Africa

By Siddharth Chatterjee
BEIJING, Feb 8 2024 (IPS)

The Year of the Dragon is upon us.

UN Secretary-General António Guterres said in his message for this Lunar New Year, “The dragon symbolizes energy, wisdom, protection and good luck. We need these qualities to rise to today’s global challenges.”

Indeed, we do. Just consider some of the challenges from the past year.

The persistent drag of COVID-19.

Sluggish economies.

The hottest year on record.

Climate disasters, one after the other.

A rising tide of fake news, fake images, and hate speech.

Risks posed by the malicious use of AI, which grows in sophistication by the day.

Conflicts in Gaza, Sudan, Ukraine and elsewhere, leaving millions highly vulnerable, and sending shock waves all over the world.

Stalled global progress on the Sustainable Development Goals, the world’s to-do list for peace and prosperity. This means that more people will remain without water, electricity, education for their children, or food for their families.

Around the world, people feel despondency and despair.

If ever we needed the spirit of the Dragon, it is now.

Mr. Dennis Francis, President of the UN General Assembly, writes a message of blessing at the National Children’s Center in Beijing. Credit: China National Children’s Center

The Lunar New Year is a perfect occasion to return to the source of our strength. All around the country, people will clean their homes and decorate them in red. There will be fireworks, feasts, family gatherings, and dragon dances.

In these celebrations, the people of China can look to inspire governments everywhere to embody the qualities of the Dragon as we head into the new year.

We saw this at work in the surprise detente between Iran and Saudi Arabia, brokered by China in March 2023 following years of bitter rivalry, and at the COP 28 climate conference last year, when the need to phase out fossil fuels was acknowledged, and the Loss and Damage Fund was agreed upon.

We see this spirit when countries now advocate for trust-building initiatives and international collaboration. These are crucial at a time when so many people around the world are losing faith in global institutions and each other.

This energy will be needed at the Summit of the Future this September at the UN General Assembly in New York. The Summit is a once-in-a-generation opportunity to take stock of the state of the planet and its people. It is a chance to summon all our courage and compassion—together.

It is no longer viable, if it ever was, to address one crisis at a time. As soon as one war ends, another starts. A fire is extinguished in one part of the world, and another is ignited elsewhere. One humanitarian crisis here, and another one there.

To create lasting peace and prosperity, the countries and peoples of the world must come together. We must draw on our shared resources, refine our aspirations, and imagine our future. This is what the Summit of the Future will help make possible.

We at the UN in China look to work closely with the Government of China in preparation for this Summit.

China has an indispensable role to play. After all, China is a model for South-South cooperation, in which developing nations support other developing nations. China is also hard at work to deliver on climate action, having set the goal to achieve peak carbon emissions before 2030 and carbon neutrality before 2060.

Consider this. In 2023, China’s $890bn investment in clean-energy sectors was almost as large as total global investments in fossil fuel supply.

And the people of China are an inspiration for countless others around the world struggling to lift themselves out of extreme poverty.

The UN family in China thanks the country’s people and Government for their endeavours. You embody the spirit of the Dragon.

This year is auspicious for another reason as well. It will mark the 75th anniversary of the establishment of the People’s Republic of China, an important milestone in the nation’s progress.

In honour of the many people who celebrate the Lunar New Year around the world, I am pleased that this year will mark the first time it joins the UN holiday calendar.

On behalf of the UN family in China, I extend our best wishes for the Year of the Dragon. May it be a time of great success, joy, and good fortune. May the Dragon remind us of our ability to create a more promising future for our own families, and the greater human family on the planet we all call home.

Chun Jie Kuai Le.

Siddharth Chatterjee is the United Nations Resident Coordinator in China.

A ship passes through the Pedro Miguel lock on its way to the Miraflores system to cross the Panama Canal. The infrastructure faces water shortages due to drought in the country, which limits the pace of maritime cargo transport through the bioceanic route that moves six percent of the world's maritime trade. CREDIT: Emilio Godoy / IPS

By Emilio Godoy
PANAMA CITY, Feb 8 2024 (IPS)

At the bar that Sandra manages in Panama City’s central financial district, the variety offered on the menu has shrunk due to delays in ship traffic through the Panama Canal, one of the world’s major shipping routes.

“We are out of stock of some of our foreign beers, because the shipment didn’t arrive. I hope it will get here one of these days,” the Panamanian bar-keeper told IPS, as she pointed to a half-empty refrigerator in the bar nestled between skyscrapers. "Above and beyond the ship traffic, the canal should provide raw water for the populations of (the provinces) of Panama and Colon. The difference is that now there is more traffic and the problem is that in the dry season the salt level rises and damages the raw water for potabilization." -- Óscar Vallarino

The delays have been repeated since drought took hold in this Central American nation throughout 2023, exacerbated by the effects of the climate crisis and the cyclical El Niño Southern Oscillation (ENSO) weather phenomenon that warms the waters of the Pacific Ocean.

This mixture of phenomena has repercussions on the forested areas surrounding the canal and the Alhajuela, Gatun and Miraflores artificial reservoirs that supply it and provide water for more than half of the country’s total population of 4.7 million people.

Due to the lack of rain, the level of Gatun Lake, the main source of water for the canal inaugurated in 1914, dropped from its normal height of 26 meters above sea level to less than 24 in recent weeks.

Six percent of the world’s maritime trade, especially container trade, goes through the canal connecting the Atlantic and Pacific oceans.

In addition, the interoceanic waterway has lost volume through evaporation due to warming water temperatures, according to a 2022 study by the Netherlands Water Partnership (NWP), a network of 180 public and private organizations.

Oscar Vallarino, a former official of the state-owned autonomous Panama Canal Authority (ACP), founded in 1978 to manage the company, said the situation stems from including the canal in its current watershed and expanding it since 2016, which doubled its capacity and the volume of ships, in addition to leading to the prohibition of the construction of more dams.

“Above and beyond the ship traffic, the canal must provide raw water for the populations of (the provinces) of Panama and Colon. The difference is that now there is more traffic and the problem is that in the dry season the salt level rises and damages the raw water for potabilization,” he told IPS.

The cruise ship Queen Victoria, owned by the British company Cunard, prepares to lower the first eight meters in the Miraflores locks of the Panama Canal, heading for the Atlantic Ocean. CREDIT: Emilio Godoy / IPS

From the Bridge of the Americas, which connects Panama City with the western part of its metropolitan area, the ships lined up to enter the canal look like figures in a board game moving slowly over a blue board. The waiting time varies, mostly en route to a U.S. port.

But the slowdown stems from the crucial element of the infrastructure: water, whose scarcity means fewer commercial vessels can cross from one ocean to the other. The reservoirs that feed the canal have a capacity of 1,857 hectoliters and currently hold only 900.

At the same time, the demand for different activities is increasing, leading to greater competition for consumption and conflicts that will intensify throughout this century.

Law 93 of 1999, modified by Law 44 of 2006, establishes the limits of the canal’s watershed, which covers 343,521 hectares and is one of 52 in the country.

The rainy season in this tropical country runs from May to November, but the last quarter of last year recorded lower rainfall, and the drought will worsen in the first half of 2024.

The population of the provinces of Panama and Colon also depends on water from the canal. But the problem is aggravated by waste, the leakage of at least 40 percent of the water due to broken pipes and the lack of efficient infrastructure.

