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Continuing years of tension, protests and Indian army deployment in Srinagar, the capital of Kashmir state (J&K) in India.

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As India's growth rate improves, one weak area is agriculture which is growing at about 3% a year, and contributes only 13.7% to GDP. Of huge significance is that about 600 million people depend on agriculture. Lagging development in this area leaves the nation backward as a whole. Farming practices are still backward and have not changed significantly. Agricultural markets, infrastructure, is still backward and needs improvement. Decline in the size of plots since 1970 from about 6 acres to about 3 acres today, and low productivity on farms is a problem. Farmers fear being pushed off the land and politicians look to the rural vote to preserve the status quo. Poor monsoon rains can increase problems for farmers as three fifths of farmland is still without irrigation. Agricultural markets are fragmented, so that apples from Himachal Pradesh in the north are not easily shipped to Karnataka in the south, and coconuts in the south not easily shipped to the north. State marketing boards in India called Agricultural Produce Marketing Committees (APMC's) control trade in fruit and vegetables. There are about 3000 fragmented agricultural markets in India, and markets can be fragmented within states. Laws from the 1950's to prevent hoarding are still on the books reducing incentives to invest in cold storage and warehouses, a significant problem in India leading to much waste and rotting of agricultural products. This hurts farmers because it leads to cuts in price. The distribution chain also hurts farmers with middlemen and commissioning agents taking as much as 6% in commission compared to the international level of about 0.5%. This review of the state of agriculture by the Economist says that 25 years after the first reforms opening up India's economy in 1990, agriculture as one area which touches the life of about half the population has not seen much change....

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11 Pacific Rim nations form the Trans-Pacific Partnership in 2018. The Obama administration supported the trade pact alienating supporters in its union base particularly in the midwestern states. Mr. Trump opposed the TPP in his election campaign and made it a significant issue for swing voters in midwestern states after job losses in the auto industry. With the opposition of president Trump the U.S. decided to withdraw from TPP.  The 11 nations agreeing to join a revised agreement are Japan, Canada, Mexico, Australia, Brunei, Chile, Malaysia, New Zealand, Peru, Singapore and Vietnam. So far six countries have formally approved the deal, Australia, Canada, Mexico, Singapore, New Zealand and Japan, setting the stage for two rounds of tariff reductions starting December 30, 2018. Agricultural products duties will be duty free within 3 to 7 years including for Japan and Mexico. Australia, New Zealand, Canada are major agricultural exporters. Japan supported the deal as a way to counter China's influence in the region. In the U.S. the gains would be in intellectual property rights but losses for workers in the auto and manufacturing industries, a point Mr. Trump recognized in his election campaign as he campaigned in the midwestern states. Mr. Obama pursued TPP over objections of workers organizations and unions including auto workers union, with his advisors suggesting this as a way to counter China's influence in the region. By 2018 the Democratic party support base fractured on this as one of the major issues.   ...

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India Middle East Economic Corridor or IMEC is a proposal backed by US and France, Britain for rail, shipping and other connections from India to Europe. India, Saudis and UAE back this Economic Corridor plan. Turkey for geostrategic reasons had operated as a route for east-west trade and has wanted a plan of its own. India has improved ties with Qatar and this could bring other nations into the plan. France hopes to bring planners together over the next 2 months. Saudis had committed $20 billion for rail investment for IMEC.

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Prime minister Modi of India's visit to Japan in September 2014 leads to a commitment of about $35 billion in Japanese investment over 5 years. Japanese companies such as Suzuki, Toyota and Toshiba already have large investments in India.

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India's foreign exchange reserves of $295 billion cover about 7 months of imports. This is not enough in currency reserves for India's central bank to take actions to prevent a depreciation of the Indian currency, the rupee. The central bank, RBI, has taken other actions including giving local exporters 15 days to convert half their estimated $7 billion foreign exchange holdings into rupees. Analysts say the RBI is running out of policy options and is down to micromanaging the currency. India's trade deficit was at $13.4 billion in March 2012 with rising cost of importing oil and lower exports. The rupee is close to 54 rupees to the dollar.

