Archive for June, 2018

How Long Can the US Dollar Remain World’s Reserve Currency

Saturday, June 30th, 2018

How Long Can the US Dollar Remain Worlds Reserve Currency?

By

Col (Retd) Bhaskar Sarkar VSM

The other day my brother sent me a Whatsapp message titled “Death of the US Dollar”. The piece stated that the Chinese Yuan has been added to IMF’s basket of currencies and China is persuading countries to use the Yuan in place of the US dollar in bilateral or even multilateral trade. Some trade deals in Yuan have been signed. The US dollar has been the world’s reserve currency since 1946. It has thus ruled the world for 72 years. Is it time for it to be replaced? This article seeks to examine when, if at all, the US dollar may be replaced as worlds reserve currency.

Strong Currency VS Weak Currency

Strong currency makes imports cheaper. Thus countries who are net importers like the US, UK and EU like to have strong currencies where as export oriented countries like Japan, China, Asian Tigers like to have weak currencies so that their exports are more competitive in price sensitive markets. Strong currencies are great for governments giving aid to developing countries, military or project expenditure abroad and tourist going abroad. A strong dollar helps the US and UK government and consumers. But it makes US and UK wages and manpower costs in manufacturing uncompetitive.

To explain the effect of currency conversion, I would like to give a few examples. I had an uncle who was an UK citizen with a pension of 1000 British pound in 2002. That was barely liveable in UK. He used to stay six months a year in Goa, India. His 1000 Pounds converted to Rs 72,000. He lived comfortably and could afford a maid and a chauffeur. One radish in Singapore costs one Singapore dollar or Rs 50. In India the same radish would cost us Rs. 5 to 10.

Frankly, I do not understand why one US dollar is Rs 68. In 1992 it was just Rs 14.

If one US dollar ever became equal to one Chinese Yuan, the US manufacturing would be highly competitive. China would not be able to sell anything in the US market. If one US dollar could come down to Rs 34, the price we pay for crude oil in Indian rupees would be half of what we pay today.

Why is dollar over valued?

The United States had remained untouched by the ravages of World War II. Its industrial production in 1945 was more than double that of annual production between the prewar years of 1935 and 1939. In contrast, Europe and East Asia were economically shattered.  The United States held most of world’s investment capital, industrial production and exports. In 1945, it produced half the world’s coal, two-thirds of the oil, and more than half of the electricity power. It held 80 percent of the world’s gold reserves. The United States started with initial economic advantage, consolidated it during and after the war and assumed leadership of the capitalist world. The United States got what it wanted through the “Benton Wood” systems for the world economy. Its dollar replaced the British pound as the world’s trading currency.  President Franklin D. Roosevelt saw the creation of the postwar order with the US at the top as a way to ensure continuing prosperity for his country.

The situation has changed. 70 years of warmongering under the Marshall Plan, policing the world and corporate greed supported by US Presidents from Regan to Obama resulted in industrial activity and manufacturing moving to Japan, Asian Tigers and China and made the US the world’s largest debtor nation. Its Public debt is over $ 20 trillion and national debt over $ 32 trillion. The gold reserve vanished when Nixon was president and the US withdrew from the gold standard. The US dollar is certainly overvalued.

So what keeps the Dollar afloat? It is because those countries which hold large reserves of dollars, China, Japan, Germany and Saudi Arabia want it to be strong so that their exports to the US remain cheap, US manufacturing cannot compete and the value of their dollar holdings is not reduced. So they keep buying US dollars when it weakens to keep it strong.

Economic Stability of Nations

Before we examine the possibility of the dollar being replaced by a new reserve currency, I would like to touch upon a new concept, “economic stability of nations”. Stable economies are those economies which are least affected by turmoil in the world economy like rise of protectionism, collapse of globalization or WTO, trade wars and a major war. These economies produce adequate food, raw materials and energy for the needs of their population and industries. They are not export oriented economies. The US, Russia, Australia and Canada are the most stable economies where as China, Japan and the Asian Tigers are the most unstable economies. These countries import energy, raw materials and export commodities and manufactured goods and machinery to the world. They can have serious economic and law and order problems if supply of energy is disrupted due to war or sanctions, the supply of raw materials is disrupted due to similar reasons or because the producers of raw material decide not to export ores but want to export metals. For example India has reduced export of iron ore and seeks to export iron and steel.

