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Downturn blues hit restaurants in Australia and New Zealand as consumers cut spending: ‘shops close early’
  • Restaurants have been forced to scale back as the global economy slows, with inflation, higher costs of living and other factors taking their toll
  • Australia and New Zealand’s policies to tackle slow growth have instead spooked many households into tightening their belts
People sit outside a pub and restaurant in Sydney’s central business district on a recent weekday evening. Photo: Su-Lin Tan

While many in the Sydney suburb of Kingsford were in the middle of enjoying their Saturday night out, Susan*, the owner of an eatery called Ben’s The Thai Takeaway, was packing up her empty restaurant at 8.30pm, half an hour before its official closing time.

“Customers are saving money to pay rent,” she said, referring to a sharp rise in prices since the pandemic ended as housing supply dwindled. “Go and look on the main street [of Kingsford]. It used to be busy, but no one is out there now. Shops close early.”

Susan’s situation is reflective of a larger trend affecting the hospitality sector across Australia and New Zealand. The pandemic’s aftermath, compounded by economic slowdowns, has ushered in a period of heightened uncertainty for restaurants as numerous factors push consumers to lose their appetite for discretionary spending, particularly when it comes to eating out.

Ben’s Thai takeaway in Kingsford, Sydney, has had to scale back its opening hours. Photo: Su-Lin Tan
Ben’s Thai takeaway in Kingsford, Sydney, has had to scale back its opening hours. Photo: Su-Lin Tan

Susan said she scaled back her restaurant’s opening hours from 10pm to 9pm when the pandemic hit, but there had not been enough demand to change back.

Business was slow during both the city’s lockdowns and had not returned despite the construction of a new tramline a few years ago, she said. Her casual diner, located close to the University of New South Wales, still has fewer patrons even though its affordable A$14 (US$9) to A$15 dishes are significantly cheaper than many other Thai eateries in Sydney.

Earlier this year, The Fork, an online restaurant booking business owned by the Tripadvisor group that had been operating in Australia for 15 years, said it was forced to “implement cost measures” and close in the country due to the pandemic’s impact on the economy and hospitality industry.

Restaurants in Australia and New Zealand, as well as many other parts of the world, are struggling as the global economy continues to slow following the initial post-pandemic spending boom, with inflation, higher costs of living, lowered spending and fatigued trade taking their toll.

Discretionary spending such as dining out tends to suffer first amid economic slowdowns as consumers focus on paying for essentials like groceries or transport.

Customers buy vegetables at a supermarket in Sydney, Australia. Photo: Xinhua
Customers buy vegetables at a supermarket in Sydney, Australia. Photo: Xinhua

In Australia, a slowdown is already under way, and while an official recession has not been called, it is suffering what is known as a “GDP per capita” recession – referring to gross domestic product – as the amount of production or output per person decreased over the last three quarters of 2023.

The country’s anaemic GDP growth of just 0.2 per cent in the fourth quarter of last year – echoing similar softness in recent quarters – sent a chill across the nation as the Australian Bureau of Statistics said two weeks ago discretionary spending was down. That includes spending on hotels, cafes and restaurants, cigarettes and tobacco, new vehicle purchases and clothing and footwear.

New Zealand, meanwhile, is officially in a recession having posted two quarters of negative growth at the end of 2023, Stats NZ data on Thursday showed, confirming the downturn that has been brewing for months.

Monetary policies implemented by both countries to tackle rising inflation became a vicious circle.

Australia says relief package won’t fuel inflation due to ‘targeted’ nature

What began as higher interest rates, and thus higher mortgage repayments, spooked many households in both countries into tightening their belts. These actions also slowed housing purchases and construction, which in turn dampened supply, jacking up rents.

Rents, along with the inflated prices of other things like food, have compounded the cutbacks made by households.

Continued high employment, however, has managed to cushion the downturns in both Australia and New Zealand.

Other parts of the Asia-Pacific have fared better in some ways, with most Asian nations facing less inflation caused by major supply-side disruptions during the pandemic and many still seeing healthy GDP growth.

Flaming & Co., an upmarket grill restaurant in Brisbane, still has customers. Photo: Handout
Flaming & Co., an upmarket grill restaurant in Brisbane, still has customers. Photo: Handout

‘It’s a tough business’

Not all restaurants across Australia and New Zealand are closing early like Ben’s, nor are they empty.

In Brisbane, diners are still flowing into Flaming & Co, an upmarket grill restaurant. However, owner Jason Zhang says that while some still spend like they used to, most of his patrons tend to order less and visit less often these days, which makes turning a profit more difficult.

“It’s a tough business. Higher interest rates have lowered the spending power of customers. The majority of people have actually downgraded their spending,” he said.

Most restaurants were making losses or very small profit margins and the volume of restaurant trade across Australia had shrunk in the past year, by as much as 30 per cent, he estimated.

June* said business at the cafe she owns in Auckland’s Westfield Newmarket was “up and down”. She said staff wanted higher wages, despite their poor quality of work, while many restaurant workers who left during the pandemic had not returned.

In 20 years of running her cafe, June said this was the “worst” trading conditions she had seen, but was hopeful things would turn around by the end of the year.

A waitress clears up outdoor tables of a restaurant in Wellington, New Zealand, in August last year. Photo: Bloomberg
A waitress clears up outdoor tables of a restaurant in Wellington, New Zealand, in August last year. Photo: Bloomberg

The drop in restaurant spending is only the latest problem to plague the hospitality industry Down Under, after being hit by a labour shortage post-pandemic.

The inflated costs of ingredients and other inputs have forced up menu prices and turned off customers. Now, coupled with a pervasive cutback in discretionary spending, restaurants’ margins and longevity are being tested.

Rakesh Tailor, the general manager of Great India restaurant in New Zealand’s Wellington, said restaurants had “terrible” staff shortages in 2022 when customers came roaring back, and now they can’t make money because of the spending crunch.

“From June last year, with the election and interest rate hikes, there was a huge plummet in diners … the number of patrons working from home has [also] affected the lunch trade greatly,” he said.

Live data from global booking service OpenTable shows the number of seated diners in Australia dropped every month this year compared with last year. The same thing is happening in other countries such as Canada, Germany and the United States.

About 40 per cent of diners surveyed by the Restaurant Association of New Zealand in December said they had reduced their dining expenses over the past year because they ate out less or ate at cheaper places.

Last Christmas – usually the busiest dining period of the year – many people did not dine out as much, according to the association. Instead, customers often just had drinks, while companies held backyard BBQs for their Christmas parties rather than catered functions at restaurants.

In Australia, the latest insolvency figures among accommodation and food providers were nearly 2.5 times higher than they were two years ago, making those sectors some of the worst hit alongside construction and retail businesses

People have a meal at a cafe on Melbourne’s Yarra River. According to global booking service OpenTable, the number of seated diners in Australia dropped every month this year compared with last year. Photo: AFP
People have a meal at a cafe on Melbourne’s Yarra River. According to global booking service OpenTable, the number of seated diners in Australia dropped every month this year compared with last year. Photo: AFP

What happens now?

Data company CreditorWatch’s chief economist, Anneke Thompson, said conditions started waning for restaurants in Australia last July when higher mortgage repayments and other cost-of-living increases began to bite.

“When I look at the data, it’s worrying,” she told This Week in Asia.

“I think the fact that we’re sort of collectively as a nation pulling back … our savings have run out or … we substitute [going out] with eating at home have really come into play. So I think we’re at the peak of the cost-of-food pressures right now.”

A drop in interest rates could provide the relief restaurants are after, which will eventually happen as inflation continues to fall, but not for at least another six to nine months, Thompson said.

Even then, recovery will not be instant when rates fall, as it will take a few rounds of rate cuts for consumers to gain confidence about spending, she said.

“If restaurants can sort of hold their breath, and try to stay afloat for at least the next six months, things will get better,” she said.

Chubby Buns Burgers was based out of a food truck until recently. Photo: Su-Lin Tan
Chubby Buns Burgers was based out of a food truck until recently. Photo: Su-Lin Tan

Staying afloat is precisely what Chubby Buns Burgers in Sydney is trying to do. The burger joint, which began as a food truck, recently graduated to a bigger bricks-and-mortar restaurant.

The restaurant’s manager, Kieran Dhakal, says astute business management in a recession is key.

According to Dhakal, the restaurant’s burger prices of about A$13 are affordable, while the quality of its food is better than those of nearby competitors.

The business in Arncliffe suburb also negotiated lower costs of food ingredients with its suppliers, and has maintained a good network of staff, Dhakal said.

“We are in a recession right now, yeah?” he said. “We will just have to learn to sustain our business in this recession.”

*Last name withheld at interviewee’s request

Posted on 24 March 2024 | 12:00 am
Australia charges Taiwanese man with smuggling meth hidden inside wine bottles, tea
  • The 27-year-old arrived on a flight from Thailand with 21.2kg of methamphetamine concealed in wine bottles, herbal tea and bath salts, police said
  • Investigators estimate US$6.8 billion was spent on meth in Australia in the year to August amid a concerning rise in consumption
Loose leaf tea and other products police say were used in the attempt to smuggle methamphetamine into Australia. Photo: Australian Border Force / Handout

A Taiwanese man was charged for allegedly smuggling more than 20kg of methamphetamine into Australia concealed in herbal tea, wine bottles and bath salts, authorities said on Sunday.

The 27-year-old arrived in Sydney on a flight from Thailand on Tuesday, the Australian Federal Police said in a statement.

Border force officers found packages allegedly containing 21.2kg of methamphetamine, which is also known as meth or Ice, concealed in wine bottles, herbal tea and bath salts in the man’s carry on luggage, the statement said.

Wine bottles that Australian police say were used in the smuggling attempt by a Taiwanese man. Photo: Australian Border Force / Handout
Wine bottles that Australian police say were used in the smuggling attempt by a Taiwanese man. Photo: Australian Border Force / Handout

The suspect was later charged with importing a commercial quantity of a border controlled drug, which carries a maximum penalty of life in prison.

