Sunday 21 December 2014

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What will be important in 2015?

Posted by on 19/12/14
From a European viewpoint… 2015 is officially the “European Year of Development”, but politically the upcoming elections in the UK (May 2015) will most likely intensify tensions in and reporting on the UK when looking at the European Union and even London’s EU membership. If 2014 was the year of the elections and new faces [...]

My Christmas Wish-list

Posted by on 19/12/14
As Christmas approaches, the Risk-Monger finds himself on Santa’s Naughty List. See how he tries to wiggle out of this one and presents three simple ideas for 2015!

Aviators’ boss ‘confused’ about airline efficiency: the impact of the oil price slide

Posted by on 19/12/14

The rapid slide in oil prices, down 41% since June, has left the aviation industry struggling to defend its continuing high fuel surcharges and reports of record profits, writes Andrew Murphy. Here is IATA’s director general, Tony Tyler, updating his stance on oil prices in light of recent developments:

Reuters reported in November 2014: “Lower jet fuel prices, which make up around one-third of the cost base of airlines, would take time to filter through due to hedging strategies, IATA said. ‘And it could even be an indicator of difficulties ahead if the fall is driven by declining demand for oil rather than rising supply capacity,’ Tyler said.”

While in March 2012 he was singing a different tune: “The risk of a worsening Eurozone crisis has been replaced by an equally toxic risk – rising oil prices. Already the damage is being felt with a downgrade in industry profits to $3.0 billion,” Tyler said.

However, for those of us concerned about the climate impact of aviation, there is no confusion – lower oil prices could fatally undermine the drive towards more efficient flying. Two recent reports show that, even when prices were above $100 dollars a barrel, the aviation industry was not able to acheive its own goal of 1.5% fleet efficiency improvement per annum. A report from the German-based Atmosfair found that the efficiency of the world’s largest airlines was around 1% over the past year while a report from the ICCT found that domestic US aviation saw zero net improvement in its efficiency in 2013.

With oil today falling to $66 a barrel, there is a real risk that airline operators will hold off investing on more efficient aircraft and aircraft manufactures will resist investing in a new generation of even more efficient aircraft. Purchasing aircraft, or the R&D for developing more efficient ones, is not cheap and the industry needs certainty that such investments will pay off – wild flucations in oil prices are a barrier to this. We now risk moving further way from the IATA goal of 1.5% efficiency improvement per annum and ICAO’s even more ambitious goal of 2% per annum. While the drop in the price of oil may not last forever, any delay in improving efficiency will further fuel the increase in aviation emissions, which are already predicted to increase by between 60% and 80% by 2026 due to passenger growth of 4% per annum.

ICAO is working to develop a market-based mechanism. However, even if it is approved at its next Assembly in 2016, it will be 2020 before it comes into force. As the climate cannot wait six more years, we need the new European Commission to use 2015 to set out a credible path to reducing aviation emission and adopting measures that will encourage greater efficiency. This should include a revision of the EU ETS for the 25% of Europe’s aviation emissions that are still covered by this scheme since “stop the clock” so that it sends a real price signal to industry. It should also include an amendment of the Energy Taxation Directive so that aviation, like every other transport sector, is subject to fuel duty.

Open Europe embraces digital change

Posted by on 18/12/14
Open Europe has moved. We are revamping and massively upgrading our digital presence to become even better. Enjoy our new website, where it will be easier for you to consume, share and engage.

Getting away from it all

Posted by on 18/12/14

It’s not surprising that the best way to describe a profound longing for something unattainable is a German word: Sehnsucht. According to Wikipedia, it “is difficult to translate adequately and describes a deep emotional state. Its meaning is somewhat similar to the Portuguese word, saudade.” Maybe, but it’s a lot more than that.

This Sehnsucht factor suggests the unarticulated conviction that life in Germany is less than ideal, what Gregor von Rezzori described as “a restless delusion welling from a melancholy deep within”. It may have something to do with the weather, but I think it’s more likely to be a reaction to the dullness of German life.

