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NEW DELHI I SATURDAY I JULY 21 I 2012

TheIndian EXPRESS
www.indianexpress.com

The Indian EXPRESS

BECAUSE THE TRUTH INVOLVES US ALL

RIDAYS decision by the empowered group of ministers on telecom, asking the cabinet to take the final call on the reserve price for auctions of 2G spectrum, shows how carefully the UPA government is treading. Assuming the cabinet will not have reasons to differ, the EGoMs decision could bring enormous relief to the government. On the basis of the recommendations, it will earn far more than the Rs 40,000 crore projected this fiscal, which means it can worry less about the need to push through politically unpalatable measures like the reduction of oil subsidy. But a decision on the auctions will also mean there will be a huge shakeout in the sector. Any reserve price in the region of Rs 14,00016,000 crore, bundled with a higher spectrum usage charge, is just another way of restating the Trai recommendation of a price of Rs 18,000 crore and above for a packet of 5 megahertz band. It carries the risk of making the returns on the capital employed for quite a few companies turn negative. Even if we assume that a sunk cost is not the correct basis to judge how a company will do in the future, there are other problems. Telecom companies will need to hike tariffs in the range of 15 to 25 per cent right after they put in the bids, and that will certainly drive away a category

Decision on spectrum reserve price helps, but it will take more for the telecom story to look up again
of customers. The Trai estimates the hike will be lower, but this is predicated on the assumption that the companies will manage to get around half their revenues from data services in a few years (around 12-14 per cent currently) and customers will start using their phones even more intensively. Then there are concerns about how the banking sector will provide the large-scale loans required. The government still has to come up with M&A norms that give clarity on whether spectrum can be freely traded, as banks will otherwise find it useless to lend against mortgaged spectrum, which has a limited market. As Trai chief Rahul Khullar has pointed out, telecom companies have a huge debt overhang. Bharti, for instance, has a debt-equity ratio of 2.8, and others are worse off. While Khullar may argue that some of this was created by the exuberant bidding for 3G, it happened as telecom companies were convinced that there would be no more spectrum available for quite some time. That the subsequent kerfuffle was not anticipated by anyone doesnt speak well of the regulators foresight. While the EGoM is believed to have okayed a deferred payment of the spectrum bid price that the Telecom Commission had turned down, there are still too many loose threads for Indias telecom story to look promising again.

Up in the air, still

Flare-up with NCP shows how Congress culture of opaqueness creates problems for UPA
as a way of making themselves heard within the coalition. Of course, lack of communication is a Congress affliction first and only later a UPA problem. Even in the matter of Pranab Mukherjees candidature for president, for instance, the party high command kept Mukherjee waiting and wondering till the absolute last moment. But while Congressmen and women may have learnt to adapt to this culture of opaqueness, allies have less reason to submit to it. At the governmental level, there are spaces and committees for the Congress to meet its allies as ministers but there are no institutionalised forums for the political leaderships of the parties in the UPA to interact with each other. Mainly due to Left pressure, UPA 1 had mechanisms of political, not just governmental, coordination. UPA 2 has discarded them all. In effect, therefore, UPA 2 functions as a single-party government, rather than the coalition that it really is. The hostilities between the NCP and the Congress may blow over, if they havent already, but the Congresss refusal to talk to its allies will continue to haunt the UPA.

Silent treatment

UST when it seemed that the Congress had won a reprieve from its several ally troubles, came a warning of another repressed storm flaring to the UPAs surface. Earlier this week, there was some restiveness in the NCP after the Congress indicated that, following Pranab Mukherjees exit, Defence Minister A.K. Antony, not Agriculture Minister Sharad Pawar, would be elevated to the No. 2 position in the government. Then, what began as a controversy over seating arrangements appeared to balloon into a full-blown crisis. It remains to be seen whether the NCP was merely ratcheting up pressure ahead of a cabinet reshuffle or sending out an early signal for a renegotiation of its position in 2014. But this much is clear: the latest episode has once again underlined the lack of communication within the UPA. The absence of regular and predictable channels of communication between the Congress and its partners has at least two related effects. One, the Congress is not able to prevent or pre-empt a crisis before it bursts into public view. And two, allies are pushed into armtwisting and grandstanding in public