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The recent appointment of fast food executive Andrew Puzder as Labor Secretary has caused great concern among union leaders. Puzder supports a $9 minimum wage compared to $15 supported by Democrats. Unions now represent 7% of the labor force, down from a high of 20% during Reagan's time when Reagan appointed a construction company executive as Labor Secretary and cut regulations.  Globalization has thinned the ranks of workers in unions. And the failure of Democratic administrations to stem the shift of factories overseas to China, Mexico and other places, as part of global supply chains focussed on cost, has weakened Democratic support among workers since the period of Bill Clinton. It eroded to the point where Obama won 65% of support among unions and Hillary Clinton won 56% in 2016. Interestingly the Republican Romney gained 33% versus 37% for Trump, showing voters were more inclined to move away from Democrats and only a smaller number willing to support Republicans, but the shift enough to give Republicans a win in 2016 for the presidency. The figures are from a Election Day survey of trade union AFL-CIO, and a larger proportion in midwestern states showed disaffection with policies from Clinton to Obama. In fact Obama spent years promoting another free trade agreement TPP that favored tech more than auto and older industries, just as Bill Clinton had promoted NAFTA, without giving thought to what this was doing to its worker base of support. A similar situation happened with Social Democrats in Germany as a SPD administration moved to the centre and handed Christian Democrats led by Merkel a win in parliamentary elections. As Democrats such as former Labor Secretary Reich, a professor at UC Berkeley who served under Bill Clinton, describe the problems of working class people their is less reflection on the impact of the changes from globalization and how Democrats handled or mishandled it, and more on the politics between the two parties.   ...

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Galston of the Brookings Institution says globalization has hurt workers in manufacturing with job losses and declining incomes. It has produced outcomes that have favored some industries such as tech, and not others such as automobiles which in the past helped create the broad middle class by offering good paying jobs to people with less than a college education. Immigration has created an issue that political leaders outside of the main parties have appealed to in France, the U.S. and Britain. The result is a polarization in the voters that has rarely been seen to this extent before. The middle class in the period from the 1950's to the 1980's is not the middle class that we see today in Europe and the U.S. The 2008 financial crisis added to the problems with the slow and uncertain recovery for some groups such as white men, the less educated, students, and people on minimum wage. 

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Public perceptions in the USA of China are changing. Today 42% have unfavorable views of China vs. 39% tha have favorable views of China from survey results released in August by the Pew Research Center. This is a change from 2007 when 42% polled had a positive view of China and 39% a negative view. Things that have changed since then are the Tibet riots and China's strong reaction, the issues of contaminated Chinese products entering the USA market and the nationalism in China on the eve of the Olympics. The last touches McCain and his senior advisor on China, Michael Green of Georgetown University, who finds the Chinese reaction on issues like trade to be cocky but cocky to the point of being arrogant. His comment "the combination of arrogance and insecurity can be dangerous." Green was on the National Security Council under President George W. Bush. McCain and Green want to bolster trade relations with other Asian countries like India to help the USA strengthen its bargaining power with China. McCain wants to strictly enforce trade agreements with China including blocking unsafe products from China. The shift in opinion in the USA at a time when there is a shift in opinion in China to a nationalistic tone sensitive to criticism of China even when it concerns issues like Tibet which do not affect any vital interests of China should be seen as significant. This is happening at the same time as a candidate like McCain who has less tolerance for Russia and a similar position for China is running strongly for President and has the experience and support of most Americans on foreign policy issues. Its useful also to see that the figures given here show 60% of Russians seeing China in a favorable light and only 30% in an unfavorable light. And when you look at France and Germany, 72% in France and 68% in Germany see China in an unfavorable light, only 28 and 26% respectively having a favorable opinion. Britain is an exception because 47% of the British public has a favorable opinion of China, only 36% having an unfavorable view. The figures are from Pew Research Center polls of 4,257 adults in he five countries conducted in March and April (international views)....

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Economic progress in South Asia may finally put behind it simmering political tensions is evident from nature of this proposal on Kashmir by Pakistan. This proposal by President Musharraf is for India and Pakistan to recognize the "line of control" as a de facto border, gradually withdraw troops, and support a new body to run the government in Kashmir. Musharraf say Pakistan then "will have to, yes," give up its claims on Kashmir. The region would have to be given more autonomy to run its affairs. Musharraf would still have to win support from the political parties for this proposal to take shape and be able to control militants in the region who oppose a settlement.