Development and rate of growth needs to be sustainable. The rich nations, IMF, World Bank and private investors encourage developing countries to borrow money and grow fast. Repayment is difficult. A default suits the rich nations who then take away economic sovereignty, force devaluation and exploit them as much as possible. Sri Lanka borrowed from China to build its infrastructure and fight LTTE. Unable to payback, it has sold the strategic port of Hambantota. Male and Nepal are borrowing heavily from China and will soon be gobbled up. Papua New Guinea and Gabon are cutting their rain forests and exporting timber to find money for growth. What happens when the forests are finished? Who are benefitting? The people will not benefit. Corrupt politicians and multinationals will. How long are the Gulf States going to splurge and fund dictators like Al Sisi of Egypt, terrorists and Islamic fundamentalism with their oil and gas revenues? More and more countries are trying to develop their own energy sources and increase use of renewable enrgy. The US has become a crude and gas exporter rather than a major importer. The economies of Nigeria and Venezuela have collapsed along with their oil revenues. Yet tiny Cuba with a less than Hindu rate of growth (3%) is stable and has no serious economic problems. The new government of Malaysia has wisely cancelled its bullet train project between Kualalumpur and Singapore because it is not economically viable and Malaysia would not be able to pay back the debt. Unfortunately, India persists with its bullet train and highway projects with borrowed money.

If and When Can the US Dollar be Replaced

The main requirement of the reserve currency is universal acceptability. Governments, investors, bankers and traders in different countries must be willing to accept it and exchange it for local currency at laid down rates. The British Pound, the Euro and the Yen are accepted as payment for goods and services in many countries. When Iran was under US sanction, India paid for oil imports in Euros. The requirement of US dollar or any reserve currency can be dispensed with in bilateral trade. For example, Soviet Union and India traded in Rupees for about 20 years. China accepts payment in Yuan for its exports to boost sales in countries which do not earn enough dollars to buy goods and services they need. Some countries like Singapore accept currencies of most countries in the world and convert them into local currencies. The importance of a reserve currency is slowly reducing.

The second requirement of a reserve currency is that there must be enough of it to meet the needs of the world. In Dec 2016 there were over 1.5 trillion US dollar notes in circulation. Printing of the US dollar is no longer made public. In comparison on the same day about 1 trillion Euro, 100 billion British Pound and 900 billion US dollars worth of Japanese Yen were in circulation. The figures for Chinese Yuan could not be found. (www.en.wikipedia.org/wiki/Circulation_(currency) . It will be seen that the US dollar has the largest numbers in circulation with Euro a close second. The notes in circulation of any other country are not adequate to meet the needs of the world.

Conclusion

The US economy does not dominate the world anymore like it used to up to the sixties. Its gold reserves are gone. From the largest lender nation it has become the largest debtor nation. But it is still the world’s largest economy. Its main competitors, Europe and China have a long way to go before they can overtake the US. Both are unstable economies because they are heavily dependent on other countries for their energy and raw material needs and for markets to sell their products.

US and EU sanctions are forcing countries to trade without using the reserve currency. Bilateral trade in local currency is becoming more common. It is also a tool to increase export to countries with low dollar reserves. Thus the importance of holding foreign exchange reserves in US dollars is reducing. But the US dollar will remain strong and the reserve currency of the world as long as two out of EU, China and Japan want it to remain so.

(Col Sarkar has written two books on economics, “Economic Nationalism: The Strategy for Survival of Developing Nations” and “Growth and Decline of Economies of Europe and US: http://smashwords.com/b/231033)

Is There an Alternative to Mr. Modi as PM

Saturday, June 23rd, 2018

Is There an Alternative to Mr. Modi as Prime Minister?

