Looking Ahead to South Asia in 2014

In the coming year, the greater South Asia region will be under enormous pressure. The 2013 elections in Iran and Pakistan ushered in new administrations that are now expected to deliver, particularly on the economic front.  Meanwhile, Afghanistan, India, and Bangladesh face their own elections in 2014.  In the midst of the ongoing transitions, the South Asia Center invited experts to share their predictions for the region in the coming year as well as offer advice on how to move relations forward between South Asian countries, and the US and greater South Asia.

Looking Ahead to 2014

Shuja Nawaz
Sunjoy Joshi
Samir Saran
Moeed Yusuf
Barbara Slavin
Bharath Gopalaswamy
Mohan Guruswamy
Jonathan Paris

2014: A Year of Transitions

Shuja Nawaz, Director, South Asia Center
This will be an important year of transition in the region. Pakistan and Iran will see the results of their 2013 elections bear fruit. Iran may solidify its initial efforts to reach agreement with the United States and the West on nuclear enrichment, leaving till later the issue of nuclear weapons per se. Pakistan will run into headwinds in stabilizing its economy and in its relations with its neighbors. The polity remains divided for now between the civil and the military. The Indian elections spell change at the top  but the economy will remain struggling for most of 2014. Bangladesh will remain unstable and the economy will suffer major setbacks, even if there is a fresh election planned for this year or  next. Ashraf Ghani has the best chances of cobbling together an acceptable alliance in the Kabul elections to ensure Western support beyond 2014.

Regional Dynamics in 2014

Sunjoy Joshi, Director, Observer Research Foundation
As the US is set to withdraw from Afghanistan in 2014, regional countries such as India, Iran, China and Pakistan are expected to fill the vacuum and step up constructive engagement with Afghanistan. The new Afghan President will initiate dialogues with his regional counterparts soon after elections in an attempt to shore up external support for his country. In particular, the Afghanistan-India-Iran trilateral transit agreement will be signed.
Afghanistan will demand Pakistan to release more Taliban prisoners and Rawalpindi will provide access to the Afghan Government to Mullah Baradar. However, neither will lead to a breakthrough in the peace talks. On the contrary, the Taliban will intensify its military campaign this spring in the hope of inflicting as much damage on the ANSF and foreign forces as possible. This will prove to be a thorn in Afghanistan-Pakistan relations, which along with frequent cross-border firing, will derail not only bilateral relations but even the peace process.

Pakistan’s relations with its other neighbour – India – are unlikely to change significantly in 2014. Irrespective of who comes to power in New Delhi, it will continue to link a rapprochement with Pakistan with the latter’s efforts against the terror infrastructure on its soil and the 26/11 perpetrators. However, Nawaz Sharif may find it dificult to deliver on both these accounts as this would involve far greater assertiveness vis-à-vis the new military chief. However, the two countries will continue to focus more on improving trade and economic relations . While this by itself may not fully satisfy India, a government led by the BJP with the support of the Akali Dal (the leading party in Indian Punjab) will probably be in a position to respond more favourably to these overtures.

Finally, while cross-border firings between the two cannot be ruled out completely, Rawalpindi will take stricter measures to ensure that no such incident is started from its side keeping in mind the turmoil that is likely to erupt on its western frontiers as the US drawdown begins.

India and the Region in 2014

Samir Saran, Senior Fellow and Vice President, Observer Research Foundation
2013 was a year of foreign policy successes for India. It can be satisfied with the developments in Nepal as also in Bangladesh (though the government has reduced credibility) and it ensured a smooth succession in the Maldives. India deftly dealt with China – managing a border incursion effectively as well as concluding successful visits by the Prime Minister and the Dalai Lama to Arunachal Pradesh despite protests from Beijing. The relation with Pakistan remained volatile with several flare-ups. 2014 must see a greater effort at normalising this key relationship – but will it happen? No. If anything one will see familiar uncertainty, and possibly in the wake of the Afghan drawdown, an exacerbation of tensions as the two nations will invariably get drawn into the proverbial zero-sum game.