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This is a very informative interview with Joe Biden. So far Biden has given few interviews where he talks freely at length about how he plans to run his administration and what is most important to his heart. The title is very misleading in this respect. Unlike the inexperience of Obama with his "we won" we must be doing something right, Biden with his years of experience comes closer to Lyndon Johnson or Truman and the same drive to get things done. He says in this interview "there is no elation." He just wants to get somethings done as quickly as he can and he knows Congress as well as Lyndon Johnson did when he tried to get his vision of "the Great Society." It is almost as if the Biden sequel to the inexperience of Obama, is like the Johnson sequel to the inexperience of Kennedy.   To understand Biden is to know what hurts him most. Biden feels the pain that every rural county in America did not vote for him. He knows something is deeply wrong that this should happen as it has never happened before. It may be time to define diversity differently - people of diverse backgrounds not just ethnic or race but also whether with rural or urban backgrounds as they are today totally different. He also feels the pain that seventy two million Americans voted for Trump. He will judge his success or failure in winning over about half of them to bring this down from 47-48% to 25%. These issues will define and shape the Biden presidency. Can he deliver to the rural counties, health care, education, broad band connectivity, everything that has disrupted life in rural America from the way it was in the Truman and Eisenhower administrations when it comes to the social fabric. The China issue simply fits into this. European societies are feeling the pain of the fragmentation in their social fabric with starkly different opportunities for life in rural vs urban. Respect for fellow Americans comes before respect for China- or Japan, or India, or Europe. Biden understands what three decades of shift of manufacturing jobs to China and other countries have done to American communities, to small towns and the rural areas surrounding them in America. For this reason Biden does not plan to change the Agreement China made with the Trump administration for 25% tariffs on a portion of imports from China and China's written agreement to buy $200 billion of American products. For this reason his response to China's challenge emerging from trade policy set in motion by the Clinton administration, and allowed to continue by the Bush and Obama administrations with the addition of foreign wars that dissipated the country's finances urgently needed for infrastructure building and investments in education and advancing science and technology, is to reverse all the negative trends. Biden plans to make the investment in America that Mr. Trump started but to do this more effectively, he says.   ...

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Chancellor Merkel's now widely quoted words were made in Munich on May 27, 2017, after a NATO summit meeting in Brussels and a Group of 7 meeting in Italy, in which she was disconcerted by U.S. president Trump's positions on NATO, Russia, climate change, and trade. These words "the times in which we could rely fully on others - they are somewhat over." Merkel added "This is what I experienced in the last few days." After the election of Emmanuel Macron in France, Merkel expressed great relief at the outcome of the French election with Macron winning about two thirds of the vote, setting the stage for the election in Germany after several months of difficult watching and waiting. Now there is new confidence in Germany shaping its own future, with France and the rest of the European Union without Britain. Merkel says she "experienced this" meaning that she had undergone a transformation in these few months, and visibly in the last few days. She was also sending a message to Germans and people of the European Union - "we have to know that we must fight for our future on our own, for our destiny as Europeans." This also complements tactically to form the approach of Germany and France at the leadership of the EU, as French president Macron said at the end of the Group of 7 conference that multilateralism was intact, and the U.S. and EU shared many common goals.   ...

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There is only one way to interpret this. Putin and Russian influence have calmed down the Israel Iran war. DJT opening up discussions and talking to both Russia and China has created a sense in both countries that their vital interests are with the US, China on a trade agreement with the US, and Russia for a settlement of the Ukraine war on terms that it sees as fair. There is the issue of nuclear non-proliferation on which US, Russia, China, India, Germany and the EU, and the rest of the world are in agreement which meant action to end Iran's nuclear program. Putin met with Iranian Foreign Minister and looked for a way to end the war. Putin said: “This gives us a chance to…think together about how it would be possible to get out of this situation,” said Putin. From the point of view of a safer planet Biden's period of not talking to China during the balloon incident, and not talking to Russia with a single minded focus on Ukraine conflict, can be seen as not the way a responsible world power should act. DJT's emphasis to end the wars in the Middle East yet standing firm on Israel's right to exist and the non proliferation of nuclear weapons, and working to end the war on Ukraine by puting pressure on all countries, is proving to be an approach that gives all world powers a chance to reflect truly on their obligations to their peoples and the people of the world. To keep their and the world's sanity and composure while pursuing national aspirations. ...