But you have to go some way back to explain the intensity of the Sehnsucht factor and the closely associated sentiment of romanticism. As in other national cultures, environment plays an important role. Germans have an almost mystical relationship with their environment of hills and forests. These must have played an important role in the shaping of the German psyche: a 1980s survey by the Bundeswehr concluded that the horizon across 80 per cent of Western Germany was only 1000 metres away…

Romanticism was an important element of German cultural life in the 18th and 19th centuries, thanks to the Brothers Grimm, Schiller, Goethe and many others less famous. The impulse took an upward tack in the early-20th century with short-lived and ultimately unsuccessful incursions into Africa, reinforced by the growing presence of exotic animals in zoos and circuses, and reflected in the works of German Expressionist artists.

Today, German TV seems to throw further light on this tendency. There’s rarely a weekend that goes unadorned with a dramatisation of a Brothers Grimm fairy story or something that harks back to a traditional way of life, German-style. Sunday morning programmes also frequently feature overblown outdoor let’s-have-fun events where the cheer seems rather forced, even if the weather is good (most often it’s not).

Other programmes are mostly set in significantly escapist environments: sunny climes – most often the eastern Mediterranean, if not African safari country, or cooler but romantic situations like Scotland, Ireland or Cornwall involving elitist things like thoroughbred horses and country houses.

Uniforms have always appealed to the German psyche but, for a reason difficult to explain, TV viewers get excited not only at police officials in green but at people wearing medical dress. Most importantly, doctors and pharmacists in white have a mystique of their own. Maybe the bombardment, from 1700 hours, of TV spots for various forms of exotic medication helps explain this.

The ultimate TV environment is a cruise-ship scenario where the programme-makers have the directorial advantage that all the characters are German and the social environment decidedly chic. In all these different scenarios, which are invariably upmarket and elitist (to add to the exoticism), everybody including the natives speaks fluent German. The only exceptions are the horses.

In short, the German TV viewer seems to enjoy associating with the well-to-do even if he or she, by national standards, is not one of them. This shows the ability to respond to the lure of the exotic in yet another dimension.

Maybe the exotic syndrome is best explained by Paolo Ciucani, an Italian who renovates vacation homes for Germans in Tuscany: “We almost feel sorry for the Germans. They are so wealthy yet so unhappy. Maybe they come here to try and learn how to enjoy life. But they end up going back to the same miserable place, so they never really change.”

BlogActiv message: We’ll be back… soon!

Posted by on 18/12/14
By BlogActiv Dear bloggers, dear readers, 2014 has been a fascinating year for everyone involved in, and blogging about, Europe’s politics and policies. On the EU stage, citizens chose their representatives for the new Parliament in last May’s EU elections. We saw the end of a decade of José Manuel Barroso at the top of the EU [...]

Donald Tusk and the Invisible World

Posted by on 18/12/14

Following his accession to the position of President of the European Council, Donald Tusk received a phone call from President Xi Jinping, and an invitation to visit China. It is not clear whether these initiatives by President Xi were preplanned, but there will be much to discuss when the two do meet. At the ceremony where he took over the position of European Council President Tusk set out his priorities. These raise a number of questions both for the EU and its place in the world, and more specifically for its relations with China.

There were two broad themes underlying Tusk’s priorities. The first is geography. All four of his priorities have geographical element, and three deal with external policy, but their focus is notable for what they leave out rather than what they take in. The first priority is to defend Europe from internal and external enemies. The second is to deal with the European economic crisis. The third to secure Europe’s borders and support those in the neighbourhood who share “our values”. The fourth is to advance relations between Europe and the US.

The invisibility of China and more broadly Asia in Tusk’s worldview is remarkable. One might be forgiven for thinking that what the IMF recognizes as the world’s largest economy or the region that consistently leads the world in economic growth might get a mention based on these facts alone. The question is even wider, as not just Asia but almost every other continent on the globe is entirely absent from his priorities. The focus on domestic challenges is perhaps understandable given the dire problems that the EU and the Eurozone face. The attention to neighbouring countries, for which we can read Ukraine and the problem with Russia, is also understandable. But this leaves out vast swathes of the world, not just China and Asia, as at best secondary considerations. Tusk apparently believes that the EU has no significant global role beyond its own neighbourhood. His focus on the importance of the relationship with the US merely emphasizes this, as there can be no doubt which side of the Atlantic will dominate.

