The South Asia Channel

Rahul Gandhi Declines PM Candidacy; India-Pakistan Trade Talks Resume; Afghanistan Investigates Civilian Casualties

Editor's note: the South Asia Channel will not be publishing a daily brief on Monday, January 20th in honor of the Martin Luther King, Jr. holiday but will resume regular briefs on Tuesday, January 21st.



Rahul Declines PM Candidacy 

India's ruling Congress party announced Thursday that Rahul Gandhi, its vice president and fourth-generation scion of the Nehru-Gandhi family, will lead its campaign for national elections but stopped short of naming him as the party's candidate for prime minister or its working president (Times of IndiaEconomic TimesBusiness Standard, Hindustan TimesLive MintNYTWSJBBCVOA). A spokesperson said that "all the members" at the Congress Working Committee meeting had wanted Rahul to be named as the candidate, "but the Congress president intervened," saying that it was not party tradition to name candidates for prime minister before the election. However, the party made it clear that Gandhi would take up the PM job if it wins in the polls, refering to Rahul as its natural leader after his mother, party president Sonia Gandhi.

Rahul Gandhi's comments earlier this week - including a statement to an Indian daily that he would accept "whatever responsibility" his party gave him -- were widely interpreted as indicating that the party would announce him as its candidate this week. Since last year, he has gradually taken control of the party from Sonia Gandhi. Critics charged that the beleaguered Congress party, which has lost ground to the Bharatiya Janata Party (BJP) and newcomer the Aam Aadmi Party, is shielding Rahul Gandhi's political career from a projected loss in the upcoming election (BBC). The announcement put to rest speculation that this year's election would be a presidential style contest between Gandhi and the BJP's controversial but charismatic Narendra Modi. 

The BJP called the move not to name Gandhi as its prime ministerial nominee a "recognition of reality" (The HinduEconomic Times). "They know that the Congress won't come to power, therefore why declare Rahul Gandhi as a candidate only to let him down?" BJP leader Ravi Shankar Prasad tweeted.

On Friday, the All-India Congress Committee held a meeting attended by 3,000 delegates to discuss the economic, political and organization-related resolutions for the party in the run-up to the elections. Sonia Gandhi reiterated at the meeting that Rahul would not be nominated for prime minister ahead of the elections, saying "We took a decision on Rahul yesterday, and the decision is final" (NDTV). 

Speaking at the convention, Rahul gave credit to his party for passing the Right to Information Act and "giving power to the people" (Times of IndiaBusiness StandardNDTV). In his address, Prime Minister Manmohan Singh claimed that India's growth rate had slowed down because clearances had not been granted to infrastructure projects for fear of the Comptroller and Auditor General of India and the Central Vigilance Commission, but said that his government deserved more credit for rapid growth over the last decade (Times of IndiaThe HinduBusiness StandardEconomic Times). The Congress said that the war on inflation would remain its "overriding policy priority," amid a growing perception that increasing prices deeply hurt the party in the recent assembly elections (The HinduEconomic Times).

General elections for the Lok Sabha, India's lower house of parliament, will be held before May 5. The current Lok Sabha will meet for the last time from February 5 to February 21, with sources saying the body would vote on the budget on February 17 (Economic Times). 

State company dividends, stake sale to pad deficit

At a time when India's state-owned banks are struggling, 16 of the big 21 lenders have announced or said they are considering interim dividends (WSJ). The dividends are an effort to contribute to New Delhi's strained budget before the fiscal year ends on March 31. The government has pledged that its deficit will be only 4.8% of GDP, but by November it had run through 94% of its deficit target. Banks are in their worst financial condition in more than a decade, with stressed loans, a category that includes nonperforming and "restructured" loans, making up 12.3% of their loan books as of Sept. 30, more than twice the level of five years ago.

Other government firms are also announcing interim dividends: On Tuesday, state-run monopoly Coal India said it would pay a one-time special dividend of about $3 billion (WSJ). The government expects another $400 million in special dividend payments from NDMC Ltd, India's top iron ore mining company, a senior finance ministry official told the Wall Street Journal on Thursday. 

On Thursday, the Indian government approved the sale of its 10 percent stake in the Indian Oil Corporation to the Oil and Natural Gas Corporation and Oil India (Business Standard). The sale raised Rs 48-50 billion ($781-812 million) for the government. It wasn't decided how much stake each company would acquire, but analysts said the sale would have a negative effect on the balance sheets of ONGC and Oil India. 

-- by Ana Swanson


India, Pakistan renew trade talks

Pakistani Commerce Minister Khurram Dastgir Khan arrived in New Delhi to attend the South Asian Business Leaders Conclave on Jan. 16-17 and hold a bilateral meeting on Jan. 18 with Anand Sharma, India's commerce and industry minister (VOAThe Hindu, DAWN). Ahead of the meeting, S R Rao, India's commerce secretary, and his Pakistani counterpart Qasim M Niyaz met on Jan. 15 to restart trade normalization talks after a 16-month gap (Economic TimesIBN Live).