This is despite the fact that this nation ranks fifth in the world in annual rainfall, has six times the world average of fresh water per person, in addition to 500 rivers, in an area of only 75,517 square kilometers.

But on the other hand, it has the highest individual consumption in Latin America, with 507 liters per inhabitant. Panama has an availability of about 115,000 cubic meters per inhabitant/year, according to the Inter-American Development Bank (IDB).

The consequences of the climate crisis and ENSO cloud the outlook for the water supply, since they mean that both excess and scarcity of water will create trouble for this Central American country. El Niño has reappeared in its strong phase, as meteorologists define the worst of its three modalities.

The ACP estimates that the basin captures almost 4.4 billion cubic meters (m3) annually, of which the canal consumes 70 percent for navigation and 15 percent for drinking water.

A view of Panama City, where population growth is driving up water demand. Drinking water for the city and the neighboring province of Colon comes from the Panama Canal and faces chronic management problems and infrastructure failures, now compounded by drought. CREDIT: Emilio Godoy / IPS

Victim of nature

In response to the crisis, the ACP adjusted the maximum draft, the daily traffic capacity and the reuse of diverted water.

As a result, it reduced the number of vessels crossing the 82-kilometer route to 24 per day from an average of between 38 and 40, which could drop to 18 this February, when traffic is expected to decline by one-third from its usual level.

In addition, it charges 10,000 dollars for water rights and auctions quotas for diverting water. Each passage requires 250 million liters of water per vessel, which is then returned to the system.

The canal already suffered an acute water crisis in 2016, but it has been aggravated now by a strong ENSO.

William Hugues, a member of the non-governmental National Front for the Defense of Social and Economic Rights, said the crisis was foreseeable and exposed the underlying aim of prioritizing the canal over the water supply to the local population.

“We issued a warning in 2006, when the expansion was being discussed, that larger locks would cause more salt water to enter Gatun. This demand would threaten the supply of drinking water. We have to accept that the canal has physical limits and we cannot respond to the dynamics of the international economy,” the economist, whose group includes social organizations, trade unions and other groups, told IPS.

Hugues, author of a book on the expansion of the canal traffic, pointed out that there is always a line of ships waiting to cross during the dry season and that the measures applied are the same as before the expansion.

Due to cargo demand, the expansion, undertaken in 2007 and completed in 2016, added two locks to accommodate the larger, heavier Neopanamax cargo ships, which need more water to transport up to 120,000 tons, especially gas cargo. But the expansion has had repercussions on the demand for water.

The use of the canal brings more than four billion dollars into the Panamanian coffers annually, approximately six percent of GDP. The drop in traffic could mean a financial loss of more than 200 million dollars a year and, therefore, will have an impact on the already stressed finances of this Central American nation.

Although it had promised to do so, the ACP did not respond to an IPS query about forecasts for canal activity in 2024.

The crisis has forced ships to take longer and more expensive routes, such as around Cape Horn, to the south of Chile, or to move cargo overland from coast to coast in Panama, before reloading it onto ships.

Drought has caused lines of ships waiting to cross the Panama Canal, where traffic could shrink even more in the face of the increasing scarcity of rain. Infrastructure managers are already limiting daily ship crossings to one-third of the usual number. CREDIT: ACP

Palliative measures

To face the recurring crises, the ACP is studying the construction of a dam and reservoir on the Indio River, west of Gatun, and the use of the Bayano dam, which would entail different costs.

The dam costs 800 million dollars and involves the flooding and displacement of some 1,900 people in an area of 400,000 hectares, while the use of the Ascanio Villalaz hydroelectric dam, owned by the Panamanian state and the private U.S. company AES Global Power, costs three times as much.

But the effects of the climate crisis may worsen, as several recent analyses suggest.

Between 1971 and 2020, Panama experienced significant drops in precipitation, although rainfall trends varied between regions.

Thus, the eastern and central Pacific provinces were significantly drier, especially during the summertime, while the western and central Caribbean provinces were wetter, particularly during the fall, according to the Panama climate risk study published by the World Bank earlier this year.

By 2050, precipitation patterns are expected to increase, when the Pacific territories should experience a jump in rainfall, mostly in summer and autumn, and the Caribbean/Atlantic should see no net change.

The study warns that the frequency of intense floods and droughts related to ENSO will become more common and are especially critical to monitor in the canal basin and the Dry Arc, an area in the west of the country characterized by scarce rainfall.

Meanwhile, the study by the Dutch organizations warns that the measures adopted are short-term and will only limit the canal’s customers in the long term, which will affect the national economy and global pollution.

In addition, several swaths of the country, including the capital and Gatun, are expected to be flooded by 2050.

Panama has an Action Plan 2022-2026 for the integrated management of water resources, composed of 35 actions, but its implementation is proceeding slowly.

The plan seeks to contribute to water security through the prioritization of concrete actions based on national priorities, climate change scenarios, the needs of the different sectors and the institutional and financial capacity for their implementation.

The ACP itself recognizes the need for long-term investments to meet the challenges.

The country has 56 water treatment plants, seven of which are located in the canal. The expansion of several facilities and the construction of two would add some 851 million liters to the flow.

According to Vallarino, a new reservoir and the use of the Bayano dam would eventually be needed.

“We have to ask ourselves if it is feasible. Studies projecting the future should be done, to assess the options. The population is a priority. If it is well managed, we may have some setbacks, but there will be enough water for the public,” he said.

Meanwhile, Hugues said that the canal’s mercantile development rate is unsustainable.

“With the expansion of the canal, shipowners will continue to expand ships, they’ll keep growing and growing. That means we would have to make the basin the whole canal. If they follow the thesis that the canal must continue to be expanded, there will never be enough water to meet demand,” he argued.

Under the circumstances, the canal must adapt, because if it does not, drinkable water will choke in the pipes and businesses such as Sandra’s will continue to have half-empty refrigerators.

Sebastien Haller scores the winner as 2023 Africa Cup of Nations hosts Ivory Coast beat DR Congo to set up a final against Nigeria.

The internet outage comes on top of a 10-month civil war which has forced nine million from their homes.

Farmers checking the saffron flowers on their farm in Pampore, Kashmir. Credit: Athar Parvaiz/IPS

By Athar Parvaiz
SRINAGAR, India, Feb 7 2024 (IPS)

Saffron, the expensive spice from the Kashmir Himalayas, has been facing challenges for years, mostly related to yields and inadequate irrigation compounded by the climate crisis.

While the government launched the 4.1 billion rupee National Saffron Mission (NMS) in 2010 to mitigate these challenges and rejuvenate saffron cultivation in Kashmir, its efficacy remains questionable, farmers say.

Saffron is one of Kashmir’s major industries, along with horticulture and agriculture, supporting some 17,000 families in the region. India contributes 5% of the world’s total production, of which 90% is supplied from the Kashmir Himalayan region.

The spice has been cultivated since 500 AD in the Kashmir valley and reached its peak in the 1990s at an annual average yield of around 15.5 tonnes from 5,700 hectares (14,085 acres), but both the land farmed for saffron and yields have declined since then.

According to a study, prolonged periods of drought have caused significant concerns among saffron farmers.

“Since the crop heavily relies on rainfall, insufficient precipitation has resulted in the region experiencing its lowest saffron productivity in the past three decades,” the study says.