“Syndicates continue to come up with different ways to attempt to smuggle illicit drugs into Australia, with this example under the guise of legitimate food and alcohol products,” said Rosemaree Cracknell of the Australian Border Force.

“Our [border force] officers are exceptionally skilled to identify and question travellers who may be attempting to import illicit substances into our country.”

Australia charges Mexican cartel-linked group with smuggling meth into Hong Kong

Sydney Airport Police Commander Morgen Blunden said the officers were committed to stamping out criminality in the airport, including by transnational drug syndicates.

“Despite all the risks involved, we are still arresting people attempting to bring illicit drugs into our country through our airports,” he said.

“No matter how elaborate or creative the attempts are, the [police] and our partners are working tirelessly to prevent airports being used as part of the criminal supply chain.”

According to a report by the Australian Criminal Intelligence Commission published earlier this month, some A$10.5 billion (US$6.8 billion) was spent on meth in the country between August 2022 and August 2023.

Waste water analysis showed a 1.5 tonne increase to 10.5 tonnes in national consumption of the drug. Commission chief Heather Cook said that the rise in meth consumption was particularly concerning “because of the significant community harms it causes”.

Posted on 23 March 2024 | 11:13 pm
As Vietnam’s Russian arms supplies dry up, who will it turn to for weapons?
  • The Southeast Asian nation placed no new major orders last year, new figures show, with its Russian arms deals taking a hit from the Ukraine war
  • South Korea is an option. But observers say the Vietnamese military is stuck in its ways – and continued covert Russian deals may be more attractive
Vietnamese soldiers stand next to missiles on display at the country’s first international defence expo in Hanoi in December 2022. Photo: AFP

Vietnam’s arms imports from traditional security partner Russia are dwindling, the latest figures show, leading observers to call for it to diversify or build up its own domestic defence industry fast.

The Southeast Asian nation placed no new major orders last year, according to figures released last week by the Stockholm International Peace Research Institute defence think tank – despite it having an estimated annual weapons-procurement budget of more than US$1 billion.

“Diversification is often easier said than done because it requires moving away from old established ties and building new trusted relationships,” said Prashanth Parameswaran, a fellow at the Wilson Centre think tank in Washington and founder of the weekly Asean Wonk newsletter.

“Vietnam will likely continue to put its eggs in more baskets, with a more diverse mix of countries that include partners in Asia and Europe, beyond just the US.”

Vietnam’s then-President Vo Van Thuong shakes hands with Russian President Vladimir Putin during a meeting in Beijing in October last year. Photo: Sputnik/via Reuters
Vietnam’s then-President Vo Van Thuong shakes hands with Russian President Vladimir Putin during a meeting in Beijing in October last year. Photo: Sputnik/via Reuters

Amid on-off tensions with China, Vietnam had been among the world’s 20 largest arms importers in recent decades, sourcing much of its equipment from Russia – with imports hitting a peak of more than US$1 billion in 2014.

But the figure last year was negligible by comparison, according to the institute. In fact, 2023 saw Vietnam import the fewest weapons since 2007, by volume.

Vietnam’s government has not commented on the reasons for the slowdown, but officials did publicly say that they wanted to diversify supplies away from Moscow in late 2022 as the country held its first international arms fair. This reportedly led to several deals, but no further information was given.

Vietnam seeks to curb reliance on Russian arms amid Ukraine war

Nguyen The Phuong, a Vietnam defence specialist at the University of New South Wales in Australia, said an important prong of the Southeast Asian nation’s military modernisation effort was constructing a strong, independent and dual-use defence-industrial complex, with the help of military-owned conglomerates and the private sector.

Reducing reliance on arms imports is a priority in the near term, Phuong said – at least for non-sophisticated weapon platforms used by ground forces.

“More advanced weapons are a problem, as Vietnam relies on Russia for purchasing tanks, warships and military aircraft,” he said. “But this issue is not easy to overcome, especially with the war in Ukraine predicted to last for several more years.”

An explosion is seen in the sky over Kyiv on Thursday after a Russian missile strike. Russian arms supplies to Vietnam have dwindled since the war in Ukraine began. Photo: Reuters
An explosion is seen in the sky over Kyiv on Thursday after a Russian missile strike. Russian arms supplies to Vietnam have dwindled since the war in Ukraine began. Photo: Reuters

While a sweeping anti-corruption drive that did not spare the military has played a part in Vietnam’s falling weapons purchases, Russia’s war with Ukraine that began in February 2022 has exacerbated the problem, Phuong said.

One factor weighing on the minds of Vietnam’s defence planners is the performance of big-ticket Russian weapon platforms on a modern battlefield, where drones, cruise missiles and electronic warfare can prove more decisive.

The last major purchase of Russian arms that Vietnam is known to have made was 64 T-90 tanks in 2016. But these tanks have regularly “come to grief” in Ukraine when targeted by US-made Javelin anti-tank missiles and Saab Bofors Dynamics NLAW “fire-and-forget” projectiles, said Carl Thayer, a Vietnam specialist and emeritus professor at the University of New South Wales in Australia.

Between 2014 and 2021, only two countries – Russia and Belarus – had “consistently” sold weapons to Vietnam, Thayer said, adding that while imports had dropped off, “there is no real evidence that Vietnam is diversifying its sources of weapons away from Russia”.

Thayer said while Vietnam’s military had explored buying aircraft, radar technology, firearms and upgrades for armoured vehicles from the Czech Republic in 2022, the US was Hanoi’s only new supplier, selling ScanEagle drones and jet training aircraft in 2017 and 2021, respectively.

The Vietnamese military has long been familiar with an old way of doing thingsNguyen The Phuong, Vietnam defence specialist

One difficulty Vietnam faces in adapting to modern weapons and platforms is weaning itself off the Soviet-era tanks, fighter jets and warships that still make up a significant chunk of its arsenal, Phuong said.

“The Vietnamese military has long been familiar with an old way of doing things,” he said, adding that the country’s opaque arms procurement process was also likely to stand in the way of future weapons deals.

“Last but not least, money” is a major issue, Phuong said, as modernising any navy or air force was “notoriously expensive”.

A Vietnamese officer tries a weapon at the stalls of Czech security firms at the Vietnam International Defence Expo 2022 in Hanoi. Photo: Reuters
A Vietnamese officer tries a weapon at the stalls of Czech security firms at the Vietnam International Defence Expo 2022 in Hanoi. Photo: Reuters

In 2022, Vietnam signed a memorandum of understanding with Russia for a substantial weapons purchase, Thayer said.

Hanoi has been making clandestine plans to buy Russian arms in contravention of US sanctions, The New York Times reported in September, citing a leaked internal Vietnamese government document.

The document, dated March 2023, laid out how Vietnam proposes to modernise its military by secretly paying for defence purchases via a joint oil venture with Russia in Siberia.

Signed by a deputy finance minister, the leaked document said Vietnam was negotiating a new arms deal with Russia that would “strengthen strategic trust” at a time when “Russia is being embargoed by Western countries in all aspects”.

Alternatives to Russian arms

Since 2022, Vietnam has upgraded relations with a slew of countries – including Australia, Japan, South Korea and the US – to comprehensive strategic partnerships, a move Hanoi says suggests “strongly enhanced mutual understanding and political trust”.

Noting that each of the partnerships’ joint statements contains a section on defence cooperation, Thayer said that these clauses could provide a basis for Vietnam to start exploring arms purchases from other countries.

“South Korea has a robust defence industry and is best placed to provide big-ticket weapon platforms, including warships, jet aircraft, artillery and missile systems,” Thayer said, adding that Washington had also offered Hanoi help in developing its defence capabilities.

Russian Su-30MK2 fighter jets of the Vietnam People’s Air Force fly during the Vietnam International Defence Expo 2022 in Hanoi. Photo: EPA-EFE
Russian Su-30MK2 fighter jets of the Vietnam People’s Air Force fly during the Vietnam International Defence Expo 2022 in Hanoi. Photo: EPA-EFE

South Korea is shaping up to be the new arms supplier of choice for Southeast Asia, particularly the Philippines and Indonesia, where it accounts for 16 per cent and 14 per cent of weapons sales, respectively.

The East Asian nation shipped slightly less than US$2 billion worth of arms to Southeast Asian countries between 2017 and 2021.

Improved relations with Washington will make it easier for Hanoi to access US allies’ military technologies, Phuong said, while the upgrades to ties with other countries could help Vietnam build out its defence-industrial capabilities.

Joint arms development projects are likely in future, he said, though it may take some time before Vietnam is cleared to buy lethal weapons from US allies, rather than just spare parts and components.

“The dilemma for Vietnam is that it needs a strong and modernised navy and air force now, but at the same time it is struggling, and hesitant, to find an alternative to Russian products,” Phuong said.

He said Vietnam was likely to either continue its arms purchases from Russia, risking sanctions and reputational damage, or engage more with Western suppliers – which would require significant institutional change within the Vietnamese military.

Either way, “time is critical”, Phuong said.

Posted on 23 March 2024 | 9:30 pm
China’s construction for Indonesia’s new capital Nusantara to lead growing overseas city-building portfolio
  • Chinese construction firms are eyeing opportunities in Nusantara, which is set to replace Jakarta as Indonesia’s capital
  • It follows Chinese construction projects in Africa, the Middle East and elsewhere in Asia as part of Beijing’s signature Belt and Road Initiative
The Presidential Palace under construction in Nusantara. Photo: Bloomberg

China is positioning itself to become one of the top foreign investors in Nusantara, the planned new capital of Indonesia that is being built from scratch over the next 20 years in the middle of forests and palm tree farms.

The investment is expected to become the stand-out showpiece in a growing body of work building smart cities and other landmark urban zones in other countries, analysts said.

The projects in turn would help China connect with friendly nations to facilitate trade, they added, giving Chinese construction firms a chance to prove themselves abroad.