2014 is India’s year of the voter, and a change of government seems a foregone conclusion. The interesting thing to see will be if any side gets a majority or will India be saddled with a hung parliament. The big question obviously is how does this affect India’s regional and foreign policies. If the BJP gets the nod from the electorate India’s policy is likely to be more of the same, as the BJP and Congress hardly differ in their approach on key bi-lateral engagements. Despite the rhetoric of difference, policy will coast along. However if a third front government eventuates, one may see diminishing attention towards foreign policy. The important players in such a government will be regional politicians like Jayalalitha, Mamata and the Badal(s) who will influence India’s approach towards Sri Lanka, Bangladesh and Pakistan respectively.

Three Trends in South Asia

Moeed Yusuf, Director, South Asia Programs, US Institute of Peace 
First, virtually all South Asian countries are having a difficult time remaining inclusive. Some exclusion is driven by politics and some by lack of state capacity to tackle violent onslaughts against peoples of certain faiths, ethnicities, or ideological leanings. From Afghanistan to Bangladesh, minorities in one or more of these categories have had a terrible 2013. And there seems little reason to believe that leaders in South Asia will muster the political will or capacity to reverse the trends.

Second, and linked to the above, nearly all South Asian states would have gone through a general election between the spring of 2013 and Fall of 2014. However, save India, all countries have seemed unable to make the jump from being ‘electocracies’ to true democracies. Bangladesh is burning thanks to political bickering as we welcome 2014; Pakistan’s first peaceful democratic transition has yet to translate into more inclusive governance styles; the majoritarian democracy in Sri Lanka is becoming even less compromising; and we continue to see tactical political agendas overburden any consociational spirit in Nepal, Maldives, and Afghanistan.

Of course, elections are better than no elections. But the history of post-colonial South Asia suggests that prolonged period of electocracy is more likely to give way to a breakdown of the system rather than to maturing democracies. South Asian leaders need to prove their democratic credentials not by winning elections but by behaving democratically once in power. Again, unlikely in the near term.

Third, the two beasts – India and Pakistan – are still stuck, unable to move forward. One suspects proponents of the flawed conventional wisdom that “nothing can move till the Indian elections” may be winning out. In reality, if things have to move, now is the most promising time: there is a fresh popular government in Pakistan and a Prime Minister on his way out and with little to lose in India. Fingers crossed on whether they can defy the odds and make a modest breakthrough in the next few months.

So South Asia of 2014: exclusionary, violent, prevalence of electocracy without democracy; and still long way away from genuine progress between the two giants in the region.

US and Iran Engagement

Barbara Slavin, Senior Fellow, South Asia Center
The United States and Iran will implement the Nov. 24 Geneva agreement despite attempted interference from hardliners in both countries. The deal should hold – assuming President Obama keeps his pledge to veto any new sanctions legislation. Iranian and American officials will begin conversations about regional issues, including Syria, and there will be greater receptivity in Iran to US-Iran academic, scientific and athletic exchanges.

South Asia’s Year of Elections

Bharath Gopalaswamy, Deputy Director, South Asia Center
It will be a year of elections in South Asia! India will  experience a hung parliament. Expect many new faces in the parliament and a good chance that Narendra Modi will become the Prime Minister.  Protests, unrest and uncertainty in Bangladesh will rise. Martial law will likely be imposed. The U.S withdrawal from Afghanistan will result in increase in violence and will be an increasingly concerning factor for India and Pakistan. Finally, the Indian economy will recover, albeit slowly around 5%

The more things change, the more they stay the same

Huma Haque, Associate Director, South Asia Center
Despite the several important transitions in 2013 in Pakistan (the first democratic transition of power, the appointment of a new army chief, and selection of a new chief justice), the problems of the common man will remain.  Sectarian violence and target killings will continue to rise, efforts to improve the energy crisis will lead to nowhere, the rupee will continue to ail, and Pakistan will not be prepared to handle the spillover from the proxy war from next door.

