India’s Fading Democracy

Ashraf Lone

Indian democracy is in grave danger. First it was all about lynchings of muslims and dalits and killing of some selective activists but now the tide of intolerance and bigotry has entered the houses of all, including the urban intellectual class, labellled by present regime as “Urban Naxals”, which has derived widespread condemnation. No one is being spared now. Those ,who are critical of the government policies are considered “threat” by the ruling class to their power . This ruling class is afraid of losing the power and is thus using every tactic to remain in power or to try everything , not to lose power in future(elections). Dissenting voices are being silenced and curbed.

RSS affiliated BJP is leaving no stone unturned to remain in power.  “Love Jehad” slogan seems to be an old or outdated tactic now, though can be used at any opportune time which suits the ruling party. Lynchings have brought shame to India, and democratic system on international level. Some of the cases of lynchings  have proved involvement of the government in these crimes and criminals are roaming free.

From last four years Muslims have felt the brunt of this regime. There have been killing of Muslims in the name of beef eating and cow smuggling going on without interruption. Mobs are ruling the streets with full state patronage. Another aspect of the Indian society is discrimination and suppression of dalits on every front from villages to university recruitments. Lynching of dalits on one pretext or the other have  been also reported.

India is under BJP rule and BJP  in Independent India’s history has for the first time came to the power with full majority. It has tried and tries everything to saffronise the country. From school syllabus to Higher education, it has tried to change the narrative of history in its favour. It has turned its “heroes’” lost battles in wins, where Akbar is defeated by Rana Pratap at Haldighati.

The BJP has failed to fulfill its promises. Before election it had promised to reduced oil prices, creation of 1 crore jobs, of bringing back black money, but now it finds itself  nowhere near the target. its IT Cell is totally frustrated now. Fake charges againt intellectuals, activists and writers has become a new norm in today’s India. They are jailed and humiliated on roads and on different forums. Killing of activists and journalist is continuing on regular intervals.

Television Media has also felt the brunt of this regime in one way or the other. Some prominent TV personalities have been attacked for for speaking truth to power. Advertisements have been stopped to various media outlets. Only those are allowed to speak who toe the line of government and ignore the plight of common masses and harsh realities of the society.

Another worrying factor is the falling value of the rupee against the dollar and rising petrol prices. These two have worried Indians. Demonetisation proved to be total disaster making people wonder , what demonetization was all about. Editor-in Chief of Forbes magazine Steve Forbes has called demonetization a theft of people’s property and has also called Indian bureaucracy “to be notorious for corruption, red tape and lethargy.”

Fear has engulfed the whole of India. Journalists are now scared to ask questions and some have taken the back seat and are keeping mum and some have turned propagandist for the government. No pressing questions are asked to government for the larger benefit of the Indian masses. Polarization is being done with purpose, to devide the society on communal lines for the vote bank politics. With 2019 elections nearing, the present regime is leaving no stone unturned to wash it from its failures and shortcomings. It is using different but dangerous tactics to woo the masses to its fold.

Indian democracy is in peril now, with only one man calling the shots on all important matters. The ruling dispensation is no mood to answer the questions of the media and the opposition. Intolerance is rising with each passing day with hate speeches against Muslims and subsequently with the lynchings of Muslims. Activists are arrested with no stoppage to these arrests. Media is being muzzled and media persons silenced and threatened. Questioning the government has become a crime now freedom of expression seems to be thing of the past . It is like “ Elected Dictatorship” and undeclared emergency now in India and future of Indian democracy looks very bleak in present atmosphere of hate and bigotry.

Hundreds of Australian Aborigines killed in state custody

Richard Phillips

Thirty years after the Hawke Labor government’s 1987–91 “Royal Commission into Aboriginal Deaths in Custody,” the state brutality and killing of indigenous people in Australia continues unabated.

According to figures published last week by the Guardian, 147 Aborigines, including children, have died in custody over the last ten years, bringing the total number of indigenous people who have lost their lives in custody to 407 since the royal commission.

The deaths were the result of pursuits or violent assaults by police or prison officers, untreated physical and mental health illnesses and suicides. Not a single police or prison officer has been prosecuted over these fatalities.

The Guardian report is based on a detailed study of hundreds of coroners’ inquests between 2008 and 2018. The newspaper decided to undertake the investigation because federal, state and territory authorities have failed to maintain up to date records on the number of indigenous deaths in custody.

Gail Hickey, whose son T. J. died during a police pursuit in 2004

Australian Aborigines are the most incarcerated people in the world. Only 2.8 percent of the Australian population identifies itself as indigenous but they constitute 27 percent of the total number of prison inmates, 22 percent of deaths in prison and 19 percent of those killed in police custody.

The Guardian investigation features an online searchable database Deaths Inside and notes that more than half of the Aborigines who died in custody since 2008 had not been convicted of a crime. Most were suspected of non-indictable offences, ranging from public intoxication, to evading police and other repressive laws used by police to harass and detain Aboriginal people.

The database includes the example of 46-year-old Mr Ward who died of heat stroke in late January 2008, after being transported 360 kilometres through the Western Australian outback in the back of a police van with faulty air conditioning. Ward was admitted unconscious to hospital where he died. He had a severe burn on his side from lying on the extremely hot metal floor of the vehicle. GLS, the transport company used by Corrective Services, and two GLS employees, were later fined by Worksafe.

The report points to “stark differences in the medical care Indigenous people receive” compared to their non-indigenous counterparts. Half of the Aborigines who died had treatable medical conditions, including diagnosed mental health conditions or cognitive impairments, such as a brain injury or foetal alcohol syndrome disorder, but did not receive the necessary care.

The most common officially reported descriptions of the causes of death in the database are “Medical episode following restraint” or “Medical care required but not all given, procedures not all followed, force used.”

On December 30, 2008, a 24-year-old Aboriginal man, referred to as HN, died in the Royal Perth hospital three days after being bashed under the security cameras of a service station in Broome, Western Australia. HN was still unconscious when police arrived and arrested both his brother and the man who had attacked them. When HN regained consciousness, he was also arrested and taken to Broome hospital but did not receive a brain scan. An autopsy later revealed that HN had extensive skull fractures and intracranial haemorrhaging. He left the hospital against medical advice and was arrested again by a police officer who thought he was “good as gold” to be held in custody.

Police watch-houses, prisons and alcohol detention centres, the Guardianreported, failed to follow their own basic prevention of suicide procedures. Prisoners known to be at risk of self-harm were held in cells with hanging points, or placed in cells alone, despite numerous recommendations made by coroners that hanging points be removed from prisons and police watch houses.

In 2010, TLI, an Aboriginal woman with a chronic injury and a tooth abscess, was denied pain medication for six weeks after being transferred to Townsville women’s prison in Queensland. Her medical records were not sent to the jail with her and authorities, apart from providing mild painkillers, insisted she did not need pain relief. Six weeks after transfer, she took her own life. The coroner found the pain was “a contributing factor in her despair” during her final weeks.