HERE is a lively debate in political science on whether nationalism is bad for democracy. While an overwhelming majority suggests that nationalism, by virtue of its illiberal nature (since it elevates collective identity over individual liberty and choice), could threaten democracy, some scholars insist that under certain circumstances, nationalism might facilitate the spread of democracy. For instance, to the extent that a strong national identity is a prerequisite for building a democratic nation-state, nationalism could be a positive force. In addition, nationalism could rally different groups in the overthrow of a dictatorship. It is unlikely that this theoretical question will ever be settled at a general or abstract level anytime soon. But what is clear, at least to people with enough common sense, is that the relationship between nationalism and democracy is most likely determined by a specific national context. With such observations in mind, we may now explore a real but important question: is Chinese nationalism bad for democracy? In the last two decades, Chinas rise has been accompanied by a disquieting phenomenon rising nationalism. Survey data, press reports and scholarly research all indicate a heightened level of nationalist sentiments. To be sure, these sentiments are diverse. Genuine pride in Chinas rapid modernisation constitutes one strand. Resentment of the West for criticising Chinas human rights record forms another. In particular, anger at the United States for its perceived containment strategy against China is a key ingredient of contemporary Chinese nationalism. A sense of national victimhood, drawn from Chinas humiliation at the hands of Western powers from 1840 to 1949 (often referred to as the century of humiliation), similarly informs many Chinese nationalists today. Resurgent nationalism presents the ruling Chinese Communist Party with both opportunities and risks. The party came to power by exploiting Chinese nationalism and presented itself as the defender of Chinas national honour.

Party and the patriot

Chinas communists have used nationalism to keep a democratic transition at bay
MINXIN PEI
The founding myth of the Peoples Republic is essentially a tale of how the Communist Party fought heroically for Chinas national survival and ended the countrys century of humiliation. Although historical research has uncovered vital inaccuracies and falsehood in the partys claims (for instance, the much-reviled old nationalist regime, not the communists, actually did most of the fighting against the Japanese), the party has been extraordinarily successful in maintaining this mythology, in part thanks to its ruthless but effective censorship. As in the past, the party today finds Chinese nationalism a convenient and valuable political resource. Cultivating such sentiments would allow the party to portray the democratic West as an Party needs economic prosperity more than nationalism to stay in power. And economic prosperity is not possible without trading with the West, Chinas largest export market and main source of capital and technology. Clearly, the party could not afford to antagonise the West so much that their vital economic relationship is jeopardised. Another substantial risk is that fuelling nationalism can backfire politically. Just as the communists used nationalism against the nationalists in the 1930s and 1940s, nationalism may be exploited by the dissidents and other elements in Chinese society as a rallying cry against the partys rule. Indeed, in many diplomatic crises, Chinese nationalists would typically vent their anger on the West first and then quickly turn

But fanning nationalism is not without risks. The Communist Party needs economic prosperity more than nationalism to stay in power. And economic prosperity is not possible without trading with the West. Another substantial risk is that fuelling nationalism can backfire politically. It may be exploited by dissidents.
evil force bent on continuing to keep China down through its human rights criticisms, support for Chinese dissidents, and military ties with countries that are Chinas historical foes (such as Japan and India). By wrapping itself in the Chinese flag, the party could find a new source of political legitimacy and gain support from the same Chinese population to whom it denies essential civil liberties and political rights. So in the post-Tiananmen era, the party has devoted enormous resources to nationalist propaganda, education programmes, and symbols. The most spectacular example is, without doubt, the 2008 Beijing Olympics. But fanning nationalism is not without risks. One obvious problem today is that the Communist their ire towards the government (it is reported that the Chinese foreign ministry has received many unsolicited packages of calcium pills with the implicit message that it should toughen its diplomatic bones). The benefits and costs of manipulating nationalist sentiments have forced the party to settle on a high-risk strategy. In ordinary times, it would keep its propaganda machine running at full speed to foster nationalism, but during crises, it would use its censorship system to restrain nationalist outbursts to avoid escalating the crises. Needless to say, this strategy has incurred significant costs. Although China may have preserved its economic ties and basic diplomatic relations with the West and

its neighbours, outbursts of Chinese nationalism, seen as manipulated and encouraged by the government, have left bitter feelings and sowed strategic distrust. For the party, such costs are worth bearing. Since the partys most vital interest is self-perpetuation, tapping into Chinese nationalism should be part of its survival strategy if doing so could forestall democratisation in China. Although it may be too early to say that such a strategy is sustainable, there is some evidence that the partys thinking may be right. One of the most fascinating developments in China today is the rebirth of a public discourse on democracy. There are many notable features of this incipient public debate. For example, this debate may mark the beginning of a long-delayed democratic transition process in China. In addition, the debate is often framed in terms of the failure of the current Chinese political system and the need for an alternative. There are three types of participants in this debate: liberals, defenders of the regime and nationalists. The views of the first two groups are evident. The most interesting and disturbing perspectives on democracy are those of Chinese nationalists. At the risk of oversimplification of their views, we may summarise their perspective or narrative on democracy as the following: Because the West does not want to see a powerful and prosperous China, it is encouraging a regime change in China so that China could be plunged into national turmoil. China must never fall into this trap, however flawed the status quo is. Unfortunately, such a perspective hardly differs from the Communist Partys position on democracy. So one may have to grudgingly concede that the partys appeal to nationalism has been a success and that Chinese nationalism will be an obstacle to democratic transition in China in the future. The writer is a professor of government at Claremont McKenna College in the US
express@expressindia.com

