Asia – Page 27 – Into India

Time for the Nehru-Gandhi family dynasty to end for Congress Party

For almost 100 years, generations of the Nehru-Gandhi family have led the Indian National Congress Party – is this dynasty coming to an end?

This question pre-occupies Indian commentators as Rahul Gandhi (pictured above) quit after leading the party to a disastrous 2019 election loss to Narendra Modi.

The modern Indian electorate is aspirational and finds little to like in the conservative and history obsessed Congress Party.

One key element of becoming a leader is that you are driven to do it, that becoming leader is your life’s passion. Rahul Gandhi never convinced in this – he looked like a man forced to run because of the dynasty.

In 1919, Motilal Nehru (pictured below) became the president of India’s oldest party, the Indian National Congress. Rahul was his great-great-grandson.

This dynasty goes from Motilal Nehru to his son Jawaharlal Nehru (independent India’s first Prime Minister), and then to Nehru’s daughter, Indira Gandhi (who had married a man named Feroze Gandhi, and since then the dynasty has been called the Nehru-Gandhi dynasty), and her two sons, Sanjay Gandhi and Rajiv Gandhi. After Rajiv Gandhi was murdered by a Tamil terrorist in 1991, the party eventually convinced his Italian wife, Sonia Gandhi (born Sonia Maino), to take over the steering wheel. Sonia brought into Indian politics her two children: Rahul and Priyanka, making them the fifth generation of the Nehru-Gandhi family line within the party leadership.

Sonia Gandhi returns as fill in leader of the Congress Party as it contemplates the future

Many say Priyanka Gandhi Vadra (pictured below) has all the leadership qualities Rahul lacked, and could succeed to the leadership.

The huge victory for Prime Minister Narendra Modi’s Bharatiya Janata Party has only underlined how the BJP has replaced the Congress as “India’s natural party of government”.

Congress has been decimated, with only 52 (up 8) national parliamentary seats compared with the BJP’s 303 (up 21) and none from 19 of the country’s 36 states and territories. It is estimated that the BJP won 92 per cent of contests with a Congress candidate and only 52 per cent of direct contests with other parties.

“The Congress Party must radically transform itself,” Rahul Gandhi wrote in his resignation letter. The question is – can it look beyond the dynasty to find a new, modern leader and political brand?

Watch Out! Divided world ahead!

You can see the world dividing, as the USA and China continue locked in a trade war.

The global division began when Trump pulled out of the Trans Pacific Partnership – of which Australia was a part. With the TPP, Trump could have dealt with China on behalf of “the world”. Once this was gone, he was free to just speak for America and that is where the divisions began. This seems to be what he wanted all along.

Then the trade war with China revved up and seems unstoppable.

One result (unintended consequence) of the Trump approach has been to unite the 15 countries trying to create the Regional Comprehensive Economic Partnership – the biggest free trade deal in history. Australia is part of this, as is, surprisingly, India. So too are Japan, China and Indonesia. The USA is not.

So what would a divided world look like? China on one side (potentially with Japan, Australia, India and the other 15 RCEP countries), USA on the other, different digital technologies and communication platforms – much more fundamental that just selling cheap shirts and tennis shoes. This is a huge divide, not just about trade.

Australia can probably play this division on both teams – we probably have to, but it will be one hell of a balancing act. Remaining close to America while engaging with China and others in the RCEP could see a win-win for Aussies. But others might have a different view.

India and Australia to be key players in world’s largest free trade deal

Australia and India are poised to be key players in the world’s largest free trade deal – the Regional Comprehensive Economic Partnership which should be signed by mid 2020.

There are 15 countries in RCEP excluding the USA. Major players are China, Japan, Indonesia, India and Australia.

RCEP will have a market of over 3.5 billion people and almost 33% of the world’s GDP.

As we have noted before – Trumps’s trade war with China has given some urgency to RCEP negotiations and the 15 countries are set to complete the deal.

Pictured the two Prime Ministers excited about RCEP – Australia’s PM Morrison (left) and India’s PM Modi

India’s renewable energy reaches new highs

We often look at India from outside and just see pollution – but look closer and you will see major change is taking place.

Solar and wind energy are taking off – “An aggregate of 80.46 GW of renewable energy limit has been introduced in the country as on June 30, 2019 which includes 29.55 GW from Solar and 36.37 GW from Wind control,” according to Power and New and Renewable Energy Minister Mr R K Singh.

The government has set a focus of 175 GW of clean energy capacity by 2022, including 100 GW solar and 60 GW of wind energy.

According to India’s submission to the United Nations Framework Convention on Climate Change on Intended Nationally Determined Contribution (INDC), a combined electric power limit of 40 per cent from non-fossil fuel-based energy resources is to be introduced by 2030.

The Ministry also told the House that a sum of 42 solar power parks with a total limit of around 23.40 GW have been approved by the government so far to encourage accomplishment of 100 GW target by March 2022.

Well done India – keep it going.

World GDP in one amazing chart

The latest estimate from the World Bank puts global GDP at roughly $80 trillion in nominal terms for 2017.

Today’s chart from HowMuch.net uses this data to show all major economies in a visualization called a Voronoi diagram – let’s dive into the stats to learn more.

The world’s top 10 economies

Here are the world’s top 10 economies, which together combine for a whopping two-thirds of global GDP.

In nominal terms, the US still has the largest GDP at $19.4 trillion, making up 24.4% of the world economy.

