November 2008, Vol. 3, No. 10

Obama's Win: The View from South Asia

Propitiate the BullBarack Obama's victory resonated across South Asia last month. The initial euphoria soon gave way to considered reflection of its implications for countries in the region. While India waited with bated breath for Obama's phone call, Pakistan, likely to be central to Obama's foreign policy, had mixed reactions. Obama's campaign rhetoric to take military action in Pakistan if the army is unwilling or unable to eliminate terrorists worries many Pakistanis, writes Salman Siddiqui. Some worried that Pakistan would receive lesser assistance from the United States when Democrats are in power, while Iqbal Ahmed argues that Republicans have more readily embraced military dictators. Indian policy circles were also cautious in their assessment of Obama given his stated commitment to ratify the Comprehensive Test Ban Treaty (CTBT), which India opposes. Moreover, Obama's linkage of Pakistan's failures on the Afghanistan border to Kashmir received severe criticism in some Indian quarters. Kuldip Nayar argues that the link is flawed and India and Pakistan don't need a mediator to solve the Kashmir problem.

Read more.

In this Issue:

  1. Feature: Obama's Win: The View from South Asia

  2. Carnegie Events and Analysis
    Stabilizing Afghanistan: Threats and Challenges; Asia's Democracy Backlash

  3. Views from South Asia:

    Foreign and Domestic Politics

    Hindu Terrorism-Abhinav Bharat and its Army Links; India's Role in Afghanistan; Navy thwarts Somali pirates;

    Economics and Development
    Economy in Trouble-Next Steps; India and the G-20 Summit

    Zardari's domestic front; IMF bailout and its implications; Privatization of national assets; Drone attacks outside FATA; Balochistan earthquake

    BNP to participate in elections, defers dat; Bangladesh battles climate change

    Youth Communist League-Watchdog or Menace?; Return of the King?

    LTTE: The end is nigh; now what?; Election time or political opportunism?

Editor's Note
As South Asian Perspectives was put to bed, news of deadly terrorist attacks in Mumbai broke. Almost three days of fighting left more than 190 dead and hundreds more wounded. The forthcoming December issue will appear mid-month and closely examine the Mumbai bombings and their impact for relations between Pakistan and India.

Barack Obama's victory resonated across South Asia last month. The initial euphoria, though, soon gave way to measured reflection of its implications for countries in the region. The Indian press worked overtime to figure why Prime Minister Singh was not one of the first nine world leaders Obama called. Many are wondering whether Obama's win means a reversal of trend in the U.S.-India relationship, which flourished under Bush. Pakistan's policy circles debated whether Obama will follow through on campaign rhetoric to undertake military action in Pakistan if the army is unwilling to eliminate terrorists. Commentators in Bangladesh, increasingly cynical of their political parties, saw reason for hope in the Obama win. Some though, were disappointed that McCain, who adopted a Bangladeshi girl, did not win. In this month's feature, commentators from the region dissect the implications of Obama's victory.

In India, a new phrase is entering the lexicon–‘Hindu Terrorism'. An investigation into the Malegaon blasts revealed it was carried out by Abhinav Bharat, a Hindu extremist group claiming that its actions were a response to Islamic terrorism. The involvement of an army colonel in the planning and execution of the blasts has set off a debate about the politicization of the armed forces. Harsh V. Pant and Maroof Raza dismiss the notion completely.

The International Monetary Fund (IMF) has been strongly criticized in Pakistan despite being the country's only hope for a financial bailout. M. Ziauddin thinks the Fund's conditions are not the problem–their selective application by the Pakistan government is. IMF conditions impacting the poor are readily adopted while conditions impacting the rich are not. Eventually the program is simply abandoned.

The Bangladesh Nationalist Party (BNP) decision to participate in the forthcoming general elections has made them more credible. While BNP's participation is a welcome move, the continuing emergency in the country makes campaigning effectively impossible. Shameran Abed deconstructs the reasons provided by the government to justify the emergency.

