Tuesday, June 23, 2020

The US-Taliban Deal: A ray of hope for the battered Afghans

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Aditi Mohta

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The US-Taliban Deal: A ray of hope for the battered Afghans

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Global Views 360

Publication Date

June 23, 2020

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US Secretary of State Michael R. Pompeo participates in a signing ceremony in Doha, Qatar, on February 29, 2020

US Secretary of State Michael R. Pompeo participates in a signing ceremony in Doha, Qatar, on February 29, 2020 | Source: U.S. Department of State  via Wikimedia

On 11 September 2001, the attacks on the World Trade Centre and Pentagon in America killed over 3000 people for which Osama Bin Laden, the head of Al-Qaeda, claimed responsibility.. Osama Bin Laden was based in Afghanistan during this attack and was protected by the government of the day which was run by the radical Islamist group Taliban. Even after the repeated demands from the USA government, Taliban refused to hand over Osama bin Laden to the USA. 

George W. Bush, the president of America at that point of time, announced the first airstrikes against Afghanistan on 7 October 2001. As other countries joined in, the Taliban were quickly removed from power and a new pro-western government was installed. The new government, however, was never able to run its writ over the whole country. The Taliban regrouped and started gaining influence in the vast rural areas and continuously attacked the US-led international military coalition as well as Afghan forces. From that point onward, the U.S. and its allies have battled to stop Afghanistan's administration crumbling and to end attacks by the Taliban. 

After more than eighteen years of war in Afghanistan, on 29 February 2020, the United States and Taliban signed a peace deal which was the first step in ending the war. The agreement was signed in the Qatari capital Doha between Talibani political chief Mullah Abdul Ghani Baradar and U.S. special envoy Zalmay Khalilzad. The U.S. Defence Secretary Mark Esper said that signing of the accord would be a good step to end the war, the road ahead would not be secure. There would be a full withdrawal of all U.S. and coalition forces from Afghanistan within 14 months since the signing of the deal. The Taliban promised to cut ties with Al Qaeda and keep fighting the militant Islamic State group.  

What is in the peace agreement?

The peace agreement was signed after nine rounds of discussion and it contains four main points: cease-fire, withdrawal of foreign forces, intra-Afghan negotiations, and counter-terrorism assurances. 

  1. Cease-fire: The negotiators agreed to a temporary reduction in violence. They said that a permanent and comprehensive cease-fire will be an item on the agenda of the intra-Afghan dialogue and negotiations. 
  2. Withdrawal of foreign forces: Within the first 135 days, the U.S. will reduce its troops in Afghanistan from roughly 12,000 to 8,600, along with the allies of the U.S. also withdrawing their forces proportionately. If the Taliban follows through all the commitments that in the peace deal, all the U.S. troops along with the allies' troops will leave Afghanistan within fourteen months. 
  3. Counter-terrorism assurances: The United States invaded Afghanistan after the 9/11 attacks, mainly to eliminate the threat of terrorism and halt terrorist activities in the country. As a part of the agreement, the Taliban guaranteed that Afghanistan would not be used by any of its members or terrorist groups to threaten the security of the U.S. and its allies. 
  4. Intra-Afghan negotiations: The reason behind the intra-Afghan talks is to bring together negotiators from the Taliban and Afghan government. The peace deal also calls for an exchange of prisoners before the intra-Afghan negotiations. The intra-Afghan talks which were supposed to take place in March 2020, have been delayed. 

Challenges to the peace deal

While this deal can be seen as a stepping stone towards a more comprehensive agreement, many difficulties may come in the way. 

The United States and the Taliban had consented to the arrival of up to 5000 Taliban prisoners in return for up to one thousand Afghan security forces. However, the Afghan government said that it had not agreed on such an exchange. The process can become difficult due to a weak central government along with ethnic, tribal and sectarian differences. At the same time, many people say that the Taliban has gotten more than it gave up. 

Through the deal, the Taliban got their primary wish: removal of American troops from Afghanistan. Yet, they had failed to be specific about the civil rights that they had repressed when they were in power. The insurgents pledged to keep international terrorist groups like Al Qaeda from using Afghanistan as their base for attacks. 

The United States promised to work towards the gradual removal of Taliban leaders from the sanction blacklists of America and the United Nations. At the same time, the experts say that the Taliban is stronger than ever at this point. It controls many districts throughout the country and continues to launch significant attacks including in Kabul and on Afghan security forces. 