“It’s fair to say that China has the strongest squad of engineers and constructors, who have benefited from the country’s building boom since the mid-2000s,” said Xu Tianchen, a senior China-based economist with the Economist Intelligence Unit.

“China is also experienced in providing full life cycle solutions, from financing to construction and maintenance, which make life easier for host countries.”

The Indonesian minister of investment has said that doing business with China is easyNukila Evanty

Beijing-based state-owned builder Citic Construction has expressed interest in developing 60 residential towers in Nusantara, which is set to replace flood-prone Jakarta as the national capital.

The move had been delayed due to the coronavirus pandemic, but government offices may be relocated this year as officials seek to reduce the burden on Jakarta.

“I’m not surprised that China will invest a lot in Indonesia, including [Nusantara], because the Indonesian minister of investment has said that doing business with China is easy and they are not fussy about asking for various requirements like other countries,” said Nukila Evanty, a Jakarta-based member of the Asia Centre research institute’s ­advisory board.

Building cities for other countries also naturally follows China’s 45-year “leap” in its own urban development, as well as the goals of its Belt and Road Initiative, said Victor Gao, vice-president of the Centre for China and Globalisation in Beijing.

‘Clear need’ for China’s Belt and Road Initiative funding to go green in 2024

Beijing’s signature Belt and Road Initiative has spawned China-funded infrastructure projects in scores of countries, including ports, highways and power plants.

Construction of smart cities – a term that usually refers to technology-aided management of traffic and urban resources – advances China’s goal of increasing “connectivity”, especially in countries near its borders such as in Southeast Asia, Gao said.

Chinese-funded projects in Nusantara – which is located on the east coast of the island of Borneo – would follow work in Africa, the Middle East and elsewhere in Asia.

In Egypt, Chinese contractors built much of the New Administrative Capital government centre, Egyptian Hong Kong-based consul general Baher Sheweikhi previously told the Post. The new capital includes one of the African nation’s tallest skyscrapers.

Several Chinese companies are also helping construct Egypt’s New Alamein, a city designed to accommodate autonomous shared cars and public transport systems, Xu added.

China is also taking part in the construction of Neom in Saudi Arabia, which officials call a “futuristic” development. Chinese firms have worked on tunnels, solar power stations and water desalination projects, Xu said.

In 2019, China and Kenya signed a US$665 million deal to help build “smart cities” in the African nation, with Chinese telecommunications equipment giant Huawei Technologies nominated to carry out the work.

And in 2020, Alibaba Cloud – Alibaba Group Holding’s cloud computing unit – received clearance in 2020 to install hardware for Kuala Lumpur’s smart city system that is designed to collect and integrate real-time data from traffic cameras. Alibaba is the owner of the South China Morning Post.

Eyeing ‘global player role’, UAE seeks closer China ties through investments

China already ranks as Indonesia’s second-largest investor after Singapore following a steep climb over the past decade, with combined direct investment from mainland China and Hong Kong in 2023 of US$13.9 billion.

“Chinese construction companies are increasingly competitive worldwide, in terms of expertise,” said Zha Daojiong, an international studies professor at Peking University.

And while countries have their own property developers, Chinese firms may carry out higher-quality work, Gao added.

The output value of China’s construction industry topped 31 trillion yuan (US$4.3 trillion) in 2022, according to People’s Daily.

The projects in Nusantara are also significant for China because Indonesia is Southeast Asia’s largest country, a member of the Regional Comprehensive Economic Partnership trade pact and an original member of the Belt and Road Initiative, said Zhao Xijun, a finance professor at Renmin University in Beijing.

And a US$7.3 billion, 142km (88 mile) high-speed railway built by a Chinese-invested consortium on the populous island of Java, which opened last year, should be seen as a “model” for what China can do, Zhao added.

“That’s a very successful cooperation project in terms of investment in Indonesia,” Zhao said.

The Nusantara Capital City Authority estimated that domestic firms have committed US$2.2 billion toward building the future capital versus a total cost of about US$30 billion – leaving plenty of space for foreign investors.

But Chinese investments in the development of foreign cities comes with risks of delays, overruns, financing and social stability, analysts added.

Officials in Beijing are watching Belt and Road Initiative partners for any “country-specific risks”, linked to economic trends and social stability, Zhao said, although Indonesia is considered “low risk”, he added.

But China would still stay on alert for “significant delays and cost overruns” on the Indonesian capital construction projects, Xu said.

A few people tend to be xenophobic towards workers from ChinaNukila Evanty, Asia Centre

Chinese contractors experienced delays and overruns on the Java high-speed railway, he added.

He said some Indonesian citizens and officials already resent China over past disputes over mining projects.

Beijing’s role in Nusantara would face particular scrutiny if the Indonesian government provides the public little information about Chinese investment, Evanty added, pointing to a perception that Chinese workers take jobs away from locals.

“A few people tend to be xenophobic towards workers from China, especially in disadvantaged areas where unemployment and poverty are high and where there is Chinese investment,” she said.

Posted on 23 March 2024 | 9:00 pm
It’s in China’s best interest to rein in a nuclearised North Korea
  • As North Korea develops tactical nuclear warheads, China must not allow Pyongyang to threaten regional security
  • Radioactive leakage could impact communities along the Chinese border in the event of a seventh atomic test
Chinese President Xi Jinping and North Korean leader Kim Jong-un attend a performance at the May Day Stadium in Pyongyang on June 20, 2019. Photo: Xinhua

Amid assessments that a seventh North Korea nuclear test hinges on leader Kim Jong-un’s decision, the timing of its execution remains a matter of utmost concern. Experts indicate that North Korea had met the technical prerequisites for yet another nuclear test as of March 2023.

Officials from the United States and South Korea said the Punggye-ri Nuclear Test Site was ready as of the first half of 2022. Given that the primary objective of the seventh nuclear test is to develop tactical nuclear warheads, last year’s unveiling of North Korea’s new warhead model, Hwasan-31, satisfies this requirement.

Undoubtedly, China shoulders the primary responsibility for North Korea’s nuclear status. This is evident as China, while adopting UN Security Council resolutions to impose sanctions on North Korea, has simultaneously pursued a dual approach of engagement, affording North Korea a window of opportunity.

Despite China’s professed commitment to stability on the Korean peninsula, its tolerance of North Korea’s nuclear programme undermines these claims, leading to criticism that China lacks credibility when advocating for strategic cooperation with the US or discussing security concerns in the Asia-Pacific region.

Even when South Korea attempted to attain nuclear weapons back in the 1970s, the US stopped it after forgoing the total withdrawal of American troops from South Korea. While the US focuses on deterring North Korea to maintain stability on the Korean peninsula, China has consistently erred by tacitly allowing North Korea’s destabilising behaviour, which exacerbates regional insecurity.

Considering that India and Pakistan have attained the status of de facto nuclear-armed states with just three and two tests respectively, a seventh North Korean nuclear test would present a challenge that surpasses the capabilities of those two countries.

North Korea’s nuclear ambitions, including the development of intercontinental ballistic missile (ICBM) technology, reconnaissance satellites and cruise missiles, threaten the global Nuclear Non-Proliferation Treaty (NPT) regime and the established order of nuclear powers. While this raises immediate concerns for South Korea’s nuclear security, there are reports that also warn of dangerous developments affecting China’s security.

In particular, China’s security interests are severely challenged by two threats. Firstly, North Korea’s nuclear weapon advancement can cause great environmental damage through a chain of missile launches and nuclear tests. The heightened risk of radiation leaks and earthquakes, particularly in northeastern China, presents a looming threat of devastation.

Secondly, the reinforcement of extended deterrence efforts by US allies, such as Nato, could accelerate the implementation of a blockade in East Asia. As North Korea’s nuclear capabilities advance, there is a greater risk of global nuclear proliferation, which could lead to the establishment of maritime defence lines by the US and its allies.

Some hawkish experts argue that if North Korea’s nuclear arsenal grows rapidly to a point where deterrence is unavoidable, pre-emptive strikes or decapitation operations should not be ruled out.

Concerns have already been raised in China about the risks of radiation leaks and earthquakes being more severe than anticipated should North Korea conduct a seventh nuclear test.

Since the sixth nuclear test in 2017, grave warnings have been given by scientists, including those based on research from the University of Science and Technology of China. There have been repeated warnings about the increased risk of a collapse at the Punggye-ri Nuclear Test Site due to successive nuclear tests, increasing fears of radioactive material leakage.

Scientists from the Chinese Academy of Sciences have reportedly expressed these concerns to their North Korean counterparts. Considering that Punggye-ri is situated just 80 kilometres from the Chinese northeast border, where up to 100 million residents live, doubts have emerged that radiation leaks have been absent during the six previous nuclear tests.

Meanwhile, the results of radiation exposure tests conducted by the South Korean government on 10 defectors from Punggye-ri indicate significantly elevated radiation levels, with five of them exhibiting a degree of severity that suggests genetic mutations.

Seismic activity triggered by nuclear tests has surpassed critical levels. Initially recorded at magnitude 4.3 during the first test, it escalated to 6.3 by the sixth, suggesting that a potential seventh test could exceed magnitude 7. This escalation raises concerns about a potential nightmare scenario: the eruption of Mount Paektu.

Since the sixth nuclear test, more than 40 natural earthquakes have occurred in an area previously devoid of seismic activity, heightening the risk of ground collapse. South Korean media has aired geological reports suggesting an imminent eruption of Mount Paektu, intensifying concerns that North Korea’s seventh nuclear test could accelerate volcanic activity.

North Korea’s war talk is a cry for deft diplomacy from the US

Mount Paektu is considered to be among the world’s most dangerous volcanoes that could erupt at any moment, with predictions indicating it could surpass the power of the 1815 Tambora eruption in Indonesia.

Given such potential consequences, it is imperative for China to reconsider the rationale and justification for granting North Korea nuclear power status. From a regional security standpoint, China must take action to prevent nuclear proliferation and protect the region’s shared ecology.