The Guardian database references the case of 22-year-old Julieka Dhu in Western Australia. She was arrested on August 2, 2014, for unpaid parking fines and violently assaulted by several police officers at South Hedland police station.

Dhu was dropped on the cell floor when she could not stand up, dragged along the floor, and then carried, handcuffed and shackled, to a police van because she could not walk. Police told her she was “faking it” and berated her as a “f…ing junkie.” Dhu died on August 4, from septicemia and pneumonia caused by an infection in a rib broken by her violent partner some weeks before.

Protest over the death of Julieka Dhu

In another case, Kumanjayi Langdon, 59, died of heart disease in May 2015 while lying on a concrete bench in a Darwin police cell. He had been drinking in a park and was picked up by police under the Northern Territory’s “paperless arrest” laws. Introduced in 2014, the laws allow police to arrest and detain people for up to four hours. The coroner ruled that Langdon “was treated like a criminal and incarcerated like a criminal; he died in a police cell which was built to house criminals.”

Later that year, in October, police were sent to Kingston in Queensland to “restrain” Shaun Coolwell, who they claimed was having a “violent drug-induced episode” and behaving in an "uncontrollable" manner.

Coolwell was pinned down by police who handcuffed him while paramedics injected a chemical sedative. He began to have breathing problems, lost consciousness and died in hospital a few hours later. An internal investigation by Queensland police cleared the officers of any wrongdoing and found they had used “the minimum force required.”

These incidents are just a small sample of the horrifying and tragic reports in the Deaths Inside database. The investigation also revealed that most of the families of those who had died in custody were treated with contempt by state authorities, who delayed telling the next of kin. One father only found out that his son had died when another prisoner called him. Grief stricken families of victims have had to wait for years before coroners’ inquests were even commenced.

Last week Pat Dodson, an Indigenous Labor Party senator and one of the “Deaths in Custody” royal commissioners, declared that Australia was “going backwards as a nation” and denounced the Liberal-National federal coalition government. Dodson’s statement is disingenuous and a crude political diversion.

The increasing number of Aboriginal deaths in custody have occurred under Liberal-National and Labor governments—state, federal and territory alike.

In the aftermath of the royal commission, the entire political establishment, including figures like Dodson and other Aboriginal leaders, the Greens and pseudo-left organisations, claimed that the various cosmetic recommendations made by the commission would “end” the state-sanctioned carnage.

Every official investigation into the deaths in custody of Aborigines, including the 1987–91 royal commission, however, has been a whitewash. The recommendations and cosmetic changes advanced at various times have done nothing to change the plight of Aborigines, the most oppressed section of the Australian working class, but provided a licence for state authorities to continue the repression.

The growing number of Aboriginal deaths in custody runs parallel with the enrichment of a small elite of indigenous bureaucrats, academics and entrepreneurs who claim that racial oppression is the product of “white society” not the capitalist system and secondly, the widening economic gulf between this milieu and the vast majority of Aborigines.

The ongoing state-repression and economic degradation inflicted on Aboriginal workers and their families are just the most graphic expression of the social onslaught being carried out on all sections of the working class by big business governments in every country. The only way to fight this is through the development of a socialist movement that unites all working people, Aboriginal and non-Aboriginal alike, in a fight to put an end to the profit system.

Sri Lankan prime minister threatens increased internet and social media censorship

Saman Gunadasa

Addressing last month’s “Colombo Defence Seminar–2018,” Sri Lankan Prime Minister Ranil Wickremesinghe declared that “global disruptive forces” were using the internet and social media to destabilise countries and were a threat to “national interests.”

The annual Colombo Defence Seminar has been held since 2011 and is organised by the Sri Lankan army. Its declared objective is to share the experiences of global defence establishments in fighting the “threats from terrorism and other activities.” The event was attended by military leaders, security and defence chiefs and diplomatic officials from 38 countries, including the US and other imperialist powers.

Wickremesinghe, who delivered the seminar’s keynote address, warned that an “array of traditional and non-traditional security threats” confronted governments in the 21st century.

While the prime minister referenced the social and political impact of what he glibly characterised as “natural calamities, climate change, human exodus and displacement,” his principal concern was what he said was the use of the Internet and social media by extremists and “violent non-state actors.”

“The new media, including social media sites such as Facebook, Twitter and other websites,” he said, “are becoming global disruptive forces.”

The nature of warfare, he said, “is shifting from physical to online” and referred to the mass revolutionary uprisings that erupted in Tunisia and Egypt in 2011. “We have seen the potential of this new media to destabilise nations and affect serious change in the case of countries like Tunisia, Libya, and Egypt etc.”

Social media and the internet played a major role in the eruption of mass strikes and protests known as the “Arab Spring,” first in Tunisia, which led to the downfall of the Zine El Abidine Ben Ali regime in Tunisia, and then a revolutionary upsurge of the working class in Egypt and the overthrow of Hosni Mubarak's dictatorship. The absence of a genuine revolutionary and socialist party of the working class, meant that the Egypt ruling elite, with US backing, was able to crush this mass movement and reestablished a military dictatorship.

Wickremesinghe’s references to these revolutionary eruptions are no accident, but are driven by his concerns about the mounting opposition of Sri Lankan workers, the rural poor and students to his own government.

The “unity government” of Wickremesinghe and President Maithripala Sirisena this year has confronted strikes and protests by power, railway, health, petroleum, ports, postal, water supply and plantation workers, as well as ongoing student protests against the privatisation of education, and demonstrations by peasants and fishermen.

The Sri Lankan government faces a mounting economic and political crisis with falling export earnings, a ballooning foreign debt and International Monetary Fund (IMF) demands that it deepens its austerity measures against the working class and rural masses.

Encouraged by the internet censorship measures by the US and other imperialist powers, Wickremesinghe’s speech is a clear indication that Colombo is planning to step up its own censorship of social media and the internet.

Colombo systematically blocked websites during its 26-year communal war against the Liberation Tigers of Tamil Eelam (LTTE). The war ended in 2009 but the blockades continued.

Like its predecessor, the Sirisena-Wickremesinghe government has targetted social media and websites and maintains its special internet military intelligence unit, established during the war.

Last November, the Telecom Regulatory Commission (TRC), which directly comes under the president Sirisena, blocked lankaenews.com, after it began criticising him.

In March this year, Colombo banned Facebook, Viber, WhatsApp and other social media on the pretext that they were being used to organise and promote anti-Muslim violence by Sinhala-Buddhist extremist groups in the central Kandy district. Sirisena has also been calling for censorship of social media using sex-related abuses to justify his threats.

Wickremesinghe has previously announced that the government is formulating new laws to censor the internet and Facebook. Sri Lanka has around six million social media users i.e., around 30 percent of the population. Like its counterparts around the world, Colombo is deeply concerned that workers and youth are increasingly turning to social media and the internet for honest and accurate information.

