NIAS Area Studies
PAKISTAN READER
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By Padmashree Anandhan
Putin’s address in the Valdai International Discussion: Six takeaways
On 27 October, the Valdai International Discussion Club held its regular conclave in Moscow on - A Post-Hegemonic World: Justice and Security for Everyone. The four-day meeting was attended by representatives from different fields from Russia and 40 countries across the globe, including Afghanistan, China, France, Germany, India, Kazakhstan, China, the US, and Iran. The key highlight was the address of Russia’s President Vladimir Putin; he discussed the changing liberal ideology, the US model of international order, Russia’s stand on the world order, Ukraine’s statehood, nuclear policy, and the energy sector.
Six takeaways
First, focus on dominance as a rule for the West. In the address, Putin highlighted the aggressive nature of the West, which has escalated the Ukraine war, and the situation in Taiwan destabilized the food security and energy markets. He termed the cultural value claimed by the West as “Cancel culture,” and criticized it for showcasing itself as a “guardians of liberalism and progress” but it only removes the other existing cultures, and restricts free thoughts in economics and politics. Putin pointed out how under “new global interdependence” the West role-plays monopoly in setting in the financial and technological sectors to practise the Western model of globalization and dominance in the global economic and political fora. Apart from this, he also brought out the need for new social models and the rights of Asia, Islamic states, and monarchies of the Persian Gulf to have their socio-political system. He criticized the West on the same, stating it suffered from a “doctrinal crisis of the neoliberal American-style model of international order,” which provides no space for progress and contradicts the multipolar world by preserving its dominance.
Second, emphasis on traditional values over liberal ideologies. On the liberal ideology, Putin pointed to the changing nature of liberalism, where classic liberalism, which was once seen as freedom for a person to think and act, is now seeing enemies within the said open society and wanting to restrict the freedom of the enemies. He accused Western ideologists and politicians of making the world believe that there was no alternative to democracy since the colonial period while it rejected all other forms of government. According to Putin, the West’s way of undermining the “liberal rules based order,” has only resulted in trade wars, sanctions, embargoes, colour revolutions, and coups. On the same, he said: “They killed Soleimani, an Iranian general. You can think whatever you want about Soleimani, but he was a foreign state official. They killed him in a third country and assumed responsibility.” Criticizing the western liberal order, he focused on the importance of the emerging neo-liberal ideas and highlighted its unique nature in terms of culture and history. Giving the examples of traditional societies such as East, Latin America, Africa, Eurasia, and minorities within the West, he stressed that the traditional values, and cultural identity they hold must be respected in the interest of the people, and civilization than being overpowered by the neoliberal elites.
Third, Russia’s approach as independent and inclusive. Highlighting Russia’s efforts to build collective security with the West, Putin expressed that the West always stood against cooperation and supported nurturing of terrorists in Russia. He said that Russia’s aim was not to challenge or replace the Western domination or the Western elites, but to uphold its right to exist and develop. The major plan is to broaden the space for other countries, increase interaction with neighbors and pave way for an economic multipolar world order, but he accused the West of being the barrier to its development and pushing it to become a tool to achieve its geopolitical goals. He later brought out how Russia has been successful in strengthening its economy, dealing the internal and external terrorism, and traditionally developing its foreign technology policy to provide a platform by creating an industry by building plants, training personnel in other countries to create competencies rather than the West’s approach to bankrupt the firms and deprive them of any advancement.
Fourth, on Ukraine’s statehood. On the lines of achieving Russia’s geopolitical goals, Putin highlighted how NATO was fortifying the Donbas region in the last eight years and how Ukraine’s statehood was shaped by Bolsheviks giving away “Malorossiya (Little Russia), the entire Black Sea region, and all of Donbas” (Russian historical lands) without the consent of the people to the nationalist-minded Bolsheviks. After the Bolsheviks, former leader Joseph Stalin joined Polish, Hungarian, and Romanian territories into Ukraine which became its sovereignty. With Poland’s influence gaining ground, language change began, ethnic Russians and Russian Orthodox Christians who wanted to join back Russia were put off by the European under the “divide and conquer rule,” which according to Putin became the first step of Europe to divide Russian unity. He said: “It is all part of our history. But it is also a historical fact that Russians and Ukrainians are essentially one ethnicity.”