Let’s hope that strong pressure from China has influenced North Korea to refrain from conducting a seventh atomic test. Whatever the reasons may be, it is crucial for the Chinese government to recognise the imperative of preventing yet another nuclear test.

Lee Min-Yong is a visiting professor in the School of Global Service at Sookmyung Women’s University, South Korea and a former adviser (foreign affairs and national security to the Presidential Office of the Republic of Korea

Posted on 23 March 2024 | 5:30 pm
Thailand rebounds from Taylor Swift miss, to host Summer Sonic music festival, Tomorrowland
  • Summer Sonic will come to Southeast Asia for the first time in its second venture outside Japan
  • The announcement comes after Prime Minister Srettha Thavisin identified hosting of major music events as ‘quick wins’ for Thailand’s economy
Swedish DJ Alesso performs at the 10th edition of the Tomorrowland electronic music festival in 2014. Photo: AFP

After missing out on Taylor Swift’s world tour, Thailand has sealed deals to host Summer Sonic and Tomorrowland music festivals as it pushes event-driven tourism to propel Southeast Asia’s second-largest economy.

Summer Sonic will come to Southeast Asia for the first time in its second venture outside Japan, with dates set for August 24 and 25 in Bangkok after shows in Tokyo and Osaka, according to Thai government spokesman Chai Wacharonke. Thailand will also be hosting the dance music festival Tomorrowland in 2026, which may be only the first of 10 consecutive editions, Chai said in a statement on Saturday.

Indonesia keen to work with Singapore on staging big gigs after Swift success

The push came after Thai Prime Minister Srettha Thavisin, who took office in September, identified measures such as visa waivers for tourists as “quick wins” to stimulate Thailand’s economy, which he has repeatedly said is in a “crisis.” Thailand, which has seen an average growth short of 2 per cent in the past decade in a region where a pace upwards of 4 per cent is the norm, has pushed promotional campaigns to extend holidaymakers’ stay and year-round festivals to boost the number of foreign tourists.

Srettha previously bemoaned that Thailand had missed out on Taylor Swift’s record-breaking Eras Tour, which made Singapore its only stop in Southeast Asia due to an exclusive arrangement with the neighbouring country.

Tycoon-turned-politician Srettha has called Singapore’s move “smart” and said Thailand should seek to emulate such strategies to bring in tourists and boost its economy.

Thai PM’s Taylor Swift remarks not expression of ‘jealousy towards Singapore’

Economists upgraded the first-quarter growth forecast for Singapore’s economy, with some attributing the gains in part to Swift’s concerts.

Gross domestic product probably expanded 2.9 per cent in the three months ending March 31, the quickest pace in six quarters, according to the median estimate in a Bloomberg survey.

Thailand’s vital tourism industry accounts for 12 per cent of the country’s gross domestic product. This year, the country aims to welcome 35 to 40 million foreign tourists, edging near a pre-pandemic record of 40 million visitors.

Posted on 23 March 2024 | 6:20 am
Indonesian logistics giant J&T turns first profit in China, making up bulk of its revenue, despite price war
  • J&T Global Express made US$58.8 million in gross profit in China while fending off fierce competition from SF Express, STO Express and YTO Express
  • Most the logistics giant’s revenue now comes from China, where it is the sixth-largest express delivery firm
J&T Express has turned its first profit ever in China, but its global profit from 2022 turned to a loss last year. Photo: J&T Express

Indonesian logistics company J&T Global Express reported its first annual profit in China despite an escalating industry price war in its first earnings report since going public in Hong Kong last October.

The company recorded a gross profit of US$58.8 million and adjusted earnings before interest, taxes and amortisation of US$30.7 million in China last year, the first positive results for both since it entered the market four years ago, according to the earnings report released on Friday.

The company’s turn of fortune comes amid fierce competition in China’s express delivery market. Major domestic logistics giants – including SF Express, STO Express and YTO Express – have been engaged in a heated price war for the past year as e-commerce user growth has slowed after the Covid-19 pandemic. It comes just two years after another brutal price war in 2021.

Average revenue per parcel was down 4.3 per cent last year to 9.1 yuan, according to data from the State Post Bureau.

Strong orders in post-pandemic China boost Meituan revenue

J&T said its own revenue per parcel remained stable in 2023, as it managed to decrease per-parcel delivery costs to US$0.34 from US$0.40 in 2022. It attributed the improved results to “a series of initiatives including strategic acquisition, service offering diversification and streamlined operation”, according to the earnings report.

J&T entered China in 2020 on the back of strong demand from online retailers such as budget e-commerce giant Pinduoduo. The market now makes up the majority of its revenue.

Last year, the company’s revenue in China increased 27.7 per cent year on year to US$5.2 billion, accounting for 59.1 per cent of its total revenue.

The number of parcels it handled in the country last year jumped 27.6 per cent to 15.3 billion, giving it an 11.6 per cent market share. It is the sixth-largest express delivery company in China.

J&T raised HK$3.5 billion in its October initial public offering in Hong Kong, making it the city’s second-largest IPO of the year.

“In China, our focus will be on further uplifting service quality and brand image to reach a broader base of high-quality customers,” the company said in its press release on Friday.

Even as business improves in China, J&T’s global business has seen greater headwinds.

The company as a whole reported a net loss of US$1.2 billion because of higher share-based payments and expenses. It had a net profit of US$1.6 billion in 2022. Total revenue last year rose 22 per cent to US$8.8 billion.

J&T, known for its low-cost logistics services, was the top express delivery service provider last year in Southeast Asia, where it held a 22.5 per cent share of the market in terms of parcel volume, according to data from Frost & Sullivan.

Posted on 23 March 2024 | 6:00 am
Why are India’s monuments disappearing? – ‘a bit of an epidemic’
  • The loss of monuments such as Kos Minar and the Barakhamba Monument has raised questions about India’s commitment to protect its heritage
  • Factors such as poor local supervision, illegal developments and insufficient funding have been cited for the monuments’ disappearance
The Alamgir Mosque in Varanasi, one of thousands of monuments in India. Photo: Amit Pasricha/India Lost & Found

As one of the world’s oldest civilisations, India boasts a wealth of historical structures ranging from palaces to temples but a rise in the number of disappeared monuments has triggered concerns about the country’s ability to protect its heritage.

While globally renowned attractions such as the Taj Mahal and the Qutb Minar are well preserved, many heritage structures are in decrepit condition or unaccounted for amid extensive urban development.

Last year, the Ministry of Culture reported that 50 of India’s 3,693 protected monuments were “missing” but heritage experts believe the number could be much higher.

Was India’s Taj Mahal a Hindu temple? Only if you believe the conspiracies

Since the start of official monument audits in 2013, the Indian parliament has received an annual report from the Archaeological Survey of India (ASI) – an agency under the Ministry of Culture – including details on the country’s unaccounted historical landmarks.

“This is concerning and a bit of an epidemic as regularly there are reports that say that national monuments have disappeared,” said New Delhi-based historian Ruchika Sharma. ASI has typically cited reasons such as urbanisation for the loss of landmarks, Sharma said.

Among the ancient sites that had disappeared according to ASI were the Kos Minar, a medieval milestone in Haryana state; the Guns of Emperor Sher Shah in Tinsukia town; the Telia Nala Buddhist site in the city of Varanasi; and the Barakhamba Monument, a 14th-century tomb building in Delhi.

Divay Gupta, a Delhi-based conservation architect, said: “Unfortunately, the government is now even de-notifying them so that they will no longer be classified as monuments of national importance.”

The structures could have disappeared due to factors including insufficient funds and staff at ASI, outdated conservation methods, poor heritage management and a lack of connection between the monuments and local communities, Gupta said.

Feroz Shah Kotla in New Delhi, India. Photo: Shutterstock
Feroz Shah Kotla in New Delhi, India. Photo: Shutterstock

ASI’s mandate covers monuments or sites that are more than 100 years old and considered to be of national importance such as palaces, forts, cemeteries and ancient inscriptions. State governments also oversee the protection of certain historical monuments not covered by ASI.

In many cities such as Delhi, there are laws to protect heritage buildings and prevent structural changes to them without official permission. The disparity, however, between protected and non-protected monuments is huge. For instance, while there are more than 700 notified heritage sites in Delhi, only 174 are protected by ASI.

India’s population surge in recent years has fuelled demand for new buildings and infrastructure, leading developers to encroach on heritage sites or even demolish them, according to heritage experts.

Many monuments have been destroyed during road widening and the building of highways or had their structures torn down by residents who used the rubble as building materials.

In India, Hindu caretaker of a mosque says: ‘It’s one God for everyone’

Government budgets for the upkeep of monuments are too small for the number of sites they have to manage and protect, heritage experts say. Most of the funds are allocated to monuments that are major tourist attractions while the overwhelming majority of the other sites do not require an entry fee.

“Many protected monuments have no guards. The problem is not a lack of funds but the way the funds are allocated. ASI puts a lot of guards on a big ticket site like the Qutab Minar but monuments that are barely known to tourists have no guards,” Sharma said.

A lack of coordination between local governments and ASI is a key reason for the loss of monuments. For instance, the land occupied by the Mughal-era Kos Minars guard towers in Haryana was sold by the state authorities to developers as they were not aware of the site’s protected status, according to Sharma.

People gather near barriers placed at an entrance point to the site of a mosque demolished by local authorities over claims that it was an illegal construction in the Mehrauli area of New Delhi, India, on February 1. Photo: AFP
People gather near barriers placed at an entrance point to the site of a mosque demolished by local authorities over claims that it was an illegal construction in the Mehrauli area of New Delhi, India, on February 1. Photo: AFP

In other instances, local authorities were directly responsible for the demolition of monuments, Sharma said, citing the 600-year-old Akhondji Mosque in Mehrauli, a neighbourhood in Delhi. On January 30, the Delhi Development Authority (DDA) razed the mosque and a madrasa, describing them as “illegal structures”. The following day, the Delhi High Court ordered the DDA to explain its reasons for the mosque’s demolition.

