings Institution scholar Stephen Cohen thinks reporters should be exploring what the fallout would be in such areas as non-proliferation and relations with China.
By Stephen Philip Cohen
[email protected]
Q. Will the new US-India relationship trigger a counter-response from those states that might regard it as threatening—notably Pakistan and China—possibly speeding up the Asian arms race?
Q. Will it induce other states to accelerate their own covert nuclear weapons programs?
Q. Has the Bush administration miscalculated IndiaÂ’s ability to keep its side of the bargain, and can the present state of very good US-Indian relations survive the failure of the nuclear deal?
Q. Even if India does deliver, what assurances does the Bush administration have that a nuclear-armed and fast-growing India will remain a "natural ally" of the United States?
People close to President Bush, notably former Ambassador Robert Blackwill, have often stated that back when Bush was governor of Texas, he had “one big idea” regarding foreign policy, and that idea was India.
Blackwill, who was one of the original close-knit group of advisors known as the Vulcans, notes that Bush came into contact with AustinÂ’s Indian-American IT community and was duly impressed. Bush later envisioned a strategic relationship with New Delhi, one that might potentially balance out China. Further, as the worldÂ’s largest democracy, India fit into BushÂ’s strategy of democracy-promotion.
One early target of the Bush administration was the sanctions imposed upon India (and Pakistan) as a result of their 1998 nuclear tests, and these were removed early in BushÂ’s first term, to the howls of the non-proliferation community. Then followed the appointment of Blackwill as ambassador to India, and joint US-India military exercises. A planned presidential visit to India, disrupted by 9/11, is now set for early 2006.
However, a major obstacle to India-US normalization is an American law: The 1978 Nuclear Non-proliferation Act (NNPA). IndiaÂ’s clandestine nuclear program has been a bone of contention between it and the United States ever since IndiaÂ’s 1974 nuclear tests, which led directly to the passage of the NNPA.
In a dramatic announcement last month, Bush and the visiting Indian prime minister, Manmohan Singh, agreed to take steps that would allow the full flow of civilian nuclear technology to India, in exchange for India becoming a de facto member of the Nuclear Non-Proliferation Treaty (NPT). India cannot become a formal member of the NPT because it tested a nuclear device after the treaty went into effect in 1968.
The nuclear dimension of the Bush-Singh communiqué brought headlines in both India and the United States. The agreement was supported by Mohammed el Baradei, the Director of the International Atomic Energy Agency (IAEA), and by Great Britain, but other countries are wary, with China so far remaining silent.
A major debate is shaping up here and in India.
In Washington this debate will be over the administrationÂ’s request to Congress to modify the NNPA to permit the flow of nuclear technology to India.
In India there is some question as to whether New Delhi should abide by whatever changes are made in the NNPA, some of which might limit IndiaÂ’s military nuclear program.
While I have for many years advocated a grand bargain in which India accepts certain restraints on its military nuclear program in exchange for civilian nuclear technology, I foresee a number of problems:
Politically, the potential deal has divided Republicans and Democrats, liberals and conservatives. While everyone is opposed to nuclear proliferation, there is already strong disagreement as to whether the deal will advance or retard this goal. The administrationÂ’s secrecy and its unwillingness to consult even with Congressional leaders may make it harder to build support for the necessary changes in legislation.
A second political calculation is the role of the India lobby, which has become moderately influential, as American stereotypes of India have changed from highly negative to highly positive. Yet, will pro-Indian legislators vote against the deal because they believe it hurts the cause of non-proliferation?
Almost all of the publicity surrounds the nuclear and proliferation component of the communiqué. Lost in the shuffle are significant agreements over business cooperation (a forum of India and American CEO’s), American assistance to India’s faltering agricultural sector, and the potential for greatly expanded defense cooperation. If the administration is unable to bring about a change in the NNPA (or if India is unable to meet the criteria that Congress builds into the new Act), what happens to the rest of the US-India relationship? Has Bush put it at risk by proposing a deal that may be politically difficult to bring off?
Will the new US-India relationship trigger a counter-response from those states that might regard it as threatening—notably Pakistan and China—possibly speeding up the Asian arms race? And will it induce other states to accelerate their own covert nuclear weapons programs? The administration’s calculation is that Israel and Pakistan might be brought into a new halfway" house regime, something short of the NPT, but is this calculation correct?