Fifth, possibility for Russia to use the nuclear weapon, Putin’ criticised, the US, the UK for being on the front to deploy tactical nuclear weapons in Europe and being provocative in uniting the international countries to form collective defence. Putin stressed that Russia’s statement was only a hint and not a direct threat to use nuclear weapons. He affirmed Russia’s cooperation for IAEA investigations and accused Ukraine for playing under cover. On the usage of nuclear weapons, Putin highlighted the “Military Doctrine,” which provides the rules for Russia to used WMD’s under threat to sovereignty, territorial integrity and protection of Russians.
Sixth, future scope of Eurasian cooperation. Russian integration into the Europe has been a basis for the conflict in Ukraine. According to Putin, it was due to systemic mistakes of European leaders in the energy, food, and monetary sector that has led to inflation, whereas the Eurasian Economic Union which operates at the interest of the member countries to fill the gap between the North-South transport corridor to boost growth. He assured to create a “collective west,” with the population from Eurasia.
IN FOCUS
By Madhura S Mahesh
US Inflation Reduction Act 2022: Four issues for Europe
On 26 October, the European Commission Head of Cabinet to Pres. von der Leyen and the US Deputy National Security Adviser Mike Pyle at their meeting in Berlin launched the “EU-US Taskforce on the Inflation Reduction Act.” The task force was established to address the concerns of the EU regarding the Inflation Reduction Act (IRA).
On 16 August, US President Joe Biden signed the Inflation Reduction Act (IRA) into law. This act was introduced to combat climate change and is the largest investment in the US’s social safety net. The continuation of premium subsidies of the Affordable Care Act and caps on drug prices are some of the policies introduced under this act. The policy that caused an uproar in Europe and the rest of the world was that of the change in subsidies plan for electric vehicle production. The European Commission spokeswoman Miriam Garcia Ferrer said: “The European Union is deeply concerned by this new, potential, trans-Atlantic trade barrier. We think that it’s discriminatory, that it’s discriminating against foreign producers in relation to U.S. producers.”
Four issues for Europe
First, the change in subsidy plans towards electric vehicles. The US offered USD 7500 worth of subsidies for all-electric vehicle buyers irrespective of the company and where it was produced. The IRA act changes this and now the incentive is offered only to buyers of electric vehicles assembled in North America only. It was done to encourage the people to “buy American” and boost domestic production, but affects Europe especially Germany in a bad way. Germany is a hub for automobile manufacturing with vehicles of Mercedes Benz, BMW and Volkswagen having manufacturing centres in Germany. With this new change, European-assembled vehicles will be more expensive compared which will lead to a decrease in sales. If they do go on to open production facilities in North America, it will decrease production in Europe and lead to a decrease in revenue for European nations.
Second, the possibility of a legal complaint to the WTO. After this law came into effect, electric vehicle manufacturing countries have considered approaching the WTO to address the issue. The countries that have expressed this option are all allies of the US. It is being considered as a last step as many think the new law is violating the WTO’s principle of fair and undistorted competition. With the law only providing subsidies to vehicles manufactured in North America, critics are saying this will lead to skewed competition in the American market and has ramifications in economies around the world. The law will make all the non-American produced electric vehicles more expensive in the US market. This will lead to a decrease in demand and a subsequently a decrease in revenue for the car manufactures. If the companies do open a production unit in North America it will take away the revenue from the companies origin country. If the matter is raised and taken to the WTO then it will be a long drawn-out affair for both sides and may start a pseudo-trade war between the opposing nations and the US. The EU which had launched an investigation looking at whether the new law will violate WTO rules said that they will be raising this concern at the joint US - EU Trade and Technology Council meeting in December.
Third, BASF's to decrease its presence in Germany. BASF is a German multinational company and the largest chemical producer in the world. On 26 October, it announced its third-quarter results where it outlined how its earnings have reduced due to a high gas and power prices. This has led to the company announcing that it would be reducing its presence in Germany by reducing business activities and jobs in Germany. This lands a huge blow to the German economy as BASF is a large company and this reflects the competitiveness in the European market. It stated how gas is six times more expensive in Europe compared to the US and with the US Inflation Reduction Act, which has provisions for climate change and increasing incentives for production may lead to BASF and similar companies to open production units in US. This will become an alternative source of production wherein the output price will be cheaper compared to the output produced in Europe due to lesser production cost.