Wickremesinghe’s speech to the Colombo Defence Seminar indicates that Sri Lanka’s political elite are preparing a major crackdown on the internet and social media.

Israel’s Netanyahu extends hand of friendship to fascistic Philippines President Duterte

Jean Shaoul

The fascistic president of the Philippines, Rodrigo Duterte, has completed a four-day visit to Israel, the first-ever visit to the country by a Philippine head of state.

Duterte met with Prime Minister Benjamin Netanyahu as well as President Reuven Rivlin and officials from Israel’s military and intelligence agencies. Among his entourage were 46 senior politicians, officials and military and security personnel, as well as a 150-strong delegation of business leaders.

The butcher Netanyahu is a fitting host to Duterte, who took office in 2016. “We remember our friends and that friendship has blossomed over the years and especially over the last few years,” Netanyahu said.

With Duterte’s visit, Netanyahu has added yet another far-right figure to Israel’s stable of allies.

The Philippine president’s visit follows visits by Hungarian Prime Minister Viktor Orban and Azerbaijan’s Ilham Aliyev, not to mention the coterie of far-right figures who attended the opening ceremony of the US embassy in Jerusalem earlier this year.

Duterte began his visit with an address to an audience of Filipinos in Jerusalem, where he defended his earlier remark, “If there are many beautiful women, there will be many rape cases as well,” as an exercise in “democracy and freedom of expression.”

Speaking last Monday after his meeting with Netanyahu, Duterte said, “May we continue to be blessed with a strong relationship,” adding cynically, “We share the same passion for peace. We share the same passion for human beings.” Then came a pledge of support for Israel’s repression of the Palestinians and its recent military threats against Syria, Iran and Lebanon.

“But,” added Duterte, “we also share the same passion of not allowing a family to be destroyed by those who [have] corrupt ideologies... In this sense, Israel can expect any help that the Philippines can extend.”

Duterte’s passion for human beings involves building a police state under the guise of a war on drugs. According to official statistics, the police killed 4,279 people between July 1, 2016 and May 15, 2018. Even more died at the hands of unofficial death squads, with the Duterte administration listing as one of its “key accomplishments” in the war on drugs an estimated 16,355 additional homicides in 2017 alone.

Duterte’s host likewise has the blood of thousands on his hands. Netanyahu heads the government of a state based on the oppression of an entire people. The Israel Defense Forces have killed more than 170 unarmed Palestinians—including children, journalists and paramedics—and injured some 13,000 in the weeks of protests near the border between Gaza and Israel that started on March 30 to demand the right of the Palestinians to return to their homes and villages. The Israeli military has used live bullets, tear gas and rubber bullets against unarmed protesters who posed no threat to Israel or its border fence.

Israel’s assault on the Palestinians follows its crippling 11-year-long blockade of the tiny enclave and its murderous wars on Gaza in 2008-09, 2012 and 2014, which killed 1,417, 147 and 2,250 Palestinians respectively and destroyed much of Gaza’s basic infrastructure and tens of thousands of homes.

Duterte said that Israel had aided the Philippines on intelligence matters on multiple occasions and thanked Netanyahu for helping his country “win its war on terror.” This was a reference to Israel’s arms supply during what became known as the Marawi Siege on the southern island of Mindanao in 2017, which left much of the city in ruins. More than 1,000 people were killed and 400,000 were forced to flee their homes in what began as a war between rival armed gangs, including Islamic State militants.

Following his meeting with Netanyahu, Duterte went to Yad Vashem, Israel’s Holocaust memorial museum, where he laid a wreath. In 2016, he compared his crackdown on drug dealers and users to the Holocaust, saying, “Critics compare me to Hitler’s cousin… Hitler massacred three million Jews... there’s three million drug addicts… I’d be happy to slaughter them.”

At Yad Vashem, he piously pledged to fight “insane rulers” like Hitler and called for learning the lessons of that “horrific and benighted period of human history.”

Duterte also chaired a business seminar at his hotel for CEOs from Israel and the Philippines. Ministers signed three bilateral agreements, adding to the existing 14 bilateral agreements relating to scientific cooperation, investment and the employment of the 24,000 Filipino caregivers—out of some 29,000 Filipinos working in Israel—that would cut the cost of employing every caregiver by $12,000.

The Filipinos were also expected to sign an oil exploration license for the Israeli-owned company Ratio Petroleum, which is seeking to exploit the Philippines’ offshore oil. The company has a stake in Israel’s Leviathan offshore natural gas production site in the eastern Mediterranean and licensing rights and options overseas, including in Guyana, Surinam, Malta and Ireland.

On Tuesday, Duterte met President Rivlin in Jerusalem. He was met by dozens of demonstrators. Prior to the visit, Israeli human rights groups had urged Rivlin not to welcome the “mass-murderer.” Appealing on behalf of at least 24 human rights groups, Israeli lawyer Eitay Mack argued that Duterte “poses a threat not just to Philippine citizens, but also to the peace of the whole world.” Welcoming Duterte was a tacit endorsement of massacres “against specific population groups,” “legitimizing other murderous leaders” across the globe.

Israel is not only legitimizing murder, it is facilitating it. The main purpose of Duterte’s trip to Israel was to explore future arms deals, including advanced weaponry and equipment and, potentially, aircraft. Duterte told Rivlin his country would in future buy weapons and military equipment only from Israel due to its lack of restrictions on their use. The US is “a good friend,” he said, “but if we buy there, there are limitations, also with Germany and China.”

The US and other countries have been forced, publicly at least, to refuse to sell Duterte arms due to gross human rights violations committed during his brutal crackdown. His tilt towards China has also angered Washington.

Israel is one of the largest arms dealers in the world, with nearly 60 percent of its defense exports going to the Asia-Pacific region. Since Duterte became president, Israel’s export of arms to the Philippines, including radar, armoured vehicles and anti-tank equipment, has risen from $6 million to $21 million.

According to the Global Militarisation Index, Israel has been the most militarised nation on the planet every year since 2007, and last year became a “cyber superpower,” selling about 10 percent of the world’s computer and network security technology. Its particular expertise is the “pacification industry,” the suppression of civilian unrest, based on its decades-long experience of suppressing the Palestinians.

Israel has a record of supplying arms to murderous regimes, including the Philippines, training and arming the death squads of the brutal dictatorship of Ferdinand Marcos in the 1970s and 1980s, Augusto Pinochet’s military regime in Chile from 1973 to 1991, and the military juntas in Argentina and Bolivia in the 1970s. It sold arms used in the Rwandan genocide, the Bosnian war and Sri Lanka’s war against the Tamil Tigers.

Last year, human rights groups accused Israel of training Myanmar’s special forces and supplying them with “advanced weapons,” including tanks and gunboats used during the ethnic cleansing campaign against the Muslim minority group, the Rohingya.

In September 2017, the Israeli High Court banned the reporting of Israeli arms sales to Myanmar after an appeal by the defense ministry. Myanmar’s navy showcased its Israeli-made gun-boats bought in defiance of EU and US arms embargos on the country. Israel has also violated the embargo on providing weapons and training to South Sudan, fueling the civil war there.