The second key theme in Tusk’s priorities is values. Out of the four areas that he said were crucial for success during his term in office, three directly or indirectly invoked values. The first was to protect the EU’s fundamental values from threats both inside and outside. The third is for Europe to secure its borders and support those in the neighbourhood who share its values. The fourth, without providing any specific objective, again can be said to have invoked values, stating that, “the relations between Europe and the United States are the backbone of the community of democracies.”

There are a number of problems with such a value laden set of foreign policy priorities. The most obvious is that such policies normally exist only as rhetoric rather than substance, another is that they generally do not achieve the goals they proclaim. They are thus usually open to the double charge of both hypocrisy and failure. In the case of China, the EU has long since decided that prioritizing values is not a productive strategy. If the commitment to values is real, priorities that see the world divided by those who hold “our values” and those who do not, the enemies of our values, risks making the EU irrelevant. If China does figure on Tusk’s agenda, a values based approach will diminish rather than increase the EU’s influence in the relationship, and probably also in that with many other Asian countries who are looking for an EU that offers more than lectures about values.

To be set against this, one interesting aspect of Tusk’s priorities is his emphasis on European (“our”) values. His proclaimed goal of defending European values implies that they are only European, rather than making any claim to their universality. This may be realistic, recognizing the limits of claims to universality of European values that often do not travel well beyond their place of origin. But is also implies a lesser global role for the EU, reducing its visibility. A Europe with only European values also means that its position as a normative power, one of its positives often attributed to the global role of the EU, is diminished. This may, however, make Tusk’s value agenda easier for China and others to live with. A Europe that defends European values allows for others to defend their own values as equally legitimate. In the case of China, this has been one of the foreign policy aims of Xi Jinping since he came to power.

All of Donald Tusk’s priorities deal with short-term problems and do not offer a long-term vision. Given the enormity of the EU’s problems, this may be understandable. But this focus has consequences. It is not clear if it is actually Donald Tusk’s intention to make most of the world’s continents invisible to the EU, and Europe invisible on most of the world’s continents, but that is what his priorities imply.

These lacunae should be of concern to Europeans because, in as far as they concern external relations, they fail to take into account most of the world outside the EU. In the case of China, the focus on values may be problematic. But more important is the invisibility of China, which is not just an economic giant but also an important global actor that the EU cannot ignore. China increasingly sees itself in these terms, and frequently asserts the importance of the relationship it has with the EU. Tusk’s priorities will raise questions about how serious the EU is in developing relations with China. At the same time, for China, Tusk’s diminished view of the EU as not being a global actor, and one that is tied to the US, will be a cause for concern,. In China’s multipolar worldview, the EU is, or at least should be, a pole in the global order.

Tusk will no doubt learn on the job. He is not entirely unfamiliar with China, and Asia. While Prime Minister of Poland, he dealt with both. He has visited China, and received high-level visits from Chinese leaders. The phone call, during which Xi reiterated his view of the importance of the EU-China relationship, and invitation to visit China could be read as a reminder that there is more to the world than Tusk’s priorities suggest.

“Junker’s Stimulus Plan Is Unrealistic On Many Fronts”

Posted by on 18/12/14
By Dim Rapidis Dimitri B. Papadimitriou on ECB interest rates policy, deflation, Junkers’s fiscal stimulus plan, debt management and the Stability Pact, US economy, and the economic crisis in Greece.

2015—Can We Make It Different?

Posted by on 18/12/14

The beginning of a new year is a great time to reflect on where we are compared to where we want to be. A few days ago I came across a post by British MEP, Richard Corbett. He wrote about how the pragmatism of the EU is important for solving problems, but “when we focus exclusively on self-interested arguments, we risk forgetting the underlying motivation for what we do – and this is dangerous.”

Mr. Corbett describes three reasons why this is dangerous, and why we should avoid isolationism. I would like to focus on one particular suggestion that he makes there: “The best way to fight the negativity of narrow-minded nationalism is to present an alternative, positive story which shows the myths up [about Europe] for the nonsense they are.”