The elections will be the main hurdle for India in 2014, where the BJP’s Narendra Modi is likely to be India’s next prime minister.  Google envisioned India-Pakistan harmony in less than 4 minutes – politicians haven’t been able to accomplish this in 60+ years.  With every forward step, two more are taken backwards.  As our optimism for opening the India-Pakistan border for trade increases, new hurdles will continue to surface.

This will be a critical year for Afghanistan with the ISAF drawdown and elections in April.  Afghan troops can barely secure the country on their own so expect an escalation of violence.  Whether a new government is the answer to Afghanistan’s stability waits to be seen.

India in 2014 – as in 1996?

Mohan Guruswamy, Senior Fellow, South Asia Center
We in India can make one safe prediction about how 2014 will unfold. That is Dr. Manmohan Singh will not be Prime Minister after the elections, most probably in May this year. Till a few weeks ago few were willing to hazard a guess that someone else other than Narendra Modi, the BJP’s anointed standard-bearer, would be Prime Minister. But after the spectacular debut of the Aam Admi Party, literally the common people’s party, in the recent elections to the Delhi Legislative Assembly, all bets are off. The AAP won 29.3% of the vote pulling the Congress down from 40.3% to 25.01% and the much-favored BJP from 36.3% to 34.37%. What was more galling for the BJP was that Narendra Modi campaigned extensively in Delhi and the BJP, responding to the anti-corruption impulses unleashed by the AAP, even changed its chosen candidate for Chief Minister mid-stream. Other political parties like the former UP CM’s dalit (lower caste Hindus) based Bahujan Samaj Party, which were making inroads into Delhi in the previous elections, were practically wiped out.

The Times of India today carries a summary of a commissioned opinion poll in India’s top eight cities, bearing bad tidings for both the major parties, the Congress and the BJP. The Times survey reveals that 44% of those polled have expressed an intention to vote for the AAP in the forthcoming parliamentary elections, if the party can put up a candidate in their constituency.  Since the BJP is generally considered stronger in urban areas, this poll has not surprisingly sent shock waves among its leadership. Ironically this apparent weakening of the BJP has brought some cheer to the badly battered Congress Party. While it expects a substantially reduced number of MP’s in the Lok Sabha, the lower house of Parliament, it enhances the hitherto almost written off chances of the Congress being a part of the ruling dispensation. The Congress Party is already supporting the AAP in Delhi, where despite its spectacular electoral debut, the AAP fell well short of a majority and is in office due to the vanquished Congress Party’s support.

Despite this, the poll also reveals that Narendra Modi is still by far the most preferred as PM. But Modi too has been badly battered in recent weeks. His general ignorance of Indian history was on display when he told an audience in Bihar that Alexander the Great died on the banks of the Ganges after being defeated by a great army of the Gupta kings, who had their capital in modern day Bihar. The only problem with this formulation was that the Gupta dynasty came into being several centuries later, and Alexander died closer to his home than Mr.Modi would like to think. He has shown himself to be gaffe prone and his handlers have studiously avoided press conferences and interviews. Can one win an election only on sound bites? Sound bites are only good in the attack mode, but cannot elaborate or outline a vision. This seems to have become Mr. Modi’s problem now. All attack but no vision.

Since yesterday his knowledge of economics too has come under question when he associated himself with a move initiated by a Yoga guru, Baba Ramdev, to have a completely tax free regime in India and have a system based on expenditure taxes. The problem with this is that only 37% of all Indians have bank accounts, and almost four-fifths of all transactions are by cash. India has a Tax/GDP of just 17.7%, the lowest among the top ten economies and less than half of the developed countries such as the USA, Japan, UK, Germany and France. In raw terms the amount of money with a government has a direct relationship with its power, to do good for its people and to make itself felt outside. Now the BJP talks relentlessly about making India a super-power, whatever that means and entails. Clearly this ambition calls for a higher Tax/GDP ratio as well as a higher GDP. How this new scheme will dovetail with the BJP’s aspirations for India? Meanwhile the party is tying itself up in knots explaining this. The Columbia University economics professor, Jagdish Bhagwati who now a Modi supporter, a few years ago famously remarked that if the BJP has an economist, then he is a Bharata Natyam dancer! A few weeks ago I saw him walking down Manhattan’s Amsterdam Avenue. He didn’t look like he was taking any dance classes.