Civil war clashes erupt in Libya

Marianne Arens 

A fragile truce prevails in the Libyan capital of Tripoli following fierce fighting last week. The city’s Mitiga airport remains closed and fighting is continuing in the south of the city.

The conflict that broke out between armed militias on August 27 was fought with tanks and heavy artillery. Entire neighbourhoods went up in flames. According to the local health authority, there were 63 dead and 171 injured. Some 2,000 people have been driven from their homes, and the fate of some 8,000 refugees trapped in camps in Tripoli remains uncertain.

The latest round of civil war strife highlights the neo-colonial ambitions of the imperialist powers. The European Union and United States have reacted with alarm to the fighting in the country, which is their gateway to Africa and access route to vast oil and gas resources. The EU is particularly worried about the future of the puppet regime of Fayez al-Sarraj, which it relies upon to keep refugees out of Europe.

The fighting in Tripoli has also revived longstanding conflicts between Italy and France—not only aggravating the political interests of the governments in Rome and Paris, but also the rivalry between Eni and Total, the major oil and energy companies of each country. Libya has the largest oil and gas fields in Africa and the ninth largest in the world.

Eni has been active in the former Italian colony since 1959 and had a quasi-monopoly position in the Libyan oil and gas sector prior to the NATO-led overthrow of Gaddafi in 2011. Since then, Total has sought to outdo Eni, with both companies supporting different militias in their quest to win the upper hand in the oil and gas business.

Italian Interior Minister and leader of the far-right Lega party, Matteo Salvini has openly accused France of being responsible for the chaos in Libya. “Obviously, someone is behind it,” Salvini told journalists on September 4, “…something like this does not happen by accident.” This same someone has endangered “for national economic interests ... the stability of all North Africa and thus of Europe,” Salvini continued, and added: “Ask Paris!”

Italian Defense Minister Elisabetta Trenta (Five-Star Movement, M5S) also blamed France for the armed conflict. “There is no denying that Libya is in this situation today because someone put their own interests above those of the Libyans and all of Europe in 2011” she wrote on Facebook. “France has a responsibility, we cannot ignore it.”

For months, the Italian government has been accusing French President Emmanuel Macron of intervening in Libya without consulting its EU partners. At the end of May 2018, Macron invited Sarraj and General Khalifa Haftar to Paris to agree on a plan for Libyan parliamentary elections next December. For the Italian government, which regards Libya as its colonial backyard, Macron’s initiative amounts to inadmissible interference.

Unlike Italy, France works closely with General Haftar, who represents the alternative-parliament in Tobruk. The Libyan Liberation Army, LNA, led by Haftar, controls most of the oil crescent on the northeast coast of Libya. Haftar also has the backing of the regional powers of Egypt, Saudi Arabia and the United Arab Emirates, while Qatar, Iran and Turkey support the UN-recognised Sarraj “unity government.”

Salvini also relies on Sarraj because he needs the Libyan coast guard as a force to seal off the Mediterranean from refugees. Only recently, Italy signed an alliance with the unity government to provide the coast guard with weapons, logistics and naval boats worth several million euros.

Since 2014, Italy has expanded its military presence in Libya. Today, the Italian army maintains a 350-member military unit in Misrata whose mission is officially to secure a military hospital. In reality, it is mandated by the Italian government to “protect certain sensitive areas in Libya, including the oil wells.” It also has the task of training the Libyan coast guard to deter immigrants from reaching Europe by any means possible.

The conflicts between France and Italy date back to the NATO war against Libya seven years ago. At that time, NATO obliterated the functioning state of Libya and brutally murdered its leader, Muammar al-Gaddafi. Since then, the country has been plagued by chaos and civil war.

Italy had initially rejected a NATO intervention led by France, the United States and Great Britain. Italian Prime Minister Silvio Berlusconi had signed a cooperation treaty with Gaddafi in 2008. The treaty provided a miserly compensation for the historic crimes resulting from Italy’s colonial rule, while granting the Italian oil industry privileged trade relations with Tripoli. Gaddafi also pledged to prevent African refugees fleeing to Europe.

In the course of the war, however, Italy changed its attitude, so as not to end up empty handed when it came time to distribute the spoils of war. It provided logistical support and missile launchers in Sicily for the war. Nevertheless, Italian politicians repeatedly blame France’s role in the 2011 war for the refugee crisis. Roberto Fico (M5S), president of the Chamber of Deputies, described the Libyan situation as a “serious problem left to us by France.”

For its part the German government has no interest in an intra-European conflict at the moment. On September 5, the German foreign minister Heiko Maas sought to pursue a policy of appeasement in Libya: “The weapons must be silent, any renewed escalation must be avoided,” read a statement by the Foreign Office.

This does not mean that Germany is staying out of the neo-colonial race for Africa. On the contrary, as part of its foreign and security policy reversal, Germany is endeavoring to correct the “flaw” of its foreign policy of 2011, i.e. the fact that it did not participate in the Libyan war. It is now intent on building up its military presence in Africa. Currently, the Bundeswehr is deployed in countries surrounding Libya, in Mali, Morocco, Tunisia, Sudan, South Sudan and in the Mediterranean.

The US is also preparing for new military intervention in North Africa. In the Nigerian desert town of Agadez, a hub of the traditional Tuareg nomadic tribes, the US Air Force is currently expanding its base for drones and fighter aircraft—the Niger Airbase 201. From bases in Italy, US fighter jets have regularly bombed Libya in recent years.

Germany’s main economic rival in Africa, however, is China. The People’s Republic has become the largest investor in Africa and announced billions of new investments a few days ago at an Africa summit in Beijing, involving all African countries.

With a high-ranking business delegation, German chancellor Angela Merkel (Christian Democratic Union, CDU) recently visited several African countries and promised them German assistance for industrialization and infrastructure. In the Sahel countries, the Bundeswehr and France are helping to build the new G5 Sahel Resilience Force, which has around 5,000 troops stationed in Mali, Mauritania, Niger, Chad and Burkina Faso.

For these reasons, the German bourgeoisie favours a united EU position on Libya. A “viable solution” can only be achieved “under the auspices of the United Nations,” a Foreign Ministry statement reads. However, the UN is far from solving the problems in Libya.

On September 5, Ghassan Salamé, UN Special Envoy for Libya, said in a video message that “only a façade of tranquility” prevails in Tripoli and the Libyan capital is “on the verge of a full-blown war.” He demanded that the UN-backed Sarraj government finally implement the security provisions set out in the 2015 Skhirat Agreement and disarm all militias.

The puppet regime of Sarraj, however, lacks the means to do so. Since the overthrow of Gaddafi seven years ago, the country’s military forces have been divided into the hands of rival militias who have plundered everything left of the Gaddafi state. They control the oil fields and economic facilities, extort protection money, run murder squads, administer the many prisons and refugee camps and offer their services to varying imperialist powers for high amounts of foreign exchange.

