Biden's infrastructure bill trouble in the US, and a new Prime Minister in Japan

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CWA # 563, 3 October 2021

The World This Week

Biden's infrastructure bill trouble in the US, and a new Prime Minister in Japan

GP Team

The World This Week #139, Vol. 3, No. 40

D Suba Chandran and Keerthana Nambiar

The US: After getting passed by the Senate, Biden's infrastructure bill is in trouble as the House Democrats differ
What happened?
On 1 October 2021, after meeting the Congress legislators over the voting of his ambitious and historic bill on infrastructure, Biden said: "It doesn't matter whether it's in six minutes, six days or six weeks, we're going to get it done." Biden has also asked the House to delay the voting until there is an agreement within. The bill aims to invest massively in the infrastructure – in terms of building and repairing roads, bridges and related infrastructural projects.

On 30 September, in a statement released by the White House, Jen Psaki, the Press Secretary, said: "While Democrats do have some differences, we share common goals of creating good union jobs, building a clean energy future, cutting taxes for working families and small businesses, helping to give those families breathing room on basic expenses—and doing it without adding to the deficit, by making those at the top pay their fair share." He also said: "A great deal of progress has been made this week, and we are closer to an agreement than ever. But we are not there yet, and so, we will need some additional time to finish the work…."

On 28 September, Rashida Tlaib, one of the Democrats who questions the bill tweeted: "Let me be clear: bringing the so-called bipartisan infrastructure plan to a vote without the #BuildBackBetter Act at the same time is a betrayal…We will hold the line and vote it down."

What is the background?
First, the ambitious infrastructure bill announced by Biden. In his words, it is "a historic investment in the nation's roads and highways, bridges and transit; in our drinking water systems; in broadband, clean energy, environmental clean-up; and making infrastructure more resilient and the climate crisis much more in our minds as to how do we deal with it." On 9 August, the Senate passed the USD 1.2 trillion package, with a 69-30 majority; this happened after a bipartisan debate that included 19 Republicans voting in favour of the bill. Following the vote by the Senate, the House was to vote this week; however, this could not happen due to differences within.

Second, the divide within the Democrats. While Biden could get the infrastructure bill passed in the Senate, he is facing a challenge in the House, primarily from his party – the Democrats. The party stands divided between the moderate and progressive sections. The progressives, questioning the bill (and Biden) within the Democrats, want a broader social safety net package. They would like to pass the Build Back Better Act, along with the infrastructure bill. According to a White House brief, "the Build Back Better Agenda is an ambitious plan to create jobs, cut taxes, and lower costs for working families – all paid for by making the tax code fairer and making the wealthiest and large corporations pay their fair share." While the infrastructure bill itself is ambitious, the other one is even more, with a budget of over USD 3.5 trillion. A section within the Democrats, including Biden, have decoupled the two and prioritized the infrastructure bill; this is the primary difference between the two groups. The larger difference between the two sections is over whether the focus should be primarily on building infrastructure or on social welfare. While the conservatives within the Democrats look at the former, the other section opposing the infrastructure bill see the larger bill and investment in infrastructure as a part of a strategy. While Biden would agree to both, he will have to calibrate the expenditure that comes with, and the numbers that he has in the Senate.

Third, Biden's recent troubles. The President has been engaged in firefighting since August, diverting his attention. Strong criticism and condemnations over the US exit from Afghanistan, treatment of migrants along the US-Mexico border (especially the Haitians), and the COVID numbers and recovery have placed Biden on a backfoot.

What does this mean?
The good thing over the recent differences within the Democrats on the infrastructure bill is Biden's statement and efforts to build consensus within before passing the same. The challenge for him is to reach there. The divide within the Democrats should be the single largest challenge for Biden – both within and outside. Despite the challenge, Biden is likely to reach a consensus.

Japan: Fumio Kishida wins the leadership race to become the next Japanese PM
What happened?
On 29 September, former Japanese foreign minister Fumio Kishida was voted to become the next prime minister of Japan in the ruling Liberal Democratic Party. Kishida narrowly beat his main rival Taro Kono, the vaccine minister, by 256-255 in the first round of voting by party members. The second round of voting dominated by LDPs members in Diet (Japan's parliament) concreted Kishida's position and secured his win.

After the vote, Kishida told LDP lawmakers: "We remain under a national crisis. We must strive and continue our coronavirus response and forge an economic package in the size of dozens of trillions of yen by the end of the year." He called for unity among party members as he leads the LDP for the general election slated for November and next year's election of the House of Councillors, the upper chamber of parliament.