“In addition to the challenges posed by drought, the region is also facing issues related to urbanization and increasing population growth,” the study further says. According to Kashmir’s agriculture department, saffron land has reduced from 5,700 hectares in the 1990s to 3,715 hectares in 2016 due to land-use conversions.

Saffron farmers, who grow the “king of spices” in fields sprawling across several thousand hectares, mainly in south Kashmir’s Pulwama district, have been complaining for years that lack of rainfall at crucial times has led to a decline in saffron production.

One or two spells of rain in September and October are vital for the crop to flower, farmers say. But in most years since the late 1990s, it either hasn’t rained in those months or has rained too much, damaging the crop, says farmer Mohammad Reshi, adding that farmers still rely on the weather in the cropping season.

“The sprinkle irrigation system, which the government claims has been put in place, should have been functional by now. But it is not working. You can see for yourself what has happened to these pipes and the bore wells. They are not serving any purpose,” Reshi tells IPS while pointing at the defunct sprinkle irrigation system in a saffron field in Pampore, where saffron cultivation is concentrated in Kashmir.

Though, Reshi says, tube wells have been dug and pipes have been laid in saffron fields for years now, “we are yet to see the water in saffron fields.”

According to him, the project was supposed to be completed years ago, but it still lingers. Denying the allegations of saffron farmers, Ghulam Mohammad Dhobi, Joint Director of Kashmir’s agriculture department, who is also the Nodal Officer for NMS, says that the government is trying its best to help the farmers get good yields.

“The farmers have not to wait for long to see the positive results of the irrigation infrastructure, as we are expecting its completion soon after it will function properly,” Dhobi tells IPS.

According to the Food and Agriculture Organisation (FAO), which has given saffron cultivation in Kashmir a Globally Important Agricultural Heritage Systems (GIAHS) status, “saffron cultivation has been facing severe challenges of sustainability and livelihood security, with an urgent need to adopt appropriate technologies to address water scarcity, productivity loss, and market volatility.”

Scientific research has established that irrigation plays the most important role in saffron cultivation in Kashmir. Firdous Nahvi, a former agriculture scientist at Sher-e-Kashmir University of Agricultural Sciences and Technology, says that saffron yields have traditionally depended on rainfall in the crucial months from August to October in Kashmir, and saffron yields have fallen in recent years because of the irrigation problem.

According to Nahvi, until 1999-2000, Kashmir received well-distributed precipitation of 1,000 to 1,200 mm per year in the form of rain and snow, but that has now decreased to 600 to 800 mm.

“In any part of the world, farming is unthinkable without water,” Nahvi says and adds: “Creating irrigation facilities was the critical part of the project because we have observed in recent years that it doesn’t rain when the crop needs the moisture.” Nahvi was the expert who advised the NMS implementers about the need for installing the sprinkle irrigation system for saffron cultivation in Kashmir.

Solutions in Farming Methods

Bashir Allie, an agricultural scientist who heads Kashmir’s Saffron Research Station, says that he has also advised the agriculture and irrigation departments of the Kashmir government that creating drip irrigation facilities is crucial for improving saffron yields.

“But we are also working with farmers through our field awareness program to enhance saffron yield,” Allie tells IPS, adding that he and his team are telling the farmers to plant the optimum number of corms in the saffron fields rather than planting them haphazardly.

For example, Allie says, the farmers mostly plant up to 300,000 corms per hectare, “whereas we advise them to go for 500,000 to one million corms per hectare (or 50 corms per square meter).” This, he says, will help the farmers increase their yields, provided they uproot the old corms every four years and plant new corms.

“What we have also observed is that the farmers keep the corms in the fields for up to 20 years and leave them unattended,” he tells IPS, adding that this affects the yield as the older corms keep producing new corms, which increases the competition for nutrients within the population and the entire population underperforms (in producing flowers), thus affecting the yield.

“So, the solution we are offering to the farmers is to plant the optimum number of corms (50 corms per square meter) and replace the corms after every four years,” Allie informs.

To mitigate the impact of drought conditions on saffron crops, Allie says that he and his team have advised the farmers to start growing almond trees in saffron fields at a distance of four to five meters so that they provide shade and help the farmers retain moisture in their saffron fields.

“Once the almond trees produce branches, they will provide shade to saffron fields, as saffron is a shade-loving plant. Also, the moisture in the soil will be retained,” Allie says, adding that the almond trees, besides providing shade, will also produce almonds, thereby helping the farmers increase their income.

IPS UN Bureau Report

 

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Displaced Palestinians at a temporary shelter in the Southern Gaza Strip city of Rafah. Crerdit: OHCHR/ Media Clinic

By Daniel Larison
WASHINGTON DC, Feb 7 2024 (IPS)

The Biden administration continues to deny any connections between the war in Gaza and the ongoing conflicts involving U.S. forces in Iraq, Syria, and Yemen.

The White House’s position that these are all unrelated conflicts that are just cropping up at the same time can’t be squared with the evidence showing that the war in Gaza has fueled regional instability and violence, including the recent drone attack by an Iraqi militia that killed three American service members and injured more than 40 at a base in Jordan earlier this week.

As much as the administration might want to keep the conflict confined to Gaza, the truth is that it has spread to several other countries. It is a disservice to the American people and to American military personnel to pretend that U.S. support for the war in Gaza hasn’t already had serious negative consequences for regional stability and for American forces in the region when it clearly has.

When he was asked about this “same, larger conflict” at a press conference on Wednesday, National Security Council spokesman John Kirby dismissed any link between Gaza and the U.S. fight with the Houthis or the back-and-forth strikes between local militias and U.S. forces.

“I absolutely don’t agree with your description of the same, larger conflict. There’s a conflict going on between Israel and Hamas…and we’re going to make sure that we continue to get Israel the support that they need to defend themselves against this still viable threat,” Kirby said.

“There were attacks on our troops and facilities in Iraq and Syria well before the seventh of October, certainly in the last administration as well. As for the Houthis, they can claim all they want that this is linked to Gaza, but two-thirds of the ships that they’re hitting have no connection to Israel whatsoever. So it’s just not true, it’s a falsehood.”

Kirby’s answer is misleading and false. The umbrella group in Iraq that claimed responsibility for the attack in Jordan, the Islamic Resistance of Iraq, explicitly stated that its attack was connected to the war in Gaza.

The Houthi leadership has been emphatic that their attacks will continue for as long as the war does. The decision of other actors to jump on a cause’s bandwagon may be cynical or not, but there is no denying that they have jumped on the bandwagon.

Refusing to face the reality of the connections between these conflicts guarantees that the U.S. will pursue ineffective and counterproductive policies by ignoring that the key to defusing regional tensions is to bring the war in Gaza to an end as quickly as possible.

Kirby did not mention that militia attacks on U.S. forces in Iraq and Syria had ceased for several months prior to October 7 because of the understanding that the U.S. and Iran had reached in connection with the prisoner exchange deal. It was only after October 7 that those attacks resumed and then increased to record levels.

Local militias have additional reasons of their own for targeting U.S. forces that predate the war, but there is no way to understand the intensity of the attacks in recent months or their cessation during the pause in fighting in Gaza last year without recognizing that they are linked to Israel’s war.