The most recent riots broke out when the 7th Brigade of Tarhuna invaded southern Tripoli. This brigade, which was originally founded by King Idris Senussi and also served Gaddafi, still counts a number of Gaddafi loyalists among its officers. When the Sarraj government tried to cut its budget in August, the brigade struck back, claiming it wanted to settle accounts with the corrupt militia cartel to which it had previously belonged.

The 7th Brigade was eventually repulsed by auxiliary troops from Misrata. No less than four different militias are currently active in Tripoli.

These militias hold Libya in a stranglehold and condemn the population to unimaginable poverty and lack of any prospects. In the country where access to schools and hospitals was free, there is now no guarantee of clean drinking water, electricity or a functioning sewage system. Many foodstuffs and basic goods are only available on the black market and at horrendous prices.

Syriza jails Syrian swimmer Sara Mardini for helping refugees in Greece

Kumaran Ira

Greece’s Syriza-led government has jailed 23-year-old Syrian competitive swimmer Sara Mardini and three other members of the ERCI (Emergency Response Centre International) association on blatantly trumped-up charges. They are accused of people smuggling, espionage and membership in a criminal organisation. The purpose of this chilling arrest is to stop assistance to refugees fleeing the NATO war in Syria by criminalising humanitarian aid.

This latest attack exposes yet again the reactionary character of the petty-bourgeois populist Syriza (the “Coalition of the Radical Left”) party, which rules Greece in a coalition with the xenophobic Independent Greeks (Anel). While overseeing draconian EU-led austerity, they set up EU-backed concentration camps to house refugees fleeing NATO wars in the Middle East and Africa in horrific conditions.

In August 2015, Sara and her Olympian younger sister Yusra became internationally famous when they risked their lives to save 18 fellow refugees as they crossed the Aegean from Turkey to the Greek island of Lesbos. When the boat’s engine failed, leaving the craft drifting and taking on water, Sara and Yusra swam the boat to safety. After a 25-day march to Germany on foot and by train and bus, Sara and Yusra were granted asylum there.

A year later, Mardini agreed to join ERCI as a volunteer to help refugees and returned to Lesbos last December. Last month, while waiting at Mytilini airport to return to Germany, she was arrested. The Guardian reported that “soon after that, police also arrested ERCI’s field director, Nassos Karakitsos, a former Greek naval force officer, and Sean Binder, a German volunteer who lives in Ireland. All three have protested their innocence.”

Mardini is being held in Greece’s high-security Korydallos prison. Under Greek law, she can be held pending trial for 18 months. The four ERCI volunteers face charges of establishing and joining a criminal organisation, money laundering, espionage, violating state secrets, counterfeiting and offences against the immigration code and electronic communications legislation.

Police provided no evidence to back up such charges. Mardini’s lawyer, Harris Petsikos, told the WSWS she “has denied all the charges. … These very serious accusations are in no way substantiated by the evidence in the police file. The accused are totally innocent. Police cannot prove anything concrete, but it will take time for the courts to hear our arguments.”

He added, “My clients and the other defendants are accused of having committed crimes in Greece on specific dates when they were not even in Greece. We provided specific evidence from Germany and England, showing that on those dates, they were in Germany or England.”

Petsikos noted, “These accusations are almost incredible. … They had radios to speak to each other, and on this public radio frequency they could also hear what police were saying. Now they are accused of hearing police radio transmissions that are supposedly state secrets. But this is obviously not the case.”

Refuting accusations that assembling water and blankets for refugees in Lesbos is people smuggling, Petsikos added: “The police are going too far. They claim that practices common in all humanitarian aid groups, that are legal and normal, to help people who have already arrived in Lesbos, are crimes. The police combined facts in a very speculative manner. Then they assembled a file that they gave the courts to try to make it seem as if these were very serious crimes: espionage, participating in criminal organisations, illegal entry into Greece, etc.”

This is a blatant attempt by police, Syriza Interior Minister Alexis Haritsis, and the Syriza government to silence anyone offering humane assistance to refugees. Human rights lawyer Jonathan Cooper told the Guardian, “this is another example of civil society being closed down by the state. … What we are really seeing is Greek authorities using Sara to send a very worrying message that if you volunteer for refugee work, you do so at your peril.”

Syriza’s cruel and anti-working class character has been exposed since it was elected in 2015, after pledging to end austerity and overhaul right-wing, anti-refugee policies. It has since betrayed all its election promises and capitulated to the European Union (EU), slashing pensions, health care and other key social services, and trampling the overwhelming “no” vote in its own July 2015 referendum on EU austerity. It also reneged on its promises on refugees, accepting the 2016 EU-Turkey deal to keep refugees from reaching Europe.

That deal stipulates that all refugees reaching Greece from Turkey will be interned in Greece until their cases are processed and they are ultimately deported backed to Turkey. More than 60,000 refugees and migrants are reportedly stranded in Greece due to that deal and to border closures across the Balkans. So far, over 19,000 refugees arrived in Greece by sea this year, compared to around 14,000 in 2017. Over 100 people died during the journey in 2018.

Refugees on the Greek islands face horrific conditions, as thousands are packed into overcrowded, make-shift EU concentration camps. On Lesbos island, more than 8,000 people are crammed into the Moria camp, which was supposed to house 2,000. Some of its inmates have been stranded there for years.

BBC journalists who were given rare access to the camp reported that children are attempting suicide there amid appalling sanitary conditions, overcrowding, and deadly violence. “Some people live in mobile cabins, but rammed in-between them all are tents and tarpaulin sheets—homes for those who cannot obtain any official living space. The camp is also now sprawling into surrounding countryside. One tent houses 17 people—four families under one canvas.”

The camp smells of raw sewage. There are around 70 people per toilet, according to medical charity Médecins Sans Frontières (MSF). “A mum describes faeces on the floor of the shelter that she lives in with her tiny 12-day-old baby,” the BBC noted.

Sara Khan, an Afghan refugee, said: “We are always ready to escape, 24 hours a day we have our children ready. The violence means our little ones don’t get to sleep.” She said her family spends all day queuing for food and all night ready to run, in fear of fights at the camp.

MSF members said, “The children they are treating have skin conditions caused by the poor hygiene inside, and respiratory diseases from tear gas fired into the camp by police to quell fights. Mental health problems are rife. ... Despite the fact that we push to move these children to Athens, as soon as possible, it’s not happening. Those children are still here.”

Luca Fontana, who has worked in conflict zones, including during deadly Ebola outbreaks in Africa, told the BBC the EU’s Greek camps “the worst place” he had ever seen. “I’ve never seen the level of suffering we are witnessing here every day. … Even those affected by Ebola still have the hope to survive or they have the support of their family, their society, their village, their relatives. Here, hope is taken away by the system.”