The problems of self-interest and narrow nationalism that Mr. Corbett points to are definitely on target. And yet, merely pointing out the problem won’t make it disappear. The forces that push for segregation are far greater and deeper than meets the eye, and require a conscious effort on the part of many organizations working in sync to provide a sustainable, long term solution.

Self-interest is at the core of our society. It is the mindset of every society, even social-democratic ones. It is at the foundation of human nature. It is not bad in and of itself, but when idolized and cultivated to an extreme, it becomes nocuous. This is where we stand now on every level—personal, social, national, and international. We’re living in the Me, Me, Me, era, a culture of narcissism. But every therapist will tell you that narcissists don’t see reality for what it is. When the whole of the Western civilization is approaching that state, it is very dangerous indeed.

The cure, therefore, has to include steps toward reversing that trend and establishing a more cohesive society, where solidarity and mutual responsibility are deemed greater than self-promotion. I do subscribe to Corbett’s words that “The best way to fight the negativity of narrow-minded nationalism is to present an alternative, positive story which shows the myths up for the nonsense they are.” And I believe that if we build an education program that gives people a personal experience of social cohesion, we won’t have to worry about narrow-minded nationalism, or any other narrow-minded self-centered approach.

At the ARI institute, we offer such a method, called Integral Education (IE), where people learn to communicate and relate to one another in a completely new way, and on a completely new level. We have implemented it all over the world, from the US to Europe, to the Middle East, and more often than not, in conflict weary societies. The results have been outstanding. Using a few simple rules of discussion, people discover, then cultivate, a new sense of kinship, and wish to preserve it.

The logic behind IE is simple: the world is interconnected and interdependent. Our values, on the other hand, are the complete opposite: self-indulgence, brutal competition, and alienation. By learning the new method of connection among us, we align ourselves with the reality of our lives. This eliminates the conflict between our need to feel superior (due to our ego-prone education) and the interdependent reality of life. When that happens, the “positive story which shows the myths up for the nonsense they are,” as Corbett so nicely put it, emerges by itself, effortlessly.

I encourage you to visit my site, where you will find more information about IE, and please contact me for further discussion about promoting Europe toward a better, more united future.

May 2015 be a year of positive shifts for all of us.


A keen appreciation of the human condition

Posted by on 18/12/14

One of the things that sticks out in the perception of a foreigner is the overriding sense of fairness of the Belgians in their dealings with others. I say this as one of the English who supposedly invented the concept of fairness and gave the word to the rest of the world.

The people of this city earned their reputation for mutual support a long time ago, no doubt partly as a result of having to ‘close ranks’ in the face of foreign oppression, notably by the Spanish and the French. “In true Belgian style, the more pitiless the repression, the greater the resistance”, says André de Vries in his book, ‘Brussels’, on the city’s history and culture.

One of the moral judgments of the denizens of Brussels came from the Burgundian Cardinal Granvelle who, in a letter to King Philip II of Spain, said that “nothing can be done because they only think of stuffing themselves, having orgies and thinking bad thoughts” (“Il n’y a rien à faire de bon, parce qu’ils ne pensent qu’à bafrer, à organiser des orgies et mal penser”).

Three centuries later, an English visitor by the name of Henry Smithers paid a backhanded compliment when he wrote that the Flemish in particular “are not destitute of benevolence when excited thereto by great occasions”.

Some time afterwards, in a letter to a friend, the young Charlotte Brontë described her Brussels schoolmates as having “a character singularly cold, selfish, animal and inferior.” Not my impression of the people of Brussels today…

Concern for one’s fellow-beings should be a universal quality but isn’t. The impersonality of life in many of Europe’s cities, and the indifference it produces, is evident from the faits divers columns of the European media. Brussels is, maybe surprisingly, a bit of an exception. While history has taught its people – and, come to that, most Belgians – to be cautious and instinctively ‘keep their distance’, the barriers quickly come down when they see a genuine case of distress.