Also: Has the Bush administration miscalculated IndiaÂ’s ability to keep its side of the bargain? Indian law will have to be rewritten and New DelhiÂ’s military nuclear program will be circumscribed. Will Manmohan SinghÂ’s coalition government, kept in power by anti-American communist and left parties, be able to deliver?
Even if India does deliver, what assurances does the Bush administration have that a nuclear-armed, and fast-growing India will remain a "natural ally" of the United States? In the past, some of our allies have decided that the US alliance is disposable or discretionary (for example: IranÂ’s reversal after the Shah, France and GermanyÂ’s decision to stay out of Iraq). Might this major change in American law and policy simply make it easier for India to continue to pursue an independent policy, one that often runs counter to American interests?
Conversely, if either the US or India are unable to deliver on the nuclear component of the agreement, will the present excellent status of US-Indian relations be unaffected? There are growing economic and political ties between New Delhi and Washington, are they strong enough to surive the collapse of the nuclear center-piece of the summit?
These questions deserve careful attention. The answers will determine whether BushÂ’s long-cherished visit to India will be a fiasco or one of the great successes of his two tumultuous terms as president.
Stephen Cohen has been a Senior Fellow in the Foreign Policy Studies Program of the Brookings Institution since 1998. He was a member of the Policy Planning Staff of State from 1985-87, and is the author of numerous books and articles on India and South Asia, notably the recently published India: Emerging Power (Brookings, 2001), and The Idea of Pakistan (Brookings: 2004).
E-mail: [email protected] -
http://news.webindia123.com/news/showdetails.asp?id=110717&cat=IndiaOriginally posted by SMAPLionHeart:Wow , china is using money to buy over america's allies.
smart move.
Let's see how america reacts.
CPI-M wants rethink on Indo-US agreements:-
Bangalore | August 27, 2005 12:25:06 PM IST
The Communist Party of India-Marxist (CPI-M) wants the India-US pacts on military cooperation and strategic alliance to be reconsidered, saying Washington only sees New Delhi as a counterweight to China.
As part of the Left Front's nationwide campaign against the newfound closeness between India and the US, CPI-M general secretary Prakash Karat Friday night denounced the agreements.
He said the agreements went against the common minimum programme (CMP) of the ruling United Progressive Alliance (UPA), which the Left Front supports from outside.
"The Congress-led UPA adopted the CMP for guiding its government. The CMP mandates India to pursue an independent foreign policy and promote multi-polarity in international relations," Karat said at a seminar on "Relationship with India and America," organised by the CPI-M and student unions here.
"Our contention is the wider Indo-US joint statement, signed during Prime Minister Manmohan Singh's visit to Washington last month, and the (earlier) Indo-US defence policy have gone against the letter and spirit of the CMP."
Terming the defence agreement, signed by Defence Minister Pranab Mukherjee and US Defence Secretary Donald Rumsfeld in June, as a betrayal, Karat said it was wrong on the part of the UPA to have first agreed to such a pact without taking the nation into confidence and keeping the parties supporting it in the dark about its contents.
"Though the defence minister stated he was going to the US on an exploratory visit, he returned after signing a 10-year framework agreement in Washington. This is a serious matter as such a pact on defence matters has far-reaching implications on our national security. In a democracy, we simply cannot accept it.
"We find the UPA government following in the footsteps of the previous National Democratic Alliance (NDA) government, which carried out secret negotiations with the US for over 15 months, involving then foreign minister Jaswant Singh and US assistant secretary of state Strobe Talbott," Karat recalled.
Karat said after signing a similar agreement in 1995 to train Indian armed forces, conduct joint exercises and exchange programmes, the US put the defence cooperation on the back burner after the Pokhran nuclear tests in May 1998.
"Post 9/11, the US again started warming up to India and restored military training so as to have access to our armed forces. It followed it up by sending its troops for joint strategic exercises and jungle training in Mizoram and high altitude training in the Ladakh region.
"We consider the latest agreement as a continuation of the military collaboration process. By signing it, we have accepted to be part of the US global strategy and join the US in its Asian strategy. Why Rumsfeld suddenly has this new love for India as against (earlier) bitter hostility towards us?