Fourth, the possibility of a “Buy European Act.” On 26 October, French President Emmanuel Macron advocated for a “Buy European Act” to counter the growing competition from China and the new IRA bid to increase domestic production. In the meeting between Macron and German chancellor Olaf Scholz, discussed the IRA and plan to push European Commission to introduce a plan which would counter the IRA and boost domestic production. The EU has always veered away from polices that are protectionist in nature which has worked for it to build a free and competitive market. Macron’s statement opens the door for these policies and addresses the larger issue of dwindling influence of Europe when it comes to market competitiveness. EU’s history of depending on other nations for production has hampered its own growth market and has led to domestic production being expensive. The IRA and Macron’s statement is forcing Europe to rethink its strategy.
References
“Launch of the US-EU Task Force on the Inflation Reduction Act,” ec.europa.eu, 26 October 2022
“The Inflation Reduction Act Is Now Law—Here’s What It Means For You,” Forbes, 23 August 2022
“EU says US electric vehicle tax credit could break WTO rules,” AP News, 11 August 2022
“U.S. Inflation Reduction Act a risk to Europe's industrial base, EU's Vestager says,” Reuters, 26 October 2022
“S. Korea discusses U.S. EV tax law with European nations,” YONHAP NEWS AGENCY, 19 October 2022
“US trade partners on warpath over electric vehicle tax credits in Manchin-Schumer,” Washington Examiner, 11 October 2022
“Europe threatens trade retaliation over electric vehicle subsidies in Biden bill,” Washington Examiner, 29 October 2022
“Scholz and Macron threaten trade retaliation against Biden,” POLITICO, 27 October 2022
“Emmanuel Macron calls for ‘Buy European Act’ to protect regional carmakers,” POLITICO, 26 October 2022
War in Ukraine: Day 248 & 249
By Rishma Banerjee
War on the Ground
On 30 October, Ukraine’s President Volodymyr Zelenskyy reported on a meeting with the 27th meeting with the Staff of the Supreme Commander-in-Chief. Ukraine’s war efforts on the frontline, strategies for further liberation of occupied territories, ammunition and equipment supply and coordination of the defence forces was discussed between the parties. Zelenskyy also mentioned that Russian forces were continuing their efforts in Chernihiv, Kharkiv, Donbas, Dnipropetrovsk, Zaporizhzhia, Mykolaiv and the surrounding regions. He also mentioned that Ukraine has finally been able to restore energy supply internally and thus no emergency blackouts had been reported. However, since generation deficits are still prevailing, he urged the citizens to practice “…extremely frugal electricity consumption and stabilization restrictions.” He criticised Russia for suspending the Black Sea Grain Deal and reported that 218 vessels were waiting in Ukrainian ports to be sent to the global markets. He accused Russia of pushing the world into a food shortage again and the resultant rise in prices.
On the same day, the Ukraine’s General Staff of the Armed Forces reported that units of Russian forces were being deployed to Belarus, exacerbating the threat of missile strikes and drone attacks from Belarus to Ukraine. It also warned against the use of unmanned aerial vehicles from Belarus on Ukraine’s territory. Forces stationed at the border with Belarus are thus preparing for a possible attack amidst intermittent shelling in the region. Spokesperson Halyna Shekhovtsova told Sky, that her unit was preparing for additional fortifications due to the perceived rise in risk.
On 30 October, New Jersey-based non-profit organization Hope For Ukraine (HFU) which supports and rehabilitates the poorest individuals and communities in Ukraine announced in a press release that since February, 36 million meals have been delivered in Ukraine. Additionally medical supplies to 18 hospitals, housing, and medical attention to 1300 refugees, and clothing and hygiene products to 52,000 people have also been given. On this issue, HFU Founder Yuriy Boyechko said: “The war is not over and the situation on the ground gets worse each day… We are improving life, one breath at a time. You can count on our organization to bring hope to many hopeless situations in the Ukraine.”