The same goes for the Houthi attacks. The Houthis did not launch a campaign against commercial shipping during their war with the Saudi coalition, so this is not something that they have usually done since seizing power in 2014. The first Houthi attacks after October 7 were aimed at Israel itself. The Houthis shifted tactics to targeting commercial vessels, but it was clear that they were doing so in response to the war.

No doubt the Houthis are acting opportunistically and are launching these attacks partly to bolster their own political fortunes in Yemen, but that doesn’t change the reality that these attacks are happening now because of the war in Gaza. If that’s true, it also seems reasonable to conclude that the attacks against shipping could be ended with a ceasefire there as well.

The Biden administration has strong political incentives to deny links between these different conflicts. If they acknowledge a link, that makes it harder for them to justify their unconditional backing for Israel’s war because of the greater costs involved. It also undermines their argument for military action in Yemen against the Houthis.

The White House needs Americans to think that the costs of continued support for the war are lower than they are, and they also need Americans to buy that the strikes on Yemen aren’t related to their stubborn opposition to a ceasefire in Gaza.

Now that there are American fatalities from an Iraqi militia attack, the administration wants to compartmentalize each conflict so that the American people won’t conclude that U.S. soldiers are being killed because of a foreign war that the president chose to support without conditions.

The administration insists that it wants to prevent a regional war, but that won’t be successful if it fails to recognize the relationships between Israel’s campaign and what is happening elsewhere in the Middle East. Denying the link with Gaza in Yemen has already led to the blunder of escalation against the Houthis.

That has done nothing to make commercial shipping more secure, but it has drawn the U.S. into another unnecessary, open-ended fight. The president is on the verge of making a similar mistake in response to the drone attack in Jordan.

The U.S. can choose to entangle itself ever deeper in Middle Eastern conflicts as it is doing now, or it can recognize the futility and folly of going down the same dead-end road it has traveled before. If Washington wants to avoid involvement in new conflicts, it must reject the path of escalation and it must stop fueling the war in Gaza that is one of the chief drivers of regional instability.

In the longer term, the U.S. needs to reduce its military footprint in the region to make it harder for other actors to hit American forces, and it needs to reassess and significantly cut back on its client relationships.

The public deserves an honest accounting of what our government is doing in the Middle East and why, and right now the White House isn’t providing anything close to that. If the president won’t change course, the very least that he can do is level with the American people about the full costs of continuing down the dangerous path that he has chosen.

Source: Responsible Statecraft

Daniel Larison is a regular columnist at Responsible Statecraft, contributing editor at Antiwar.com, and a former senior editor at The American Conservative magazine. He has a Ph.D. in History from the University of Chicago. He writes regularly for his newsletter, Eunomia, on Substack.

The views expressed by authors on Responsible Statecraft do not necessarily reflect those of the Quincy Institute or its associates.

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By Jomo Kwame Sundaram
KUALA LUMPUR, Malaysia, Feb 7 2024 (IPS)

Investor-State Dispute Settlement (ISDS) provisions in international trade and investment agreements – long abused by opportunists with means – are slowly being rejected by cautious governments.

Jomo Kwame Sundaram

Developing country governments need to be much more wary of ISDS and its implications, and should urgently withdraw from existing commitments. They should expunge ISDS clauses in existing trade and investment agreements and exclude them from new ones.

ISDS ripe for abuse
ISDS allows a foreign investor to sue a ‘host’ government for compensation by claiming new laws, regulations and policies adversely affect expected profits, even if changed in the public interest. It involves binding arbitration without going to court.

ISDS provisions are included in many free trade agreements (FTAs) and bilateral investment treaties (BITs). These were invoked in 84% of cases before the World Bank Group’s International Centre for Settlement of Investment Disputes (ICSID), the most used arbitration forum. Investment contracts and national investment laws are also invoked.

ISDS decisions are made by commercial ‘for-profit’ arbitrators prone to conflicts of interest. Foreign investors can thus seek compensation amounting to billions of dollars via a parallel legal system favouring them.

ISDS provisions in such agreements enable foreign investors to sue governments for billions of dollars in compensation by claiming changes in national law or policy will reduce profits for their investments.

Neocolonial ISDS
During the colonial era, imperial authorities often used concession contracts to grant private companies exclusive rights to extract resources, such as minerals and crops, or conduct other economic operations, including building infrastructure and operating utilities.

Investments were protected by (colonial) law, and sometimes by investment contracts after independence. Companies might negotiate contracts with governments to get better terms. A tenth of the claims before the ICSID involved such contracts.

Thus, ISDS perpetuates a colonial pattern of privileging the interests of foreign capital. The World Bank’s Foreign Investment Advisory Service (FIAS) has long promoted including ISDS in domestic investment laws. Thirty of the 65 countries it advised enacted new laws providing for such arbitration.

Investment treaty arbitration started as a post-colonial innovation to protect the assets of former colonial powers from newly independent states. Investment arbitration rules deliberately privilege foreign investment over national law.

ISDS abused, biased and corrupt
ISDS encourages abuse and corruption. As legal fees and arbitration awards tend to be very significant for developing countries, when invoked, ISDS has a chilling effect intimidating host governments, often forcing them to concede or compromise regardless of the merits of the claims.

Nigeria was ordered to pay US$11 billion to a British Virgin Islands company, Process & Industrial Developments (P&ID). P&ID had used ISDS to claim compensation from Nigeria for allegedly breaking gas supply and processing contract.

When P&ID initiated ISDS proceedings in August 2012, it had not even bought a site for the gas supply facility. Yet, it claimed to be ready to fulfil its contractual obligations.

Six years later, in November 2023, the English High Court ruled the contract in dispute was obtained fraudulently via secretive practices allowed by ISDS. The Court also ruled P&ID had bribed Nigerian officials, including its legal team then, to get the contract.

Presiding English High Court Judge Knowles expressed “puzzlement over how the [ISDS] Tribunal failed to notice the serious irregularities” despite various “red flags” of fraud noted by others.

Elsewhere, Pacific Rim Mining Corp, a Canadian company, had proposed a massive gold mine in El Salvador using water-intensive cyanide ore processing. Later, it claimed the government had violated its domestic investment law by not issuing a permit for the mine.

The ICSID ultimately rejected the company’s claim, ordering it to pay two-thirds of the US$12 million El Salvador had spent on legal fees. But the company has refused to pay.

Wake-up call ‘down under’
The Australian Fair Trade and Investment Network (AFTINET) advocacy group has updated its brief supporting its call for the urgent review and removal of ISDS clauses in the country’s existing foreign trade and investment agreements.

AFTINET has specifically urged the Australian Joint Standing Committee on Treaties (JSCOT) to review and amend the ASEAN-Australia-New Zealand Free Trade Area (AANZFTA).

The Australian Labor Party government, elected in May 2022, pledged not to include ISDS in new trade agreements, and to review such provisions in current agreements. Its brief focuses on ISDS provisions used by Australian mining billionaire Clive Palmer to sue Canberra.

Registering his Zeph Investments in Singapore, Palmer has used AANZFTA ISDS provisions to get compensation from Australia in two matters. The first is his application for an iron ore mining lease in Western Australia.

The second is against the authorities’ refusal of coal mining permits in Queensland for environmental reasons. Palmer has also made a third claim invoking the Singapore-Australia FTA, bringing his total claims to nearly A$410 billion.