"We all aware that the US has a close and strategic relationship with Pakistan. Why this sudden change? We believe in the new strategic doctrine of the US, its main and long-term target is China, to contain China and prevent it from gaining parity with the US in terms of economic or military strategic strengths.
"In this new doctrine, the US sees India as a counter weight against China. It underlies the new American approach to draw India into military and strategic collaboration to fulfil its global designs," Karat told about 500 participants.
While complimenting the prime minister on a successful visit to the US, Karat regretted the Indo-US joint statement.
"Being a major developing country and the world's largest democracy, how can India be a strategic ally of a unipolar country like the US?
"This agreement is against the CMP's foreign policy of maintaining and promoting multi-polarity with other countries the world over."
(IANS) -
http://www.indiadaily.com/editorial/4369.aspOriginally posted by SMAPLionHeart:Wow , china is using money to buy over america's allies.
smart move.
Let's see how america reacts.
India-China-Russia massive joint military exercise in 2006
Anil Rane
Aug. 26, 2005
Asia is planning the biggest military exercise in the world. India, China and Russia will conduct the biggest ever-military exercise.
According to media sources, Russian, India and China may hold a three-party military exercise in 2006, a high-ranking source in the Russian Defense Ministry told Interfax news agency on Friday.
"We may be able to hold such an exercise within the framework of the Shanghai Cooperation Organization [SCO] next year [2006]," the source said.
"We are discussing the possibility of military exercises similar to the Russo-Chinese Peace Mission 2005 drill. We hope that we will hold such exercises next year," he said.
"One cannot rule out that by the next year the SCO countries, including those who have the status of observer, may join Russia and China for joint exercises. It would be good for Russia, India and China to stage a joint exercise," the source added. -
http://www.financialexpress-bd.com/index3.asp?cnd=8/29/2005§ion_id=28&newsid=12241&spcl=noOriginally posted by SMAPLionHeart:Wow , china is using money to buy over america's allies.
smart move.
Let's see how america reacts.
India-China plan to pour oil on troubled relationship stirs doubts
8/29/2005
NEW DELHI, Aug 28 (AFP): Energy-thirsty India is hoping to turn its arch rivalry with giant neighbour China for fuel supplies into an alliance but becoming oil patch partners could be tough, analysts say.
India, which lags way behind China in the frenzied global race to secure oil and gas supplies, said last week the Asian giants would sign pacts in November aimed at teaming up to bid for oil and gas projects.
But analysts are doubtful about whether such a partnership between two neighbours with a history of hostility could work.
"It's a nice idea for India and China to talk cooperation, but they have a mountain to climb as they have no history of cooperation," said Ng Weng Hoong, editor of Singapore-based industry publication Energy Asia.
"They haven't been really talking for decades and suddenly they find themselves searching the same parts of a shrinking world for energy. It's tough to talk intimately when you're both rushing for the door at the same time."
India, which initiated the idea, imports nearly 70 per cent of its oil needs while China relies on foreign producers for more than a third of its oil.
Their ever-expanding energy appetites to fuel booming economies have strained world supplies and helped propel oil prices to record highs.
"The logic for India is 'if you can't beat them, join them'," said Rahul Bedi, New Delhi-based analyst for Janes Defence Weekly. But India would have to accept that "China will be the senior partner," he said.
China has been regularly outbidding its neighbour, most recently last Monday when India's state-run Oil and Natural Gas Corp lost out in a offer for Kazakhstan's third-largest oil producer.
"The first test case (for cooperation) is right before our eyes: PetroKazakhstan," said Energy Asia's Ng. "Chinese media has been celebrating the catch... I haven't see a story or commentary from anyone in Chinese oil circles saying, 'Let's see if we can share this bounty with the Indians'."
While China and India signed a declaration in April committing themselves to energy cooperation, the Indians have been doing most of the cheerleading.
The head of the Indian oil ministry's international division, Talmiz Ahmad, told the news agency. -
http://english.people.com.cn/200508/24/eng20050824_204401.htmlOriginally posted by SMAPLionHeart:Wow , china is using money to buy over america's allies.
smart move.
Let's see how america reacts.
Sino-US interdependence viewed from three angles
A pair of most important and complicated bilateral relations in today's world, Sino-US relationship invariably presents a prospect full of contradiction and antinomy. A correct understanding of the current Sino-US relationship requires not only close follow-up tracing from the policy angle, but also effective explanations made from a theoretical high. Theoretical value lies in whether it is possible to draw a most central and crucial variable from numerous and changeable reality, thereby bringing people's subjective understanding close to the objective reality to the greatest extent.
