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Message from India: Please Stop Calling Us Poor

India is the world’s most ancient civilisation and the world’s third biggest and fastest growing economy. There are many problems and much poverty but it is sick and tired of being patronised by the West.

Siddharth Pathak

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India is a country of paradoxes. On one hand millions of young ambitious people wanting to make something out of their lives write their own destinies, on the other hand there are millions of others who choose spirituality in leaving themselves to whatever their fate has set for them.

The same paradox exists in our perceptions too. On one hand there is undoubtedly the world’s largest population living below the poverty line with average incomes being very low, and the country being frequently lumped into a poor category. But on the other hand there is this fabulously rich aura of India being the golden bird that drew the attentions of the Europeans seeking her magical riches and spices. The contradiction here is incidentally at the root of the discontent and hostility Indians have over the colonial era. India went from being an unbelievably rich land to being pillaged under the colonial era – or at least so goes the narrative.

The image of India’s poverty attracts a lot of attention and money. According to the World Bank, India received a total of $2.4 billion in foreign aid in 2013. While this money certainly contributes towards alleviation of poverty and helping those on the lower strata of the society, there are a few problems, which actually backfire on the noble intentions with which these donations are made.

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India is finding it’s way to actualize its national ambitions to become a $10 trillion economy by 2034.

Professor William Easterly is an economist who studies economic development, and the bulk of his work bluntly disputes the myth that foreign aid works. He asserts that “economic development happens, not through aid, but through the homegrown efforts of entrepreneurs and social and political reformers.” And is it really difficult to understand why that might be the case?

Consider the old adage: it is better to teach a hungry man how to fish, than to give him a fish. For helping those living among poverty we have to enable them to be able to achieve the necessary conditions for making their lives better. If we keep feeding them, and taking care of them in perpetuity, what would become of them, if the aid flows were to be disrupted? Jim Rogers, one of the greatest investors of our time, wrote in his book “Adventure Capitalism” of how he saw in his travels to Africa long lines of people in Ethiopia, waiting for the arrival of the free grains which kind hearted people from American Churches had donated. He lamented over how an entire generation of people in the rural areas had grown up not knowing how to farm, while pristine farmlands in Ethiopia lay unharvested.

India, China, and various countries of Africa have all received vast sums of donations in the last five decades, but this has hardly affected poverty levels. In fact, the biggest reduction in poverty numbers came only when these countries adopted genuine economic development using the distributive capacities of the markets. Sure, there are legitimate criticisms about using markets, but the benefits of them in tackling human development issues such as hunger, poverty and malnutrition significantly outweigh the cons. Also consider the fact that prior to the development of liberalism as thought of by John Stuart Mill, there was no impetus that another country, much less other people from the same country, had any moral obligation to “help” other people. And yet in varying time periods people in what now are perceived to be “poor countries”, sat on vast amounts of resources.

Apart from economic reasons as to why foreign aid is counterproductive, there are equally important political reasons for it. Perhaps the most damaging aspect about colonialism in India was that it struck a wide blow on to the collective psyche of the Indian identity. It was not because “foreigners” had conquered India (“foreigners” ruling over India goes at least a few thousand years), it was because of the projection of the idea that Indians were people that the imperialists had to “civilise”. In doing so they damaged, belittled and mocked the sense of being an Indian, and as a result shred the humanity of their identity. John Stuart Mill, who came up with the strange, convoluted idea of “benevolent despotism” was heavily influenced by his father, James Mill who had authored a book called “History of British India”, an elaborate study of the Subcontinent which was used by the East India Company officers and subsequently the British Foreign Office in teaching newly posted officials in India about the land and its history.

However, the History of British India contained within it nothing but a highly self-serving vision of what India ought to be, instead of what it was. Mill, for example casually brushed aside the contexts and nuances which punctuate the evolution of societies and shape broader sociological frameworks, and instead lazily announced that India’s past possessed “three phases, Hindu, Muslim and British.” He criticised in his book those British officials who thought the indigenous people “to be a people of high civilisation, while they have in reality made but a few of the earliest steps in the progress to civilisation.”

Unfortunately, such patronisation formed the bedrock in which many senior officials came to view not just India, but numerous other parts of the world.