Indian historian and author Swapna Liddle said there was a need for better planning for monument protection alongside urban development and closer coordination between architects, historians and archaeologists.

“Monuments that are protected are cheek by jowl with unauthorised structures. ASI is also de-notifying monuments under its protection and we don’t know their fate in the future,” Liddle said.

While Sharma lamented the destruction of Akhondji Mosque, she said there was a valuable lesson from the saga as the site was previously well managed and cared for by the local community.

“Many historical mosques in the country are community-managed and this would help ASI. It’s a good heritage preservation model,” she added.

Posted on 23 March 2024 | 4:00 am
India’s economy is booming, so why are its start-ups finding it harder to get money to grow?
  • Indian start-ups saw a steeper drop in funding in 2023 even as the country’s stock market surged 19 per cent since the beginning of last year
  • Much of the blame for investors’ relative reticence towards start-ups can be laid at the sharp turnarounds in fortune for heavyweights like Paytm and Byju’s
A vegetable vendor waits for customers displaying a barcode for digital payment company Paytm at a market in New Delhi. Photo: AFP

India’s economy and stock markets are booming, but its start-ups are not.

Investors, once eager to pump in billions of dollars in promising Indian tech ventures, are now going slow and cutting smaller cheques. They’ve been burnt by ignominious falls from grace – and valuations – for once-marquee young firms or market debutants of recent years such as digital payment company Paytm.

Karthik Reddy, managing partner at India’s Blume Ventures, which has invested in hundreds of early-stage start-ups, said his firm plans to do about eight new deals this year compared with 12 last year. It will invest bigger sums in firms it is confident about instead of spreading funds across more companies.

“When your existing portfolio is not showing gains, it is hard to be excited to do more,” he said.

Investors looking at Indian start-ups are much more focused on potential profitability, less enamoured with tech companies and more interested in stable bricks-and-mortar businesses, according to interviews with six executives at foreign and domestic investment firms as well as two CEOs at start-ups.

India’s tech world faces ‘wake-up call’ as big names Paytm, Byju’s falter

In January and February, India’s start-ups raised about US$900 million – a pace that signals another slow year after a six-year low of just US$8 billion in 2023, Venture Intelligence data shows.

That’s a far cry from the record US$36 billion raised in 2021 or even the US$24 billion in 2022. In contrast, India’s stock market – spurred on by 8 per cent-plus economic growth- has surged 19 per cent since the beginning of last year, hitting a record high this month.

The two-thirds drop in funding last year for Indian start-ups was also much steeper than the 36 per cent drop for US start-ups and the 42 per cent drop for Chinese start-ups, CBInsights data shows.

Significantly, Blume’s next fund is set to be either equal in size or smaller than its last one which raised US$290 million – an unusual development for a top Indian venture capital firm.

India’s 10 biggest venture capital firms have over the past decade always embarked on bigger funds than their last one, a Reuters analysis shows.

“In this environment. I don’t think we can make big returns with more money,” Reddy said.

Less start-up funding can have a broader economic impact. In the last eight years, start-ups generated 20-25 per cent of India’s new jobs and 10-15 per cent of its economic growth, an Indian trade body and McKinsey said in a report this month.

Much of the blame for investors’ relative reticence towards start-ups – described by Prime Minister Narendra Modi as the “backbone” of the country – can be laid at the sharp turnarounds in fortune for Paytm, online educational firm Byju’s and Uber-rival Ola Cabs.

Paytm’s shares have plunged 80 per cent since its 2021 listing. It was criticised at the time for valuing itself too high and is now in crisis after the central bank ordered its banking arm wound down for persistent non-compliance.

Byju’s, once the poster child for India’s start-up ecosystem, was valued at US$22 billion in 2022 but now values itself at around US$200 million. It’s at loggerheads with investors over a rights issue and cannot pay its staff.

In some cases, valuations have plunged even without a major crisis. Vanguard, an investor in Ola Cabs, slashed the ride-hailing firm’s valuation to US$1.9 billion, a drop of 74 per cent from 2021, although it did not give a reason.

‘Much easier’: QR codes power rural India into a cashless economy

Ashish Sharma, chief executive at Temasek-backed InnoVen Capital which has invested US$1.5 billion in Asian start-ups, said it was clear with hindsight that too much capital was poured into some sectors, leading to sharp increases in valuations.

“Some companies got lucky … [but] getting lucky cannot be a business model.”

“One change is that we need to be more cautious when evaluating high growth/ high [cash] burn businesses and assess if the assessable market is large enough that it can attract growth investors to raise the next round of capital,” he added.

India’s Nexus Venture Partners, which manages US$2 billion, is “broad-basing” its bets beyond typical tech start-ups to capture a larger portion of the economy and because traditional sectors are less risky, according to a source with direct knowledge of the matter who declined to be identified.

Nexus, which has since December backed a sportswear manufacturer and a coffee chain, did not respond to a request for comment.

Employees of online educational firm Byju’s work at their office in Bengaluru, India. Photo: AFP
Employees of online educational firm Byju’s work at their office in Bengaluru, India. Photo: AFP

In one brighter sign, Japan’s SoftBank is considering deploying up to US$300 million in India this year, according to a source briefed on its plans.

That comes after not signing a single new cheque in India in two years – a sharper pullback than in other regions by the tech investment behemoth.

“Most [Indian] start-ups were too richly valued and SoftBank could not justify those valuations,” said the source who was not authorised to speak to media and declined to be identified.

SoftBank, which invested US$11 billion in Indian start-ups between 2014 and 2021, did not respond to requests for comment.

Posted on 23 March 2024 | 3:30 am
2 men indicted in deaths of Indian migrant family at Canada-US border
  • A grand jury found that Steve Shand and Harshkumar Patel conspired to bring and transport illegal immigrants to the US, causing serious bodily injury
  • The deaths of four Indian nationals in 2022 spurred sprawling investigations into the illicit immigration pipeline to the US from their home state of Gujarat
A border marker between the US and Canada at Emerson, Manitoba. Photo: The Canadian Press via AP

A federal grand jury has indicted Steve Shand and Harshkumar Patel over their alleged role in trying to illegally bring a group of Indian nationals across the Canadian border into the United States in a case that led to a family of four freezing to death.

The deaths of Jagdish Patel, 39, Vaishaliben Patel, 37, and their two children Vihangi, 11, and Dharmik, 3, in January 2022, spurred sprawling investigations into the illicit immigration pipeline to the US from their home state of Gujarat in western India.

Authorities discovered the four bodies frozen in Emerson, Manitoba, and found five other Indian immigrants on foot and two more in a van driven by Shand in a rural area between Lancaster, Minnesota, and Pembina, North Dakota.

Shand, of Deltona, Florida, was scheduled to face trial next Monday in Fergus Falls on two counts of illegally bringing in and transporting undocumented immigrants, but the long-delayed proceedings were postponed again on Friday.

The seven-count superseding indictment filed this week includes far more extensive criminal allegations against Shand and says he acted with Harshkumar Patel, who was arrested in Chicago last month and is now in the Sherburne county jail in Elk River, Minnesota. Gujarati police have also arrested a series of smugglers in connection with the case in India.

Lawyers for both men could not immediately be reached for comment.

Indian village mourns family who froze to death on US-Canada border

The grand jury found that Shand and Patel conspired to bring and transport unauthorised immigrants to the US, causing serious bodily injury and placing lives in jeopardy. The indictment said the pair brought or tried to bring them, aided and abetted their journey, and that Shand and Patel transported them for commercial advantage and private financial gain.

Authorities said in a complaint filed against Patel last September that they conducted a forensic examination of Shand’s phone and found he had been communicating on WhatsApp with Patel, whom he knew as “Dirty Harry,” about rental cars, hotels and payments to Shand. Messages discussed what time Shand should travel to the border to pick up the Indian nationals.

Shand said in a March 2022 interview with federal agents that he met Patel at a gambling establishment in Florida’s Orange City, where Patel was a manager and Shand used to pick up and drop off clients in his taxi. Authorities said they believed that Patel had entered the US without legal permission from Canada after being denied an American visa at least five times.

Shand said Patel recruited him to transport undocumented immigrants from the Canadian border in Minnesota to the Chicago area for money. Shand told authorities that he had made five such trips between December 2021 and January 2022, including the one in which he was arrested.

Canadian officers in Emerson where four people were found dead near the Canada-US border. Photo: RCMP/AFP
Canadian officers in Emerson where four people were found dead near the Canada-US border. Photo: RCMP/AFP

Because the immigrants did not speak English and Shand did not speak their native language of Gujarati, he would put his phone on speaker so that the Indian nationals could communicate with Patel. Shand told authorities that Patel paid him about US$25,000 for the five smuggling trips, dropping off cash in his postbox or with Shand’s adult son, according to the complaint.

The day the family of four died in sub-zero temperatures, Shand texted Patel, “Make sure everyone is dressed for the blizzard conditions please.”

“Done,” Patel replied at 1am, according to the complaint.

Eight hours later, Patel messaged him, “When ever you at the spot let me know.”

Authorities stopped Shand and the Indian nationals on foot that morning. One of the men in the group told investigators that he was carrying a backpack of children’s items for a family of four who had got separated from them during the night. A search led to the discovery of Jagdish Patel and his family, lying frozen just a few dozen feet from the international border.

Posted on 23 March 2024 | 2:40 am
South China Sea: Philippines accuses Beijing of damaging supply vessel with water cannon
  • Video clips of the attack near Second Thomas Shoal showed a white ship repeatedly dousing another vessel sailing alongside it with a water cannon
  • Beijing said the Philippine convoy ‘forcibly intruded into the area despite the Chinese side’s repeated warnings and route controls’
Chinese vessels surround the Philippine coastguard ship BRP Cabra (second right) during its supply mission near Second Thomas Shoal in the disputed South China Sea on March 23. Photo: PCG/AFP

The Philippines accused the China coastguard of blocking a Filipino supply vessel and damaging it with water cannon on Saturday morning off a remote and contested South China Sea reef.