In the face of the reality of the current Sino-US relationship, realism of the mainstream research method of international politics and neo-liberalism have, to different degrees, exposed theoretical "poverty" It is impossible for realism to explain the strategic constructive cooperative ties of China and the United States and the ever-closer interdependent ties of the two countries in the economic field. Neo-liberalism cannot shake off the "state centralist method characterized by wrapping oneself up in a cocoon". Since the 1990s, the development of China-US relationship has gone beyond the mode of inter-state ties, commodity, capital, technology, personnel and information exchanges that cross the Pacific Ocean have brought bilateral ties deep into the two societies and touched the daily life of each ordinary citizen, under such circumstances, a structural inter-dependent relationship has been formed between China and he United Sates. Understanding of such relations requires three basic theoretical visual angles:
First is economic globalization. The current China-US relationship is different from the US-Soviet ties during the era of Cold War and will not fall into the same old road of the rise of Germany and Japan in history. The most fundamental factor lies in the background of economic globalization. Economic globalization has changed the connotation, nature and gaming rules on China-US relationship, causing the transnational behavioral entity to go beyond national boundaries and forming a network of close interaction relations. Economic globalization will not automatically avert the contradictions and frictions between China and the United States, on the contrary, it will bring about more friction points. However, due to the interdependence between China and the United States, it is difficult for either side to sustain the cost of suspending bilateral normal economic and trading relations, this makes the mission of "containing China" become impossible.
Second is domestic politics. The distribution of the profits gained from interdependence between China and the United States among different domestic interest groups is unbalanced. Some industries, trades, social groups and even individuals benefit themselves, while other groups and individuals may suffer losses. Both the profit-making group and the group suffering losses will rise into action on the domestic political stage and will exert influence and pressure on national policies, this is especially noticeable in the United States. The influence exerted by US domestic political factors on Sino-US relationship has become increasingly evident in recent years. We can neither react radically like the shadow of a snake in the cup, nor can we fail to know the gains or losses and make unprincipled concession. In fact, the interest group in US domestic politics is a usable resource in diplomatic work.
Third is geographical strategy. In the foreseeable future, the drop in the stage of Sino-US economic and social development as well as international positions and the drop in foreign strategic focus have made it possible for the two countries to find out harmony in geographical strategy. As the overlord of the world, the United States needs China's cooperation in regional and global affairs; as a large regional country being devoted to economic development and the building of a well-off society, China needs a stable and prosperous international environment. Of course, the harmony of geographical strategy needs run-in through dialogs and inter-action, this is identical with China's requirement for "a period of 20-year strategic opportunity.
This article by Yu Wanli, deputy director of the foreign affairs office of the American Institute under the Chinese Academy of Social Sciences, on the 11th page of Global Times, August 19, is translated by People's Daily Online -
http://www.telegraph.co.uk/news/main.jhtml?xml=/news/2005/08/27/wjfk27.xml&sSheet=/news/2005/08/27/ixworld.htmlOriginally posted by SMAPLionHeart:Wow , china is using money to buy over america's allies.
smart move.
Let's see how america reacts.
JFK backed nuclear defence of India
By Francis Harris in Washington
(Filed: 27/08/2005)
President John F Kennedy was willing to use nuclear weapons to defend India against Chinese attack, newly released tapes of White House deliberations reveal.
Mr Kennedy displayed a readiness, hitherto undetected by historians, to extend America's nuclear umbrella to India in a 1963 meeting with his national security staff.
Seven months earlier India had been the victim of a bloody and unprovoked attack by China in which it lost 15,000 square miles of territory and left 7,000 troops dead, missing or captured.
Believing that the conflict could be repeated and that India might fall to communism, Mr Kennedy's aides emphasised to the president that only nuclear arms could now deter or reverse a Chinese invasion.
Discussing the possibility of a security guarantee to India, Gen Maxwell Taylor, chairman of the joint chiefs of staff is heard on the tapes telling the president: "I would hate to think we would fight this on the ground in a non-nuclear war." The point was then rammed home by the defence secretary, Robert McNamara, who weighed in to support the general.