Most significantly this spirit of concern, which seems to come naturally to all constituents of the Belgian community (with a small ‘c’), seems to extend from the autochtones to underprivileged immigrants. I have been privileged to witness incidents where the human response of Bruxellois/Brusselaars of various convictions and colours – Spaniards, Maghrebians, Sub-Saharan Africans – has been equally spontaneous and warm.

Sadly but significantly the most notable exception to this rule is the privileged immigrant community – not necessarily the people actually working in the European institutions but the Eurowatchers and the other members of the parasite organisations surrounding them. They are the people who need to develop this human empathy more than anyone else, but they’re too busy catching up with endless Euro-developments to care…

On the other hand, this essential and very Belgian spirit of humanity does have its downside. The obverse side of the coin is that Belgians tend to ‘sell themselves short’, they are too self-effacing and too low-key in a world that is aggressively competitive. But there’s also a thing called appreciation of the human condition – something that, fortunately for us expats, comes naturally to many Belgians.

To hell with ethnic purity

Posted by on 18/12/14

The French, who for so long talked about ‘nos ancêtres, les Gaulois’, may have felt justified in not looking too closely at their antecedence. The Germanic element is in fact more important: according to Luigi Barzini, the Italian author and politician, almost half the inhabitants of present-day France are the descendants of Germanic tribes.

As Graham Robb points out in his book The Discovery of France, “The Celtic and Germanic tribes who invaded ancient Gaul and the Frankish tribes who attacked the ailing Roman province had almost as many different origins as the population of modern France. The only coherent, indigenous group that a historically sound National Front party could claim to represent would be the very first wandering band of pre-human primates that occupied this section of the Western European isthmus” (what Norman Davis calls “the European Peninsula”).

Even 500 years ago, there were few communities in Europe that could reasonably claim, had they wanted to, to be ethnically homogeneous. In fact, they had better things to do with their time. In the intervening half-millennium, those communities that could have made this assertion have seen their claims made even more tenuous by migration and miscegenation. Italy, for example, saw the settlement of the Germanic Langobardi - the ‘long-bearded people’, today’s Lombards – and the short-lived incursions of the Visigoths and Ostrogoths who sacked Rome.

The Iberian peninsula provided the setting for a series of Germanic civilisations: first and fleetingly the Vandals, who gave their name to Andalusia, later the Suevi (the Swabians again) and the Visigoths. Spain was a very cosmopolitan place. Other settlers in that particular piece of God’s Earth, some temporary but most of them permanent, included the Iberians, Celts, Phoenicians, Greeks, Romans, Carthaginians, Arabs, English and French.

In fact there is genetic evidence of a population movement through Spain that brought Stone Age man up the Atlantic coast to the British Isles (except that at that time these islands were still land-linked to the Continent, which made matters easier for the migrants). The genetic marker in question is particularly prominent in the Irish county of Connaught (98.3% of all men, according to a recent study by Trinity College scientists) – a phenomenon that may also owe something to the land clearances imposed on the Irish by their English masters later on.

The Celts, because they ended up in the most inaccessible corners of Western Europe – Scotland, Ireland, the Isle of Man, Wales, Cornwall, Brittany, Galicia and northern Portugal – have managed to maintain some sort of ethnic identity. Yet even the most idiosyncratic of the Celts, the Irish, cannot evoke their Celtishness much beyond the limits of their cultural traditions. Historian E Esteyn Evans believed that the genes coming from English settlers there exceed those deriving from the Celts, and that “those coming from older stocks would constitute the largest proportion” (a reference to the earlier Upper Palaeolithic, Mesolithic and Neolithic settlers).

In his book The Language Instinct, Stephen Pinker observes that “race and ethnicity are the most minor differences of all.” The human geniticists Walter Bodmer and Luca Cavalli-Sforza have noted a paradox about race. “Among laypeople, race is lamentably salient, but for biologists it is virtually invisible. Eighty-five percent of human genetic variation consists of the differences between one person and another within the same ethnic group, tribe or nation.”

Many communities arrive at apparent homogeneity through a gradual process of miscegenation combined, in some cases, with their relative isolation. Portugal is a good example, but in its case as in many others the brew is like a minestrone soup, where one spoonful looks just like another, yet each spoonful contains enough ingredients to confound any claims to homogeneity.