The Philippine military said the nearly hour-long attack occurred off Second Thomas Shoal, where Chinese ships have unleashed water cannon and collided with Filipino vessels in similar stand-offs in recent months.

The military released video clips that showed a white ship repeatedly dousing another vessel sailing alongside it with a water cannon. One clip showed two white ships simultaneously firing water at the same vessel.

It also released another clip showing a white ship marked “China coastguard” crossing the bow of a grey vessel it identified as the Philippine supply boat Unaizah May 4.

It said the videos were taken on Saturday morning while the Unaizah May 4 was on its way to Ayungin Shoal – the Filipino name for the outcrop garrisoned by a small unit of Philippine troops that is also claimed by Beijing.

Philippines debates mandatory military training to boost its readiness for war

“The UM4 supply boat sustained heavy damages at around 08:52 (am) due to the continued blasting of water cannons from the CCG vessels,” the military said in a statement, without describing the nature of the damage or whether there were any casualties.

A Philippine coastguard escort vessel later reached the damaged boat “to provide assistance”, the military said.

China coastguard spokesman Gan Yu said in a statement that the Philippine convoy “forcibly intruded into the area despite the Chinese side’s repeated warnings and route controls”, adding the Chinese carried out “control, obstruction and eviction in accordance with law”.

“We sternly warn the Philippine side: those who play with fire will bring shame on themselves. The Chinese coastguard is ready at all times to resolutely safeguard our country’s territorial sovereignty and maritime rights and interests,” Gan added.

China claims almost the entire South China Sea, brushing off rival claims from countries including the Philippines and an international ruling that its assertion has no legal basis.

The latest confrontation came four days after visiting Secretary of State Antony Blinken said the United States stood by its “ironclad” commitments to defend long-time ally Manila against armed attack in the South China Sea.

Two days after Blinken’s visit to Manila, the China coastguard also tried to drive away Filipino scientists who landed on two cays near Scarborough Shoal, another contested South China Sea outcrop.

The Unaizah May 4, which was also damaged in a China coastguard water cannon attack off Second Thomas Shoal earlier this month, had returned to the area on Saturday escorted by two Filipino coastguard vessels and two Philippine navy ships, a Philippine military statement said.

Is Beijing a threat in South China Sea? Survey shows most Indonesians think so

The Philippine soldiers stationed on the shoal live on a derelict navy ship, the BRP Sierra Madre, and require frequent resupplies for food, water and other necessities.

“This particular mission was set up to ensure a full troop complement on board BRP Sierra Madre after one personnel needing serious medical attention was recently evacuated,” the military added.

Four crew members had been hurt by broken glass during the previous water cannon attack on the Unaizah May 4.

Commodore Jay Tarriela, a Philippine coastguard spokesman for South China Sea issues, said in a separate statement that its escort vessel, the BRP Cabra, was “impeded and encircled” by three Chinese coastguard and other vessels early Saturday.

As a result, Cabra was “isolated from the resupply boat due to the irresponsible and provocative behaviour of the Chinese maritime forces”, he added.

Posted on 23 March 2024 | 2:04 am
South China Sea: Philippines debates boosting war readiness through mandatory military training for students
  • Proponents of the Reserve Officers Training Corps bill say the programme will better prepare the Philippines to defend itself at all times
  • But critics say the costs of implementing it and doubts over its strategic impact mean efforts are better redirected towards modernising the military
Philippine coastguard personnel are shadowed by a Chinese coastguard ship during a resupply mission to Second Thomas Shoal in the disputed South China Sea earlier this month. Photo: AFP

Renewed talks on a bill that would reinstate a mandatory Reserve Officers Training Corps (ROTC) programme in colleges and universities in the Philippines has sparked debate on whether it would be effective in strengthening the country’s military amid growing tensions in the South China Sea.

Senator Robin Padilla told local media on March 14 that he was getting “impatient” with the bill, which he filed two years ago and was languishing in the Senate.

In August, Padilla revived his call to pass the ROTC bill – which would require all full-time college students to receive two years’ training with the Armed Forces of the Philippines – in response to China’s coastguard using water cannons on Philippine vessels and fishing boats.

The part-time training programme would be held over four academic terms, coinciding with students’ studies. The Philippines already offers an ROTC programme that college students may take as a prerequisite to graduation, but it is not mandatory.

Philippines condemns China’s ‘dangerous’ use of water cannons at its boats

“Is the Philippines ready to defend itself?” Padilla asked his fellow lawmakers when calling for the bill to be passed.

He likened the Philippines’ situation to Russia’s war in Ukraine, saying that regular Ukrainian citizens were helping their country survive the conflict, and emphasising the need to increase the military’s ranks if the Philippines was to have a fighting chance in any conflict against China.

“Given the size of China’s military and reservists, they could walk all over us, urinate on us, and we would drown,” he said.

A survey commissioned by the Philippines’ armed forces and conducted by research firm OCTA in December revealed that 77 per cent of Filipinos said they were willing to fight for their country in the event of a conflict with a foreign enemy.

According to data from June last year, the Philippine military has 150,000 active-duty personnel and around 1.2 million reservists.

The Philippines has had a mandatory ROTC programme in the past, but it was made voluntary through a law passed in 2002, after a student from the University of Santo Tomas was killed by senior ROTC officers for exposing corruption within the programme at the university.

A vessel identified by the Philippine Coast Guard as “Chinese maritime militia” (top right) shadows a Philippine vessel (upper left) and a China coastguard vessel (lower right) during a supply mission to Second Thomas Shoal in the disputed South China Sea on March 5. Photo: AFP
A vessel identified by the Philippine Coast Guard as “Chinese maritime militia” (top right) shadows a Philippine vessel (upper left) and a China coastguard vessel (lower right) during a supply mission to Second Thomas Shoal in the disputed South China Sea on March 5. Photo: AFP

Senator Ronald dela Rosa echoed Padilla’s sentiments when he spoke to reporters last week, saying that the Philippines needed to be prepared to defend itself at all times.

“We cannot have a credible defence if we do not have enough reserves. We cannot produce enough reserves if we do not have the ROTC programme. We’re vulnerable without the ROTC programme,” dela Rosa, a former national police chief, said on March 13.

The senator also noted that other regional countries such as Singapore required mandatory military service from its citizens, which kept their reserves strong.

Opposition senator Risa Hontiveros, however, said pursuing a mandatory ROTC programme was “not the right policy direction” and instead called for efforts to modernise the country’s military.

“I think as the tension in the West Philippine Sea heats up, the most correct course of action for us as the Senate is to continue and judiciously increase support for military modernisation, especially for the Philippine Navy, and adjust other aspects of national defence,” she said on March 11, referring to the part of the South China Sea that falls within the Philippines’ exclusive economic zone.

Hontiveros added that a smaller but more effective armed forces could be more strategic for the country’s national defence, especially with the Senate’s passage of the Philippine Maritime Zones Act, a bill that defines the country’s maritime zones in line with The Hague’s arbitral ruling in 2016, which largely dismissed Beijing’s territorial claims in the South China Sea.

China, which rejected the arbitral ruling, has condemned the Philippines’ efforts to pass the act, saying Manila “has attempted to further enforce the illegal arbitral award on the South China Sea by domestic legislation”.

Joshua Espeña, vice-president of the International Development and Security Cooperation think tank, said that while a national defence force would work, an ROTC programme that did not add any real value in terms of understanding and training for modern warfare would be unlikely to have a real strategic impact against a large enemy force with sophisticated machinery.

Espeña also highlighted practical concerns, saying that making ROTC mandatory might end up becoming costly to implement, forcing competition for limited resources in the annual defence budget set by lawmakers.

A Filipino soldier fires a Javelin anti-tank weapon system during last year’s annual “Balikatan” US-Philippines joint military exercises in the Philippines. Photo: Reuters
A Filipino soldier fires a Javelin anti-tank weapon system during last year’s annual “Balikatan” US-Philippines joint military exercises in the Philippines. Photo: Reuters

In last year’s Senate hearings, the Philippines’ Department of National Defence projected that implementing the ROTC programme alone would cost 61.2 billion pesos (US$1.09 billion), the bulk of which would be allocated to the estimated 9,000 military personnel needed to carry out the programme in more than 2,000 colleges and universities.

“We must include concerns such as pensions, benefits, and other relevant perks in joining the reserve force,” he said.

According to Espeña, much of the country’s defence budget already goes toward personnel expenses, while capital outlay, maintenance and other operating expenses, such as those incurred to procure new warfare systems and equipment, lag behind.

“[Much of the budget] is understandably concerned with incomes, pensions, and dependency concerns for the regular forces aside from expenditures on training and education,” he said.

“The current reserve force does not receive monthly income, assuming they have day jobs, but the money allocated is for training and education. We must gear our reserves to operate and prevail in modern warfare to optimise the defence budget.”

Is Philippines at front line of ‘WWII-style war’ with China over disputed sea?

The Philippines needs to look beyond simply adding more numbers to its forces if it wants to strengthen its defence strategy, Espeña argued.

“My view is that defence policy should [focus on] securing a robust force structure of … regular and reserve forces first rather than just building a mass against enemies using untrained, unprofessional conscripts in times of war. We do not have enough population to rebuild a post-war order if we do not use human capital well,” he said.

Despite being its biggest proponent, Padilla is not waiting for the passage of his ROTC bill to recruit more of his countrymen. On March 11, he launched a voluntary Basic Citizen Military Training programme for Senate employees, which has already seen 161 people sign up.