The peace process is also faced by the problem of the illegal drug trade. According to Afghan officials, more than 20 terrorist groups still operate inside the country, which is another threat to the deal. By signing the agreement, the U.S. and the Taliban state their commitment to reduce violence and not attack each other. What remains a worry is how much and how long the Taliban will hold fire on Afghan security forces before the cease-fire is finally reached in Afghan negotiations.

Sources that were used:

  1. https://www.nytimes.com/2020/02/29/world/asia/us-taliban-deal.html
  2. http://diplomatist.com/2020/05/16/us-taliban-peace-deal-and-its-implications-for-central-asia/
  3. https://www.aljazeera.com/indepth/interactive/2020/02/war-afghanistan-2001-invasion-2020-taliban-deal-200229142658305.html
  4. https://www.bbc.com/news/world-asia-51689443
  5. https://www.dawn.com/news/1529415
  6. https://www.cfr.org/backgrounder/us-taliban-peace-deal-agreement-afghanistan-war
  7. https://www.aljazeera.com/news/2020/02/afghanistan-taliban-sign-deal-america-longest-war-200213063412531.html
  8. https://www.dawn.com/news/1537384
  9. https://www.washingtonpost.com/context/u-s-taliban-peace-deal/7aab0f58-dd5c-430d-9557-1b6672d889c3/?itid=lk_inline_manual_3

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April 13, 2021 7:47 AM

Are India's Antitrust laws effective at controlling monopolies?

On 15th of July 2020, Reliance Industries Ltd (RIL) held its annual general meeting of the shareholders. The chairman and managing director Mukesh Ambani, announced that global tech giant Google would be investing $4.5 billion in Jio Platforms. Facebook also has acquired a 9.99% stake in Jio Platforms. This is the first time in the world that both the global tech giants have invested in the same entity. These investments have boosted the confidence for Jio Platforms and also for India’s growth but there have been questions and speculations about the potential anti-competitive makeup of these deals.

The objective of this article is to explore the interpretation and the effectuality of Antitrust laws in India.

Anti-competitive practices are those business practices which firms engage in to emerge as the or one of the few dominant firms, who will then be able to restrict inter firm competition in the industry in a bid to preserve their dominant status. The Collins English dictionary defines antitrust laws as those laws that are intended to stop large firms taking over their competitors by fixing prices with their competitors, or interfering with free competition in any way. These laws focus on protecting consumer interests and promoting a competitive market. The word ‘Antitrust’ is derived from the word ‘trust’. A trust was an agreement by which stakeholders in several companies transferred their shares to a single set of trustees.

In present-day India, talking about market dominance Reliance Industries Ltd (RIL), resembles American company—John D Rockefeller's Standard Oil Company—of the early 20th century. Mukesh Ambani holds the highest ability to influence markets and policy in every sector in which RIL is present—petrochemicals, oil, telecom, and retail. Many industry experts and critics suggest that Ambani has used his political clout to twist the regulatory framework in his favor.

Gautam Adani, founder of Adani Group | Source: Twitter

Furthermore, economic power in aviation infrastructure is clustering into a few hands as well. In 2019, the Adani Group bagged the 50-year concession to operate all the six Airports Authority of India-operated airports—Lucknow, Jaipur, Guwahati, Ahmedabad, Trivandrum, and Mangaluru—which were put up for auction. The company also obtained a controlling stake in ‘The Chhatrapati Shivaji Maharaj International Airport, Mumbai’ from GVK Airports. Moreover, Adani Group is now set to construct the Navi Mumbai International Airport. The group is now eyeing Indian Railways while they have already established an alarming monopoly in green energy and sea ports. While Airports are natural monopolies, one private company controlling more than 8 important airports is not good news to airlines.

India has established antitrust laws to promote competition. For 40 years, India followed the Monopolies and Restrictive Trade Practices Act 1969 (MRTP). This act was based on principles of import substitution and a command-and-control economy. However, over time several amendments had to be made to the act. In 2002, the Indian approved a new comprehensive competition legislation. This is called the Competition Act 2002. The act focused on regulating business practices in order to prevent practices having an appreciable adverse effect on competition (AAEC) in India. The act primarily regulates three types of conduct: anti-competitive agreements (vertical and horizontal agreements), abuse of a dominant position, and combinations such as mergers and acquisitions. The act lists out the cartel agreements that it intends to prevent. This list includes price-fixing agreements, agreements between competitors seeking to limit or control production, market-sharing agreements between competitors and bid-rigging agreements. These agreements are called “cartel” arrangements.