What is the background?
First, the post-Abe political compass in Japan. Shinzo Abe's unexpected resignation, citing health reasons, set off a frenzy among the LDP leaders, replacing him with Abe's right hand Yoshihide Suga. 'Abenomics' for managing the Japanese economy was the highlight of his regime. The transition was a significant turning point in Japanese politics and foreign affairs. Abe's legacy is the most critical variable for a positive alliance with the United States and assertive foreign policies. His reorientation in Tokyo's stand towards rising China, with the Quad grouping and lead in Trans-pacific Partnership, diversified Japanese foreign policies.

Second, a quick analysis of Suga's performance. The challenges for the Suga government included a wide spectrum of geopolitical tensions and regional security regarding Taiwan and East and the South China Sea. With the slow vaccination rollout and unpopular opinion of going ahead with the Tokyo Olympics, public support for Suga declined.

Third, the divide within the LDP. Factional politics is an essential element in the Japanese political system. According to reports, LDP has seven factions; five are significant, and two are considered minor. The LDP leadership election outcome is dependent on the political footings and equations within the inner factions. In the case of Tokyo Olympics 2020, the power struggle inside LDP has been visible between leaders who support and the ones against the Olympics. The factional divide became evident with the leadership elections between Fumio Kishida and Taro Kono wherein Kishida won by a small margin.

Fourth, the rise of Kishida. Fumio Kishida will be Japan's 100th prime minister. Assuming that the LDP retains the power in the upcoming elections, Kishida will have to face challenges of navigating Japan's pandemic response and jump-starting its stagnant economic recovery. His stand on major issues, starting from bridging the economic inequities and orienting foreign policies to climate change and gender equality, will determine his support.

What does this mean?
First, the changing dynamics. With robust leadership and a capable team, Kishida may focus on strategically maintaining a stable equilibrium without compromising Japanese interests. Second, the choice. The leadership election is for debate whether LDP moved out of Abe's shadow. Kishida as a choice could work against Japan's 'revolving-door' leadership.

Also, in the news …
By Sukanya Bali and Avishka Ashok

East and Southeast Asia This Week
China: State planner urges to secure coal supplies
On 29 September, China's state planner urged local authorities and railway companies to bolster their transportation of vital coal supplies to power houses as China grapples with a power crunch. The authorities also asked railways to prioritize the transportation of coal used in heating and electricity generation. The move comes after tight coal supplies, tougher emission control and strong manufacturing demand have raised the price of coal, which is the biggest source of electricity in China. Curbs have been imposed on power consumption in several parts of the country.

China: Cyber Administration sets up algorithm rules for tech companies
On 29 September, Reuters reported, China will be setting up algorithms rules to tighten its control over the tech sector. The Cyberspace Administration of China said the algorithm used by technology firms will uphold core values of socialism and will ensure "fair and transparent" working of algorithms. The regulator added this will "vigorously promote the research on algorithm innovations ... and enhance the core competitiveness of China's algorithms."

China: BRI loses momentum, says a study published in the US
On 29 September, AidData, a research lab at the College of William & Mary in the US, published a report that indicated a fall in momentum in China's BRI projects due to rising debts and increasing opposition in partner countries. Beijing has spent an average of USD 85.4 billion a year in the five years after the BRI was launched in 2013. The initiative has backed 165 countries over the last 18 years. South China Morning Post reported, "study of 13,247 global BRI projects … finds China relied primarily on debt rather than aid in overseas financing." Presently, 42 countries have "public debt exposure to China exceeding 10 per cent of GDP."

China: Aerospace Science and Industry Corporation launches high-resolution Earth observation satellite
On 27 September, China Aerospace Science and Industry Corporation announced the launch of a Kuaizhou 1A carrier rocket "to place a high-resolution Earth-observation satellite in space." According to the agency, the launch took place from the Jiuquan Satellite Launch Center and marked the 11th flight of the Kuaizhou 1A.

China: State council releases White paper on Xinjiang
On 26 September, the State Council Information Office of the People's Republic of China released its first white paper focusing on the population dynamics in the Xinjiang region. The 64-page report displayed the fast demographic development over seven decades and boasted of a 99.96 per cent enrollment rate in primary education in the region. Xinjiang spokesperson Xu Guixiang said: "Xinjiang is a book with profound content. A few days staying here would only let people know its cover while its content, characteristics, and spirits need longer time to ponder over."

North Korea: Anti-aircraft missile tested
On 30 September, North Korea test-fired a new anti-aircraft missile. This marked its fourth test within a month. Earlier this week, Pyongyang launched a hypersonic missile with nuclear capabilities. The US Secretary of State Anthony Blinken said: the tests "create greater prospects for instability and insecurity". North Korea said: "weapons are needed for self-defense," and accused the US and South Korea of "double standards". According to KCNA, the new anti-aircraft missile showed "remarkable combat performance" and included "new key technologies".