Posted on 23 March 2024 | 12:00 am
How celebrating the centenary of Rabindranath Tagore’s China trip can offer New Delhi and Beijing a chance to reset ties
  • Marking the event could serve as a platform to revive cultural exchanges, reminding both that for most of human history, they have lived in peace
  • Tagore centres for civilisational dialogue would help improve the image of China in India and vice versa, which is mostly shaped by Western narratives
Rabindranath Tagore. Photo: Handout

The troubled ties between India and China are expected to worsen in the coming years and analysts see no future where the two Asian powers will come together in cooperation.

One way of turning things around is to reflect on the times when the neighbours were engaged in the struggle to establish modern states and to take seriously a major thinker of that period, Rabindranath Tagore, who envisioned harmonious relations.

This April marks the 100th anniversary of Tagore’s visit to China and provides an opportunity to celebrate the occasion and study his vision.

The poet made the trip when India was under colonial rule and China was in the midst of its “century of humiliation”. At a time of great suffering, his visit was a symbol of the commonality of their situation and their attempt to establish new bonds. The tour also marked a historic turn in India-China relations.

Chinese society then was in intense flux and debating the place of Western thought. Chen Duxiu, one of the founders of the Communist Party (who later left the group), had welcomed “Mr Science” and “Mr Democracy” and attacked old customs and traditions including Confucianism. In his lectures in China, Tagore argued against associating modernity with an uncritical acceptance of the West and said, “The revelation of spirit in man is truly modern: I am on its side, for I am modern.”

His point of view was appreciated and he was effusively welcomed by several Chinese intellectuals, including Liang Qichao, who compared his visit with those of ancient travellers between India and China. In his introduction to Tagore, Liang spoke of how India and China had extensive contact in the past – most prominently through Buddhism – which was interrupted by colonial expansion. Western colonialism had not just hindered positive civilisational exchange; it had created the conditions for mutual suspicion and misunderstanding. Liang saw Tagore’s visit as reigniting the contact between two ancient civilisations in modern times.

Chinese author Bing Xin (right) wrote a moving tribute to Tagore’s work. Photo: Xinhua
Chinese author Bing Xin (right) wrote a moving tribute to Tagore’s work. Photo: Xinhua

Tagore also had a deep influence on modern Chinese literature. “I was so elated as if I had found a hidden orchid while strolling along a mountain path,” the author Bing Xin wrote in her moving tribute to discovering Tagore. Several Indians and Chinese travelled to each other’s countries after Tagore’s trip. India-China relations could be said to have reached a crescendo in 1954 with the signing of the Panchsheel agreement, which created a new paradigm for international relations. The subsequent sad break in ties needs no repetition.

However, the popularity of Tagore in China has only increased. He is widely known and is taught in Chinese school textbooks. In some ways, his ideas have more relevance at this time when both sides are re-examining the importance of their ancient heritage, and there are three key aspects of Tagore’s thought that deserve the attention of the world today.

The first is his critique of Western modernity. Tagore believed that in Western modernity, moral progress had not kept pace with scientific advances. He was a critic of Western nationalism, which he considered an abstract and limiting ideal driven by profit-making that had led to unnatural growth. He also questioned the excessive materialism of the West and believed that society should benefit from the gains of applied science, but that these must not overwhelm human relations.

The national flags of China and India. Much debate and discussion is focused on the shape that Chinese and Indian modernity is going to take. Photo: Bloomberg
The national flags of China and India. Much debate and discussion is focused on the shape that Chinese and Indian modernity is going to take. Photo: Bloomberg

Today, as China and India have both made immense material progress, much debate and discussion is focused on the shape that Chinese and Indian modernity is going to take. Both countries are seeking clarity on how their modern social organisation differs from that of the West, and its relationship to their ancient civilisational heritage. Scholars of China, for example, have noted the distinct state organisation in the country, referring to it as a civilisational state. Tagore emphasised that one must search for civilisational heritage in folk forms, in the ways and beings of ordinary people rather than in the culture of the elite.

The second is the doctrine of universal man. Tagore was immensely concerned with the place of the human being in society and directly confronted the complex problem of human experience in modern society. He believed that individuals would only find their self-expression in seeking to spiritually expand and unite with all of humanity. He thus sought an organic unity of humanity, which, in his view, would be guided by love. Individuals should strive to be “world-workers” who reject both rootless cosmopolitanism and narrow provincialism. Tagore further argued that Western nationalism was producing a limited sort of human being, and instead, there was a need to create what he called the complete moral man. He particularly emphasised the importance of education in developing human personality.

The third aspect is Asian unity. Tagore contended that it would be Asia that would show a new dawn to the world. Pan-Asia as an idea is often associated with Japanese thinkers, but the Nobel laureate was a critic of Japanese imperialism. He did not view Asia as a racial or geographical category but rather as a historical and political one. A synthesis of different cultures in Asia would develop in her “a confident sense of mental freedom, her own view of truth”. Otherwise, Tagore said Asia “will allow her priceless inheritance to crumble into dust, and trying to replace it clumsily with feeble imitations of the West make herself superfluous, cheap and ludicrous”.

As is evident to anyone who is paying attention, we are reaching the end of the era dominated by the West

What possibly could unite such a large land mass with such a huge variety of peoples and cultures? As the American scholar William Edward Burghardt Du Bois wrote “colored people vary vastly in physique, history and cultural experience. The one thing that unites them today in the world’s thought is their poverty, ignorance and disease, which renders them all, in different degrees, unresisting victims of modern capitalistic exploitation”. Pan-Asia was a theory shaped by the resistance to Western domination over the world. Du Bois, who was a founder of the Pan-African movement and an admirer of both the Indian freedom struggle and the Chinese revolution, expanded the Pan-Asia concept further to Pan Africa-Pan Asia.

Tagore declared that the time has come to “prepare the grand field for coordination of all the cultures of the world, where each will give to and take from the other; where each will have to be studied through the growth of its stages in history. This adjustment of knowledge through comparative study, this progress of intellectual cooperation, is to be the keynote of the coming age”. He felt that Asia must first seek to synthesise and understand its own heritage so it could properly assimilate the contribution from the rest of the world.

As is evident to anyone who is paying attention, we are reaching the end of the era dominated by the West. China and India will likely be the two largest economies in the world by 2050. The relationship between them and their cooperation will shape not only their own populations but the future of humanity itself. Unfortunately, there is currently a pitiful amount of contact between the two nations, who have maintained close communications with the West.

The ancestral home of poet and Nobel Laureate Rabindranath Tagore in Kolkata. Photo: Handout
The ancestral home of poet and Nobel Laureate Rabindranath Tagore in Kolkata. Photo: Handout

This is why it is important not only to commemorate the centenary of Tagore’s visit to China but also to take up his unfinished project of seeking a synthesis of Asian thought that requires Asian countries to know and understand each other. The image of China in India and vice versa is mostly shaped by Western narratives. Discussions tend to focus on realpolitik and narrow concerns. A small group of scholars certainly do have contact, but many of them are based in the West and their works have limited reach in broader society. Far wider association is needed. It would be apt to set up Tagore centres for cultural understanding and civilisational dialogue. Tagore’s own vision of the importance of his trip was summarised in his statement: “I shall consider myself fortunate if, through this visit, China comes nearer to India and India to China – for no political or commercial purpose, but for disinterested human love and for nothing else.”

The two societies must consider honouring the 100th year of Tagore’s visit to China, an event that would remind both that for most of human history, they have lived in peace with each other. A study of his thought will provide us with a modern vision for how they can continue this long-standing tradition.

Archishman Raju is a scientist based in Bengaluru, India. This article was first published by the Asian Peace Programme (APP), an initiative to promote peace in Asia, housed in the NUS Asia Research Institute.

Posted on 22 March 2024 | 11:00 pm
India comes for China’s manufacturing crown as supply chains slowly shift
  • Reforms and incentives are attracting international investors looking to diversify away from China amid its intensifying rivalry with the US
  • But India still has a way to go – on trade ties, education and infrastructure, among others – if it wants to catch up to its giant northern neighbour
Workers clean solar panels at Premier Energies Solar on the outskirts of Hyderabad last year. India has introduced production-linked incentives for sectors such as electronics and renewable-energy equipment. Photo: AP

Warm weather’s early onset isn’t sapping the spirits of officials in Tamil Nadu this year. Instead, the mood is upbeat as one high-profile overseas investment after another has flowed into the southern Indian state over the past few months.

The state, whose capital Chennai has been dubbed the “Detroit of Southern Asia” because of its new-found status as a carmaking hub, has quickly expanded its global footprint by hosting three of iPhone-maker Apple’s top contract suppliers: Foxconn, Pegatron and Tata Group.

Shipping and logistics giant UPS also established a global technology hub in the city, beginning in August last year, while leading renewables energy firm First Solar has invested in a manufacturing facility.

Robot arms assemble cars at a Hyundai Motor India Ltd. plant in Tamil Nadu. The southern Indian state has quickly expanded its global footprint by playing host to international businesses. Photo: Reuters
Robot arms assemble cars at a Hyundai Motor India Ltd. plant in Tamil Nadu. The southern Indian state has quickly expanded its global footprint by playing host to international businesses. Photo: Reuters

Chennai is just one of many Indian industrial hotspots that have started expanding as global firms look to diversify their manufacturing base amid intensified US-China rivalry and faltering growth in the world’s second-largest economy.

Two decades ago, China and India’s economies were neck and neck, and would famously often be compared as the Dragon and Elephant at investors’ meetings, where attendees would dwell on their relative merits. Over the years, the Dragon beat the Elephant hands down to emerge as the world’s factory.

But India now looks set to make a pivot, analysts say, and could soon challenge China’s manufacturing pre-eminence amid a changed world order.

‘Historic moment’: Modi ramps up push to position India as alternative to China

Tamil Nadu is one of the country’s success stories. Home to more than 130 Fortune Global 500 companies, India’s southernmost state recently outlined an incentive programme aimed at encouraging investors to go beyond assembling low-value products, and manufacture high-value goods.