Despite the government’s policy against ISDS, the provision was not reviewed in the amended AANZFTA. AFTINET is urging Canberra to urgently remove its exposure to ISDS cases as Palmer’s actions have made this all the more urgent.

ISDS abuses recognised
The Palmer case has increased concerns about ISDS, especially the abuse of lack of transparency. Arbitration processes are typically closed-door, preventing public, including forensic scrutiny of business transactions and practices.

AFTINET notes “excessive” ISDS claims have been growing, while Judge Knowles noted the “severe abuses” of ISDS in the Nigeria v. P&ID case “driven by greed”.

The huge compensations sought and awarded have encouraged even more “long-shot, speculative ISDS claims”. Such claims are typically based on “loose” book-keeping and dubious projections and other calculations, easily falsified by well-paid accomplices.

While the Australian government pledges no new ISDS commitments, but also wants to get rid of earlier ones, much more vulnerable developing country governments seem quite oblivious of the huge risks they are exposing their countries to!

IPS UN Bureau

 

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Third UN Conference of Landlocked Developing Countries will be an opportunity to address the issues these countries face.

By IPS Correspondent
UNITED NATIONS, Feb 6 2024 (IPS)

Landlocked developing countries need greater support from the international community so that they are no longer left behind when it comes to progressing with the SDGs, says the UN High Representative of the Least Developed Countries.

The Third UN Conference of Landlocked Developing Countries (LLDC3) is set to be hosted in Kigali, Rwanda, in June. A preparatory committee for the conference has been established and convened its first meeting on Monday. 

The overarching theme of the conference, “Driving Progress through Partnerships,” is expected to highlight the importance of support from the global community in enabling LLDCs to meet their potential and achieve the SDGs. The conference invites the participation of multiple stakeholders, including heads of state and government, the private sector, and civil society. Several senior leaders in the UN system, including Secretary-General António Guterres, are expected to attend the LLDC3 Conference.

Thirty-two countries are classified as LLDCs, 17 of which are also classified as Least Developed Countries (LDCs). Sixteen are in Africa, and the remaining are located across Asia, Europe, and South America. This year will mark the first time that the LLDC Conference will be hosted in Africa.

Rabab Fatima, Under Secretary-General and High Representative of the Office for the Least Developed Countries, and the Secretary-General of the LLDC3 Conference, remarked that this conference would be a “once-in-a-decade opportunity” for the global community to address the needs of the LLDCs in order to “ensure that nobody is left behind.”

“The 32 landlocked developing countries are grappling with unique challenges due to their geographical and structural constraints and lack of integration into world trade and global value chains. Their situation has been further exacerbated by the lingering effects of the pandemic, climate change, and conflict,” she said.

The lack of direct access to coastal ports means that LLDCs rely on transit countries to connect them with international markets. This can lead to high trade costs and delays in the movement of goods. In other cases, many of the LLDCs’ transit neighbors are also developing countries with their own economic challenges. According to Fatima, the average cargo travel time for LLDCs was twelve days, compared to seven days for transit countries.

As a result of the slow progress in development, twenty-eight percent of people in LLDCs live in poverty. At least a third of the people are at a high risk of or already live with some form of debt distress, and fifty-eight percent of people deal with moderate to severe food insecurity.

Enkhbold Vorshilov, Permanent Representative of Mongolia to the UN, noted that the conference would be a “critical juncture” for the LLDCs. He also serves as the co-chair of the preparatory committee along with the Permanent Representative of Austria. He added, “Despite our varied cultural and economic structures, we share common challenges that impede our development and economic growth.”

The Preparatory Committee will negotiate the details of the conference’s outcome document, which has been prepared to “encapsulate the challenges and aspirations of the LLDCs,” according to Gladys Mokhawa, Permanent Representative for Botswana and the Chair of the Global Group of Landlocked Developing Countries. Mokhawa expressed that the document has so far received general support from member states and that the final draft would be comprehensive and committed to addressing the challenges that LLDCs face “that align with their specific needs and aspirations.”

“A vision is clear: to transform the geographical challenges and to ensure that our landlocked status is nothing more than a detail of geography,” she said. “We believe that our collective efforts can and will make a difference.”

“Our goal is not merely to draft a document but to build positive, genuine partnerships that will empower landlocked developing countries to overcome their challenges and achieve sustainable prosperity,” said Vorshilov. He added that, along with support from neighboring transit countries, cooperation from development partners and financial institutions would be important to mobilize the resources needed to support the LLDCs.

The document is intended to serve as a guideline for the LLDCs for the next decade and will touch on several areas of interest. In addition to addressing transport and trade, it will focus on emerging issues, such as science, technology, and innovation, and improving capacity and resilience against issues arising from climate change.

Earlier meetings, including the first meeting of the committee, have seen delegations express solidarity with the LLDCs and support for the agenda of the upcoming conference. Ambassador Stavros Lambrinidis, Permanent Representative of the European Union Delegation to the UN, stated that the development challenges call for “more efficient allocation of financial resources on the path toward the SDGs” and that an “essential element” of their partnership would be the development of connections and transport corridors for the benefit of all peoples.

Speaking on behalf of the Africa Group, Ambassador Marc Hermanne Araba of Benin noted that Africa has faced the brunt of the challenges faced by the LLDCs and their neighboring transit countries. He added that the present moment was an opportunity to “chart a transformative agenda for the LLDCs,” and therefore it is important for the global community to reaffirm its’ commitment to address the LLDCs’ challenges together to “ensure that these countries are not left behind.”.

Fatima welcomed the media as a “key partner,” through which the voices of LLDCs would have a platform, and to bridge the gap between the conference and those communities who will be most affected by the outcomes by sharing their perspectives.

IPS UN Bureau Report

 

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Women’s rights organizations in Asia are calling for states to introduce much-needed laws to criminalize FGM, says Nawmi Naz Chowdhury, Global Legal Advisor at Equality Now.

By Nawmi Naz Chowdhury
KUALA LUMPUR, MALAYSIA, Feb 6 2024 (IPS)

Significant advances have been made in Africa towards ending female genital mutilation/cutting (FGM/C). Unfortunately, the same cannot be said for Asia, where FGM/C occurs in at least ten countries, but governments across the region are failing to take effective action. Women’s rights organizations are calling for states to introduce much-needed laws to criminalize FGM, provide national data on the extent and nature of the practice, and adequately fund efforts to tackle this regionally neglected problem.

Calls for governments in Asia to criminalize FGM/C

There remains a widely held misconception that FGM/C occurs primarily in Africa, and this low level of awareness about FGM/C in Asia is contributing to inaction.

Nawmi Naz Chowdhury, Global Legal Advisor at Equality Now, with members of the
Asia Network to End FGM/C at the 7th Asian and Pacific Population Conference.

In recent years, the UN, through its international human rights treaty bodies and other human rights mechanisms, has provided recommendations to Asian countries, such as India, Sri Lanka, Singapore, and the Maldives, to address FGM/C and pass specific laws for prohibition. Yet, nowhere in Asia has a law banning it.

At the 7th Asian and Pacific Population Conference (APPC), seven women’s rights organizations made joint recommendations to regional governments about introducing a zero-tolerance approach to FGM/C.

