CUTS International Washington DC Center
Monthly Brief #40, July 2021
Revamping Capitalism by Strengthening Market Competition
 
“Capitalism without competition isn’t capitalism; it’s exploitation”, said Joe Biden rightly while signing an executive order to promote greater competition across the American corporate landscape. This is a welcome step in the right direction at a time when the global tech giants are wrapping the world market and resources in their hands, giving them an unhindered control over a zillion bits of data.
 
It is in the recent past the world started to see actions from various governments to limit the power of corporate giants who harm the competitive atmosphere in the market. The News Media Bargaining Code was passed by Australia to address the bargaining power imbalances between Australian media and big digital platforms such as Google and Facebook. Other than Australia, European Union and countries including Canada are actively looking to curb the monopoly powers of global tech giants. India, too is working on regulating the power of big tech firms to make them accountable and protect national interests.
 
Even though we cannot take away the credit from big tech for innovation, democratising access and opportunity, the concentration of power and wealth in the hands of few will increase inequalities, inefficiencies and exploitation. The concerns around misinformation and disinformation are increasing every day. During this age of artificial intelligence and machine learning, unlimited access to data of its citizens in the hands of corporates and even states is dangerous and undesirable. It can result in manipulation, misuse, cheat practices, surveillance capitalism and crushing of dissent. After all, one should remember that with the help of AI a dead person can be kept alive.

Given their democratic traditions, India and U.S. can come together to dispassionately discuss these issues and design norms. At the same time, they can work towards enabling access to digital infrastructure for which India needs USD 10 billion per year for bridging the digital divide. This is all the more important given the role tech will play in inclusive recovery from the horrendous pandemic.
 
India and the U.S. along with their democratic friends can create a regulatory framework to curb the hegemony of global big powers and to enable a level playing field for both domestic and foreign market players, including start-ups and MSMEs. It is worthy for them to remember that efficiency is achieved only through fostering competition through designing inclusive standards, open APIs, interoperability and portability in a capitalist system.
                                        
Pradeep S. Mehta
Editor

P.S.: Will the unconditional exit of U.S. from Afghanistan affect the stability and power relations in the Indian sub-continent? Is it going to affect the geo-strategic interests of India and the Quad?

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The world requires a trust-based model of governance
The world has come a long way from Globalisation 1.0. While issues like covid vaccine coverage or industrial development may appear far more important for poor countries, what has not changed is the top-down decision-making process. Now the world’s seven richest countries have decided that it is time for taxation reform. They have set a global minimum corporate-tax rate of 15% without consulting other countries.

WTO TRIPs | Waiver on COVID-19 vaccines: Promoting One World, One Health
Stressing on the need for unity and solidarity during this global health crisis, Indian Prime Minister Narendra Modi has sought support for text-based negotiation from the G-7 nations at their Summit in Cornwall, United Kingdom, which was held from 11th to 13th June, 2021. This is a third volume of CUTS Occasional News Wrap on this subject, which covers various dimensions of TRIPs waiver on the COVID-19 vaccines so that they are available in an affordable manner worldwide, including the least developed countries.
 
Think tank recommends India set up new trade negotiating body
As India prepares for renegotiations and new trade negotiations with complementary markets including the UK, U.S., and European Union, a think tank paper has recommended establishing a new body of experienced trade negotiators with a designated trade representative within the ministry of commerce. Normally, India’s trade negotiations are done by bureaucrats from the commerce ministry either through permanent representation in Geneva at the World Trade Organisation (WTO) or through a need-based swift move of other civil servants from relevant ministries, Ridhika Batra, a non-resident senior fellow at the Atlantic Council’s South Asia Center and vice president of corporate affairs, Americas for the Mahindra group, said in the report.
 
India had trade surplus with 9 of the 20 Indo-Pacific countries in 2020: CII
India’s trade with select Indo-Pacific economies increased eight times over the last 19 years, reaching $262 billion in 2020 from $33 billion in 2001, with the U.S. being the largest trade partner with a dominant share (Paywall) of 29% in 2020. As per the study, India had a trade surplus with eight countries- Kenya, Mauritius, France, Fiji, Bangladesh, Sri Lanka, Maldives and the U.S.- from 2016 to 2020.