And I can’t help but see the similarities between the view then, and the view about “poor countries” or “third world countries” now. In fact, it wouldn’t be a stretch to argue that today’s view is the successor of the views of the past.

India is not a poor country. It certainly has a large share of people who live below poverty lines, but should this be the sole determinant of how India be ought to be looked at by the rest of the world?

Well Indians will say a forceful no, but the reality is that India is viewed from the narrow constructs which have their foundations from the heydays of colonialism, which further accentuates the problems, because colonialism is looked at with great hostility. It is what explains why Indians were furious at the way many Western publications and newspapers questioned India’s foray into space by launching a Mars mission. Journalists questioned whether it was justified that a country with significant levels of poverty should spend money on such projects. Indian President, Pranab Mukherjee in turn angrily retorted that British aid was “peanuts” compared to the economy, and the government even moved ahead to block any more aid from UK. 

This reaction is not true just for India. Just a few weeks ago, Bolivian Minister for Land and Rural Development angrily refused Bill Gates’ donation of 100,000 chicken, saying “He does not know Bolivia’s reality to think we are living 500 years ago, in the middle of the jungle not knowing how to produce.”

But what he said afterwards – “I think it’s rude coming from a magnate that does not know Bolivia’s reality” – is something which more people and countries, particularly those in the developed world, should consider before inciting irritated response from native people.

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Russia ranks HIGHER than Switzerland in these areas of doing business

Some curious things happened with several businesspeople who attended World Cup events in Russia.

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Russian President Vladimir Putin

One of them was a distinctly renewed interest in doing business inside the country, and another was the realization to what extent perceptions have been tainted by media and political rhetoric directed against any real or imagined nastiness attributed to Russia these days.

These past few weeks have been invaluable, at the very least by affording a clear picture of Russia through which almost all anxiety-ridden preconceptions were illuminated and dispelled. More disturbing was the fact that the several businesspeople I was dealing with were furious. They were livid for being played for fools, and felt victimized by the dismally untrue picture painted about Russia and Russians in their home countries, both by their own politicians and the press.

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Most felt that they have been personally sanctioned by their own countries, betrayed through lack of clear unbiased information enabling them to participate and profit from Russia opportunities these past three growth years in spite of “sanctions”.

The door to doing good business in Russia has been and is open, and has been opening wider year after year. That is not just “highly likely”, but fact. Consistently improving structures, means and methods to conduct business in Russia sustainably, transparently and profitably are now part of the country’s DNA. It is a process, which has been worked on in the west for more than a century, and one, which Russia has only started these past 18 years.

True, there are sanctions, counter-sanctions, and regulations governing them that must be studied carefully. However if you are not a bank or doing business with those persons deemed worthy of being blacklisted by some countries “sanctions list”, in reality there are no obstacles that cannot be positively addressed and legally overcome despite the choir of political nay-sayers.

READ MORE: Russia just dumped $80 BILLION in US debt

The days of quickly turning over Russia opportunities into short-term cash are rapidly fading, they are a throwback to the 1990’s. Today the major and open opportunities are in the areas for Foreign Direct Investments. The nature of FDI is long term to make regularly recurring sustainable returns on investment.

Long term, Russia always was and increasingly confirms that it is a vibrant and attractive market. There is a significant consumer market with spending power, a well-educated workforce, a wealth of resources and the list goes on. The economic obstacles encountered have largely been imposed from without, and not from the dynamics and energies of the Russian economy itself.

Eventually sanctions will end, although the timeline is anyone’s guess. Meanwhile business continues, and any long-term engagement within Russia by establishing a working presence will yield both short and long-term investment rewards. These will only be amplified when the sanctions regimes are removed. In any event, these aspects are long-term investment decisions and one of the criteria in any risk assessment.

For some added perspective, Russia is ranked by the Financial Times as the No.2 country in Europe in terms of capital investments into Europe. It has a 2017 market share of 9% (US$ 15.9 billion) and includes 203 business projects. This is 2% higher than 2016 and better that 2014/2015 when sanctions were imposed.