On 28 October, people from the Iranian diaspora in Ukraine protested in the Maidan Independence Square in Kyiv against Russia’s aggression in Ukraine and Iran’s support of the same. The organizer of the protest, Goreshi Mansour said that they do not support the actions of the Iranian authorities and are against the destruction caused by Iranian Kamikaze drones used by Russia.
The Moscow View
Claims by Russia
On 29 October, Russia’s defence ministry reported that Ukraine had launched an unsuccessful attack with nine aerial and seven naval drones on Russia’s Black Sea Fleet stationed in Sevastopol in Crimea. However, Russia’s army was able to “destroy” the drones. The ministry accused UK of training the Ukrainian 73rd Special Center for Maritime Operations, which had carried out the attacks. Terming it as a “terrorist attack,” the Governor of Sevastopol Mikhail Razvozzhayev said that it was the “most massive” drone attack by Ukraine since the beginning of the war.
On the same day, Moscow’s ambassador to Washington, Anatoly Antonov responded to the criticism against Russia for suspending the Black Sea Grain Deal. He said that the reason behind the suspension was Ukraine’s drone attacks on the Sevastopol fleet but also because of “Washington's reaction to the terrorist attack on the port of Sevastopol” and the “complete disregard” the US showed towards Russia’s allegations of Ukrainian attack. Antonov also responded to the accusations that Russia is exacerbating global hunger and stated that ever-since the brokering of the deal, it has repeatedly emphasized on sending the grains to the poor countries Somalia, Ethiopia, Yemen, Sudan and Afghanistan, even though only received only three per cent of the total products.
The West View
Responses from the US and Europe
On 30 October, the US, the UK and the EU along with Ukraine and the international community responded strongly to the Russia suspending the Black Sea Grain Deal. Due to the deal, so far, nine million tonnes of food and grains from Ukraine and Russia had been made available to the global market, thus bringing down soaring food prices by 15 per cent since March. NATO Spokesperson Oana Lungescu said, that Putin was once again “weaponizing food” and urged him to reconsider his decision. On the same issue, UN Secretary General mentioned he was deeply concerned about Russia’s actions and he be postponing his departure to attend the Arab League summit to try and revive the deal. Russia has requested a UNSC meeting on 31 October on the same issue.
On 28 October, tens of thousands of Czechs reached the capital to demonstrate their solidarity for Ukraine. The rally happened in the context of three anti-government displays where protestors exhibited agitation against the pro-Western Czech Prime Minister. The organisers of the previous rallies were known to be pro- Russian as well. The people on 28 October waved the Czech, Ukraine and EU flags, and cited, “Czech Republic against fear.” Organised by a group named Million Moments of Democracy, the rally expressed that the anti-government protests “exploited fear in inflation” and was undermining democracy.
On 29 October, Poland’s Prime Minister Mateusz Morawiecki announced that US based Westinghouse had received the contract to build Poland’s first nuclear power plant. The move is to reduce Poland’s reliance on coal and to increase its energy independence. Morawiecki assured that the technology to be used would be “reliable and safe.” US’s Energy Secretary Jennifer Granholm appreciated Warsaw’s decision and said: “This announcement also sends a clear message to Russia: We will not let them weaponize energy any longer.”
On 29 October, European Central Bank (ECB) President, Christine Lagarde said that the Bank will have to raise interest because of inflation caused by Russia’s war in Ukraine. On 27 October, the ECB had raised its interest rates to a record high since 2009. She said: “That's what he [Putin] is trying to do, cause chaos and destroy as much of Europe as he can… This energy crisis is causing massive inflation which we have to defeat.”
THE GLOBAL FALLOUTS
Implications of the Ukraine war
On 28 October, at an address to the UNSC, International Atomic Energy Agency Director General Rafael Mariano Grossi referred to the “extremely fragile and dangerous” nuclear safety and security situation at the Zaporizhzhya Nuclear Power Plant (ZNPP). He mentioned that considerable progress had been made in the establishment of a nuclear safety and security protection zone around the ZNPP, and because of high-level consultations with Ukraine and Russia, IAEA was “not far from” setting up the safe-zone.