 

U.S. Secretary Granholm and Indian Minister Khuba Celebrate Subnational Clean Energy and Climate Partnership between NASEO and AREAS
U.S. Secretary of Energy Jennifer Granholm and India’s Minister of New and Renewable Energy Bhagwanth Khuba joined the National Association of State Energy Officials (NASEO), India’s Association of Renewable Energy Agencies of States (AREAS), Center for Strategic and International Studies (CSIS), and SED Fund for the signing of a Memorandum of Understanding (MOU) promoting coordination and capacity-building between state-level energy officials in the United States and India.

Solar Power is Dirt-Cheap and about to get even more powerful
A push for more powerful solar equipment underscores how further cost reductions remain essential to advance the shift away from fossil fuels. While grid-sized solar farms are now typically cheaper than even the most advanced coal or gas-fired plants, additional savings will be required to pair clean energy sources with the expensive storage technology that’s needed for around-the-clock carbon-free power.
 
India wants rich countries to pay more for green energy shift
India can’t prioritise eliminating (Paywall) greenhouse gas emissions without sufficient financing from richer nations to help offset the high cost of transitioning to clean energy, according to a senior government official. In laying out its position ahead of key global climate talks later this year, the top bureaucrat in India’s environment ministry also said the country doesn’t plan to tighten its emissions goals unless more money is promised from developed economies under the United Nations-sponsored climate change agreement.

In a first, Coal India sends fuel to Bangladesh power plant
In a first, state-run Coal India Ltd (CIL) has sent (Paywall) 4,000 tonnes of coal to Bangladesh for its Khulna power project, as part of India’s strategy to play a key role in creating a new energy security architecture for its neighbours. The 1,320 megawatts (MW) Khulna project has been built recently in a joint venture by India’s NTPC Ltd and Bangladesh Power Development Board (BPDB).

 

Can Indo-U.S. partnership go from being a perennial curiosity to a quotidian affair?
The Indian debate is often trapped between new and contradictory fears. Can India really trust the U.S. to extend full support in coping with the China challenge? At the same time, Delhi also worries that the U.S. may be trying to “entrap” India into an alliance. While we expect the U.S. to give iron-clad guarantees on supporting us (that is what alliances are supposed to do), we insist that Delhi will never enter into an alliance with the U.S.

Indo-Pacific reflects reality of Globalisation: S Jaishankar
The evolving situation in the Indo-Pacific region reflects the reality of globalisation, the emergence of multipolarity and the benefits of rebalancing, External Affairs Minister S Jaishankar said on Tuesday, July 06. In his address at the inaugural session of the Indo-Pacific business summit, he suggested that the broad policy of like-minded nations for the region was an expression of collective interests in promoting prosperity and securing global commerce.

India and Japan looking at boosting cooperation in third countries: Foreign Secretary Harsh Vardhan Shringla
In an address at the India-Japan forum, Foreign Secretary Harsh Vardhan Shringla said the growing convergence between the two countries on strategic and economic issues has the potential to shape a multi-polar world that is more peaceful, secure and sustainable. The evolving geopolitical situation, with the focus shifting decisively towards the Indo-Pacific region and a deeper understanding of the complementarities between the two countries, has further enhanced the partnership.
 
Biden builds on Trump’s use of Investment Review Panel to take on China
The approach, with its heavy focus on China, mirrors other recent actions that build on steps taken under Mr. Trump. In recent weeks, the Biden administration has expanded a prohibition on Americans investing in Chinese companies with purported links to China’s military and mandated a broad review of apps controlled by foreign adversaries to determine whether they pose a security threat (Paywall) to the U.S. TikTok also remains under review by Cfius, administration officials said.