EDITOR Letter of the

Letters to the

WEEK

Dressing down

IT IS a shame that the

NCW head blames incidents of molestation on the way women dress, instead of criticising male attitudes towards women. Even if a woman dresses provocatively, it does not give men the right to molest her. The comment shifts the blame on to victims and tries to justify the culprits actions. The NCWs Mamta Sharma is no different from the Canadian policeman whose remarks on women drew protests worldwide. Ashok Goswami Mumbai

Her plight

THIS refers to The

Guwahati frames (IE, July 18) by Syeda Hameed. She has rightly shown the plight of women. We talk a lot about the right to freedom of expression, but there are so many instances when a girl is scared of raising her voice against the brutalities meted out to her only because she doesnt have any sense of security. Nida Tahir Srinagar

Amar Prem

INDER MALHOTRA

Very Indian Phenomenon

The British created VIPs, independent India embraced them
dian VIP. From the morrow of Independence, all ministers were entitled to fly the national flag on their cars and in their homes. Cabinet ministers had the additional right to display on their vehicles the Ashoka emblem. When Nehru went to his first Commonwealth prime ministers conference in London, he found that no British minister, including the prime minister, flew the flag on their limousine, a practice that continues even today. On returning home, he discarded the flag on his own Ambassador and told his colleagues to do the same. The scramble for the VIP means. In sharp contrast to what prevails in the US, the superwealthy in India dont need to proclaim themselves VIPs. They get whatever they want without saying a word. The whole system seems geared to their needs and wishes. The odd tycoon who gets caught on the wrong side of the law lives in jail in greater luxury than five-star hotels can provide. It is the political class, the army of bureaucrats and those who can muscle into the establishment (a great many do, including some whose only qualification is that they are related to some high up in power) that form the bedrock of der terrorism on the Indian scene had added to the woes of the helpless non-VIPs in direct proportion to the burgeoning privileges and pampering of those more equal than the rest. However, there is nothing so grim as not to have a comic side to it. Nothing causes so much resentment and bad blood among VIPs as a higher category of security assigned to someone else. They get angrier when told that security classification depends not on the status or seniority of the individual to be protected but on the threat perception by intelligence agencies. What has taken over in a big way is the craze, and competition, for the red beacon or lal batti atop the cars. At first the privilege was restricted to a few at the very top but then it spread like an epidemic. Mercifully, the move to extend the right to lal batti to all the 800 MPs has been stalled for the present, at least. But imagine the havoc it would cause for the traffic in the nations capital when members of Parliament do get their coveted red beacon, as they almost certainly will. And please do not forget that what is sauce for MPs in Delhi is sauce also for MLAs in states. The writer is a Delhi-based political commentator
express@expressindia.com

WEEK before the Olympic cauldron is lit in London, Lord Sebastian Coe, the head of the London Games organising committee, is in an unenviable position. Despite years of planning and careful execution, the city is finding that its preparations arent quite watertight. Everything that can go wrong, has. The wet English summer has been wetter, sparking fears of waterlogging at a few venues. There were renewed security concerns following news of a shortage of personnel, which led to Britain calling back 3,500 troops from Afghanistan for the Games. Heathrow, one of the busiest airports in the world, is stretched to its very limit and beyond. There are project delays, traffic snarls, cab drivers strike and cost overruns. All this and more led the British tabloid The Sun to run a screaming headline, OOPS, cre-

The run-up to Olympics may be riddled with anxieties, but thats just part of the Games
atively using the Olympic rings to spell out the word. While the concerns are genuine, there is no reason to press the panic button just yet. Coe & Co. can, in fact, take heart from the fact that such situations arent unprecedented. In fact, even a cursory look at the history of Olympics and other major sporting events will show that these are almost routine. And who knows it better than Indians, who have dealt with everything from leaking roofs to collapsing bridges en route to delivering what were almost universally hailed as a successful Commonwealth Games. There were scandals as well, but thats a different story. Therefore, while it is only natural for London to hold its collective breath, theres reason to hope and believe it will exhale in relief and pride once the flame is put out on August 12.

