The general and railway budgets suggest preparation for the general election. The June deadline for waiver of the Rs 60,000 crore farm loans indicates an early poll. If so, the decision may well have been dictated by the impasse over the nuclear deal. The government could ignore the Left and proceed with the IAEA agreement. It could then dissolve parliament and announce the election before finalizing the deal. That would squarely make the N-deal a poll issue. This scribe had suggested doing this many months ago. It is what democratic norms demand. If the government goes ahead and does that now, is it too late? That will depend on whether the government goes whole hog or flounders in half measures.

Is a Congress poll victory inconceivable? The chances may seem remote, but they are within the realm of possibility. It remains to be seen whether the Congress strategists do their homework. The populist budgets have created a transient feel-good public mood. It takes more than that to win a general election. And undoubtedly if the government proceeds with the N-deal the opposition will make it a major poll issue. So how might the government respond?

By speaking the truth. By stating that the N-deal is not just about energy but also about forging a long term strategic partnership with the United States. By stating that such informal understanding, as prevails in the special relationship between the US and UK, is not uncommon in international relations. By stating that the role of China in our neighbourhood makes an Indo-US partnership imperative. And, finally, by pointing out that such a strategic partnership has been existing for decades between the US and China. It does not necessarily impinge on relations with third countries.

Stating all this will not be enough. While furthering relations with the US, the government would have to avoid toeing the line on China advanced by the powerful US corporate lobby. It seeks expansion of its Asian market by encouraging closer Indo-Chinese economic ties – and to hell with India’s security! The government must act on its own to restrain China’s hegemonic tendencies. For starters, India-China trade requires a drastic rethink.

China now is India’s biggest trading partner, ahead of the US. Sixty per cent of China’s urban population lives off China’s State Owned Enterprises (SOE). These lose heavily because of mismanagement and corruption. If they are shut down massive destabilizing unemployment would result. To maintain SOEs China’s state-owned banks keep extending them bad loans. To perpetuate this system China must rely on earnings from huge exports. Exports are China’s lifeline. In its trade with India, China exports thrice as much as it imports from India. Why? Chinese imports in India are mostly low tech goods that can be dispensed with. And those in the high tech telecom sector are deemed a grave security risk by our National Security Adviser!

If our PM could focus more on security than on the rate of growth he would alter priorities. Perhaps the pressure from the US corporate lobby is too heavy for him to resist. Who owns Chinese industry? Eighty per cent ownership is foreign, mostly overseas Chinese based in Southeast Asia. The rest is owned mostly by the west. A clutch of China’s communist rulers in Beijing and the provinces misuse their positions to allow this by becoming partners in big business enterprises. That’s why there are so many billionaires among families of top Chinese leaders, who for decades forbade ownership of private property and assets in China. The precise links between the overseas Chinese and US finance capital is difficult to fathom. That is why pressure from corporate America for closer Sino-Indian ties is suspect.

An enhanced relationship with America through the N-deal would greatly increase India’s leverage with China. According to recently retired US official Nicholas Burns, who piloted the N-deal, China would not oppose India in the Nuclear Suppliers Group. This is because China would not like to appear isolated among the big powers. That is why the job of scuttling the deal has been left to China’s puppets in India. But given the attitude of the Left and some of the UPA allies, how can the Congress surmount their challenge on the N-deal and win an election fought on the issue?

It is estimated that a closer relationship with the US after the Iraq occupation would also cost the Congress its Muslim vote. That may or may not be true. But what about the main vote constituency of the BJP? LK Advani told visiting US Defence Secretary Robert Gates that “it is too late to save the nuclear deal”. If the Congress plays it right these could be Advani’s famous last words. He is going against the grain of his party’s natural vote bank, which would support a strategic alliance between India and the US.

In the days and weeks preceding the poll there is likelihood that insurgency in Pakistan will hot up. According to current trends Pakistan’s three major alliance partners of the new civilian government will unite to offer more autonomy to NWFP and Baluchistan, and will fight Al Qaeda by isolating it. The PPP leader, Zardari, has already indicated that Kashmir is not the most pressing issue. The US and Indian public opinion will solidly back their effort. National security concerns could very well become a major poll issue. The N-deal would be assessed by the public in a new context.

The Congress could exploit Advani’s blunder on the N-deal. It could target the BJP’s vote bank. Already, the government is making muffled placatory sounds in the court on the Ram Sethu issue. But that is not enough. Half measures will not do. Congress would have to go all the way. Rajiv Gandhi unlocked the gates at Ayodhya to permit pooja for the Lord Ram idol placed there. What if Sonia Gandhi and son Rahul complete the job? What if the government approaches the court hearing the Babri case to submit that because the Ram idol has been placed there for so long it is impractical to remove it now and therefore the Ram Temple should be constructed there? How would the RSS, VHP and the entire BJP vote bank react? Would they support the Congress, or would they support a BJP led by Advani, standing alongside the CPI-M in opposing the N-deal?

This is just one possible scenario. There are others. The unfolding events in Pakistan, and the possible political realignments before India’s general election, make certain only the uncertainty of the forthcoming election results. 

March 3, 2008

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