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China's current account surplus has declined to 2.8% of GDP for 2011 from about 10% in 2007, and will be around 2.3% of GDP in 2012, according to IMF estimates. The U.S. current account deficit is down to 3.1% of GDP from 5.1%. By controlling the exchange rate China was able to keep the competitiveness of its exports, resulting in a five fold increase in exports from 2000 to 2010, according to the IMF. The decline could be temporary say experts, as the the recession in Europe and the U.S. resulted in slowing exports, with its infrastructure buildup sucking in imports of machinery and other goods from the western countries at an accelerated pace with its 2009 stimulus measures. Another reason is that in the last decade China has developed its own high tech and other companies which will now increase exports. IMF forecasts show a pickup in China's trade surplus to 4.25% by 2017. This could be lower if the renminbi is allowed to appreciate. Estimates of appreciation of the renminbi are 8 percent in nominal terms since June 2010 against the dollar. Including inflation, which is higher in China, the renminbi has appreciated by 13% since June 2010. ...

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The head of the World trade Organization Okonjo-Iweala and the prime minister of Bahamas Mia Mottley say that overconcentration of manufacturing in China creates fewer opportunities for growth for poor countries. The supply chain needs to be redesigned after the pandemic not just because it creates a more dependable supply chain for the US and the European Union. It also  needs to be resdesigned to increase manufacturing in countries such as India and Mexico because this will create more opportunities for growth in other countries. For this to happen the infrastructure has to be made similar to that in China. This program of rapidly building the latest infrastructure and logistics with next generation technologies is underway in India with the Modi administration building new pools of capital, skilled labor, land and logistical infrastructure for the purpose of  rapid export led growth. A target of 2 trillion dollars in exports by 2030 has been set by India. This will affect a broad region from Indonesia to Vietnam in Asia and Mexico, Brazil in Latin America, bringing the benefits of trade to a wider region for the first time and making allies of the US and the European Union true partners in trade and manufacturing for the supply chain. ...

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Former prime minister Nawaz Sharif's PML-N party wins 125 of 269 seats in Pakistan's parliament. The Tehreek-e-Insaf party of Imran Khan won 31 seats and the PML-N party of the current president Asif Zardari won 32 seats mostly in Sindh province. Independents won 31 seats and some of these independents are likely to support Sharif in forming a new government. Election turnout of 60% showed a large degree of enthusiasm in this election and hopes for economic revival in Pakistan. The focus of Sharif will be on improving the economy, tackling electricity shortages, and building infrastructure. Sharif promised to pursue peaceful relations with India and Afghanistan, and keep the focus on the economy. Sharif and his advisers are bringing a new deftness in the dealings with the Army, the Pakistan Taliban, saying he would call for a halting of drone strikes, limiting the role the U.S. plays in the region, both positions popular in Pakistan, separating differences with former president Musharraf from the institutional role of the military. Small business owners and large business support Sharif's efforts to tackle electricity shortages, with an estimated loss of $12 billion in idled factories alone. The long period of political conflicts between the military, the judiciary and the political parties have led to neglect of Pakistan's economy, as neighboring countries in Asia surged ahead. The realization that popular pressure for improving standards of living and the economic opportunities are both huge has led to an extraordinary election, and put Sharif at the centre of an important new beginning for Pakistan. ...

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Indian rating agency Crisil says expeditious settlement of stressed assets in India's banking system is needed for the private sector to play its part in the country's infrastructure development. In the last 4 years much of the effort in infrastructure was undertaken by the government. Crisil CEO Ashu Suyash, says Rupees 50 lakh crore needs to be allocated for capital investment in infrastructure for the 5 year period 2018- 2022. About Rupees 3000 crore investment per day is required. In addition to improving the banking system, other actions needed are new private-public partnership efforts, front ending of projects, and a deepening of the infrastructure financing system. Infrastructure investments have suffered from lack of investment in India and this should be a top priority for the government, say experts. This includes tapping into pension and insurance funds under new arrangements. The central government has announced a 7 lakh crore investment plan to build 83,000 kilometres of highways by 2022. Crisil has developed an "investability index" to track and measure the attractiveness of such projects.   ...