By

Col (Retd) Bhaskar Sarkar VSM

www.smashwords.com/profile/view/Bhaskarsarkar1940

The bye election losses and the possibility of opposition unity in coming elections have unnerved BJP top brass, BJP supporters and supporting media. Out of 27 by elections held in the last two years, BJP has won only 5. Some of these 5 are in constituencies like Palghar where the opposition failed to unite. Unable to stem the tide, BJP and its supporters are trying to project that there is no alternative to Mr. Modi as PM. They are trying desperately to convince the public that the opposition has no viable leader. They argue that Mr. Rahul Gandhi and the regional Satraps like Mr. Mulayam Singh, Akhilesh Yadav, Mrs. Mayawati, Mrs. Mamta Bannerjee, Mr. Chandra Babu Naidu, etc will fall prey to their personal ambitions, fight amongst themselves after victory and like Mr. V P Singh, Mr. Chandra Sekhar, Mr. Raj Narain, Mr. I K Gujral and Mr. Deve Gowda, and will fail to provide a stable and effective government. The people of India should not therefore vote for the opposition coalition and vote BJP and Mr. Modi back to power.

2019 General Elections is about What Kind of India We Want

I want to submit to the wise voters of India that General Elections 2019 are not about who should be PM of India but what kind of India do we want.

Do we want an India where we live and work in harmony without distinguishing between religions, caste or ethnicity as the army does or are we going discriminate and divide people based on religion, caste and ethnicity, exploit minorities and lower castes and destroy India?

Do we want a atmosphere of fear, hate, intolerance and conflict in our universities and society or we want an atmosphere of amity, tolerance, peace and prosperity?

Do we want an India where we are free to eat and drink what we want; to wear dresses as per our choice; to party, cut cakes and celebrate Valentine’s Day or any other occasion as we want or do we want some half baked Hindutya cultural fanatics to lynch us, beat us up and extort money simply for doing what we have done since independence?

There are many such questions.

Has Modi Government Really Performed?

Let us start with Indian Railways.The entire focus of the Modi Government is on economically unviable bullet trains and superfast trains and Railway Minister taking social media calls from passengers and helping them. The reality is that the Railways are badly understaffed and mismanaged. 30% of trains are running late and in Northern Railway, almost 50% trains are running late.  People are so fed up that the passengers of a late train threw stones at a passing Rajdhani train at Gaya station injuring a number of passengers. Under the BJP, the railways have become so inefficient that the Army had to construct foot over bridges at railway stations for them in Mumbai to ensure passenger safety.

In the field of development entire focus of the Modi government is on building highways and expressways. It has no concern for ordinary people living in cities and villages who suffer from acute shortage of drinking water? The allocation for development of catchment areas and water sources is not even one tenth of allocation for roads. Do we want a government that is insensitive to the needs of the Aam Admi?

The fact is that our government is making a fool of us all the time. The Government fixes minimum prices for agricultural products but does not procure and the farmers are driven into bankruptcy. Demonetization further impoverished the poor who depend on cash for earnings. It has finished the resale property market, construction industry, the marble industry and thousands of small businesses leaving millions without work. The government has announced 90,000 vacancies in the railways but I am ready to bet that not one will be appointed during the tenure of the present government.

Implementation of GST is in a mess. Many revenue offices do not have the required hardware, software and trained personnel. One revenue department officer said that the claims for refund are more than the collection. Exporters are crying for refunds. Who knows the truth? The Government ensures that all adverse information is not available to public.

Modiji has been distributing gas cylinders to poor ladies. That is laudable. To do that he has stopped MNREGA and other subsidies. Many amongst the poorest cannot get rations because they do not have money or Aadhar Cards or the card readers in ration shops do not function. What use is cooking gas when you have nothing to cook?

Crores have been spent on building toilets but they cannot be used because there is no water.

The government wants a cashless society and a digital economy where 30% of the population is barely literate, 80% of the people do not know English or how to use a credit card, computer or ATM and most of India’s 600,000 villages do not have banks or ATMs. 30% of visits to ATMs are fruitless as there is no cash. Chairman SBI said that the shortfall is currency in circulation is over 40,000 crores. Only the Aam Admi suffers.