The APPC is a regional review mechanism that convenes every ten years to discuss critical issues of population and development in Asia and the Pacific. Held at the UN Conference Centre in Thailand on November 15–17, 2023, women’s rights activists convened a side event, Rights-Based Approaches as the Foundation to Achieving Just and Sustainable Development in Asia and the Pacific – where participants discussed harmful practices affecting women and girls, including FGM/C.

Lawmakers were advised to put in place robust legal and policy measures, and proposals were featured in the Civil Society Call to Action and the Youth Call to Action.

FGM/C is a global problem

FGM/C is a harmful practice involving the partial or total removal of external female genitalia or other injury to the female genital organs for non-medical reasons.

Internationally recognized as a grave violation of women’s and girls’ human rights, FGM/C is done with the aim of controlling and curtailing the sex drive of women and girls. It can cause a range of lifelong physical and psychological problems, including infections and severe pain, emotional trauma, sexual dysfunction, reproductive health concerns, childbirth complications, and, in some cases, death.

An interactive data tool by the World Health Organization (WHO) revealed that, based on data from just 27 countries, the financial cost of health care for women with issues caused by FGM/C is USD $1.4 billion annually. The WHO also estimates that if FGM/C were abandoned, the savings in health costs would be more than 60% by 2050.

FGM/C is a global concern. Worldwide, the official number of women and girls undergoing FGM/C is estimated to be over 200 million. However, the true scale is far bigger. Academic and media reports, unofficial data collected by civil society organizations, and anecdotal studies based on interviews with survivors reveal that FGM/C is found in every continent except Antarctica.

Asian governments need to provide data on FGM/C

 

The United Nations call to action #HerVoiceMatters in leading the #EndFGM movement.

Indonesia and the Maldives are the only Asian states that share national-level FGM/C prevalence data; no official data is provided by any other Asian countries. However, academic research and survivor testimonies strongly indicate it occurs in Brunei, India, Malaysia, Pakistan, the Philippines, Singapore, Sri Lanka, and Thailand.

Accurate, comprehensive national FGM/C data collection is vital to understanding how women and girls are directly impacted and at risk. It also provides crucial insights into what communities are involved, the types of FGM/C performed, and what the implications are for health, human rights, and bodily autonomy.

Data on FGM/C can be used to plan appropriate interventions and measure their effectiveness. Furthermore, reliable statistics are key to attracting funding and holding governments and other duty-bearers accountable.

Lack of data gives governments an opportunity to claim a basis for inaction. For example, in India, in response to a question on FGM/C in Parliament in 2023, the Ministry of Women and Child Development noted that while there may be a few instances of FGM/C in the country, “there is no credible data to establish its prevalent existence.”

Investing in community action to end FGM/C

Unlike elsewhere, in most of Asia, there are little or no large-scale government programs for community education and awareness-raising about FGM/C. Few resources are directed toward prevention and supporting grassroots activities, and it is difficult for local organizations to secure funding.

Collective actions, such as those led by the Asia Network to End FGM/C, are playing an invaluable role in shining a much-needed spotlight, supporting women and girls, and galvanizing collaboration within and across national borders.

FGM/C can only be eradicated with positive community engagement about its harmful effects, underpinned by laws and policies that punish perpetrators and meet the needs of survivors. To achieve this, governments in Asia need to work in partnership with civil society organizations, affected communities, and survivors to better understand FGM/C, develop and implement effective policies, and invest in social, legal, educational, and health service provisions.

Global commitments to eliminating FGM/C

February 6 was designated by the United Nations as the International Day of Zero Tolerance for Female Genital Mutilation. How far we have come to ending FGM/C is gauged by the extent to which international commitments made by countries to end the practice are being met.

Various international human rights mechanisms have been put in place for countries to take robust measures. Sustainable Development Goal 5.3 and international human rights treaties on the rights of women and girls, such as the Convention on the Elimination of Discrimination Against Women (CEDAW) and the Convention on the Rights of the Child (CRC) expressly prohibit FGM/C and call on states to take action.

International documents, such as the Programme of Action under the  International Conference on Population and Development (ICPD PoA), urge countries to eradicate FGM/C and contain steps to eliminate it. Recommendations include “… strong community outreach programs involving village and religious leaders, education and counselling about its impact on girls’ and women’s health, and appropriate treatment and rehabilitation for girls and women who have suffered cutting” (para. 7.40, ICPD PoA).

Ending FGM/C in Asia must be prioritized

2024 will mark 30 years since the International Conference on Population and Development (ICPD) was first held in 1994. The anniversary marks a significant milestone in the area of advancing sexual and reproductive health and rights for women and girls globally. Ending FGM/C is a key component of this, and to effectively implement global commitments to achieve this, global efforts must focus on Asia as a priority.

Unless Asian countries step up to resolve current challenges, it will be hard to instigate action, design and implement policies, and hold governments and other duty-bearers to account in advocating for the introduction and effective implementation of legislative measures to finally end FGM/C in Asia.

 

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Asian women at a meeting. Credit: Unsplash/Christina @ wocintechchat.com

By Sara Danzeo and Elena Mayer-Besting
BANGKOK, Thailand, Feb 6 2024 (IPS)

In the bustling financial hub of Singapore, Rhea See, an early-stage fund manager, leads an accelerator platform dedicated to empowering women in technology.

She firmly believes that investing in women transcends the conventional paradigm of merely ‘doing good.’ For Rhea, it represents a strategic move towards smart economics and game-changing innovation.

“Many still view investing in women as a niche, impact-only endeavor and I want to shatter this stigma. Investing in women is not just about doing good, but it’s about smart economics and game-changing innovation; it’s about unlocking untapped potential and driving technological advancement and profitable returns,” shares Rhea.

As of July 2023, women accounted for only 17 per cent of all decision-makers at venture investors headquartered in South-East Asia. About 67 per cent (vs. 77 per cent in 2022) of regional investors do not have a woman in an investment decision-making role.

Evidence shows that diversity in venture capital firms not only fosters creativity and alternative viewpoints but also positively impacts financial performance. A study by Paul Gompers, a professor at Harvard Business School, found that venture capital firms with more diversity among their partners tend to be more profitable.

The study revealed that firms with at least one female partner saw improved financial performance, with returns increasing by approximately 10 per cent. This translates into a significant economic impact, as the median venture capital fund return moves from around 14 – 15 per cent to 16 – 17 per cent with the inclusion of female partners.

Additionally, having women as partners increased the success rate of startups supported by these firms. This research suggests that gender diversity generates alternative perspectives that can uncover new investment opportunities and help avoid blind spots

Starting a fund is no small feat. It requires a commitment of at least 15 years, a factor that might deter many. Additionally, the venture capital industry, particularly for women-led funds, embodies a complex mix of long-term relationship building, navigating biases and strategic networking.

Considering the demanding nature of the role and the need for substantial family support and background education, this may present significant obstacles for women in the Asia-Pacific region, who are traditionally considered the main caretakers in the family.

Women-led funds raised less than 2 per cent of the $166 billion raised by venture firms globally in 2022, indicating the significant gap that still exists.

Acknowledging the unconscious bias and additional hurdles that women fund managers face in the region to raise funds, 2X Global with the support of the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) under the Catalyzing Women’s Entrepreneurship Programme, supported by Global Affairs Canada, together with Australian Aid, launched an introductory and acceleration programme for female-led or gender-balanced fund managers with gender smart investing strategies across the Asia-Pacific region.