Violent protests and strikes crippled Kathmandu in November. Student groups began warring after the alleged murder of two youths by Youth Communist League, the youth arm of the ruling Maoist party. Shyam KC ponders the irony of Maoists condemning violent protests when they themselves conducted an armed struggle against the state not too long ago.

If government reports in Sri Lanka are to be believed, the battle against Liberation Tigers of Tamil Eelam (LTTE) is reaching its last phase. The Sunday Leader reports that because the battle is far from over and the economy is going into recession, the government is mulling a snap poll.

Ashesh Prasann
Editor, South Asian Perspectives



Propitiate the BullObama's Win: The View from South Asia
An editorial in the Telegraph notes that the Indian Prime Minister, Manmohan Singh, was not one of the first nine leaders Obama called after his victory. This omission, combined with his promise to ratify CTBT and predisposition towards diplomatic intervention in Kashmir, both of which are counter to official Indian positions, give reason to qualify the optimism surrounding Obama's win. (The Telegraph, November 7, 2008)

The Hindu dismisses both apprehensions and hopes generated in India's official circles by Obama's victory. Questioning the idea that Obama would reverse the gains made in the bilateral relationship with India, the editorial board argues that all sections of the U.S. establishment support the ongoing strategic cooperation with India. The paper also argues that the Pakistani army should end its involvement in politics, a goal which Obama supports. (Hindu, November 7, 2008)

In an interview with Outlook, Karl Inderfurth, a foreign policy adviser to Obama, denied that the Obama administration would mediate the Kashmir problem between India and Pakistan. He argued that Obama's commitment to ratifying the Comprehensive Test Ban Treaty (CTBT) would not present a problem for India , if the United States were to lead by example. (Outlook, November 17, 2008)

S.L. Rao looks at India's present and past political leaders and bemoans the absence of an Obama-like figure after Jawaharlal Nehru. He does not expect much to change in the next elections despite some commentators' attempts to cast Mayawati as the ‘Indian Obama'. (The Telegraph, November 18, 2008)

Khalid Aziz thinks Obama may not be able to change course in Afghanistan despite campaign promises. Given that Europe is not inclined to supply more troops, the United States will have to continue with the current holding strategy in Afghanistan. This will result in greater U.S. pressure on Pakistan, which will only eliminate a few al-Qaeda leaders. He concludes that the solution to the Afghan problem lies in Afghanistan and not in Pakistan. (The News, November 11, 2008)

Iqbal Ahmed Khan points out that though Republican administrations have focused more on Pakistan , they have also embraced military dictators more readily than Democrats. He welcomes the Biden-Lugar bill increasing non-military aid to Pakistan and believes that Pakistan's vision of its own future should be a democratic, welfare state committed to cooperation with Afghanistan and India . (The News, November 18, 2008)

In an anecdotal survey, Salman Siddiqui finds that most Pakistanis would have preferred John McCain as president. The sentiment is born out of the impression that Obama is inclined to bomb Pakistan and will push the country towards signing the NPT and the CTBT. (Dawn, November 5, 2008)

India and Pakistan's obsession with how the U.S. views them smacks of a colonial slavishness. Kuldip Nayar argues that the two countries don't need U.S. mediation to solve any bilateral differences. He welcomed Ahmed Rashid's nomination as an advisor on Afghanistan but criticized the linkage Obama advisors have made between Afghanistan and Kashmir. (Dawn, November 14, 2008)

Zafar Sobhan thinks Obama's presidency will undercut Bangladesh's religious extremists who were helped by the Bush regime's policies. He also dwells on Obama's message of hope and believes that it resonates in the country, which has become increasingly cynical about politics. (Daily Star, November 24, 2008)

Carnegie Events and Analysis

Stabilizing Afghanistan: Threats and Challenges
William Maley Stability in Afghanistan depends on the United States and its Afghan and other allies providing security for the Afghan people. Calls for an Iraq-style “troop surge” ignore the immediate need for a comprehensive political strategy to fix Afghanistan's fragile security structure, dysfunctional system of government, and unstable borders, warns a new policy brief by Afghanistan expert William Maley.
Click here for the full interview.