Its okay, London

NE of Paul Krugmans columns in a recent issue of The New York Times startled me. For, its subject was VIP, an expression I had never before encountered during my frequent visits to, and a rather long stay in, the United States, either in the American media or in public and private discussions. From the article, it is clear that Krugman himself was taken aback when he heard the threeletter acronym, which stands for Very Important Person, being bandied about. The occasion was Republican presidential nominee Mitt Romneys fund-raiser, where a donor waiting to get in demanded sternly, Is there a VIP entrance? We are VIPs. This, according to the columnist, pretty much sums up the attitude of Americas wealthy elite Romneys power base is composed of very self-important people (comprising) the top 0.01 per cent of the population. Nobody else throws his or her weight around in that country, and the common person doesnt give a damn about VIPs. Here, of course, the situation is hugely different. The VIP status is flaunted in the face of countless millions every day, round the clock and round the calendar. You dont have to spell out the word; everyone knows what it

infectious smile is no more. The hero of so many hit movies leaves us with a line on our lips: Zindagi, kaisi hai paheli, haye. In a memorable scene in Namak Haram , the union leader Somu, played by Rajesh Khanna, confronts his friend and abrasive factory owner Vicky, played by Amitabh Bachchan. Vicky berates Somu, the latter retorts that Vicky is no longer his friend. This scene symbolises the evanescence of innocence. The hero who made sacrifices soon got replaced by a hero who beat up his rivals. A new ethos unfolded for the industry and society at large. The death scene in Anand has never been bettered in Hindi cinema. That movie showcased the brilliance of Khanna, the ever-smiling cancer patient who dies, leaving the immortal message, Zindagi aur maut uparwale ke haath mein hai, Jahanpanah. G.S. Iyer Pune
RAHUL GANDHI has apparently declared that he is now ready to share larger responsibilities either in the government or the party (Wait over, Rahul says ready for larger role, IE, July 20). This declaration is part of a plan to eventually thrust the partys or the governments leadership on him, regardless of his qualifications for the job. This kind of planning is not done for other young leaders of the Congress party. The people of India have yet to free themselves from the stranglehold of dynasty and enter the true age of democracy. Mathew Oommen Pune

THE superstar with the

The descendant

Somewhere down the line, the English class system and Indias deathless caste system must have rubbed off on each other to produce the wonder that is the Indian VIP.
the VIP cult and the perks and privileges that go with it. Like much else, the VIP is a legacy of the British Raj. Independent India has not only embraced it with gusto but also expanded it vastly. For instance, all through the British rule, only the viceroy and the governors of 11 British Indian provinces could fly the flag on their cars. The only exceptions were army generals. Somewhere down the line, the English class system and Indias deathless caste system must have rubbed off on each other to produce the wonder that is the Instatus then took other manifestations. For example, Mohanlal Saxena wrote to Nehru that though he was a minister of state, he held full charge of the ministry of rehabilitation. He saw no reason, therefore, why the gates to his bungalow should be without the globes of light that adorned the entrances to cabinet ministers homes. Flags on the VIPs cars reappeared soon, though usually sheathed rather than fluttering. Meanwhile, the events of the 1980s in Punjab and Kashmir, and the appearance of cross-bor-

State of states

APROPOS Dengs

WORDLY WISE
Voltaire

It is lamentable, that to be a good patriot one must become the enemy of the rest of mankind.

HE national unity government that Prime Minister Ben- the ultra-Orthodox camp, and to make progress on matters of najamin Netanyahu and Kadima leader Shaul Mofaz set up on tional interest, such as improving relations with the US, reviving negoMay 8 as an alternative to holding early elections has tiations with the Palestinians, preparing the budget for a recescollapsed after 70 days. All the expectations and hopes that a sion, and solving the crisis over the draft... New elections broad coalition with the participation of Kadima would bring must be declared early. And the time that is left before those about changes in the foreign policy and internal policy of the PRINTLINE elections are held must be exploited by the camp opposed to right-wing and ultra-Orthodox government, have been the coalition of Netanyahu and his natural partners. proven false... Netanyahu was given a rare opportunity to free himself from the hold of his natural partners from the extreme right and From a leader in the Haaretz, Tel Aviv

Benjamin Netanyahu has wasted a chance to break free of extremist moorings

United they fall

grandchildren by Sanjaya Baru (IE, July 17), China is experimenting with bottom-up reforms, but the situation in India is very different. Indias vast potential is hampered because the states are not given the space to grow. More powers should be given to the state to evolve policies specific to its socio-economic situation. M.K. Mahapatra Pune