All institutions are in a mess. The Lokayukt has not been appointed in 4 years so that no one can complain. Courts are under staffed by 40 to 50% and vacancies of judges are not being filled up because non saffron judges are unacceptable. Vacancies of teachers are not filled up in government schools. We had an HRD minister who could not place her educational qualifications for public scrutiny. A C grade TV actor whose main qualification is that he acted as Shri Ram in a TV serial headed the Film Institute. The Dy CM of UP says Sita, wife of Shri Ram was a test tube baby. A BJP MLA in UP rapes a woman and has her father beaten to death by the police. It required intervention by the High Court or Supreme Court to get him arrested. None of the cow vigilantes who killed have been put on trial, let alone been convicted. Modiji is silent on the issues.

GDP growth is jobless and manipulated. Surgical strike on Pakistan did not reduce cease fire violations. These are actually on the increase. The hard line in Kashmir has not reduced the level of violence. Killing insurgents never ended insurgencies. When an insurgent dies, another takes his place. Peace comes only when the cause or outside support can be removed.

Modiji has made 81 foreign trips in 4 years. All foreign leaders including American, French and Chinese Presidents are his “hug-able” personal friends. Yet China provides unconditional support to Pakistan, refuses to allow Hafeez Sayeed to be branded an international terrorist and will never allow India into Nuclear Supplies Group or become a member of UN Security council. Border and trade issues remain unresolved, Modiji claims to be a personal friend of Mr. Donald Trump. Yet Trump has imposed duties on Indian steel and aluminium, forced India to reduce import duties on Hurley Davidson motorbikes, cut number of H1B visas and is likely to stop spouses of these visa holders from working in the US. What has India gained in real term from these visits?

Who Benefitted most from BJP Government?

The prime beneficiaries are old and unproductive cows, bulls and bullocks. They are being sheltered in Gaushalas at government cost in BJP ruled states or are roaming the streets, eating garbage and having fun. Two people have been gored to death in Alwar and many injured. Stray dogs are also beneficiaries. They are free to bite and have killed many children. Who cares?

Next to benefit are the “Gaushala owners”, who are mostly from the Hidutya Brigade. They get Rs 70 per day per animal. (Widows get only Rs 25 per day). How much do they spend? Your guess is as good as mine.

Next to benefit are the fringe groups of RSS and VHP who under police and government protection are extorting money and lynching people.

RSS members are also prospering. President, PM, all governors, male chief ministers, ministers and heads of institutions are from RSS or VHP. Being a member of RSS is like being an alumnus of Doon School in British days.

AVBP is also having a great time. With the support of BJP leaders and police, they beat up students of other unions and teachers whenever they feel like.

Last but not the least to benefit is the top 10% of India. The government is of the rich, by the rich and for the rich. Petrol prices are denting the budget of the lower middle class. The plight of farmers and tens of millions of educated unemployed are there to see by those who care. But the government certainly does not care.

It is for people to judge whether Modiji is a great PM or a great orator and dream seller. It is for the people to decide whether Modiji or Mr. Mohan Bhagwat decides the policies of the BJP government and who is the real ruler of India. Or have they divided the turf. Finance and foreign affairs seem to be under Modiji and the rest to RSS and the Hindutya Brigade.

Alternatives to Mr. Modi

Now I will suggest two names for PM in place of Mr. Modi. My first choice is Mr. Yashwant Sinha. He is an IAS with 26 years of service, politician and a former Finance Minister (1990–1991) under Mr. Chandra Sekhar and March 1998 – July 2002 under Mr. Atal Bihari Vajpayee and Minister of External Affairs (July 2002 – May 2004). He was a senior leader of the BJP before he quit BJP on 21st Apr 2018. He is a vociferous critic of Mr. Modi. A man of impeccable reputation, he is senior enough to command respect of all opposition leaders and unite them. To me he is like Mr. Mohatir Mohammad, former PM of Malaysia, who returned to politics at the ripe old age of 92 to fight his own party and protégée to save his country from ruin.