Joshua KurlantzickAsia's Democracy Backlash
Over the last two years, the military supported caretaker regime in Bangladesh has declared emergency and detained thousands of political activists to purportedly remove graft from politics. Bangladesh is not alone in South and Southeast Asia which is experiencing undemocratic developments after a wave of democratization in the 1990s, writes Joshua Kurlantzick.
Click here to read the full text

Views from South Asia

INDIA - Foreign and Domestic PoliticsJamia students peace march

Hindu Terrorism - Abhinav Bharat and its Army Links
Investigation into the Malegao blasts, which occurred outside the Student's Islamic Movement of India (SIMI) office, revealed that they were carried out by hard-line Hindu groups. The uncovering of Hindu terrorists has debunked the myth propagated by the right-wing Bharatiya Janata Party (BJP) that all terrorists are Muslims, asserts an editorial in the Hindu. (The Hindu, November 3, 2008)

Praveen Swami points out the irony evident in BJP's defense of Hindu terrorists– the same reasons were previously employed by Islamists, who were then criticized by the same BJP. He also traces the historical roots of Abhinav Bharat, the group linked to the Malegaon blasts, and concludes that they were inspired by the same fascist sources as Islamic radicals. (The Hindu, November 5, 2008)

An editorial in the Business Standard argues that political parties apart from the BJP have also been reluctant to condemn militancy from their constituencies. Political outfits like the Akali Dal were even actively associated with the militancy in Punjab in the 1980s and are now part of the political mainstream. It also criticizes the notion that the blasts were a ‘reaction' to Islamic terrorism. (Business Standard, October 26, 2008)

Jug Suraiya makes the case that terms like ‘Hindu terrorist' or ‘Islamic terrorist' have no meaning. Any perpetrator of violent crimes is an unqualified criminal, and the addition of qualifiers only leads to self-justifying reprisals and an endless cycle of terror. (Times of India, November 1, 2008)

The involvement of an army official (Lt. Col. Srikant Purohit) in the Malegaon blasts has led to concerns that the Indian Army is politically involved with Hindu nationalist forces. Maroof Raza dismisses the notion, assesses the army's policies on religious practice and concludes that the army has maintained its tradition of being strictly apolitical. (Outlook, November 24, 2008)

Harsh V. Pant attacks Outlook's under-investigated and sensationalist reporting when it posed the question, “Saffron in Uniform?” on its cover. He questions the notion that retired army men joining the BJP indicates a broader trend in the army and demands similar numbers for the Congress. The armed forces are the only institution which has not suffered from the decay in national values which plagues India's politics. (Outlook, November 24, 2008)

India's Role in Afghanistan
In a freewheeling interview with Outlook, India's ambassador to Afghanistan, Jayant Prasad, talks about the July bombing of his embassy and the inspirational manner in which his staff responded to the killing of their colleagues. India does not believe in exporting democracy to Afghanistan and focuses instead on providing humanitarian assistance, food, medical services, and building infrastructure, he says. (Outlook, November 10, 2008)

India has legitimate interests in Afghanistan and Britain regards it as a partner in the country, said Sherard Cowper-Cowles, UK ambassador to Afghanistan. In an interview with Times of India, he also outlined NATO's strategy in Afghanistan: encourage Afghans to lead counterinsurgency operations, keep up the military pressure, and then negotiate with the reconcilable elements in Taliban. (Times of India, November 11, 2008)

Navy thwarts Somali Pirates
The Indian Navy blew up a pirate ship in the Gulf of Aden where Somali pirates are becoming a menace. A Times of India editorial praises the Navy's work but notes that the government decided to send ships to the region only last month after eleven nationals were held on a hijacked Japanese ship. It argues that apart from the need to protect its economic interests, India, as a rising power, should be able to protect its citizens. (Times of India, November 13, 2008)

INDIA - Economics and Development

Economy in trouble - Next Steps?

