Dateline Yekaterinburg: Manmohan, Zardari set to break the ice as SCO, BRIC meet

Manmohan Singh has arrived in Yekaterinburg (nee Sverdlovsk) for three days of hectic diplomacy centred around the Brazil, Russia, India, China summit and the Shanghai Cooperation Organisation. But those interactions are likely to be overshadowed by his much-anticipated meeting with the president of Pakistan on June 16, the first since Mumbai put a halt to the bilateral peace process...

16 June 2009
The Hindu
[This is the combined version of a story I split into three for the print edition. The links for the other two stories are here and here]

Manmohan, Zardari set to break the ice
BRIC debut puts the “political” back into economy

Siddharth Varadarajan

Yekaterinburg: With the world‘s eyes riveted on this Russian city on the Asian side of the Urals where the potentially system-shaping international interactions of the Shanghai Cooperation Organisation and the Brazil, Russia, India and China (BRIC) quartet get under way on June 16, Prime Minister Manmohan Singh arrived on Monday with an additional target in his sight: his first encounter with Pakistani President Asif Ali Zardari since last November’s terrorist attacks in Mumbai put bilateral relations into cold storage.

Though the format of the half-hour meeting scheduled between Dr. Singh and Mr. Zardari for Tuesday afternoon has not yet been finalised, senior officials told The Hindu they hoped it would be a one-on-one affair. “That way, there can be the freest possible exchange of views,” an Indian official said. The meeting between the two leaders, which was requested by the Pakistani High Commissioner in New Delhi last week, did not mean India no longer stood by its expectation that Pakistan must act against terrorism emanating from its soil.

“We will express our expectations. This is not a question of presenting a list of demands … But we are clear that terrorists are not going to be given a veto” over the bilateral relationship, a senior official said.

The Prime Minister will hold separate bilaterals with his Chinese, Kazakh and Russian counterparts. Yekaterinburg will also mark the international re-entry of Iran’s President Mahmoud Ahmadinejad, fresh from an election victory the West regards as tainted. Fittingly, a bilateral with Russian President Dmitri Medvedev has already been arranged, and the Indians do not rule out a “pull aside” with him.

Indian officials refused to speculate about what might emerge from the Manmohan-Zardari meeting. “We are against setting markers because all we do is feed the enemies of peace, who then know what they have to do to stop the process,” said an official. At the same time, officials cautioned against the Yekaterinburg encounter being elevated to the status of a “structured dialogue.” While expressing their unhappiness over Islamabad’s “legalistic” handling of the case of Lashkar-e-Taiba chief Hafiz Saeed, freed from house arrest by a Lahore court earlier this month, they conceded that the Pakistani Army offensive against the Taliban in Swat was a “major, major battle.”

India and Pakistan became observers of the SCO in 2005 but Delhi has so far refrained from attending its summits at the highest level, preferring to deploy ordinary ministers instead of the Prime Minister. This year, that pattern is being broken. The Indian side says this is because the Russian hosts changed the format of the interaction, granting observers a voice in the SCO’s restricted sessions. But officials also concede that India today has a greater appetite for interacting with a grouping that is seen as a reflection of big power rivalry in the Asian landmass.

Stakes up

What has changed is the geopolitical terrain following the victory of President Barack Obama in the United States, as well as the deteriorating situation in Afghanistan and Pakistan, both of which have increased India’s stakes in the SCO game. India, they said, was not averse to even joint SCO-level military exercises, especially with an anti-terror focus, once the grouping came up with a suitable format.

If the SCO is a body with an essentially Asian, security-centric footprint, the Brazil, Russia, India, China summit being held here the same day is being seen globally as a grouping whose political interactions could help to alter the shape of the international financial system and the global economy that it underpins.

Writing exclusively in The Hindu today, Brazil’s president, Luis Inacio Lula da Silva, says the BRIC summit “marks a major turning point in how our countries engage in a world undergoing profound change and … [beset by] broken paradigms and failing multilateral institutions.”

With 40 per cent of the world’s population and output (in purchasing power parity terms), “the BRIC grouping has the potential to lead global economic growth,” Prime Minister Manmohan Singh said in a statement before leaving New Delhi.

But if Dr. Singh spoke coyly of the BRIC “coordinating international efforts to overcome the ongoing financial and economic slowdown,” Mr. Lula was more blunt about the political economy of the quartet’s first summit agenda. “Are rich countries willing to accept supranational oversight and control of the international financial system, so as to avoid the risk of another global economic meltdown? Are they willing to forfeit their stranglehold on decision-making at the World Bank and the IMF? Will they agree to cover the costs of technological adaptation required for people in developing countries to also benefit from scientific progress, without harming the global environment? Will they eliminate protectionist subsidies that make modern agriculture in many developing countries unviable, leaving poor farmers at the mercy of commodity speculators and generous donors?”

Declaring that “the time for politics” has come, he said these are “the questions that the BRICs want answered.”

Indian officials said the summit would also focus on the emerging challenges the financial crisis posed, adding that the National Security Advisors or equivalent officials from the four countries met recently to review the issue.
“Supranational” currency

Among the four members, Russia has been the most forthright about the need for the world’s rising economies to push for the creation of a new “supranational” currency to replace the dollar as the primary international unit of account for foreign reserves.

China and Brazil favour an expansion of the IMF’s Special Drawing Rights (SDRs), with Brasilia recently offering the IMF a $10-billion loan towards this end. India remains noncommittal, with Foreign Secretary Shiv Shankar Menon describing these discussions as “academic” and “premature.”

Senior officials told The Hindu that Russia had since clarified that it did not intend to use the BRIC forum to press the debate on a shift away from the dollar.

Manmohan, Hu review ties

Against the backdrop of heightened rhetoric on the border issue in recent weeks, Prime Minister Manmohan Singh and Chinese President Hu Jintao met here on Monday night to review the bilateral relationship, reiterate their intention of pursuing closer ties and give a fresh push to their high-level dialogue on the disputed boundary between the two countries.

Speaking to reporters, Indian officials said the next meeting of the Special Representatives tasked with resolving the boundary question was slated for August 7 and 8 in New Delhi.

Asked about the recent statements by the outgoing Indian Air Force chief and other IAF commanders on the threat from China and the internal situation in Tibet, the officials said Defence Minister A.K. Antony had ordered serving officers not to make public comments.

“In our system, policy statements are the preserve of ministers and duly authorised officials,” the sources said, adding, “Unauthorised statements do not constitute Indian policy. They remain the individual view of whoever makes them.”

The officials said these statements were unhelpful. “They muddy the waters … The Chinese read them and then they react … and this prompts further statements.”