While China’s economy is far behind in nominal terms at $12.2 trillion, you may recall that the Chinese economy has been the world’s largest when adjusted for purchasing power parity (PPP) since 2016.

The next two largest economies are Japan ($4.9 trillion) and Germany ($4.6 trillion) – and when added to the U.S. and China, the top four economies combined account for over 50% of the world economy.

Here are some of the most important recent movements:

India has now passed France in nominal terms with a $2.6 trillion economy, which is about 3.3% of the global total. In the most recent quarter, Indian GDP growth saw its highest growth rate in two years at about 8.2%.

Brazil, despite its very recent economic woes, surpassed Italy in GDP rankings to take the #8 spot overall.

Turkey has surpassed The Netherlands to become the world’s 17th largest economy, and Saudi Arabia has jumped past Switzerland to claim the 19th spot.

Australia could benefit from Trump’s trade war with China

They are talking fast, negotiating hard and could come up with a sweeping deal this year that reduces the need for direct talks on an Australia-India FTA.

Australian PM Morrison (left) and Indian PM Modi – pretty happy about the future

RCEP will have the potential to deliver significant opportunities to Australian businesses and consumers. RCEP will cover ten of Australia’s top 15 trading partners, and collectively RCEP participating countries will account for a combined GDP of US$23.8 trillion (2016). These countries account for almost 60 per cent of Australia’s total two way trade, and over 65 per cent of our exports.

Thanks Donald.

‘Kithana acha he Modi!’ Morrison wrote in Hindi, which means “how good is Modi?”

The Australian Prime Minister took to Twitter on Saturday to share a cheerful selfie with Indian Prime Minister Narendra Modi — a fellow world leader attending the G20 summit in Osaka.

‘Kithana acha he Modi!’ Morrison wrote in Hindi, which means “how good is Modi?”.

Indian PM Modi replied in Aussie style – “Mate, I’m stoked about the energy of our bilateral relationship!”

This relationship could be a key to a successful Regional Comprehensive Economic Partnership deal of 15 countries in our region – big step forward.

The personal connections of leaders can go a long way to overcome bureaucratic hurdles. Long may their relationship flourish!!

Let’s hope PM Modi and PM Morrison meet lots and do deals

Now, this is the kind of photo I would like to see a lot more of.

Australian PM Scott Morrison (left) and Indian PM Narendra Modi in discussions.

This is vital for Indian Ocean strategic issues plus our trade and investment relations.

Here’s a very nice irony – Australia and India have really struggled to agree a Free Trade Agreement but one outcome of the Trump trade war on China is that the 15 countries in the Regional Comprehensive Economic Partnership (Including Australia and India) are now motivated to do a deal – they are talking fast, negotiating hard and could come up with a sweeping deal this year that reduces the need for direct talks on an Australia-India FTA.

Thanks Donald.

My interview with His Excellency Dr A.M. Gondane, High Commissioner of India to Australia – first extract “tariffs and trade”

One 12 June, I had the privilege of a one-on-one interview in Canberra with the Indian High Commssioner, Dr AM Gondane. Here is the first of a series of short extracts from that interview:

Dr Gondane: “Australian tariff rates are low and ours are at a higher level. There are differences and we know that Australia is a very open economy. It is natural for Australia to desire Indian tariffs to match the Australian model, but this will take time. We have actually made a lot of progress and opened more than 90% of our tariff lines for restarting the negotiations.

“There are some sticking points, but I think, with careful negotiation and goodwill, the free trade agreement could be reached. Because India’s tariffs are higher it will naturally take longer to get them down.

“Both Australia and India are negotiating the Regional Comprehensive Economic Partnership (RCEP) forum (meeting in Melbourne this week) which could be another avenue for increased trade.

“The RCEP provides good scope for commonality and the opening up of India and Australia economies – both are active in the RCEP,” the High Commissioner said.

The 15 Member countries of RCEP are Australia, India, China, Japan, Republic of Korea, Singapore, New Zealand, Malaysia, Indonesia, Brunei, Cambodia, Laos, Myanmar, Vietnam, Philippines. They are meeting in Melbourne this week.

Dr Gondane concluded with a wide ranging comment about the Indian Ocean region and pointed to Prime Minister Modi’s vision for the Indo-Pacific:

“The period of doubling of Indian economy has reduced and we can reach US $ 5 trillion within the next few years. We are already the fifth largest economy in nominal terms and third largest in purchasing power parity. That is why the Indian Prime Minister has elaborated on what is our conception of the Indo-Pacific. Australia is an important partner in the Indian Ocean. These two powers will be of great consequence in the next twenty years.”

India-Australia trade relations set to grow at critical time

Many of us have championed closer economic ties between Australia and India. It is now more important than ever to get closer to India.

As Austrade expresses it – “With trade wars, powerful neighbours, and the odds on a recession narrowing within the next two years, considering Indian market entry has never been more mission-critical for Australian business.”

Some key statistics:

•In 2018, Australia’s total exports to India grew 10% to A$22.3 billion. India ranked number five in Australia’s export destinations.

•Two-way trade increased by a similar percentage to A$30.4 billion, making India Australia’s sixth largest two-way trade partner.1

•Australian investment in India increased almost 12% to A$15.6 billion, slightly ahead of India’s investment in Australia at A$15.1 billion.

However – and here is why Australia needs to balance trade – according to the Australian Bureau of Statistics, in 2016–17 (the latest year for which there is data), only 2,087 exporters engaged with India, compared to 7,214 for China.

Time to think India.