Arvind Subramanian reconciles the apparent contradiction between the credit crunch supposedly affecting markets and the 30 percent growth in credit in India . The answer lies in two forces acting simultaneously. Credit demand increased after foreign funding dried up in the private sector, leaving insufficient credit for present needs. At the same time, private players are being crowded out of credit markets by the government which seeks to finance oil companies, thus accelerating credit growth. (Business Standard, November 5, 2008)

Percy S. Mistry outlines the steps India should take to maintain a growth rate of 5-6 percent in the next two years. These include cessation of exchange rate management, pooling together of government equity in banks and IMF funds, and entering into rupee-swap arrangements with the United States , China , and the IMF. (Business Standard, November 2, 2008)

The inflation rate fell this month, much to the relief of Indian consumers and the government. An editorial in the Telegraph dissects the trend reversal and identifies oil, steel, and textiles as its chief contributors. Since India is a major importer of the first and exports the other two products, their prices are impacted by the global market rather than the domestic. (The Telegraph, November 17, 2008)

The reduction in oil prices and general deflation may have one positive effect – India could get its new nuclear power plants at much lower cost. The much-touted ”nuclear renaissance” could stall if countries experiencing financial crunch cancel their orders, thus creating a buyers' market in the nuclear power industry. Given the circumstances, Vandana Gombar concludes that nuclear power will be competitively priced if India negotiates well. (Business Standard, November 4, 2008)

Did the Left save India ? In an interview with Outlook , Sitaram Yechury claims that it did by blocking proposed reform in insurance and banking, thereby insulating India from the global financial crisis. He also asserts that if the Left had allowed the government to go ahead with its plan to allow full capital account convertibility, the markets would have been hit harder. (Outlook, November 10, 2008) Economist Prabhat Pattnaik agrees. (Outlook, November 10, 2008 )

India and the G-20 Bush signs deal
Arvind Subramanian outlines his recommendations for India's agenda at the G-20 meetings. He argues that India should support efforts to resist protectionism in the short run. In the long run, it should seek to enhance the IMF's resources and change its governance structure to reflect the current global power configuration. He believes that the meetings give India the opportunity to punch above its weight and it should capitalize. (Business Standard, November 11, 2008)

Yours truly, Ashesh Prasann, examines one of Singh's recommendations for responding to the economic crisis-injecting liquidity into the global economy. A systemic change in global finance requires fresh allocation of Special Drawing Rights (SDRs) and a move away from the dollar reserves system. Because of the way the IMF is structured, this can only be done with the United States' cooperation. (The Asian Age, November 13, 2008)

Prabhat Pattnaik writes that the injection of liquidity is not sufficient. A boost to global demand is necessary and only coordinated government action can prevent a prolonged recession. He also warns that the third world will be impacted despite its relative insulation from global markets and food insecurity will increase. (Outlook, November 14, 2008)

Back to the top


Asif Zardari and Bush

IMF Bailout and its Implications

Lack of credibility emerged as a key factor in Pakistan's bailout negotiations with China, Saudi Arabia and the IMF. Yousuf Nazar argues that this is because of the government's failure to act on the World Bank's advice to reduce subsidies in March. This failure to remove subsidies has compounded problems by increasing inflation and it no longer be controlled by reducing interest rates. (Dawn, November 18, 2008)

Pervez Tahir thinks IMF assistance should remain a standby arrangement and should not prevent Pakistan from drawing up a blueprint for reform. Necessary reforms include fiscal discipline, increased taxation, and borrowing only for investments. (Dawn, November 21, 2008)

Abdul Sattar agrees. He further thinks Pakistan needs a serious austerity program similar to the one adopted in 1999. He also believes that the IMF loan will reassure other countries which have previously refused to give any funds to Pakistan. (Pakistan Observer, November 18, 2008)

Why do we love to hate the IMF? M. Ziauddin thinks the Fund's conditions are not the problem–their differential application by the Pakistan government is. IMF conditions which impact the poor are readily adopted while those conditions impacting the rich are not adopted, before the program is eventually abandoned. (Dawn, November 15, 2008)

Meanwhile, Raza Rumi thunders that the IMF program will produce a “social holocaust.” (The News, November 1, 2008)