Maybe the Swabians again – descendants of the Suevi, one of the Alemanni tribes that crossed the frozen Rhine in AD 406 – have a case for some degree of genetic continuity. Poachers turned gamekeepers, they won the right from an enfeebled Roman Empire to guard its frontiers. The consequence today is a community of common origin that extends along both banks of the Rhine through four countries from France’s Alsace to include Germany, Switzerland and the Austrian Vorarlberg.

Russia: Uncertain Consequences

Posted by on 18/12/14

In the morning of Dec. 16, the ruble was supposed to rally. Instead, it collapsed. The ruble fell as the current account was improving, something that shows the collapse has had little to do with speculators, but has had everything to do with capital outflows, a signal that domestic investors and depositors have lost credibility in the Russian policymakers. Uncertainty continued on Dec. 17.
With this, political risk in Russia is on the rise. However, the magnitude of this crisis of confidence remains unclear. While Putin’s approval ratings are high, the ruble’s weakening is an indicator of the Russian economy’s dependence on oil prices, as well sanctions and a declining sentiment from the West.
This will likely reflect in statements coming from Russia: there is probably going to be increased assertiveness towards the West, considering that Moscow needs to support the idea, in front of its domestic public, that the economic problems are due to external factors. It remains to be seen what the public reaction will be, considering that this recent crisis comes after a miscalculation on Ukraine and on the background of an oil crisis.
However, depending on how the crisis develops, the West doesn’t want to push Russia over the edge. The interconnections between the Western economies and Russia, considering the contagion risk, are a factor that the West must take into account. There are a lot of questions still to be answered, beginning with the one referring to how severe is the ruble fallout on Dec. 16 and what’s the impact on the financial and economic system of Russia, of Europe and, later on, consider the global implications.

Russia’s Strategic Shift To East Continues: Now India

Posted by on 18/12/14

The steadfast support of the people of Russia for India has been there even at difficult moments in our history. It has been a pillar of strength for India’s development, security and international relations. India, too, has always stood with Russia through its own challenges. The character of global politics and international relations is changing. However, the importance of this relationship and its unique place in India’s foreign policy will not change. In many ways, its significance to both countries will grow further in the future.”

( Indian Prime Minister Narendra Modi)

Russia and India made 20 deals in 24 hours (on 11th Dec. 2014) given $100 billion-worth boost to their economies. The economic burden of Western sanctions has pushed Russia to the east in search of business opportunities. During President Vladimir Putin’s visit to India in the presence of he and Indian Prime Minister Narendra Modi 20 pacts were signed and the two sides ended with US$100 billion commercial contracts. (Source RT )

Rich pickings by both sides included deals worth $40 billion in nuclear energy, $50 billion in crude oil and gas and $10 billion in a host of other sectors, including defense, fertilizers, space, and diamonds. Moscow is seeking greater investment from Indian state-run companies in Russian oil and gas projects, including ones being explored in the Arctic.

New Indo-Russian deals

Putin’s just-ended India trip constitutes a major foreign policy success for the Russian President as he has successfully teamed up with China and India, Asia’s number one and third economies respectively. Some highlights of the Indo-Russia deals:

  • india nuclearRussia would be constructing 12 new nuclear reactors for India in two decades – each will cost $3 billion apiece.


  • Russia holds the world’s second-biggest natural gas reserves and is among the globe’s biggest oil producers. Among the agreements today was a 10-year deal that will raise Indian imports of Russian oil almost 40-fold from current levels. The two nations plan to study the possibility of building a hydrocarbon pipeline system connecting India and Russia, according to a joint statement from Putin and Modi.
  • The $2.1 billion deal that 12 Indian companies dealing in diamonds have signed with Alrosa. Russia’s diamond reserves are more than 1 billion carats, the largest in the world, while Russia’s Alrosa accounts for more than quarter of the global diamond mining.
  • BrahMos cruise missileReviving their good old defense partnership the new Indo-Russian initiative involves Russia producing state-of-the-art multi-role helicopters in Indian factories to cut down on costs and time overruns. This deal will be worth $3 billion once formally signed. In addition India will be at liberty to export these helicopters to third countries.
  • In addition there was also the $2 billion potash deal.
  • Russia would look at participating in the Delhi Mumbai Industrial Corridor project.
  • Moscow is seeking greater investment from Indian state-run companies in Russian oil and gas projects, including ones being explored in the Arctic.
  • Both governments have set-up a Joint working group (JWG) to negotiate the specifications of an agreement, a final agreement would be signed between India and Eurasian Customs Union