The competition Act is enacted by the Competition Commission of India (CCI), which is exclusively responsible for the administration and enforcement of the Act. It comprises a team of 2 to 6 people appointed by the government of India. The CCI has previously handled high-profile cases. In 2018, CCI imposed a fine of Rs135.86 crore on Google on the grounds that Google misused its dominant position and powers to create a search bias. In another important case, the CCI, ordered a probe into Idea, Vodafone and Airtel when Reliance Jio owner Mukesh Ambani lodged a complaint against the three for forming a cartel and denying Jio the POI required for network connection, causing multiple call failures. The Cellular Operator Association of India was also probed for encouraging the same.

In some cases, the Competition Commission has been successful in tackling activities that are against the free competitive market. However, critics and economists believe that the act is now unable to adapt to the changing business environment in e-commerce, telecom, technology and the government’s role in distorting competition. Demonetization and GST drove the formalization of the economy. One consequence of them was that bigger, better organized players gained at the cost of smaller ones with lesser resources. The Insolvency and Bankruptcy Code (IBC) was designed to solve the problem of non-performing assets (NPAs) of banks. But consequentially, it has also led to a consolidation in many sectors.  

However, CCI has expressed inability to consistently adjudicate punitive measures due to obligation in several cases. This points to the loopholes in the very provisions of the Competition Act 2002. In an Economic and Political Weekly (EPW) article, Aditya Bhattacharjea—an Economist—argues that even though the 2002 Act represents an improvement from the MRTP Act which was extremely restrictive, the present act also remains riddled with loopholes and ambiguities. According to Bhattacharjea, this creates unnecessary legal uncertainty, which acts in advantage of lawyers and law firms. For instance, the act allows the CCI to leave some scope of flexibility for “relative advantage, by way of contribution to the economic development.” Bhattacharjea argues that this may allow large firms to justify their anti-competitive practices in the name of development.

Mark Zuckerberg and Mukesh Ambani having online interaction after Facebook invested in Jio Platforms | Source: NDTV

Data portability plays a significant role in determining market power of certain firms. In 2017, the CCI closed cases against both WhatsApp and Jio involving allegations of predatory pricing and privacy violations. In both these decisions, the regulator did not consider the restrictions around data portability as a competitive advantage. The possible data leveraging advantage for the attempted monopolization could be the ‘portfolio effect’. Portfolio effect refers to increasing the range of brands, by bundling of telecom or messaging service and other service offerings or illegal vertical restraints, even predatory pricing. This in turn may lead to greater ability of further leveraging, deterring innovation and results in degradation of quality. Another possible advantage is explained as the theory of leveraging. The best example of leveraging is when Microsoft entered the media-player market by extending its quasi-monopoly on the operating systems market by taking advantage of the indirect network effects. In case of Facebook acquiring 10% of Jio’s shares, it is a concern that both entities could potentially use WhatsApp’s market dominance in telecom and social networking services and establish dominance in e-commerce market through anticompetitive acts.

There was a consensus among Indian policymakers at the time of the 1991 economic reforms that economic liberalization would eliminate the nexus between the business elites and the policymakers. On the contrary, the relationship between these two groups got further strengthened.

On the other hand, few critics and industrialists argue that extreme restrictions on growing companies hampers the progressive growth of the national economy. While RIL’s Jio looks like a cause for concern, the company has also saved Rs. 60,000 crores for annual savings in India. In addition to that, the entry of Jio to the telecom industry has led to a rise in data consumption and improved accessibility and affordability of the internet across the nation.

However, the concern still lingers as the question of whether this growth is a result of actual innovation or crony capitalism remains unsolved.

However, the fact that telecom, organized retail, ports and airports have two or three players controlling the bulk of the sector needs to be addressed. A healthy competition is quintessential for long-term growth and innovation. Harmful trade practices and cartelization does not only affect small manufacturers but also the general public.

The government, CCI and other lawmakers must closely examine the present laws and provisions and need to see if they are required to amend the act.

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