Zardari's Domestic Front

Ayesha Siddiqua thinks President Zardari lacks political wisdom. Rather than attending to the injured after the Marriott blasts and the Balochistan earthquake, he was seen making foreign trips, albeit to raise cash that Pakistan desperately needs. She attributes the poor image management to overly centralized authority - the president is not hearing views from the ground up. (Dawn, November 14, 2008 )

A similar diagnosis is made by Asha'ar Rehman who writes that the government's attempt to quell the lawyers' movement hasn't worked. Even though some lawyers deposed by Musharraf have been brought back, Justice Chaudhry has not been reappointed as Chief Justice. Zardari's much vaunted reconciliation initiative has stalled because his small, closed group of trusted advisors urge him to focus on more ”important” matters. ( Dawn, November 19, 2008 )

Cyril Almeida gazes at the crystal ball and predicts Nawaz Sharif will make a bid for power in March 2009. The Punjab senate elections, expected to favor Zardari's Pakistan People's Party (PPP), nomination of a new chief justice from the lawyers movement, and Obama's new Afghanistan strategy will compel Sharif to seek power in that month.. Where the first two could strengthen Zardari's hold on power, the third will favor Sharif's coalition, which is supported by Islamists. ( Dawn, November 21, 2008 )

Privatization of National Assets

Is privatizing national assets a good idea? The government argues that the Qadirpur gas fields need to be privatized because the government owned managing company lacks the technological resources to undertake deep block drilling. Shakil Ahmed wonders why the government cannot undertake technological modernization in Qadirpur, given that it makes considerable profit. (Pakistan Observer, November 11, 2008)

Akhtar Hasan Khan makes the economic case against privatizing the Qadirpur gas field. He argues that the full extent of gas deposits has not been investigated and the government is giving away a strategic asset at a low price. (Dawn, November 17, 2008)

An energy-sector boom looks likely in the near future, particularly for renewable energy technology. M. Asif sees an opportunity for Pakistan to produce energy systems but it can capitalize on it only by importing technology from abroad and undertaking reverse engineering-building the same equipment domestically after deconstructing it. (Dawn, November 18, 2008)

Drone Attacks Outside FATA Militants captured

Militant attacks in Peshawar, 270 miles from South Waziristan, suggest that extremists are more widespread than imagined, according to Khalid Aziz. This is part of a strategy to draw the Pakistani army away from the operations in Bajaur and Mohmand. It also tests the limits of the drone attack tactic adopted by the United States. In conclusion, Aziz wonders whether the U.S. military will now target urban centers like Peshawar and Bunnu? (The News, November 18, 2008)

As if in response, the U.S launched a drone attack on Bunnu soon after. Ayaz Amir examines the implications of the first drone attack outside FATA, previously considered unthinkable. He thinks the change from Musharraf to Zardari has helped America–a ‘yes-man' was replaced by a democratically elected ‘yes-man' who cannot defend Pakistan's sovereignty. (The News, November 21, 2008)

The idea of Pakistan negotiating a settlement in FATA which returns power to maliks, the erstwhile tribal leaders, is wishful thinking, writes Faras Zaki. The militia leaders, who have now tasted power, come from the lower strata of society and would be loath to return to the old status quo. A more participative democracy in the region could defuse such class tensions. (The News, November 20, 2008)

Balochistan Earthquake

The provincial government of Balochistan has admitted it cannot provide relief before making damage assessments, reports Murtaza Razvi. Without government help, survivors of the quake are left to the mercy of the elements. The onset of winter could result in more loss of life than the quake itself. (Dawn, November 6, 2008)

Back to the top


Sheikh Hasina waves

BNP to participate in elections

The Daily Star welcomes the Bangladesh Nationalist Party's decision to participate in the general elections. It also exhorts the BNP to follow Awami League's lead in nominating more women and fresh faces. (Daily Star, November 22, 2008)

Khaleda Zia and Sheikh Hasina, leaders of the two main parties in Bangladesh, met cordially and the news made headlines. A Daily Star editorial muses on how adversarial politics have translated to such intense personal animosity that the two cannot have a respectful relationship. (Daily Star, November 23, 2008)