The 2XI GP Sprint, which began in September 2023, is providing tailored coaching, practical exercises and network facilitation for GPs with the aim of accelerating their progress towards achieving their first close.

In November 2023, in Singapore, selected participants of the GP Sprint presented their investment thesis to LPs. During the presentations, the determination, qualifications and expertise of these women from the region were showcased.

These women are not just poised to become exceptional wealth managers; their investment theses, often environmentally and socially conscious, suggest a transformative impact on the region through strategic capital allocation.

The involvement of women in the investment field is more than a matter of equity; it makes business sense, while emerging as a strategic necessity for the sustainable and holistic growth of the investment landscape.

The Catalyzing Women Entrepreneurship programme by ESCAP has forged strategic partnerships with organizations such as 2X Global to empower female capital allocators and pave the way for a more inclusive and prosperous future in the Asia-Pacific investment landscape.

Sara Danzeo is Partnerships Specialist, Trade, Investment and Innovation Division, United Nations Economic and Social Commission for Asia and the Pacific (ESCAP)

Elena Mayer-Besting is Programme Management Officer, United Nations Economic and Social Commission for Asia and the Pacific (ESCAP)

IPS UN Bureau

 

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Soccer great Cristiano Ronaldo is on target again for Saudi Pro League side Al Nassr. The Saudi government has invested billions of its oil revenues in recent years in sport, including tennis, golf, boxing and, above all, football. Credit: Shutterstock

By Paul Virgo
ROME, Feb 5 2024 (IPS)

Argentina forward Lautaro Martinez scores as Inter Milan beat Napoli in the Saudi capital Riyadh to win the Italian Super Cup for the third consecutive time.

Soccer great Cristiano Ronaldo is on target again for Saudi Pro League side Al Nassr.

England’s Tyrrell Hatton becomes the latest golf star to sign up for the rebel Saudi-backed LIV circuit.

The World Snooker Tour announces a first TV event in Saudi Arabia in March, featuring seven-time world champion Ronnie O’Sullivan and current world title-holder Luca Brecel and a rule change that will make it possible for players to notch a maximum score of 167, instead of the traditional 147.

Human Rights Watch says the policy is primarily designed to “sportswash” Saudi Arabia’s reputation, hosting major sporting events that attract widespread, positive media attention to divert it away from the hosts’ abuses

If you have seen a news headline about Saudi Arabia recently, there is a good chance that the story is related to sport.

The Saudi government has invested billions of its oil revenues in recent years in sport, including tennis, golf, boxing and, above all, football.

Taken at face value, it is a way for the kingdom to splash its vast wealth on laying on lavish entertainment and boost its GDP in the process.

Critics, however, see something more sinister at play.

Human Rights Watch (HRW) says the policy is primarily designed to “sportswash” Saudi Arabia’s reputation, hosting major sporting events that attract widespread, positive media attention to divert it away from the hosts’ abuses.

It says that, by becoming the country where Ronaldo and Neymar ply their trade, and hosting events like Real Madrid versus Barcelona in the Spanish Super Cup, it becomes easier to forget Jamal Khashoggi, the journalist brutally murdered in the Saudi consulate in Istanbul in 2018, and his colleagues jailed, censored or harassed in Saudi Arabia, to not think about women’s and LGBT rights in the kingdom; and ignore the mass killings of migrants along the Saudi border with Yemen.

“Sports unite fans across the political spectrum, and – with due exceptions, such as when national teams of ‘rival’ countries compete against each other – are generally non-political territory,” Claudio Francavilla, HRW Associate Director, EU Advocacy, told IPS.

“They are seen as part of the entertainment industry, and attract media, sponsors, tourists and potential investments.

“When an abusive government hosts a major sporting event for sportswashing purposes, its goal is that media, sponsors and the general public focus on the game, often preceded and followed by flashy opening/closing ceremonies, appreciate the organization and hospitality provided by the host, and promote the hosting government as an open, advanced, great-to-visit-and-make-business-with country – everything but its human rights abuses, to be hidden from the public sphere and debate.

“In other words: look at the ball, look at the fireworks, forget the abuses”.

In May, Saudi human rights activists, and intellectuals released “A People’s Vision for Reform in Saudi Arabia”, a document calling for the release of all political prisoners, the respect of the rights to freedom of expression and of association, the upholding of the rights of women, migrants, and religious minorities, the abolition of torture and the death penalty, reform of the justice system, and a redistribution of the country’s wealth.

HRW says that, instead of complying with their human rights obligations and starting a dialogue with these civil society actors, the Saudi authorities have continued to repress dissent and invest in campaigns and events that whitewash or sportswash their reputation.

Indeed, having already secured the rights to host EXPO 2030 and the 2034 Asian Games, the Saudi government may soon secure the rights to host the 2034 men’s football World Cup and – gallingly, considering the country’s treatment of women – it is bidding for the 2035 women’s World Cup too.

Saudi Arabia is not the only country to indulge in sportwashing.

“The most prominent recent cases include Russia’s 2018 World Cup and China’s 2022 Winter Olympics,” said Francavilla.

“The UAE buying Manchester City FC has been characterized as sportswashing, as well as Bahrain’s Formula 1 Grand Prix and the Saudi acquisition of English Premier League club Newcastle United FC”.

Sportswashing does not always have the desired effect mind.

Before the recent Spanish Super Cup in Riyadh, Barcelona warned their fans of potential “severe penalties” regarding same-sex relations and “open displays of support for LGBTI causes, even on social media”, thus drawing attention to the issue.

The 2022 soccer World Cup in Qatar highlighted serious abuses against migrant workers there.

It could be argued that Saudi Arabia is only using sport in the same way that competitions like NBA basketball and Premier League soccer have long been part of the soft power of the United States and Britain, neither of which have unblemished human-rights records.

That said, while Human Rights Watch doesn’t rank countries in its annual report on abuses worldwide, other organizations, such as RSF with its press freedom index, do and States like China, Russia, Saudi Arabia, UAE, Bahrain and India, rank considerably below the UK and the USA.

“The deliberate use of sports events by governments with abysmal human rights records as a tool to sportswash their reputations, instead of enacting human rights reforms that would do the same job, much more effectively and impactfully, and likely at a much lower economic cost, is particularly despicable,” said Francavilla.

He calls on sports federations, especially world soccer’s governing body FIFA, to take the lead on curtailing this phenomenon, whoever is guilty of it.

“In June 2017, FIFA adopted and published its Human Rights Policy stating that human rights commitments are binding on all FIFA bodies and officials,” he said.

“Human Rights Watch has long called on FIFA to apply clear, objective human rights criteria to all states for hosting both the men’s and women’s World Cup and other tournaments, and for any major commercial sponsorships, including labour protections, press freedom, non-discrimination and inclusion.

“Given past corruption and serious human rights abuses, including discrimination against LGBT people and the unexplained deaths of thousands of migrant workers who built the infrastructure for the 2022 World Cup, Human Rights Watch has requested FIFA to apply a series of measures for the 2030 and 2034 World Cup bids.

“Those measures would apply to any bidder, be it the US, UK, China or Saudi Arabia”.