Podemos proposes to “co-govern” with Spain’s Socialist Party government

Alejandro López 

The Podemos party is negotiating to enter into an open coalition with Spain’s minority Socialist Party (PSOE) government. Three years after its Greek ally Syriza, the “Coalition of the Radical Left,” took power and betrayed its election promises to end European Union (EU) austerity, Podemos is signaling to the ruling elite that it has at most minor differences with the PSOE’s militarist and austerity agenda.

Last May, the PSOE took office after organizing a no-confidence vote with Podemos and Catalan and Basque nationalists to oust the minority, right-wing Popular Party (PP) government. The PSOE government has stumbled from one crisis to another, however, trying to present a “left” face by playing up its female ministers or proposing to move the remains of fascist dictator Francisco Franco from his official state tomb. At the same time, it is deepening the PP’s austerity, military spending increases, attacks on migrants, and incarceration and prosecution of Catalan nationalist politicians.

Having played a key role to garner regionalist and nationalist votes to support the PSOE’s no-confidence motion against the PP, Podemos is now negotiating a possible parliamentary coalition to prop up the PSOE. Speaking to Telecinco, Podemos General Secretary Pablo Iglesias said he sees himself as “a partner in government” with the goal of “co-governing together from parliament.”

Last Thursday, Iglesias also met with Sánchez to discuss the 2019 budget. “There are good vibes, it’s a good start; if we do reach an agreement we would like to see out the term to 2020,” he said at a press conference after a two-and-a-half-hour meeting. He added, “We have advanced towards an agreement on the budget.” This would open the way for Madrid to pass a new austerity budget for 2019 next month, once it submits its draft budget to the EU.

Iglesias was shelving the criticisms Podemos raised of the PSOE this summer, calling for talks with the European Commission and for repealing the Organic Law on Budgetary Stability and Financial Sustainability. Podemos and the PSOE did not disagree over austerity, however, but over the tempo at which to implement EU demands. Now, Podemos is making clear that it is willing to jettison even these minor, essentially symbolic differences in order to show the ruling class that it can be trusted in government.

Underlying Podemos’ offer to “co-govern” with the PSOE is an attempt to stabilize the government amid growing economic crisis and social opposition. The end of the summer tourist season saw the destruction of 300,000 jobs in one day, a new record even in Spain’s bankrupt labour market. The downturn also provoked a fall in retail sales in July of 0.4 percent year-on-year.

At the same time, according to the Spanish Confederation of Employers’ Organisations, the main business lobby, strikes called between January and August led to the loss of 9.5 million hours of work, up 46.43 percent from 2017. There were 348 strikes in Spain during that time, in which 633,936 workers participated.

The consolidation of a PSOE-Podemos coalition in parliament will be no less reactionary than a minority PSOE government supported by Podemos from the outside. Indeed, as Podemos negotiates with the PSOE, it is not demanding that the PSOE abandon its militarist policies and escalating attacks on social and democratic rights. Its silence denotes consent to the EU-PSOE agenda.

The new government’s first measure was to take over the previous PP government’s austerity and militarist budget. The budget includes cuts of 13 percent in education, 8 percent in health, 27 percent in research and technology, 35 percent for culture and 58 percent in infrastructure. At the same time, it showered the military and intelligence apparatus with billions of euros, mandating a 10.5 percent increase in military expenditure, the largest in a single year since the fascist dictatorship of Francisco Franco, and 7.4 percent funding increase for the National Intelligence Centre.

On migration, after having allowed the Aquarius refugee vessel to dock in Valencia, PSOE Prime Minister Pedro Sánchez is supporting neighbouring Morocco’s large-scale crackdown on thousands of migrants, asylum seekers and refugees. So far, two migrants have died in this operation. The PSOE also carried out an unprecedented mass expulsion of 116 Sub-Saharan migrants to Morocco last month.

Sánchez is also continuing the crackdown on Catalan nationalists that has unfolded since the brutal police assault on peaceful voters in last October’s referendum on Catalan secession from Spain. He has threatened to again suspend Catalonia’s elected government by invoking Article 155 of Spain’s 1978 constitution. Prosecutors recently reaffirmed that the referendum was a “violent insurrection” and called on the Supreme Court to condemn Catalonian politicians on charges of rebellion, punishable by 15 to 25 years in prison.

Last Wednesday, the Interior Ministry announced that it would send around 1,000 police officers to Catalonia for the September 11 celebrations of the region’s national day.

The most virulent criticism of the PSOE from Podemos emerged last week, when the Ministry of Defence announced it was suspending the sale of 400 laser-precision bombs to Saudi Arabia. Podemos’ criticisms came from the right, however.

Even though the contract amounted to €9.2 million, or 1 percent of the total €932 million in Spanish weapons sales to the Saudi monarchy since 2015, it soon emerged that Riyadh was threatening to cancel a €1.8 billion contract with Spain to build five Corvette warships. José María “Kichi” González, the Podemos mayor of Cádiz, where the warships are being built, attacked the PSOE for jeopardising the contract. He falsely portrayed the sale of warships as “the dilemma between producing weapons or eating” referring to defense industry jobs in Cádiz.

Iglesias came to the defence of the mayor, stating that “the problem is that Spain has been selling arms to one of the states that favored ISIS, and we are concerned about violation of Human Rights […] but I understand that Kichi puts workers before.”

By the end of the week—under pressure from the Saudis, Podemos and sections of the PSOE—the government backed down. “The government is working to maintain good relations with Saudi Arabia and to defend the contracts for the construction of five Corvettes in Navantia’s shipyards,” government spokeswoman Isabel Cela said.

The Saudi-bomb affair has once again exposed that Iglesias and Podemos are imperialists and militarists. It continues their track record of defending the police and the army and recruiting its members—most prominently former Chief of the Armed Forces and Podemos member General Julio Rodríguez, who led Spain’s participation in the 2011 NATO war in Libya.

PSOE-Podemos talks confirm the assessments of Podemos made by the WSWS. As a newcomer in the December 2015 elections, Podemos had ranked third, winning over 5 million votes, or 20 percent. As the bourgeois parties struggled to elect a new government, the WSWS warned that Podemos’ repeated pleas to form a government with the PSOE aimed “to enforce further unpopular austerity measures on working people and the entire Spanish population.”

We warned: “Podemos, regardless of its rhetoric, does not aim to carry out an alternative or radical policy. Instead, like Syriza … it aims to give a face lift to a discredited political establishment—in this case, working with the PSOE, which has waged imperialist wars and enforced savage austerity measures against the Spanish people.” This assessment has been vindicated.

Police suppress protest over schools in debt-ridden Chinese city

Pradeep Ramanayake 

Chinese police made multiple arrests to curb a protest in Leiyang, a large city in Hunan province in southern China, during the first weekend of September. The immediate reason for the protest was a local government decision to cut costs in government-funded schools by relocating all fifth and sixth grade students to private schools.

The parents had already petitioned the authorities in an open letter to reverse the decision without success. On September 1, some parents demonstrated at their schools in central Leiyang, blocked a national highway and then protested outside the Leiyang government offices. Police stepped in and arrested five people.