My second choice is Mr. Kamal Nath of Congress. He is the longest serving member of Indian Parliament. He has been elected 9 times from his constituency. An MP since 1980, he served as Minister for Environment and Forests from 1991 to 95, Minister for Textiles from 1995 to 96, Minister for Commerce and Industry from 2004 to 2009, Minister for Urban development from 2009 to 2011 and Minister for Highways and Road Transport from 2011 to 2014. A man of impeccable reputation, he is most experienced and senior enough to command respect of all opposition leaders and unite them. If Mr. Yashwant Sinha became PM, he would be my choice for Finance Minister.

Conclusion

To conclude I would say that I find it ridiculous for people to say that Modiji is irreplaceable. In a country of 1.25 billion, there are thousands of talented persons who are more educated, more capable, more visionary, more humble, more caring and more patriotic than Modiji. God and the hour will produce the man.

I also have no doubt that BJP will fail to split the opposition by raising silly question about the successor to Mr. Modi and the opposition being able to unite. Mr. Rahul Gandhi and other leaders of opposition parties are not selfish fools. They are not seeking personal power but a Secular, Socialist and Federal India. I have no doubt that they will make all sacrifices necessary to defeat the neo-liberal economists and Hindutya Brigade that seeks destroy the plurality, amity and diversity of India.

You have to decide whether you want a Saffron India with anti Aam Admi neo-liberal economic policies or a secular, socialist and pluralistic India where all are free to do their own thing and vote accordingly. The choice is yours.

Can Terrorism in Kashmir be Ended by Force

Saturday, June 23rd, 2018

Can Terrorism in Kashmir be Ended by Force?

By

Col (Retd) Bhaskar Sarkar VSM

www.smashwords.com/profile/view/Bhaskarsarkar1940

BJP has ended its three year alliance with PDP in Jammu & Kashmir. Governor’s Rule (sick BJP rule, BJP being in power at the Centre) has been imposed. The reason given is break down of law and order and PDP Government’s soft attitude to terror. As an example of the first is the murder of senior journalist and a soldier on leave in Kashmir. (Murder of journalists and lynching of Muslims on suspicion of cow slaughter in UP, Bihar and Jharkhand, gang rape of NGO women in Jharkhand all BJP ruled states, are not breakdown of law and order.) The example of the second is PDP’s insisting on a ceasefire during Ramadan and releasing about of 11,000 stone pelters. BJP hopes to defeat terrorism in the valley by an all out offensive by the entire Government machinery and bring peace and prosperity to the State.

This article is not intended to question BJP’s decision. It has a national security advisor, an Army Chief and a host of senior generals and police officers to advise it and implement its decisions. This article simply seeks to apprise my readers of possible pitfalls of this strategy.

Terrorism around the World

There is hardly any country in the developing world that has not faced insurgency or terrorism. Colonial powers were defeated in armed struggles for independence in Indo-China, Kenya, Cyprus, Zimbabwe, Algeria, Cuba etc. The insurgents could defeat first world powers like Britain, France and the US because they had a cause which had popular support of its people and economic and military assistance from the Soviet Union.  USSR withdrew from Afghanistan after 8 years of counter insurgency operations because they could not defeat the Afghan Mujahideen funded by the US and trained, armed and provided sanctuaries by Pakistan’s ISI and US CIA. USA, the world’s only superpower, has not been able to defeat the Taliban in Afghanistan in 16 years because Pakistan provides Taliban support and sanctuaries in its border areas. Turkey has been fighting Kurdish insurgents the PKK since 1984 with no end in sight. Israel has been fighting Palestine terrorists since 1967. It will be seen that military power has been unable to end any insurgency which enjoys popular support and external aid and sanctuary.

Insurgency and Terrorism in India

The Naga Insurgency started in 1947. Nagas did not want to be a part of India. Insurgency was active till 1973. The Nagas accepted the Indian Constitution by signing the Shillong Accord in 1975. Two factions did not accept the Accord. One faction is camped in Myanmar and occasionally ambushes Indian Army. The other has signed a secret agreement with the BJP Government and lives in a sanctuary in Nagaland with their arms on government dole.