Commenting from a meeting of the Confederation of Indian Industry on Thursday, Khan argued for the implementation of a liberalized visa regime, closer ties between banks and more mobile connectivity between the two countries, calling the visa regime and the absence of a banking relationship the greatest non-tariff barriers to trade (Live MintEconomic Times). India put a liberalized visa pact signed in September on hold following the killing of two Indian soldiers in Kashmir by Pakistani troops in November. The two countries also announced an agreement in August 2012 to issue a full banking license to two banks from each country, but there has been little forward movement on the plan since then, reports said. According to Khan, the State Bank of Pakistan has written the Indian central banks saying that three banks would like to open their branches in India (Economic Times).

Due to domestic considerations, Pakistan is working on granting India "Non-Discriminatory Market Access," a more politically neutral term than "Most Favored Nation" status (Times of India). "The idea is, instead of getting caught in nomenclature, we should provide substantial market access to India," Khan remarked. "There are sensitivities on both sides" (Economic Times). India provided MFN status to Pakistan in 1996. Pakistan had agreed to give India MFN status by December 2012, but missed the deadline due to domestic considerations. 

Explosions disrupt prayers

At least eight people were killed and more than 60 injured when a bomb exploded at Tablighi Markaz, a religious center in Peshawar, just before Maghrib prayers on Thursday (DAWN, ET). Following the explosion, the bomb disposal squad found two more remote-controlled devices at the mosque, planted in bags on the second floor. Officials said the bombs were planted in vegetable oil tins and weighed about five kilograms each. Meanwhile, bomb disposal experts defused a bomb found outside a Tablighi Markaz mosque in Nowshera around the same time the bomb exploded in Peshawar.  That device, weighing about five kilograms, was also housed in a vegetable oil tin. The attacks have not been claimed by any terrorist group and the Pakistan Taliban made sure to distance itself; Shahidullah Shahid, a Taliban spokesman told Reuters that "the Tehrik-i-Taliban Pakistan (TTP) strongly deny such inhuman activities" (RT).

An explosion on the tracks caused a Karachi-bound Khushhal Express train travelling from Peshawar to partially derail near Umerkot in Rajanpur district of Punjab, killing at least three people on Friday (DAWN, ET). Police at the scene said at least 15 others were wounded in the incident. The Minister for Railways, Khwaja Saad Rafique, announced financial compensation worth Rs500,000 ($47,000)for the relatives of the dead and Rs100,000 ($950) for each injured, while also ordering an immediate inquiry into the incident be conducted.

Polio Reservoir

The World Health Organization (WHO) has declared Pakistan's Peshawar the "largest reservoir" of polio in the world; a call for urgent action to boost prevention (AFP, VOA, ET). More than 90 percent of the current polio cases can be genetically linked to Peshawar, according to the latest genomic sequencing results. Out of the 91 polio cases in Pakistan in 2013, 83 can be linked to Peshawar. In Afghanistan, 12 of the 13 cases reported in 2013 were linked to Peshawar. The security situation in the area has prevented effective polio campaigns and resulted in only a few children being vaccinated. Pakistan was also the only polio-endemic country in the world where polio cases rose from 2012 to 2013.


The fact-finding team assigned by President Hamid Karzai found that 13 civilians, including four children and three women, were killed during a joint U.S.-Afghan forces raid on Wednesday (Pahjwok). Although it was clear that the operation in Parwan province had resulted in civilian deaths, official accounts of the incident differed: NATO's International Security Assistance Force's statement said 10 insurgents and 2 civilians were killed while Karzai's statement accused the U.S. killing eight civilians, including seven children (NYT, Post, Pahjwok). The fact-finding team, led by Parwan officials, plans present its report, which concluded that a U.S. airstrike led to the high number of civilian deaths, along with pictures of the scene to President Karzai.

Confident of victory

A spokesman for the Afghan Taliban told BBC's John Simpson on Thursday that they are "confident of victory" over NATO-led forces (BBC). Zabiullah Mujahed told the BBC that "in the remote parts, everywhere is mojahedin Taliban. They're moving around and have control over the villages." He added that foreign forces "are so scared they're confined to their bases." When asked about the upcoming elections in April, Mujahed said that the Taliban had "no relationships" with any of the candidates in the "fake" presidential elections. As foreign troops prepare to withdraw in 2014, and tensions between the U.S. and Karzai over the Bilateral Security Agreement continue, some worry that the Taliban will regain power.


Bravery rewarded

The Hangu Deputy Commissioner handed the family of Aitizaz Hassan, the teenage hero who was killed while stopping a suicide bomber on January 6 in Ibrahimzai, a Rs5 million ($47,000) on Thursday (ET, DAWN). Hassan became a national hero last week when he tackled a suicide bomber right before he entered Hasan's school (DAWN). The suicide bomber detonated the bomb, killing himself and Hasan, but no one else was killed. Amjad Afridi, a senior adviser to the provincial government, told Agence France-Presse: "We have decided to name Aitezaz Hassan's school after him. We will also construct a sports stadium in Hangu and will name it after Hassan" (AFP).

--by Emily Schneider

--Edited by Peter Bergen

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