Later that day another protest erupted outside the city’s public security bureau headquarters to demand the release of the five detainees. Ten more protesters were arrested which only escalated the confrontation as over 600 people gathered outside the police headquarters.

Angry protesters threw water bottles, bricks, fireworks and petrol bottles at government officials and police officers. By Sunday morning, the police had broken up the protest and arrested 46 more. Amid continuing anger over the arrests, the police later released 41 people.

The proposed change affected nearly 10,000 pupils who were due to start the new school year after the weekend. They were forced to transfer to a private school which is remote, more expensive and is suspected of formaldehyde pollution. The protesting parents displayed banners declaring “I want to attend public school” and “Boycott private schools.”

Even after the forced relocation of students to private schools, the public schools remain under-resourced and overcrowded. The Leiyang administration anticipates that the number of students in each class room will remain at 66, almost three times the standard class size.

Even after the protests dissipated, the authorities blocked news of the parents’ demands. A summary of the complaints published on WeChat, a popular Chinese messaging platform, was quickly taken down with a notice posted that it was in violation of rules.

The protests were not just the outcome of forcing thousands of students to switch schools, but reflect the resentment and hostility that has built up as social conditions have declined. Leiyang has been heavily dependent on the coal industry which has been in continuous decline leaving the city’s government in a deep financial crisis.

According to the annual revenue statement, in the first five months of this year, Leiyang’s government revenues dropped 15.4 percent year-on-year to 807.3 million yuan ($US118 million). Now the workers and other masses have to bear the burden of the decline of coal industry and the growing debts of city-backed companies.

The local government’s attempts to diversify the economy have fallen flat. The Wall Street Journal reported: “Newly constructed buildings are struggling to find residents, while across the Lei River on the city’s east side, warehouses once packed with coal are empty and black with soot. Rundown shops, empty shacks and unwanted piles of coal dust line a road that once saw busy traffic from trucks transporting coal to and from mines uphill.”

Many areas of China have been hit by closures and retrenchments as the central government has restructured the coal and steel industries to wind back capacity and destroy hundreds of thousands of jobs.

By February, the Leiyang government warned about the financial difficulties it faced in providing education, health care and other social services. In May, government workers went unpaid for more than a week, until emergency funds arrived. Then the government took the drastic step of cutting admissions to public schools, attempting to make parents pay for more expensive and inferior education for their children.

Just prior to the weekend protests, residents complained about a planned new sports complex costing 430 million yuan to be opened for the Hunan Province Youth Games basketball competition later this month. Their anger boiled over in social media in comments saying that the government was spending taxpayers’ “blood and sweat money” to build a vanity project, while ignoring basic education.

The protests point to the broader tensions being generated by China’s debt crisis. Larry Hu, an economist at Macquarie, Australian based global financial group, told the Wall Street Journal: “Debt by local governments totals 46 percent of the size of China’s $12 trillion economy”

Zhang Ming, an economist with the state-run Institute of World Economics and Politics, estimates that “hidden debt” totaled 23.57 trillion yuan at the end of 2017, greater than the 18.58 trillion yuan of local government debt acknowledged in official data.

According to the IMF, the rate of debt growth will accelerate over the next few years. It said China’s non-financial sector debt was now expected to reach 290 percent of gross domestic product (GDP) by 2022, compared with 235 percent last year. Previously the IMF estimated that debt would stabilise at around 270 percent of GDP over the next five years.

As the central government seeks to rein in debt and stave off a financial crisis, it will be the working class in more depressed areas such as Leiyang that will be hit hardest. This will inevitably fuel the class struggle. Just last June, large protests by truck drivers erupted in nine Chinese provinces and municipalities against falling wages, high fuel prices and police harassment.

Japan and China improve relations in face of US trade war measures

Ben McGrath

In recent months, Japan and China have taken tentative steps towards improved relations in response to trade war measures against both countries by the Trump administration in the US. The apparent thaw in what has been a frigid, and at times hostile, relationship underscores the destabilizing impact of Trump’s aggressive America First drive.

In an interview with the Sankei newspaper on September 2, Japanese Prime Minister Shinzo Abe stated “that the Japan-China relationship has completely returned to a normal track.” Japanese Finance Minister Taro Aso expressed similar sentiments when meeting his counterpart Liu Kun in Beijing on August 31. Implicitly criticizing Trump and Washington, Aso told reporters after the meeting, “We affirmed that protectionism benefits no country.”

Aso’s trip was in part to negotiate reinstating a currency swap that could be finalized when Abe travels to China in October for a summit with Chinese President Xi Jinping. In turn, Xi may visit Japan next year. The original deal expired in 2013 and was not renewed amid sharp tensions over the territorial dispute between Tokyo and Beijing over the Senkaku/Diaoyu Islands in the East China Sea.

Both governments are exploring closer economic relations to offset Washington’s trade war measures. Trump has criticized Japan for trade deficits in the auto industry, with the US president threatening to place tariffs on Japanese carmakers in addition to the current tariffs on steel and aluminum. Tokyo had sought exemption from the latter measures but was rebuffed.

While Tokyo has publicly tried to maintain the appearance of an airtight alliance with Washington, cracks are appearing over foreign policy as well as trade. In his interview with Sankei, Abe also made clear that he would not be bound by friendship, but instead act in Japan’s national interest.

Talks over trade and North Korea have reportedly turned contentious, according to a Washington Post article on August 28. It noted that in June Trump reportedly told Abe at a meeting, “I remember Pearl Harbor,” and criticized Japanese trade policy after Abe refused to budge on demands for a bilateral trade deal favorable to the US.

Trump’s remark is highly provocative as it recalls the US battle cry during World War II in the Pacific—Remember Pearl Harbor. Trump has a history of anti-Japanese demagogy on trade going back to the late 1980s when he was lashing Tokyo, not Beijing, for its trade deficit and buying up America.

Trump also “completely ignored” Abe’s advice on North Korea, a source close to the prime minister told the Washington Post, generating concerns in Tokyo that its interests were being undermined. The Japanese government is concerned that the US might allow North Korea to keep shorter range nuclear missiles capable of hitting Japanese cities.

Japan, as the third largest economy in the world, is turning to China to offset the negative impact of the more openly predatory US policy. With the economies in the region closely linked, the US tariffs on Chinese goods will also indirectly impact Japan.

Criticizing Washington, Hiroshige Seko, Japan’s Economy, Trade, and Industry Minister, stated, “This works as absolutely no plus for the world economy, and Japanese companies are shipping parts to China to finish them as products there that are exported to the US, and the effects are already being felt. Ultimately, it will hurt the US and Chinese economies.”

However, Tokyo will use whatever foothold it can gain through this apparent thaw in relations with Beijing to ensure its imperialist interests are met. Rather than working as a junior partner of the US, the Abe government is increasingly pursuing a more independent foreign policy and remilitarizing so it can back it through force of arms if necessary.