Insurgency in Mizoram started in 1966 and ended with a negotiated settlement in 1987 when the Congress Party under Rajeev Gandhi agreed to make the rebel leader Mr. Laldenga the CM of Mizoram. Insurgency stared in Manipur in 1965 and continues to this day on a low key. Ulfa insurgency started in Assam in 1983. It is low key with its cadre are happy living on extortions from tea gardens and truck drivers. Its leader lives in exile in China. The insurgency groups of Northeast India received military and economic aid from East Pakistan and later Bangladesh under General Zia ur Rahaman and Begum Zia. They would have made peace if they had not received similar aid from China and sanctuaries in Bangladesh and Myanmar.

Insurgency started in Punjab in 1987 with assistance from secessionist Sikhs in Canada and military aid and shelter from Pakistan. Terrain in Punjab does not favour insurgency. Insurgents lost popular support with their excessive extortion and atrocities on women and were eliminated by the Army and Punjab police by 1997.

Maoist insurgency is the successor of the Naxalite movement which started with a peasant revolt in Naxalbari in North Bengal in 1967. The movement was crushed in Bengal by 1972 but spread to Bihar, Odisa and Andhra. At its peak in 2008, the Maoists were active in 11 states. They are being dealt with by state police and paramilitary forces. They are most active in Chattisgarh, Bihar, Jharkhand and Odisa. No end is in sight.

Terrorism in J&K

J&K was peaceful and a prime tourist destination till 1987. In fact when Pakistan parachuted its Special Forces into J&K during the 1965 War, the locals rounded up the Pakistanis and handed them over to the local police or army posts. In Jan 1987, when corruption and misrule was at its peak, 14 Muslim Parties came together to form a united front to contest elections. The elections were shamelessly rigged. On 15 August 1988 first anti India demonstrations erupted in Srinagar. Demonstrators were fired upon. Jammu and Kashmir Liberation Front, established in UK in 1977 and with presence in Pakistan and POK, led the armed insurgency. Yasim Malik was in charge of Indian Kashmir. The first batch of 300 Kashmir youth went to Pakistan in 1998. They returned in 1989 with arms and ammunition and engaged in raids on security forces. Pakistan was able to infiltrate over 2500 well trained and heavily armed battle hardened foreign militants who had become unemployed by the Russian withdrawal from Afghanistan. The Islamic terrorists began an ethnic cleansing campaign. Nearly 400,000 Pandits were either murdered or forced to leave their ancestral homes. But the foreign mercenaries alienated the local Kashmiris with forced marriages. Lack of tourists led to a drastic economic downturn. Yasim Mallik disbanded the military wing of JKLF in 1994. Level of violence began to decline with Mr. Vajpayee’s efforts to improve relations with Pakistan. Pakistani President Pervez Musharraf visited Delhi and Agra and put forward a peace plan. The Kargil War in mid 1999 further reduced the level of violence. A degree of normalcy returned and tourism revived.

Hizbul Mujahideen is currently the only active Kashmir based militant group. They are assisted by Lashkar-e-Taiba and Jaish-e-Mohammed from Pakistan. The number of Kashmiris joining militancy is linked to events that spark civilian anger in Kashmir. Hanging of Afzal Guru in 2014 became a rallying point for Kashmiri youth to take up arms. At least 54 Kashmiris joined the militants in 2014, a sharp rise from 16 the year before. Violence increased when the Hizbul Mujaheedin Commander Burhan Wani was killed by the Security Forces in 2016. 88 Kashmiris joined militancy in 2016, highest in six years. Violent clashes between stone-pelting protesters and security forces have increased. Almost 100 people including security forces have been killed during the months of protests which followed Wani’s death. Thousands of others have been injured. Over 6000 agitators have suffered eye injuries due to pellet gun fire. Cease fire violations, attempts at infiltration, attacks on Army and CRPF camps, grenade attacks and encounters between terrorists and security forces continue unabated.

Support from Pakistan

The primary reason why Indian Security Forces are not making much progress in dealing with terrorism in Kashmir are increasing local support, aid from Pakistan and safe sanctuaries in Pakistan. This lack of success is only to be expected.  External support is a very important requirement for successful separatist movements.