(Sources: Al Jazeera , Bloomberg and RT )

The first major political initiative, since the collapse of the Soviet Union, between India and Russia began with the Strategic Partnership signed between the two countries in 2000. Traditionally, the Indo-Russian strategic partnership has been built on five major components: politics, defence, civil nuclear energy, anti-terrorism co-operation and space. However, in recent years a sixth component, economic, has grown in importance with both countries setting a target for US$20 billion in bilateral trade by 2015. The Indo-Russian Inter-Governmental Commission (IRIGC), which is one of the largest and comprehensive governmental mechanisms that India has had with any country internationally.

T50 stealth fighterIndia and Russia have several major joint military programmes including (Source WikiPedia ):


The critics

According The Hindu U.S. is upset at India-Russia deals. A day after Russian President Putin’s visit, the United States criticised India for the agreements signed between New Delhi and Moscow. Responding to a question on the 20 agreements signed, including one on the Rupee-Rouble trade, State department spokesperson Jen Psaki said, “Our view remains that it’s not time– for business as usual with Russia. But beyond that, we’d have to take a closer look at what these agreements entail.”

The U.S. and Ukraine have also expressed unhappiness that President Putin was accompanied by the Crimean Premier Sergey Aksyonov. Mr. Aksyonov is on the sanctions list of the U.S., Canada and European Union for his role in the accession of the former Ukrainian region to Russia in March this year. Mr. Aksyonov initialled a “partnership agreement” between Crimean and Indian businesses, particularly in the area of meat exports. The meeting with the Crimean Prime Minister followed Russia’s decision to allow the import of Indian buffalo meat last week. While the U.S. state department said it was “troubled” by his presence in New Delhi, Ukranian President Petro Poroshenko accused India of putting “money” ahead of “values” and “civilisation”.

Wider context

The wider picture – besides new Indo-Russian cooperation – includes the Sino-Russian cooperation, the BRICS (Brazil, Russia, India, China, and South Africa), The Shanghai Cooperation Organization (SCO), the Eurasian Economic Union EEU, the energy war and other bilateral operations. Faced with an increasingly hostile West, Russia is visibly turning East. In particular, China and Russia have become closer, signing a historic gas deal, conducting joint naval exercises, and increasing trade. Russia and China are determined to reduce U.S. and NATO presence in Central Asia to what it was before the 2001 invasion of Afghanistan. The SCO has consistently rebuffed U.S. requests for observer status, and has pressured countries in the region to end U.S. basing rights. At present, the SCO has started to counterbalance NATO’s role in Asia.

bricsThe BRICS met 2013 in Durban, South Africa, to, among other steps, create their own credit rating agency, sidelining the “biased agendas” of the Moody’s/Standard & Poor’s variety. They endorsed plans to create a joint foreign exchange reserves pool. Initially it will include US$100 billion. It’s called a self-managed contingent reserve arrangement (CRA). During the July (2014) BRICS Summit in Brazil the five members agreed to directly confront the West’s institutional economic dominance. The BRICS agreed to establish the New Development Bank (NDB) based in Shanghai , pushed especially by India and Brazil, a concrete alternative to the Western-dominated World Bank and the Bretton Woods system.

So in near future BRICS will be trading in their own currencies, including a globally convertible yuan, further away from the US dollar and the petrodollar. All these actions are strengthening financial stability of BRICS – a some kind of safety net precaution, an extra line of defense.