With elections around the corner, a state of emergency continues in Bangladesh. Shameran Abed criticizes the various reasons the government has given to justify the state of affairs. He argues that the smooth development of an election atmosphere is an absurd reason to continue the emergency. (New Age, November 18, 2008)

Bangladesh battles climate change

Bangladesh will lose 17 percent of its landmass by 2050 because of climate change. The issue has turned political as farmers in Gaibandha are demanding compensation for damages to their land. A New Age editorial calls upon political parties to mobilize the country's interests at global forums. (New Age, November 20, 2008)

In an interview with the New Age , Saleemul Haq says developing countries will need up $100 billion each year to adapt to climate change. He argues that the money should be generated through cap-and-trade systems and levies on air travel. (New Age, November 20, 2008)

Back to the top


Prachanda gesturesYouth Communist League – Watchdog or Menace?

The killing of two youths, allegedly by the youth wing of the ruling Maoist party, the Young Communist League (YCL), has led to strikes and violence crippling Kathmandu . Shyam K.C. argues that the street protests turned violent only because the government ignored the issue until tensions reached the breaking point. He ruminates on the irony of Maoists condemning violent protests when they conducted an armed struggle against a ‘feudal' state which did not pay heed to their grievances. (Kathmandu Post, November 24, 2008)

Harald Olav Skar wonders how the YCL can be integrated into the new democratic structure. He writes that youth organizations often take on a life of their own, creating the danger of YCL operating as a paramilitary force because its cadres are trained in armed combat and possess arms. (Himal Southasian, October 2008)

Return of the King?

What has the former king been doing in his new civilian role? The Kathmandu Post reports that the king would be willing to enter active politics like the erstwhile royals in India. (Kathmandu Post, November 11, 2008)

Sujeet Arjel detects a consolidation of the opposition forces in Nepal. The royalist Rashtriya Prajatantra Party (RPP) is making a strident call to reinstate the monarchy and non-communist forces are coalescing with them to form a center-right coalition. (Telegraph Nepal, November 18, 2008)

Back to the top


SL forces in KilinochhiLTTE: The End is Nigh – Now What?

It seems certain that the Sri Lankan army will soon capture the LTTE strongholds in the North. In a hard-hitting editorial, the Sunday Leader asks the important question–what happens afterwards? If security forces are to police the north completely, it is unlikely that peace will prevail for long. If the 34 million rupees spent on killing each LTTE militant were to be allocated to developing the North and East, would the Tamil problem remain? (The Sunday Leader, November 23, 2008)

An editorial in the Island argues that the LTTE chief, Prabhakaran, will never be able to enter democratic politics despite President Mahendra Rajapakse's call for talks. Prabhakaran has rejected three presidents' offers for peace talks and India's devolution package in the past. His maximalist goal of creating a separate Eelam state and a standing request for extradition by India leave him with few political options. ( he Island, November 22, 2008)

Election time or political opportunism?

The government in Sri Lanka might call for a snap election as the economy is rapidly deteriorating, argues an editorial in the Sunday Leader. With reserves depleting and entrenched military battles still to be fought, the government is banking on the perception that it needs just a little more time to finish off the LTTE to carry it through the elections. (The Sunday Leader, November 16, 2008)

A Daily Mirror editorial claims that any elections held without impending reforms will be a farce. There is no independent election commission in the country and ruling parties are known to mobilize government machinery and criminals to win. (Daily Mirror, November 24, 2008)

Back to the top


Editorial Staff

Ashesh Prasann, Junior Fellow, South Asia Program, Carnegie Endowment

Carnegie Endowment for International Peace
1779 Massachusetts Avenue, NW
Washington, DC 20005
Ph: 202-939-2332

Subscriber Information
To subscribe or unsubscribe from the newsletter, please click here. For previous issues visit our archive.

We welcome any feedback or suggestions for South Asian Perspectives. To contribute work or list your upcoming events related to South Asia, please email