The economy however is moving slowly back to the dominant trends of the past decade. Industrial production is showing signs of reviving. The agricultural sector is poised for another good year primed by a bumper harvest. Exports have been increasing. The worrying increase of the current account deficit has been reversed and the depreciation of the rupee has been arrested. The Reserve Bank of India has projected a GDP growth of just over 6% next year. What India needs most now is a regime that does not rock the boat? That might seem a tall order, but the Indian political system has always exhibited a penchant to clamber out of a crisis. So the big question that needs to be asked is what kind of a government will India get?

One thing is certain. The era of one party government’s is long gone.  Another things that is just as certain is that there is now a broad consensus on economic policy, liberalization and the need for foreign investment, Indian or otherwise. Except for the infantile ranting from the extreme left internationalists and extreme right ultra-nationalists few challenge this major consensus. India’s heterogeneity and the rise of regional and decentralizing aspirations, and its democratic system have now found expression by the growth of regional parties. One thing most observers here are agreed here is that the strength of regional parties will once again increase at the cost of one or the other national parties. Under Narendra Modi’s leadership, with him being tainted with being responsible for the massacre of Gujarati Muslims, the BJP will be unacceptable to all the regional parties, except the Sikh party- the Akali Dal, as they profess to be secular (non-sectarian) and derive support from the not inconsiderable Muslim minority. If it requires the support of these parties, the BJP may dump Narendra Modi after the elections for somebody less angular. But it is unlikely to work. In all probability the Congress Party is not expected to get more seats than the regional parties together, with AAP too adding its numbers to these ranks. The regional parties will be in a good position to bargain for a government headed by one of their own, with the Congress supporting it. As they did in 1996.

Moving Forward in 2014

Jonathan Paris, associate fellow, International Centre for the Study of Radicalisation (ICSR) at King’s College London
Pakistan will muddle through in 2014. As I concluded in my Prospects for Pakistan Report in 2010, the US will have an increasingly difficult time getting Pakistan to promote US interests. The US is and will continue to be unpopular in the Pakistan street, and Imran Khan’s anti-drone campaign will continue to gain domestic support. Nawaz Sharif will, however, keep US-Pakistan relations on a steady course. In some respects, Pakistan-US relations may be more stable than US-India relations in 2014.

Pakistan’s neighbor, Afghanistan, will be in steady turmoil as the post-Karzai and post-ISAF era approach. Things may not deteriorate to the extent that Afghan and Pakistani troops start clashing along the border, but expect the Taliban to score some significant hits against Afghan government institutions.

Iran-US relations should continue to improve as President Rouhani gains stature internally from being seen as ending Iran’s political and economic isolation. Iran and the US are likely to start working together to try to bring the Syrian civil war to an end. Iran needs help in extricating it from the ‘black hole’ that Iranian support for Assad has become. The US appears more concerned about rising Al Qaeda and Sunni extremists in Syria and Iraq than with supporting its Gulf and moderate Sunni allies and Israel against the Iran-led Shiite axis. Does this sound confusing? Welcome to US policy in the Middle East 2014.  

The P5+1 and Iran will likely reach another interim deal or extend the current agreement for another six months, as is permitted under the November 2013 agreement. But a final agreement over Iran’s nuclear program will not be reached in 2014.

I wrote two years ago for the South Asia Center that ‘Turkey’s regional leadership aspirations will come down a notch or two as Erdogan’s health problems, Kurdish problems and economic problems dent his popularity and that the West will become increasingly disenchanted with Erdogan’s brinksmanship and mercurial personality’.   Things are going to get worse for Erdogan than I predicted for 2012, though one can never count him or the ruling AKP out given the absence of dynamic leaders from the other political parties. I expect Abdullah Gul, co-founder of AKP, to emerge as an alternative power pole to Erdogan, particularly if the corruption charges against Erdogan and his cronies gain traction.