Less than a month after the BRICS’ declaration of independence from the current strictures of world finance, the SCO—which includes China, Russia, Kazakhstan, Kyrgyzstan, Tajikistan, and Uzbekistan—approved India, Pakistan, Iran, and Mongolia for membership in the organization. Also SCO has received applications for the status of observers from Armenia, Azerbaijan, Bangladesh, Belarus, Nepal and Sri Lanka.

Bottom line

China and Turkey are now followed by Indo-Russian cooperation. Russia’s President Vladimir Putin held talks with India’s new prime minister Narendra Modi as sanctions-hit Moscow seeks to strengthen energy, defence and strategic ties in Asia. India opposes joining Western sanctions against Russia, and is likely to disregard a caution from Washington that now is not the right time to do business with Moscow.

Most importantly, the just-concluded 15th India-Russia annual summit has laid out a specific decadal roadmap for bringing about a complete transformation in the Indo-Russian bilateral ties and taking them to a much higher trajectory than ever before.

The latest developments in Russia’s strategic shift to East and now to India are in my opinion a strong symptom that alternative poles of power are emerging that soon may present a serious challenge to the U.S.-dominated world that emerged from the end of the Cold War. In my conclusion the era when the IMF, World Bank, and U.S. Treasury could essentially dictate international finances and intimidate or crush opponents with sanctions, pressure and threads are drawing to a close.

The great Eurasian axis between China and Russia boosted by ongoing Western sanctions due Ukraine is already in good motion. The deal done with China and the deal just done with Turkey redirect to these two countries gas that had previously been earmarked for Europe. (More in Is South Stream Pipeline Transforming Itself To “Turk Stream”? ) These deals show that Russia had made a strategic decision this year to redirect its energy flow away from Europe. The Russian response to ongoing Western sanctions has been launching a counter-strategy including the formation of a potential non-dollar trading bloc among major players such as China, Iran, Turkey, India) in the global energy markets. (More about issue in ¥uan and Waterloo of Petro$ ; see also some geostrategic background in my slideshow Some Geostrategic Aspects in Russia vs. U.S. Relationship )

indo-russia deals



Net Neutrality: A Hungarian Perspective

Posted by on 16/12/14


By Miklos Orban


Call me a history geek, but I love the Modern Mechanix blog. It is about how people foresaw the future in different ages, and funny to see how “the future” turned out at the end. But this blog also reminded me of the net neutrality debate. While we all know the positions of Amazon, Facebook or Google on this issue, the voices of small businesses, average websites Modern Mechanix or the everyday Internet user like me have not been heard in this long debate.


It is not the likes of Google or Facebook that will suffer where net neutrality is not respected. Companies like these operate with such a presence globally that it is certain they will not be forgotten by any internet service providers anywhere in the world. For instance, recently Facebook struck a deal with service provider Globe, operating in the Philippines, resulting in an offer that allowed access only to Facebook’s content. This demonstrates the influence that this kind of multinational business can leverage. And similarly in Hungary, Magyar Telekom just introduced a few commercial offers which limit access to the biggest websites.


If service providers are empowered to decide on the accessibility of content, small companies, local websites or niche blogs will easily be left out these commercial discussions, as they are virtually unknown to most of the ISPs. No survey is required to establish the likelihood of this happening, recent examples have already proved this in many countries, including in Central and Eastern Europe. Moreover, it is also likely that if ISPs are able to, they will demand payment for how content is displayed. Obviously, SMEs like PROKOP in the Czech Republic or small sites like Modern Mechanix will be unable to contend with the likes of Amazon and so access to their content is likely to be slowed or even blocked altogether.


Without net neutrality, service providers could also decide to impose significantly higher fees on consumers who wish to access all web content and restrict the lowest paying customers to only what the ISPs choose to offer. This means that fewer and fewer consumers will have access to small websites and e-shops and consequently, these small players will disappear. If net neutrality is not maintained, the landscape of the internet is likely to change drastically to an environment in which only large corporations can survive and small businesses and local players will die. This would hurt Central and Eastern Europe badly. And believe me, the world would be a less interesting place without the Modern Mechanix blog.

Miklos Orban is the chairman of Explico, a regulatory consultancy boutique providing services beyond traditional legal advice.


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