Japan: Cabinet drafts cyber security strategy; blames China, North Korea and Russia as threats
On 27 September, Japan adopted a draft cybersecurity strategy for the next three years. The Japan Times reported the Cabinet said: "The situation in cyberspace contains risk of rapidly developing into a critical situation" and that the three states China, Russia, and North Korea are "suspected of being involved in hostile cyber activities." Cabinet also added the country will take, "tough countermeasures using every effective means and capability available," including diplomatic responses and criminal prosecutions.

South Asia This Week
India: Adani Group signs port deal with Sri Lanka
On 1 October, India and Sri Lanka entered into a USD 700 million deal to build a strategic deep-sea container terminal known as the Colombo West International Terminal. The Sri Lanka Ports Authority (SLPA) said: "The agreement worth more than $700 million is the largest foreign investment ever in the port sector of Sri Lanka." The deal is signed between India's Adani group, which will have 51 per cent of the controlling stake, and John Keells will account for 34 per cent stake in the joint venture.

Pakistan: Defence Secretary strengthens military ties with Russia
On 29 September, the third round of the Russia-Pakistan Joint Military Consultative Committee (JMCC) led by Defence Secretary retired Lt Gen Mian Mohammad Hilal Hussain and Russian Deputy Defence Minister Col Gen Alexander V. Fomin agreed to strengthen "bilateral military cooperation." The leaders discussed the current status of bilateral relations as well as different areas of mutual cooperation, including military training, joint exercises, intelligence cooperation, and defense industrial cooperation.

Pakistan: Imran Khan talks about a dialogue with the TTP
On 1 October, Prime Minister Imran Khan, in an interview with TRT World said that the government is in talks with some groups of Tehreek-i-Taliban Pakistan (TTP), seeking a reconciliation. He said, "There are different groups which form the TTP and some of them want to talk to our government for peace. So, we are in talks with them. It's a reconciliation process." He also added, "We might not reach some sort of conclusion or settlement in the end but we are talking." On the same day, the TTP announced a three-week ceasefire, starting from 1 October till 21 October.

Afghanistan: Taliban asks countries to reopen embassies
On 2 October, the Taliban's Acting First Deputy Prime Minister, Mullah Abdul Ghani Baradar asked countries to reopen Afghan embassies. He also added, the Islamic Emirate "does not have any policy to harm any country." Tolo News reported, Acting Foreign Minister Amir Khan Muttaqi said: "We want to open a new political chapter of good governance at home and a new political chapter with the region and the world as far as our relations are concerned."

Central Asia, Middle East and Africa This Week
Kazakhstan-Kyrgyzstan: Government delegations meet with Taliban officials
On 1 October, Radio Free Europe Radio Liberty reported that representatives of both the Kazakh and Kyrgyz governments met with Taliban officials. According to the Taliban officials, the meetings focused on trade relations along with a promise from the Taliban that they would not allow any group to use Afghan territory to plot attacks on neighbouring countries.

Syria: Jordan reopens borders; Russia and Turkey discuss Syria; The US rejects normalization
On 29 September, Jordan reopened its Jaber-Nassib border crossing with Syria to reintroduce Syria in the regional political and economic bodies. On the same day, Turkish President Recep Tayyip Erdogan visited Russian President Vladimir Putin in Moscow and discussed cooperation on the Syrian war. Erdogan said: "Peace (in Syria) depends on the relations between Turkey and Russia." On the same day, the US announced that it would not normalize of upgrade relations with Syria. The State Department spokesperson said: "Assad has regained no legitimacy in our eyes, and there is no question of the US normalizing relations with his government at this time."

Qatar: Emir holds first legislative elections
On 2 October, Qatar held elections for two-thirds of the advisory Shura Council, a first in the country's legislative history. The voter turnout for the election was around 44 per cent. The election is being held to appoint 30 members of the 45 seat Shura Council out of which the Emir will appoint 15 seats. Across Qatar, 233 candidates took part in the election, out of which 26 were women. However, none of them were elected.

Israel: Foreign Minister inaugurates embassy in Bahrain
On 30 September, Israeli Foreign Minister Yair Lapid reached Bahrain on the occasion of inaugurating the Israeli embassy in Manama. The exchange marks the first official visit by an Israeli minister to Bahrain and also the first commercial flight between the two countries. Lapid said: "We talked about the cooperation between our countries and about taking the official peace between us and turning it into an active, economic, security, political and civic friendship." The relaxation of tensions between the two countries was not appreciated by Palestinians who felt abandoned by the Arab states' approval of Israel.