References
“There were no emergency blackouts in the country today, but the generation deficit persists, therefore frugal electricity consumption should be continued - address by the President of Ukraine,” president.gov.ua, 30 October 2022
“Russia continues redeploying separate units to Belarus,” Ukrinform, 30 October 2022
“36 Million Meals Provided In Ukraine By American Relief Organization Hope For Ukraine,” Kyiv Post, 30 October 2022
“Iranians Protest in Kyiv Against Iran’s Participation in Russia’s War,” Kyiv Post, 28 October 2022
“A unified database of victims of repressions will appear in Russia,” LENTA.RU, 30 October 2022
“Moscow responds to criticism over grain deal suspension,” RT, 30 October 2022
“Russian military reveals details of Ukrainian drone attack in Crimea,” RT, 29 October 2022
“Russia Says Repelled Ukraine Drone Attack on Crimea Fleet,” The Moscow Times, 29 October 2022)
“Armenia ready to implement Russia’s peace plan – PM,” RT, 28 October 2022
“Extraordinary session of the CSTO Collective Security Council,” kremlin.ru, 28 October 2022
“UN, Nato, EU and US call on Russia to resume Ukrainian grain deal,” The Guardian, 30 October 2022
Pavel Polityuk and Michelle Nichols, “U.N., Turkey, Ukraine press ahead with Black Sea grain deal despite Russian pullout,” Reuters, 31 October 2022
Jones Hayden, “Poland picks Westinghouse to build its first nuclear plant,” POLITICO, 29 October 2022
“UPDATE: Poland ready to help Ukraine transport goods: foreign ministry,” Radio Poland, 31 October 2022
“Tens of thousands of Czechs show their support for Ukraine,” The Washington Post, 30 October 2022
“Lagarde: ‘Sick’ Putin behind Europe’s inflation crisis,” POLITICO, 29 October 2022
“IAEA Chief Visits US: Nuclear Energy, Ukraine and UN Security Council,” iaea.org, 28 October 2022
IN BRIEF
By Sai Pranav, Madhura S Mhesh, and Sandeep Ganesh
DENMARK
Three candidates fight against Frederiksen to become the next Prime Minister
On 30 October, THE LOCAL dk provided profiles for the four candidates of the Prime Ministerial election in Denmark, which will be held on 01 November. The major candidates are the centre-left Social Democrats Prime Minister Mette Frederiksen, the liberal Jakob Ellemann-Jensen, the conservative Soren Pape Poulsen and the centrist moderate Lars Lokke Rasmussen. Frederiksen was the second female Prime Minister of Denmark after Helle Thorning-Schmidt. She has implemented tougher migration policies to defend the welfare state. She lost her popularity because she illegally handled the culling of the minks population due to the fear of mutation of the novel coronavirus. Ellemann-Jensen had a family of members of parliament and succeeded the former Prime Minister Rasmussen to lead the Liberal Party, whereas Pape Poulsen is considered the wild card on the right wing. However, a scandal involving the lineage of his husband led to the fall of his popularity. His party is now faring at six per cent, while it trailed 16.5 per cent of votes two months ago. Rasmussen formed a new party named the Moderates which rose from polling 1.8 per cent a month ago to 11.5 per cent now. (“Three candidates for PM in Denmark, and one wild card,” THE LOCAL dk, 30 October 2022)
SWEDEN
Swedish Meteorological Institute predicts a rise in temperature in winter
On 28 October, Kristianstad city in Southern Sweden experienced 19.5 degrees Celsius, making it the highest recorded temperature in Sweden in late October. It is not the highest recorded temperature for October. However, it is the highest during the period of late October-early November. A meteorologist at the Swedish Meteorological and Hydrological Institute (SMHI), Erik Hojgard-Olsen, said that 2022 October had been warmer than usual by a few degrees in Sweden and that the meteorologists have continued to observe high temperatures with a warmer climate in 2022. (“Sweden sees record heat for this late in the year,” THE LOCAL se, 29 October 2022)
REGIONAL
Sweden’s Prime Minister’s first bilateral visit to Finland
On 28 October, Sweden’s Prime Minister Ulf Kristersson met with Finland’s Prime Minister Sanna Marin in Helsinki, discussing bilateral relations between the two countries and their future in NATO. Marin and Kristersson had discussed strengthening their cooperation to respond to hybrid threats or creating supply security for both countries. Finland and Sweden are closed due to access to NATO simultaneously. The Prime Ministers also condemned Russia for violating the UN Charter by invading Ukraine. Marin and Kristersson agreed to continue supporting Ukraine in the ongoing war. They also discussed the technological sector and the scope of business in network technologies. Kristersson met Finland’s President Sauli Niinisto, and it will be his first time abroad as a Prime Minister has been to Finland. (“Prime Minister Marin and Swedish Prime Minister Kristersson highlight importance of cooperation between Finland and Sweden,” valtioneuvosto.fi, 28 October 2022)
