Editorial 1 : A Tough Road from the Brink
Context: Canadian attempts to involve Indian political leadership in Nijjar affair are preposterous
India-Canada Relations
- India and Canada relations truly reached a low point.
- Personal Political Attacks: The two countries’ public recriminations have gone beyond the realm of intelligence and diplomacy into the dangerous territory of personal political attacks.
- The relations went into steep decline last year after Canadian Prime Minister Justin Trudeau accused Indian government’s agents in killing of Hardeep Singh Nijjar.
- India had strongly refuted Canadian allegations. It pointed to Canadian indifference and the hypocrisy in preventing its citizens from promoting violent separatism in India through their support for Khalistan.
Latest Development
- NSA Meet: National Security Advisor (NSA) Ajit Doval met Canadian NSA on October 12 in Singapore to discuss the latest ramifications of the Nijjar matter as well as the Canadian allegations that Indian diplomats were engaged in illegitimate diplomatic conduct.
- Trudeau told media in Ottawa on October 14 that he had conveyed to PM Modi in Laos that the Singapore NSAs meeting was going to be incredibly important and that it had to be taken very, very seriously.
- Canadians have not given an official account of what transpired at the meeting and India has remained silent on the meeting.
Canada’s Move
- Canadians claim that they asked India to lift the immunities of six Indian diplomats who were persons of interest in the series of criminal activities involving the Indian community and Nijjar’s murder.
- A person of interest is an informal term used by US and Canadian law enforcement agencies regarding those who may have some knowledge or involvement in a crime.
- Blatant Propaganda: Canadians would know that no country ever lifts the immunities of its diplomats. Hence, this entire Canadian exercise was propagandistic.
- Reaction from India: The upshot of the Canadian move is that India recalled the six Indian diplomats, including the High Commissioner, and expelled six Canadian diplomats and issued a strongly worded statement condemning Trudeau and his politics.
- Impact on Bilateral Ties: All this will naturally impact bilateral ties in all spheres, including people-to-people contacts.
Way Forward
- India finds itself in a critical situation as Canadian officials have four Indian nationals in their custody in connection with the Nijjar murder case and they may produce “evidence” in court while prosecuting them, which may be embarrassing to the government.
- India will have to energetically engage Western countries with which it has robust diplomatic and intelligence ties.
India must impress upon them the preposterousness of Canadian attempts to involve the Indian political leadership in matters, which India always refrains from interfering in.
Editorial 2 : Rich Nation, Poor Nation
Context: The Economics Nobel for 2024 underlines the connection between wealth of nations and democracy
Income Gap
- There is a large gap between rich and poor countries.
- The income gap between rich and poor countries is persistent.
- While the poorest countries have become richer, they are not catching up with the richest.
- Factors: Historical Factors and Institutional Differences
- The developed world has a common thread in the form of political and economic structures.
Meaning and Role of Institutions
- It means a strong legal system where rules are defined, with an adjudication system in place.
- It is a gamut of political and economic edifices which drive the growth agenda of a country.
- The regime can be inclusive, which is best exemplified by the West, which is also largely democratic.
- There are transparent laws relating to doing business, covering taxes, trade and commerce etc. This provides the contours for doing business.
- Alternatively, it can be exploitative as can be seen in autocratic regimes, such as in some parts of Africa.
- Societies with poor rule of law and institutions that exploit the population do not generate growth or change for the better.
Colonialism
- Colonial Impact: The quality of institutions can be linked to the number of settlers in colonies post-independence.
- In some places, the aim of the colonists was to exploit the indigenous population and extract resources for their own benefit.
- In others, the colonists formed inclusive political and economic systems for the long-term benefit of European migrants.
- Places where colonists remained and settled due to lower mortality, there was evidence of creation of institutions which worked well.
Main Takeaways from the Economics ‘Nobel’ 2024
- Importance of a democratic set up.
- Democracies definitely work better, as there are free elections and while different parties may have varied motivations, one needs to perform in order to get back to power.
- Creation of the right institutions that foster investment.
- Protection of private property is such an institution which comes automatically if there is a strong judicial system.
- Similarly, various policies that support the growth process would be part of the system.
China’s Example
- China has managed to create one of the largest economies with the latest state-of-the-art infrastructure and production processes.
- The political system is autocratic for all practical purposes, but has delivered well.
- Counter Argument: While the economy is large and competes well with other developed nations, there is immense inequality within the country.
- Therefore, such guided growth, where the government owns and controls a large part of the means of production, does not bring about an optimal solution in terms of equality.
Singapore’s Example
- Outlier: Singapore is not democratic but has strong institutions and can be considered an outlier for sure.
Coming to India
- The government has focused a lot on the ease of doing business which has been achieved by creating the appropriate institutional structure through a series of reforms in every sector.
- Providing access to infrastructure, land laws, dispute resolution, strong financial systems etc. are all part of the institutional set up that is required to keep growth ticking.
- In the last 10 years or so India has become the fastest-growing economy though, admittedly, there is a long way to go in becoming a developed economy.
Conclusion: A takeaway from this year’s Nobel Laureates can be that unless there are democratic regimes which foster the building of strong institutions, growth across countries will remain lopsided.