Mali: The UK calls for a reconsideration of the defence deal with Russia
On 30 September, the Malian Defence Minister Sadio Camara referred to the delivery of four helicopters, weapons and ammunition from Russia and explained that the deal was made in December 2020 to help in their fight with the ISIL and al-Qaeda. He said: "Mali bought these helicopters from the Russia Federation, a friendly country with which Mali has always maintained a very fruitful partnership." On 29 September, the Africa Minister of the UK joined the international pressure on Mali to reconsider the deal with the Russian Wagner group. She said: "The UK is deeply concerned by consultations between the Malian government and the organization known as the Wagner Group. The Wagner Group is a driver of conflict and capitalizes on instability for its own interests, as we have seen in other countries affected by conflict such as Libya and Central African Republic."

Ethiopia: Government issues persona non grata to seven UN officials
On 1 October, the Guardian reported that the Ethiopian government had expelled seven senior UN officials for interfering in the internal affairs of the country. The expelled officials were given 72 hours to leave the country. The UN Secretary-General Antonio Guterres expressed shock over the expulsion while UN aid chief Martin Griffiths once again stressed upon the need to get the aid trucks moving into the country's interiors where lakhs of people may be suffering from a famine.

Tunisia: President appoints first female Prime Minister
On 29 September, President Kais Saied announced Najla Bouden Romdhane as the Prime Minister two months after seizing power in the country. Not much is known about her other than being a part of the World Bank.

Guinea: Colonel Mamady Doumbouya appointed as interim President
On 1 October, Colonel Mamady Doumbouya was appointed as the interim President after the coup overthrew President Alpha Conde. Colonel Mamady led the coup on 5 September. He promised the country and the international observers that his junta would not prevent any elections in the country post the transition period. He pledged to "loyally preserve national sovereignty" and to "consolidate democratic achievements, guarantee the independence of the fatherland and the integrity of the national territory".

Europe and The Americas This Week
The EU: The US holds Trade and Technology Council meetings
On 28 September, the US Secretary of State Antony Blinken and other delegates met the EU delegation and held the Trade and Technology Council (TTC) meetings. They discussed bilateral and multilateral issues, WTO reforms, the upcoming MC12 agenda and the challenges posed by controlling states. They also pledged to work towards cooperation. The US and EU also discussed the growing Chinese influence in technology and trade in the international market.

Hungary: Foreign Ministry signs 15-year deal with Gazprom
On 27 September, the Hungarian Foreign Minister Péter Szijjártó announced the 15-year natural gas supply deal with Gazprom. Ukraine expressed displeasure with the development as it would lose out on millions of transit fees as the gas will be supplied through Austria and Serbia. The Ukrainian Foreign Ministry stated that the deal was a "purely political, economically unreasonable decision that was taken to the detriment of Ukraine's national interests and Ukrainian-Hungarian relations."

The EU: Court cancels two agreements with Morocco
On 29 September, Euronews reported that the top court on the European Union had called off two agricultural and fishing agreements with Morocco, which allowed the sale of products produced in the disputed Sahara region. This could endanger the trade deals between Belgium and Morocco who have already quelled fears of discontinuation of trade and instability between the EU and Morocco. However, the trade deal will continue for another two months before any changes.

Paraguay: Indigenous communities protest against amendment of land invasion law
On 29 September, the indigenous communities in Paraguay protested against a law that criminalized invading private property. The protests turned violent after seven police officers were injured, four cars were set ablaze, and the mob vandalized the public property in the country's capital city. One of the officers was hit by an arrow and then beaten with sticks and stones. However, it is unsure if the people who engaged in this violence belonged to the indigenous communities. The indigenous community in Paraguay was protesting against the amendment as the communities often invaded private properties and demanded the land be given to poor farmers.

Venezuela: President Maduro removes six zeros from currency for ease of transactions in the hyperinflated economy
On 1 October, Venezuela announced the launch of its second monetary overhaul, which cut six zeros from the currency due to hyperinflation. The move was passed to help account for business handling, which was being challenged by the huge figures. At present, the minimum wage salary is USD 2.50 per month, whereas the year-on-year inflation stands at 1,743 per cent. The people do not seem to look forward to any easing up in the economic crisis any time soon as this is the second overhaul in three years.

About the Authors
Keerthana Nambiar is a postgraduate scholar in the Department of International Relations in the University of Mysore. Sukanya Bali is a PhD Scholar at OP Jindal University. D Suba Chandran is Professor and Dean of the School of Conflict and Peace Studies at the National Institute of Advanced Studies. Avishka Ashok is a Research Associate at NIAS.