EU asks Kosovo to extend the deadline for change of license plates
On 29 October, European Commission’s spokesperson for foreign affairs and security at the Nabila Massrali said that Kosovo should extend the deadline for the phase-out of old Serbian license plates. These license plates are still being used by ethnic Serbs in Serbia. Massrali added: "This has been the consistent advice of Kosovo's closest partners, including the EU and the U.S. It is disappointing to see it has not been followed." The EU agreed that Kosovo has the right to phase out old license plates but said that the way it is being done violates an agreement from 2016 which calls for a 12-month period for the process. Massrali’s statement comes after Kosovo’s Prime Minister Albin Kurti introduces a new plan relating to the new license plate registration rule which promotes a gradual phase-out of the old license plates. Starting from 01 November, drivers will be issued warnings for three weeks. Following this for the next two months fines will be levied and after which for two-months temporary licence plates will be valid. All of this is done to ensure that by 21 April 2023 all the vehicles will have the new licence plates and failure to do so will lead to confiscation of vehicles. (“EU Urges Kosovo To Allow More Time For Conversion Of Serbs' License Plates,” rfel.org, 29 October 2022)
EU to provide new grants to Serbia towards energy prices and infrastructure
On 28 October, European Commission President Ursula von der Leyen announced that Serbia will be providing EUR 165 million in grants to Serbia. von der Leyen announced EUR 165 million to support the budgetary requirements regarding energy provision for the vulnerable population and businesses. This is a short-term solution and not a sustainable one according to the President. President von der Leyen also announced an additional 500 million in grants for investment in energy infrastructure which will benefit and diversify Serbia’s energy sources. some of the projects under this will be the Trans-Balkan Electricity Corridor, a gas interconnector between Serbia and North Macedonia. and a new, modern and more energy-efficient University Children's Hospital in Belgrade. During her visit to Serbia, von der Leyen visited the construction site of the Serbia-Bulgaria gas interconnector which was 80 per cent funded by the European Commission and the European Investment Bank. (“Statement by President von der Leyen on the occasion of her official visit to Serbia,” ec.europa.eu, 28 October 2022)
SCIENCE AND TECHNOLOGY
Slovakia and Poland hit with cyber attacks
On 29 October 2022, the Polish and Slovakian parliaments were hit by cyber-attacks affecting the functioning of the Senates. Slovakia’s Deputy Speaker Gabor Grendel said that the Parliament was hit around 1100 hours when the parliament was set to vote on several bills. Grendel said that the parliament was informed by the head of the administrative department that the entire parliament’s computer system was down due to a cyber attack on its IT system. Slovakian parliamentary speaker Boris Kollar said that the attacker has not been identified and that technicians are looking into the source of the problem and getting the system back up. The Polish parliament’s entire IT infrastructure was attacked and the authorities are of the view that Russia is behind this attack. The Polish Senate issued a statement saying: “The attack was multi-directional, including from inside the Russian Federation. Polish Senate Speaker Tomasz Grodzki called the Russian government a “terrorist regime”. (A massive cyberattack hit Slovak and Polish Parliaments,” Security Affairs, 29 October 2022)
Hyundai Motor Group to build electric vehicles in Slovakia from 2025
On 31 October, Hyundai Motor Group announced that they will be producing electric vehicles in Slovakia. The Kia Corporations Slovakian plant will now mass-produce pure battery electric vehicles (BEVs) for Europe from 2025. No further details have been reported regarding the nature of production. Built-in 2006, the plant currently has exceeded four million units in cumulative production. Slovakia has come up as a major player in the production of EVs with automobile production consisting of 13 per cent of Slovakia’s GDP. (“Hyundai Motor Group to Produce EVs in Slovakia from 2025,” Business Korea, 31 October 2022)