Terrorism in Kashmir is supported by Pakistan Army, Pakistan’s ISI and terrorist groups like Laskar-e-Taiba and Jaish-e-Mohammad. Many of the militants in Kashmir are from across the border. Infiltration and cease fire violations have not stopped after the valiant surgical strike by our armed forces which killed many militants and destroyed a number of camps. Those killed have been replaced by new recruits and the camps have been relocated and their security enhanced. Data shows that in 2016, at least 371 attempts were made by militants to infiltrate from across the border. It was the highest since 2010 when 489 infiltration bids were recorded. Pakistan is also paying the stone pelting mobs who try to disrupt operations against militants. Such Pakistani actions are only to be expected. During a visit to Kashmir recently, the Army Chief General Bipin Rawat had warned of strict action against protesters who attack security forces during anti-insurgency operations. The threat has not deterred the Kashmiri protesters.

Use of Counter Terror or the Hard Approach

To many theoreticians, the answer to separatist terror is state terror. The main followers of this doctrine are Israel, and Turkey. Over fifty years of this policy has not been able to subdue the Palestine people who have little external support and nothing but stones, small arms, improvised rockets and kites to fight back with. State terror includes the use of weapons like pellet guns, use of excessive force on demonstrating unarmed civilians and fake encounters. The main drawback of state terror is that it alienates the population. It violates human rights and creates unfavourable opinion both inside and outside the country. It is abhorred by intellectuals and the media. It increases the resolve of the population supporting the insurgency to continue the fight. Hanging of Mangal Pandey did not prevent the Sepoy Mutiny. The Jaliwana Bag Massacre did not stop the Indian freedom movement.

The Soft Approach

Mrs. Mehbooba Mufti, the outgoing CM, has said that hard approach will not work in Kashmir. Is there any other approach possible? There is. First is to accept that killing and capturing militants and hurting unarmed civilians is not going to solve the problem. Divide Kashmir into white, grey and black areas. White areas are those under government control. Grey areas are those where security forces and militants are both active and both have a degree of support of the population. Black areas are those where the militants have strong support of the population and security forces are at a disadvantage. The government and security forces must defend the white areas with adequate force; patiently try to make grey areas white and black areas grey. Kashmiris must be made to feel that they are cherished citizens of India and not a bunch of terrorists and anti-nationals. The role of the security forces should be to maintain law and order and protect loyal citizen.

Killing and capturing militants should never be the focus. When you kill one, another five will join. Try to get them to surrender. Have a practical surrender policy. The government and the security forces must focus on stopping the funding and arming of the militants by knocking out Hawala traders and effective monitoring of vehicles bringing arms and ammunition into Kashmir from outside the valley. Efforts must be made to win the hearts and minds of the people.

Conclusion

A fundamental fact about state terror is that it alienates the population and absolute terror alienates absolutely and permanently. The running of an administration based on terror requires an uncommonly high degree of ruthlessness. Leaders like Stalin, Idi Amin or Pol Pot who could kill millions of unarmed civilians are extinct.  The Kashmiri problem is unlikely to go away till either Pakistan or India give up. But the intensity of the conflict can die down and a degree of normalcy as in the North East or the Maoist belt can return.

History tends to repeat itself. But sometimes history is made. India made history when it it defeated Pakistan in just 17 days and liberated Bangladesh in 1971. It is possible that BJP and General Rawat will create history. I wish them success.

Every Kashmiri wants peace and prosperity. The BJP government wants the same. Only time will tell whether a military solution can be imposed on the people of Kashmir.

(Col Sarkar has authored five books on military matters; “Tackling Insurgency and Terrorism: A Blue Print for Action”, Vision Books New Delhi; “Outstanding Victories of the Indian Army” and “Kargil War: Past, Present and Future”, Lancer Publishers and Distributors, New Delhi; “Who is Afraid of the Chinese Dragon: I am” and “Tackling the Maoist Insurgency”, Atlantic Publishers and Distributors, New Delhi.)