Another item of perspective is the Country Risk Premium. All investors consider this when calculating the scope for long-term return on investments. What may surprise some is that Russia is no longer ranked as a very high-risk country. For comparisons sake: The risk premium for Germany is zero (no extra risk), the risk premium for Italy is 2.19%, and for Russia, it is 2.54%. When compared to politically popular investment destinations like Ukraine the risk premium is 10.4%  – food for thought. Bottom line is that the risks of investing in Russia are a smidge higher than investing in Italy.

Russia is ranked 35 among 190 economies in the ease of doing business, according to the latest World Bank annual ratings. The ranking of Russia improved to 35 in 2017 from 40 in 2016 and from 124 in 2010. It may also surprise some to learn that as concerns protecting the rights of minority investors, paying taxes, registering property and some other aspects of the World Bank comparisons, Russia comes out better than Switzerland (See: Rankings).

From operational standpoints, establishing an invested presence in Russia does not mean one must adopt Russian managerial methods or practices. The advantages for established foreign companies is that their management culture is readily applied and absorbed by a smart and willing workforce, enabling a seamless integration given the right training and tools.

The trend towards the ultimate globalization of business despite trade wars, tariffs, sanctions and counter-sanctions is clear. The internet of the planet, the blockchain and speed of information exchange makes it so whether we wish it or not. Personally, I hope that political globalization remains stillborn as geopolitics has a historical mandate to tinker with and play havoc with international trade.

Russia occupies a key strategic position between Europe and Asia. The “west” (US/Europe) have long had at times rather turbulent relationships with China. At the same time the Chinese are quite active investors in both the US and Europe, and western companies are often struggling to understand how to deal with China.

The answer to this conundrum is Russia: this is where East and West will ultimately come together with Russia playing a pivotal role in the relations between the west and China. At the end of the day, and taking the strategic long-term economic view, is what both Chinese and Western companies are investing in when they open their activities in Russia.

If long-term commitment and investment in Russia were simply a matter of transferring funds then I would not be bothering with this opinion article. Without a doubt, there are structural issues with investing in Russia. A still evolving and sometimes unclear rule of law, difficulties obtaining finance for investments directed towards Russia, the unique language and culture of business in the country. Nevertheless, companies that have an understanding and vision of global strategy will manage with these issues and have the means to mitigate them.

Money and other invested resources do not and should not play politics; any investment case when evaluated on objective financial criteria will reveal its fit, or lack of, within a company’s global strategic business objectives. The objective criteria for Russia over any long term horizon is both convincing and strong. This has been repeated by all of the businesspeople I have met with these past few weeks. Without doubt we shall see some new companies coming into the Russian market and objectively exploring the gains their playing fair business football here will yield.

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Media meltdown hits stupid levels as Trump and Putin hold first summit (Video)

The Duran – News in Review – Episode 58.

Alex Christoforou

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It was, and still remains a media meltdown of epic proportions as that dastardly ‘traitor’ US President Donald Trump decided to meet with that ‘thug’ Russian President Vladimir Putin.

Of course these are the simplistic and moronic epitaphs that are now universally being thrown around on everything from Morning Joe to Fox and Friends.

Mainstream media shills, and even intelligent alternative news political commentators, are all towing the same line, “thug” and “traitor”, while no one has given much thought to the policy and geo-political realities that have brought these two leaders together in Helsinki.

RT CrossTalk host Peter Lavelle and The Duran’s Alex Christoforou provide some real news analysis of the historic Trump-Putin summit in Helsinki, without the stupid ‘thug’ and ‘traitor’ monikers carelessly being thrown around by the tools that occupy much of the mainstream media. Remember to Please Subscribe to The Duran’s YouTube Channel.

And if you though that one summit between Putin and Trump was more than enough to send the media into code level red meltdown, POTUS Trump is now hinting (maybe trolling) at a second Putin summit.

Via Zerohedge

And cue another ‘meltdown’ in 3…2…1…

While arguments continue over whether the Helsinki Summit was a success (end of Cold War 2.0) or not (most treasonous president ever), President Trump is convinced “The Summit was a great success,” and hints that there will be a second summit soon, where they will address: “stopping terrorism, security for Israel, nuclear proliferation, cyber attacks, trade, Ukraine, Middle East peace, North Korea and more.”