Having heard the views of his senior advisers, the president can be heard on the tapes apparently committing himself to India's nuclear defence.
"We should defend India, and therefore we will defend India," he says through the tape's crackle.
The president also noted that his advisers were preoccupied with securing British involvement in India's defence.
He asked Dean Rusk, his secretary of state, why it was important to secure the backing of the Prime Minister, Harold Macmillan, with whom he had a troubled relationship.
Mr Rusk replied: "I think we would be hard pressed to tell our own people why we are doing this with India when even the British won't Â… We need to have other flags flying on these joint enterprises."
Mr Kennedy never issued the security guarantee to India and he was assassinated six months after the tapes were made. -
http://www.rsi.sg/english/newsline/view/20050826183137/1/.htmlOriginally posted by SMAPLionHeart:Wow , china is using money to buy over america's allies.
smart move.
Let's see how america reacts.
What India-China oil cooperation will entail
August 26, 2005
Plans for India and China to mount joint bids for foreign energy projects have been mooted but both Asian giants will still compete for resources.
Talmiz Ahmad, who heads IndiaÂ’s oil ministryÂ’s international division, says the planned collaborations between the two countries are still in the early stages.
Besides the fact that both countries will have more negotiating muscle, what other benefits will such collaboration bring to China and India?
Justin Teo posed this question to Commodore Uday Bhaskar, from the Institute for Defence Studies and Analyses, in India.
UB: Well, I think the macro benefit is that China and India now represent people in the demand side. You have a cartel of countries who represent the supply side. I think if major countries on the demand side of the oil domain are able to pool their resources and requirements, I think itÂ’ll put them in a better position at the negotiating table with the states in the supply cartels. We have an OPEC for the oil producers, I think there is a case for an OSEC or oil consumers kind of consortium. And in Asia, countries like India, China and perhaps at some point, Indonesia, plus Korea and Japan who also have large oil requirements, could pool their efforts together. I think itÂ’s inevitable actually.
JT: What could be included in the initial steps for this collaboration?
UB: Well, I think there is a clear interlink today between the energy dimension along with the growth rates and the environmental impact. So I think we need to do some consultation between the long term energy supply and demand. And the correlation with economic activity and impact on the environment because of greenhouse gases, and the commitments which the Kyoto protocol represents. So I think we need a kind of strategic dialogue, which would be strategic in a non-military sense. That is if we can make reasonable projections into the future, I think we have to carry out very informed assessments. So that there is a sense of cooperative effort as far as major oil consumers and the demand side is regulated in the appropriate manner. I also foresee a point in the not too distant future when these countries might have to look at alternate sources of energy. Now, whether these are solar, whether theyÂ’re wind or nuclear, will depend on individual countries and their own options and constraints. But hypothetically, whether we talk about nuclear or the wind, I think again, a certain degree of cooperation will be mutually beneficial.
JT: Should the United States and Europe be worried by such a deal between India and China?
UB: I think not. As I believe energy will very soon become the driving force or the driving determinant for many bilateral and multi-lateral relations. And given the United States own dependence on hydro-carbons at this point in time, I think the US itself could also be brought on board, so that there is a sense of transparency, and whatever China and India are proposing to do that in the long term would not be detrimental to a country such as the United States.
JT: What will this collaboration mean for western oil firms who have not been able to compete on the same level as these state-backed oil firms from China and India?
UB: Well, I think the fact that the western oil forms did not bid for Petrokazakhstan is not an indication that they would be outbid or that they did not want to. I think as far as western countries are concerned, I think here we have a clear political dimension which is the way that the governments of individual countries, whether itÂ’s the United States or Japan, are looking at hydrocarbons. ThatÂ’s one aspect. The second is the degree in which they are looking at it from a purely business and commercial point of view, which is another strategic dimension. My understanding of the Petrkazakhstan deal, was that the Chinese were determined to get it and this happened in the back drop of the attempt by CNOOC for UNOCAL, and the fact that they did not get it, I think ChinaÂ’s determination and the fact that China would have paid a price that was higher than what others were willing, was more or less evident. So I think there was a sense of prudence that may have dictated the response of the western oil companies.
Commodore Uday Bhaskar, from the Institute for Defence Studies and Analyses, in India. -
damn..that's a lot of articles to read