 

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A new UN Advisory Body is expected to make recommendations on international governance of AI. The members of the AI Advisory Body – launched October 2023 by Secretary-General António Guterres – will examine the risks, opportunities and international governance of these technologies. Credit: Unsplash/Steve Johnson

By Nandan Nilekani and Tanuj Bhojwani
BANGALORE, India, Feb 5 2024 (IPS)

India is on the brink of a transformation that could change its economic and social future.

Before the end of this decade, more Indians will use AI every day than in any other country in the world. What’s more, people in advanced economies will be surprised by the ways the country will use AI.

India is on the cusp of a technological revolution that could alter the trajectory of its social and economic future, and in this revolution. there are lessons for the rest of the world.

Our prediction hinges on three facts: India needs it, India is ready for it, and India will do it.

India needs it

The concept of “China plus one” has been gaining traction, with its admonition that global companies should not depend inordinately on China for their manufacturing and software needs.

India, with its growing infrastructure investments, favorable policies, and young working population, is the most likely beneficiary of this shift. It is perhaps the only country poised to match the scale of China.

With 1.4 billion people, India is closer to a continent than a country. Its population is almost twice that of Europe. But the average age in India is 28, compared with Europe’s 44, which means a higher share of the population is of working age. This is the starting point: India is a very large country of very young people.

This demographic dividend, favorable global trends, and the unlocking of decades of suppressed potential are starting to show returns. Even as the macroeconomic projections for most of the world seem modest or bleak, India remains a bright spot. These young Indians are aspirational and motivated to use every opportunity to better their lives.

What really sets India apart from the West are its unique challenges and needs. India’s diverse population and complex socioeconomic concerns mean that AI there is not just about developing cutting-edge technology. It’s about finding innovative solutions to address pressing problems in health care, education, agriculture, and sustainability.

Though our population is just double the size of Europe’s, we are much more diverse. Indians, like Europeans, are often bi- or multilingual. India recognizes 19,500 dialects spoken by at least 10,000 people. Based on data from the Indian census, two Indians selected at random have only a 36 percent chance of speaking a common language.

This language barrier is complicated by the fact that the official literacy rate in the country hovers near 77 percent, varying vastly between states. This means that roughly 1 in 4 people can’t read or write. Even though the government tries to provide welfare assistance for its most vulnerable, it’s hard to spread awareness about the service and reach the last mile.

Filling out a simple form to access welfare can be daunting for someone who is illiterate. Determining eligibility for assistance means depending on someone who can read, write, and navigate the bureaucracy.

Actually. receiving services means assistance seekers must have an agent helping them who is not misinformed—or worse, corrupt. These barriers disproportionately affect those who need government assistance the most.

We have the ability to solve a lot of problems for our population, but the hard part has always been in the distribution, not the solution. In India, we believe that AI can help bridge this access gap.

AI enables people to access services directly with their voice using natural language, empowering them to help themselves. As Canadian writer William Gibson aptly said, “The future is already here—it’s just not evenly distributed.” Nowhere is this more glaringly evident than in India.

The rest of the world has been eyeing AI with curiosity, waiting for real-use cases. In India, we see potential today. While this may be true of many other developing economies, the other important factor is that.

The rest of the world has been eyeing AI with curiosity, waiting for real-use cases. In India, we see potential today.

India is ready for it

India’s population isn’t just young, it is connected. According to the country’s telecommunications sector regulator, India has more than 790 million mobile broadband users. Internet penetration continues to increase, and with the availability of affordable data plans, more and more people are online. This has created a massive user base for AI applications and services.

But where India has surpassed all others is in its digital public infrastructure. Today, nearly every Indian has a digital identity under the Aadhaar system. The Aadhaar is a 12-digit unique identity number with an option for users to authenticate themselves digitally—that is, to prove they are who they claim to be.

Further, India set up a low-cost, real-time, interoperable payment system. This means that any user of any bank can pay any other person or merchant using any other bank instantly and at no cost.

This system—the Unified Payments Interface—handles more than 10 billion transactions a month. It is the largest real-time payment system in the world and handles about 60 percent of real-time payment transactions worldwide.

With the success of these models, India is embracing innovation in open networks as digital public infrastructure. Take the example of Namma Yatri, a ride-hailing network built in collaboration with the union of auto-rickshaw drivers in Bangalore and launched in November 2022.

These drivers have their own app, with a flat fee to use it, no percentage commission and no middleman. The app has facilitated close to 90,000 rides a day, almost as many as ride-hailing companies in the city.

Unlike Western countries, which have legacy systems to overhaul, India’s tabula rasa means that AI-first systems can be built from the ground up. The quick adoption of digital public infrastructure is the bedrock for these technologies.

Such infrastructure generates enormous amounts of data, and thanks to India’s Account Aggregator framework, the data remain under the citizens’ control, further encouraging public trust and utilization. With this solid footing, India is well positioned to lead the charge in AI adoption.

India will do it

In September 2023, the Indian government, in collaboration with the EkStep foundation, launched the PM-Kisan chatbot. This AI chatbot works with PM-Kisan, India’s direct benefit transfer program for farmers, initiated in 2019 to extend financial help to farmers who own their own land.

Access to the program, getting relevant information, and resolving grievances was always a problem for the farmers. The new chatbot gives farmers the ability to know their eligibility and the status of their application and payments using just their voice. On launch day more than 500,000 users chatted with the bot, and features are being released slowly to ensure a safe and risk-managed rollout.

These steps are part of an encouraging trend of early adoption of new technology by the Indian government. But the trend extends beyond the government. India’s vibrant tech ecosystem has taken off as well, a direct offshoot of its booming IT exports—currently at nearly $250 billion a year.

Next to those from the US, the largest number of developers on GitHub, a cloud-based service for software development, are from India. This sector not only innovates but also widely adopts digital public infrastructure.

The effect is cyclical: start-ups feed the growing tech culture and, in turn, leverage the data to build more precise and beneficial AI tools. India’s dynamic start-up ecosystem, moreover, is actively working on AI solutions to address various challenges.

AI can be a game changer in education as well, helping close the literacy gap. AI technologies are uniquely positioned to help students learn in their native languages, as well as learn English. AI’s applications are useful not only for students; they extend to teachers, who are often overwhelmed by administrative tasks that detract from teaching.

As AI takes over routine tasks in government and start-ups, the roles of teachers and students evolve, and they form dynamic partnerships focused on deep learning and meaningful human interaction.

What India needs is a strategic plan to chase down the most important opportunities for AI to help. The trick is not to look too hard at the technology but to look at the problems people face that existing technology has been unable to solve.

And organizations such as EkStep have stepped up with a mission called People+AI. Instead of putting AI first, they focus on the problems of people. This has led to surprising new uses unique to India.

India’s emerging status as a technological powerhouse, combined with its unique socioeconomic landscape, puts it in a favorable position to be the world’s most extensive user of AI by the end of this decade.

From streamlining education to aiding in social protection programs, AI has the potential to deeply penetrate Indian society, effecting broad and meaningful change.

Nandan Nilekani is the chairman and cofounder of Infosys and founding chairman of UIDAI (Aadhaar); Tanuj Bhojwani is head of People+AI

Source: IMF Finance & Development

Opinions expressed in articles and other materials are those of the authors; they do not necessarily reflect IMF policy.

IPS UN Bureau

 

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