However, we suspect what will ‘trigger’ the liberal media to melt down is his use of the Stalin-esque term “enemy of the people” to describe the Fake News Media once again…

 

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While US seeks to up the ante on pressure on the DPRK, Russia proposes easing sanctions

These proposals show the dichotomy between the philosophy of US and Russian foreign policy

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The United States last week accused the DPRK of violating refined petroleum caps imposed as a part of UN nuclear sanctions dating back to 2006, and is therefore submitting a proposal to cut all petroleum product sales to North Korea.

The Trump administration is keen on not only preserving pressure on North Korea over its nuclear arms development, but in increasing that pressure even as DPRK Chairman, Kim Jong-Un, is serially meeting with world leaders in a bid to secure North Korea’s security and potential nuclear disarmament, a major move that could deescalate tensions in the region, end the war with the South, and ease global apprehensions about the North’s nuclear arsenal.

Meanwhile, Russia is proposing to the UNSC sanctions relief in some form due to the North’s expressed commitment to nuclear disarmament in the light of recent developments.

Reuters reports:

MOSCOW/UNITED NATIONS (Reuters) – Russia’s envoy to North Korea said on Wednesday it would be logical to raise the question of easing sanctions on North Korea with the United Nations Security Council, as the United States pushes for a halt to refined petroleum exports to Pyongyang.

“The positive change on the Korean peninsula is now obvious,” said the ambassador, Alexander Matsegora, according to the RIA news agency, adding that Russia was ready to help modernize North Korea’s energy system if sanctions were lifted and if Pyongyang can find funding for the modernization.

The U.N. Security Council has unanimously boosted sanctions on North Korea since 2006 in a bid to choke off funding for Pyongyang’s nuclear and ballistic missile programs, banning exports including coal, iron, lead, textiles and seafood, and capping imports of crude oil and refined petroleum products.

China tried late last month to get the Security Council to issue a statement praising the June 12 Singapore meeting between U.S. President Donald Trump and North Korean leader Kim Jong Un and expressing its “willingness to adjust the measures on the DPRK in light of the DPRK’s compliance with the resolutions.”

North Korea’s official name is Democratic People’s Republic of Korea (DPRK).

But the United States blocked the statement on June 28 given “ongoing and very sensitive talks between the United States and the DPRK at this time,” diplomats said. The same day, U.S. Secretary of State Mike Pompeo spoke to his Chinese counterpart Wang Yi about the importance of sanctions enforcement.

U.S. Secretary of State Mike Pompeo is due to informally brief U.N. Security Council envoys along with South Korea and Japan on Friday.

Diplomats say they expect Pompeo to stress the need to maintain pressure on North Korea during his briefing on Friday.

In a tweet on Wednesday Trump said he elicited a promise from Russian President Vladimir Putin to help negotiate with North Korea but did not say how. He also said: “There is no rush, the sanctions remain!”

The United States accused North Korea last week of breaching a U.N. sanctions cap on refined petroleum by making illicit transfers between ships at sea and demanded an immediate end to all sales of the fuel.

The United States submitted the complaint to the U.N. Security Council North Korea sanctions committee, which is due to decide by Thursday whether it will tell all U.N. member states to halt all transfers of refined petroleum to Pyongyang.

Such decisions are made by consensus and some diplomats said they expected China or Russia to delay or block the move.

When asked on June 13 about whether sanctions should be loosened, Russian U.N. Ambassador Vassily Nebenzia said: “We should be thinking about steps in that direction because inevitably there is progress on the track that should be reciprocal, that should be a two-way street. The other side should see encouragement to go forward.”

The proposals of both the United States and Russia are likely to be vetoed by each other, resulting no real changes, but what it displays is the foreign policy positions of both nuclear powers towards the relative position of the DPRK and its rhetorical move towards denuclearization. The US demonstrates that its campaign of increased pressure on the North is necessary to accomplishing the goal of a denuclearized Korean peninsula, while Russia’s philosophy on the matter is to show a mutual willingness to follow through on verbal commitment with a real show of action towards an improved relationship, mirroring on the ground what is happening in politics.

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