On assuming office last year, Trump dealt Abe a blow by pulling out of the Trans-Pacific Partnership (TPP). Now, however, Japan is playing the leading role, along with Australia, in refashioning a new TPP. At the same time, it is taking part in the previously stalled China-backed Regional Comprehensive Economic Partnership (RCEP).

The RCEP deal includes the ten ASEAN nations as well as Japan, China, South Korea, Australia, New Zealand, and India. It would be the largest regional free trade deal in the world. It would cover one half of the global population and one third of the world’s gross domestic product. Singapore’s Trade and Industry Minister Chan Chun Sing stated early this month that a broad agreement could be reached by November.

For China, opening new markets would mitigate some of the effects of US tariffs already imposed on $50 billion worth of goods and another $200 billion that Trump is now proceeding with. To mend relations with Tokyo, Beijing has toned down its anti-Japanese chauvinism and also eased tensions over its territorial dispute.

Last month, the two countries celebrated the 40th anniversary of the 1978 Friendship Treaty between the two nations. Much has also been made by the two governments and the media over the trip in May to Japan by Chinese Premier Li Keqiang. Li even using the preferred Japanese expression of “forward looking” on historical issues—a means of pushing Japanese imperialism’s war crimes in the 1930s and 1940s into the background.

Economic cooperation is also growing in other areas. Japan originally boycotted the launch of China’s Belt Road Initiative—a massive infrastructure project linking the Eurasian landmass. However, Tokyo is now considering joining China in investment projects in Southeast Asia and other regions.

This new thaw seemed only a few years ago, as the previous US administration of Barack Obama carried out the “pivot to Asia,” aimed at applying military and economic pressure to China, exploiting regional territorial disputes to do so. This included the dispute between Tokyo and Beijing over the Senkaku/Diaoyu Islands, with Obama declaring that the US would back Japan in any war with China over these rocky outcrops.

Despite these improved relations between Japan and China, tensions and rivalry remain. Tokyo has never reconciled itself to slipping from the world’s second largest economy to third behind China. Nor has it ever been willing to permanently accept a subordinate role to the US. As in the 1930s, conflict over trade in the Asia Pacific is paving the way for a new and even more terrible war for dominance.

Growth at 8.2%, Yet All Is Not Well in India’s Unorganised Sector

Arun Kumar

India’s gross domestic product (GDP) has grown at a robust 8.2% in the first quarter of the current financial year, according to recently released official data.

This is the highest in the last two years which has seen two shocks to the economy in the form of demonetisation and GST. The spurt in growth is due to a sharp increase in the growth of the manufacturing sector (13.5%), construction (8.7%) and agriculture and allied sectors (5.3%) compared to the same period last year.

Critics have argued that the numbers are higher precisely because they were so low during this period last year. Manufacturing had declined by 1.8%. Construction had grown at 1.8% and agriculture at 3%. This is called the base effect.

Growth last year during the first quarter was low due to the effect of demonetisation. So, if the economy recovers from the shock of demonetisation, there would be a spurt in growth because it is catching up with its trend growth. This is what the officials claim.

The rate of growth in the services sector is mostly down compared to last year. Also, investment is hardly recovering with gross fixed capital formation at current prices rising from 28.7% to 28.8%. This implies that businesses are not investing more in machinery and buildings. Thus, even if growth rate is higher now, this spurt may not continue both because of the base effect and the lack of increase in investment rates.

At 8.2% rate of growth there should be feel good all around in the economy. Are the protesting farmers and traders barking up the wrong tree? The farmers should be earning much more with a higher agricultural growth rate and ought not to be protesting. Are the young protesting about jobs doing so for nothing? Jobs creation in the economy should be robust and there should be less of a crisis of employment. Are businessmen complaining of difficulties for no cause?

The government has assiduously argued that demonetisation did not have a negative impact on the economy. If there was some adverse impact it was temporary and disappeared soon. It has emphasised that the long-term impact has been positive and that is what is visible now.

Similarly, regarding GST, the government has argued that it was a much-needed reform. It is contended that it has had a positive impact on the economy after some teething troubles. The claim is that GST has led to ‘ease of doing business’ which has led to a spurt in growth. So both these shocks to the economy are portrayed as structural changes that have resulted in the present higher growth, even if there was a temporary setback.

The problem with these arguments is that the unorganised sector does not figure in any of them. This sector is 45% of the GDP and employs 93% of the workforce. Data from this sector is collected periodically (not quarterly or even annually) as is the case with some components of the organised sector. The data on the basis of which the quarterly GDP is calculated is primarily from the corporate sector, agriculture and so on.

The press note issued by the government says that for industry, “The first quarter estimates are based on …. abridged financial results of listed companies from BSE/NSE, Index of Industrial Production (IIP)…”.

So not even the entire organised sector data are used to estimate the growth rate. No question of using the unorganised sector data which is not available.

So how is the unorganised sector estimated in the absence of data? Certain assumptions are made. Namely, that it is growing in proportion to the organised sector for which some data are available. The ratio of the two sectors is estimated in a reference year and this is used till the next survey is done. However, in between the surveys, if there is a shock, the ratio changes and the old ratio is no more applicable. A new ratio is required for which a survey needs to be done but since this was not done, a new ratio cannot be calculated. The two shocks due to demonetisation and GST have changed the ratio. Thus, the old methodology needs to change.

The unorganised sectors which largely use cash were massively hit by demonetisation. Due to persisting cash shortage for eight months, they could not revive for long and were again hit by GST. While they have been exempted from GST or a simple provision has been made for them (called Composition Scheme), they have been adversely hit due to the design of GST. They are hit by input tax credit (ITC), reverse charge mechanism (RCM), restrictions on inter-state sales and so on.

While official surveys were not done, private surveys were conducted and they point to a sharp decline in the unorganised sector. Demand for work under the MGNREGS shot up as workers lost work in urban areas and migrated back to the rural areas. This demand has remained high. Further, credit off-take reached a record low. Finally, investment data showed a sharp decline. These factors support the argument that there was a sharp downturn in the economy.

The decline in the unorganised sector had two consequences. Production from the unorganised sector was substituted by the organised sectors and mass demand from the unorganised sector declined. The latter further hit the growth of the unorganised sectors. Coexistence of agricultural surplus along with persistence of malnourishment among a large percent of the women and children is an indication of lack of purchasing power with the unorganised sectors. Surpluses due to low demand have led to low prices of agricultural produce and depressed incomes.

In brief, the two-way movement in the economy – the rise in the organised sector production and a decline in the output of the unorganised sector – means the pre-demonetisation ratios for estimation of quarterly growth rates do not hold. Earlier, it was implicit in the method that the unorganised and organised sectors are growing together – this is no longer true.

Two important conclusions follow. One, the organised sector is growing at the expense of the unorganised sector leading to a crisis in the latter. Two, official data needs to be corrected and the rate of growth would turn out to be far less than 8.2%.