 

India Deemed ‘Vital’ AI Partner for U.S.
India has become an important strategic partner to the United States in the field of artificial intelligence as the government in New Dehli moves forward with plans to embrace AI-based innovation and infrastructure, according to a new report. The Center for Security and Emerging Technology (CSET), a Washington, D.C. - based think tank run out of Georgetown University’s Walsh School of Foreign Service, recently released a study titled “Mapping India’s AI Potential,” which examined India’s potential for AI development across a number of indicators including talent, research, patents, cloud computing, and companies and investment, said Husanjot Chahal, a research analyst at CSET and co-author of the report.

U.S. accuses China of masterminding cyber attacks worldwide
The White House and its western allies have accused the Chinese government of teaming up with criminal gangs to commit widespread cyber attacks, including one on Microsoft this year that affected tens of thousands of organisations. The accusation came as the U.S. Justice department unsealed an indictment alleging that four Chinese nationals affiliated with the Ministry of State Security had overseen a separate campaign to infiltrate companies, universities and government bodies in the U.S. and overseas between 2011 and 2018.

Google takes a significant step towards localisation of Indian data
India’s quest for greater levels of data localisation received a leg up on Thursday, July 15, when Google announced it was setting up a second cluster of data centres in and around New Delhi to meet the growing demands of the domestic Indian market, a Reuters report said. This will be Google’s second set of data centres in India following the launch of its first cloud region in Mumbai in 2017, and the 10th in the Asia Pacific region. ‘It's a large commitment from us in capital and infrastructure investment and it's designed to allow us to capture the opportunity that we see around growth,’ said Thomas Kurian, CEO at Google Cloud.
 
Biden initiative could propel mega growth in Indian IT services
U.S. President Joe Biden has announced a major initiative to make American industry more competitive. This is expected to generate a wave of fresh IT spending in emerging technologies like cloud, AI, IoT, among others and open up large business opportunities for the likes of TCS, Infosys, HCL Tech. India’s IT sector, which clocked a 2.3 per cent revenue growth to $194 billion in 2020-21, could be in for a mega growth cycle over the next five years.

 

Indian defence sector waking up to the call of hour
With the recent cabinet approval for corporatisation of the Ordnance Factory Board (OFB), the defence sector in India is moving forward in the right direction with much-needed reforms, which should have been initiated decades before. But, it's better late than never. At a time when India is facing threats on the borders, and from the use of unaccustomed civilian technologies such as drones, it is vital for the Indian defence sector to fully equip its forces with modern equipment and technology.

U.S. supports India's emergence as leading global power: State department
The United States supports India's emergence as a leading global power and vital partner in efforts to ensure that the Indo-Pacific is a region of peace, stability, and growing prosperity and economic inclusion," it said after Secretary of State Antony Blinken landed in New Delhi on a two-day visit.

India and U.S. to jointly host Indo-Pacific Business Forum in October
India and the U.S. will virtually co-host the fourth annual Indo-Pacific Business Forum (IPBF) in October, the State Department has announced. The IPBF, now in its fourth year, is the leading event to promote trade, investment, and economic cooperation between the United States and its partners throughout the Indo-Pacific region. The two-day online event from October 28 will be co-hosted by the U.S. and India in partnership with the U.S. Chamber of Commerce, the Confederation of Indian Industry, the Federation of Indian Chambers of Commerce and Industry, and the U.S.-ASEAN Business Council (USABC).
 
Future of Afghanistan cannot be its past: Jaishankar at SCO meet in Dushanbe
Emphasising that the future of Afghanistan cannot be its past, India on Wednesday, July 14, presented a three-point roadmap for the conflict-ridden country that entailed cessation of violence and terrorist attacks, settlement of the conflict through political dialogue and steps to ensure that neighbouring countries are not threatened by terrorism, separatism and extremism. External Affairs Minister S Jaishankar put forth the roadmap at a meeting of the Shanghai Cooperation Organisation (SCO) foreign ministers' contact group on Afghanistan in Dushanbe amid growing global concerns over the Taliban fighters gaining control over large parts of the country.