Economic mess starts to hurt Indian diplomacy

Discussion in 'Foreign Relations' started by ejazr, May 24, 2012.

  1. ejazr

    ejazr Stars and Ambassadors Stars and Ambassadors

    Oct 8, 2009
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    Hyderabad and Sydney
    Economic mess starts to hurt Indian diplomacy - The Times of India

    NEW DELHI: The 2G telecom crisis is not just a story of corruption in India's showpiece infrastructure sector. Neither is the Vodafone issue. As these crises drag on, they are beginning to have a diplomatic fallout on India's relations with these nations with implications ranging from the minor to the significant.

    With the high pitch over the Indian children in Norway now a thing of the past, its time for India to face the heat from the other direction. Telenor, which is also caught in the toils of the 2G scam, is more than a telecom company. The Norway government's pension fund, which is the world's largest sovereign fund, and provides pensions to all Norwegians is deeply invested in Telenor. If Telenor is forced to exit India under a cloud, the effect on bilateral ties can only be imagined. This is no longer a telecom problem, its fast becoming a diplomatic one.

    Sheikh Abdullah bin Zayed Al Nahyan, foreign minister of the United Arab Emirates is a worried man and his frequent interactions with the Indian leadership is proof of that. The 2G crisis has put Etisalat on the mat, and as investigations and case against them continue, it might begin to impact bilateral ties. The UAE is India's largest trading partner, with over 1.75 million Indians living and working there. Although India is increasing its oil offtake from the UAE, taking business away from Iran to the UAE, the India-UAE relationship could end up bruised. For an Indian government hoping to attract billions of dollars in investment from their sovereign wealth fund, the prospect of worsening bilateral ties is a nightmare waiting to happen.

    Foreign office mandarins are now expected to practise economic diplomacy with their interlocutors. But, sources said, this will become progressively difficult because India's economic decisions are being taken without keeping foreign policy goals in mind. But the foreign office, which is the first point of contact between these countries and India, doesn't have a seat at the high table. The MEA, or the foreign policy angle, rarely gets a hearing. In the numerous GOMs created to solve economic policy problems, the foreign ministry is not represented in anything more than the ones on Nalanda university and perhaps the UID system.

    Russia's Sistema, also embroiled in the 2G mess, is owned by one of the closest friends of Russian president Vladimir Putin. Vladimir Yevtushenkov enjoys special privileges as a Putin crony, and the telecom fallout is bound to have diplomatic implications. Although you may not hear about it in public, these issues are now the stock content of bilateral interactions between India and these countries.

    India's Vodafone decision will definitely have an impact on ties with the UK, no matter how government officials gloss over the matter. This week, Vodafone featured in the UPA's white paper on black money, which has also drawn instant fire.

    Indian diplomats are as helpless as the officials they confront on the other side of the table and the best they can do is to lend a sympathetic ear. In the rest of the government, these issues are being treated as sector-specific, but only foreign office mandarins can see the growing stain. They will be the ones called upon to clear the mess, but most of the time, their concerns are barely heard by other parts of the government.
    panduranghari likes this.
  3. parijataka

    parijataka Senior Member Senior Member

    Oct 15, 2011
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    Yes when policy and governance matters are manipulated to fill the pockets of select few in ruling clique expect economy to slide. India is a true kleptocracy where right from President downwards state functionaries are stealing taxpayers hard earned rupees. Mera bharat mahaan.
  4. lcatejas

    lcatejas Regular Member

    Nov 19, 2010
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    Parties are above from Country Now.. idiot ganwar ministers and puppet ministers are main reason for this slow down.. Man with thousand scams is giving speech on corruption...than just imagine the condition...its time to change ... we will have to come out on the road and hold these bustards from there neck out from there house and drag then on the road... TIME HAS COME ...:mad:
  5. panduranghari

    panduranghari Senior Member Senior Member

    Jan 2, 2012
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    This currency systems and the evolving nature of our current society that created this system is in the process of radically changing its paper wealth structure. The government, as an extension of that society begins to support and maintain the asset value of almost everything. This is the engine that drives an eventual hyperinflation. Not a typical business expansion inflation we are used to, rather an all-consuming, ending inflation that does not stop. At this point the concept of sound money takes a back seat to maintaining majority asset holdings on a permanent plateau. By extension, the official stance is moved to promote all paper assets as "national money". Stocks, bonds, business function and even general welfare is elevated to an equal footing with the need for a good sound money in your pocket. The mood becomes one of "what good is a sound rupee if we are deflating"? Check that one off your list because we are well on that road.

    The international value of major currencies become more a function of "who can manipulate them the best" rather than their soundness. Forget the trade deficits, asset price bubbles, debt overflows or interest rates,,,,, it's who is best at controlling currency derivative function. Traders buy using "official control" as their determining value fundamentals. Truly, at this stage the prospects of a price deflation and its opposing currency hardness are a distant joke. India like the US has now moved to using measures once reserved for third world systems when it comes to playing the money game. Example: "our national debt is being paid off"!
  6. nrj

    nrj Stars and Ambassadors Stars and Ambassadors

    Nov 16, 2009
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    Rightly said ! :thumb:
  7. sehwag1830

    sehwag1830 Tihar Jail Banned

    Dec 23, 2011
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    Yes India shouldn't tax Vodafone because it will hurt relation with UK. And what does India benefit from relation with UK ? It is extremely easy to buy Indian journalist and ask them to write a lifafa article in Indian newspaper.

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