“What we have seen over the last two years is very, very strong interest in establishing advanced manufacturing facilities. Companies are also very keen to establish global capability centres here in India,” said Vishnu Venugopalan, managing director and CEO of Guidance Tamil Nadu, the state government’s investment promotion agency.

Global interest in India has grown since Prime Minister Narendra Modi’s government launched production-linked incentives for sectors such as electronics and renewable-energy equipment to boost the economy four years ago amid the pandemic.

These were recently expanded in an attempt to usher in investments in sophisticated technologies like making satellites and space-launch vehicles.

Is India like China, 15 year ago? ... The answer is yesKevin Carter, emerging-markets investor

A raft of reforms has also been introduced to cut red tape, such as a simplified tax code that has sped up logistics, and revamped infrastructure including arterial highways, brand new airports and a modernisation programme for the country’s antiquated railways.

Further changes are expected, sending the stocks of many Indian companies soaring in anticipation – as Modi and his government seek a third consecutive five-year mandate in national polls between April and June.

“Is India like China [was] 15 years ago?” asked Kevin Carter, founder of the Emerging Markets Internet and ECommerce ETF, which has a specialised India-focused fund called INQQ. “The answer is yes.”

More than half of the country’s population is under 30, he pointed out. India, which surpassed China as the most populous country last year, is also the world’s fastest-growing major economy.

Customers visit India’s second Apple retail store, named ‘Apple Saket’, at a shopping centre in New Delhi last year. Investors expect India to surpass China in terms of number of consumers. Photo: Hindustan Times via Getty Images
Customers visit India’s second Apple retail store, named ‘Apple Saket’, at a shopping centre in New Delhi last year. Investors expect India to surpass China in terms of number of consumers. Photo: Hindustan Times via Getty Images

“When you combine demographics and growth, India will surpass China in terms of number of consumers,” Carter told an investment webinar this month titled “The Rise of India: Investing in the Perfect Emerging Market”.

One of the cornerstones for optimism about India, he added, is its world-beating public digital infrastructure that has enabled millions to open bank accounts and transfer money instantly, swelling the nation’s base of middle-class consumers.

This digital infrastructure is soon expected to bring e-commerce into the fold – allowing consumers to get deliveries such as groceries from family-run shops within minutes, likely bringing more opportunities, Carter said.

Reforms and opportunities

“Without question, there is an opportunity for India. It is coming not only from the US-China rivalry and global firms’ ‘China plus one’ strategy, but from two other sources,” said Naushad Forbes, a former president of the Confederation of Indian Industry.

“China’s internal policies are really deterring foreign investors and making them seek other locations. Rising wages in China are also making it more economical to start simple assembly operations in places like Vietnam, Bangladesh, the Philippines and India.”

US officials have pointed to fines, raids and other actions against foreign companies that have made it risky to do business in China, despite efforts to reassure investors. But India’s ability to make the most of rising diversification varies from sector to sector, Forbes said.

“Medium-technology sectors are the ones where India is showing the greatest promise,” he said, adding that industries like speciality chemicals, engineering products and ready-to-eat foods are among the biggest areas of strength.

Workers make clothing for Ralph Lauren Corp. at a factory in Gurugram earlier this month. Observers say some of India’s neighbours have better positioned themselves for garment production. Photo: Bloomberg
Workers make clothing for Ralph Lauren Corp. at a factory in Gurugram earlier this month. Observers say some of India’s neighbours have better positioned themselves for garment production. Photo: Bloomberg

But Forbes rued the fact that India was not grabbing opportunities in labour-intensive sectors such as garments. “India should worry about [this] because of the potential for employment creation,” he said, pointing out that neighbouring countries like Bangladesh had better positioned themselves.

Delhi is also missing a trick, Forbes said, by not joining trading blocs such as the Regional Comprehensive Economic Partnership – a free-trade agreement that includes China, Japan, South Korea, Australia, New Zealand and the 10 member states of Asean.

Despite strong ties with Western nations, he said “India is not being a part of key free trade where a lot of products exist”.

Experts say India’s reluctance to join the trade bloc stems mainly from China’s presence since a border clash in 2020 frayed diplomatic ties. But Chinese components are still needed for many of the products, such as iPhones and electric vehicles, in which India wants to ramp up production.

Technicians and engineers work at a mobile-phone manufacturing factory in Noida, India’s Uttar Pradesh state. Chinese components are still needed for many of the products that India manufactures. Photo: Shutterstock
Technicians and engineers work at a mobile-phone manufacturing factory in Noida, India’s Uttar Pradesh state. Chinese components are still needed for many of the products that India manufactures. Photo: Shutterstock

Southeast Asia, a growth bright spot, could also help amplify India’s manufacturing, Forbes said.

“I hope we have a more moderate approach to how we define our self interest. China is a huge market and it’s not just a large exporter but also the second largest importer,” he said.

Delhi, which recently signed several new free-trade deals and is negotiating others with Britain and the European Union, should also look to lower import duties across the board, observers said.

“India’s import tariffs are among the highest across emerging markets, which acts as one of the deterrents to improving India’s market integration,” said Upasana Chachra, chief India economist at multinational investment bank Morgan Stanley.

Geopolitical tensions and the China-plus strategy provides India with a unique opportunity to become an integral part of global value chainsPushan Dutt, INSEAD economics professor

High import tariffs fuel concerns about Delhi being too protectionist of its domestic industries, analysts say – even though isolated sectors may have benefited. The government did recently signal it would readjust some taxes to boost manufacturing, however.

Earlier this month, Delhi said it would lower import taxes on electric vehicles, committing to at least US$500 million in investment and a manufacturing plant within three years, potentially allowing Tesla to enter the market.

“India has not been very open to trade. Exports, for instance, are slightly more than 20 per cent of Chinese exports,” said Pushan Dutt, an economics and political-science professor at INSEAD business school.

“The geopolitical tensions and the China-plus strategy provides India with a unique opportunity to become an integral part of global value chains and use exports as an engine of growth.”

Simultaneously, India should look to boost jobs in labour-intensive sectors like tourism to cater to its young and growing population, experts said.

Job seekers visit stalls at “Mega Udyoga Mela” (Mega Job Fair) in Bangalore last month, organised by the Karnataka state government. Providing enough jobs is India’s single biggest economic challenge, observers say. Photo: EPA-EFE
Job seekers visit stalls at “Mega Udyoga Mela” (Mega Job Fair) in Bangalore last month, organised by the Karnataka state government. Providing enough jobs is India’s single biggest economic challenge, observers say. Photo: EPA-EFE

Employment challenge

Providing enough jobs is the country’s single biggest economic challenge, according to Forbes, who said: “We are providing a lot of employment but mostly in informal services, not in good-quality formal jobs.”

India’s elite engineering colleges are tougher to enrol in than Harvard, boasting illustrious graduates from Microsoft CEO Satya Nadella to Google CEO Sundar Pichai, while the country’s scientific and technical manpower services the world.

“India’s vast pool of highly skilled talent, particularly in the fields of engineering and information technology, provides us with the resources needed for innovative technological advancements,” said Subramani Ramakrishnan, vice-president of the UPS Technology Centres in India, explaining the American logistics firm’s decision to establish a technology hub there.

Yet millions of young people in smaller towns and rural areas still struggle to master foundational skills – though the government did recently launch a new National Education Policy in a bid to improve matters.

Students and visitors conduct science experiments at Raman Research Institute in Bangalore during a recent open day. India boasts world-class institutions for tertiary education, but needs to invest more in other areas. Photo: EPA-EFE
Students and visitors conduct science experiments at Raman Research Institute in Bangalore during a recent open day. India boasts world-class institutions for tertiary education, but needs to invest more in other areas. Photo: EPA-EFE

“Where India lags behind is investment in education. While boasting world standard institutions like the IITs [Indian Institutes of Technology], India needs to invest in basic and secondary education,” said Pushan Dutt, an economics and political science professor at INSEAD.

“The quality of schools and teachers is poor and variable; teacher absenteeism is common and the quantity of colleges has not kept pace with the rapid increase in the number of young people entering the labour force.”

Nearly a quarter of India’s young people, or 23.22 per cent of those aged between 15 and 24, were unemployed in 2022, according to the latest available figures from the World Bank.

Yet labour laws are still cumbersome, remaining one of the biggest obstacles from the country’s bureaucratic legacy of red tape, Dutt said, adding that a backed-up courts system hardly helped matters.

Indian Prime Minister Narendra Modi addresses a public meeting in Chennai earlier this month. He is set to make labour reforms a priority if re-elected this year, his party says. Photo: AFP
Indian Prime Minister Narendra Modi addresses a public meeting in Chennai earlier this month. He is set to make labour reforms a priority if re-elected this year, his party says. Photo: AFP

Modi is set to make labour reforms, already passed by parliament in 2020, a priority if he wins the coming general elections as widely expected, a spokesman for his ruling party was quoted as saying by Reuters last month.

Despite being approved by parliament, the new labour code has yet to be implemented following resistance from labour unions who oppose easier hiring-and-firing provisions and restrictions on their activities.

Budding manufacturing growth

The promise of more reforms and growth has spawned a new generation of businesses who aim to usher in fresh manufacturing paradigms.

Bharath Krishna Rao Potluri, co-founder and CEO of Emobi Manufactury, is looking to pioneer low-cost two-wheelers for India in a strategic partnership with Japan’s Honda and Musashi Seimitsu Industry Co., catering to businesses making last-mile deliveries.

“We are moving away from the concept of mega-factories, and we believe more in micro-factories, which would be more regionally distributed, and closer to the points of consumption,” said Potluri, who hails from a business family.

Emobi’s first micro-factory in Bengaluru, capital of Karnataka state, is set to start production in July this year.

India’s long-term prospects are upbeat. Domestic demand will remain an important growth driverAditi Raman, Moody’s Analytics economist

Potluri concedes that Chinese firms, the global leaders in electric vehicles, have had a 10-15 year head start, but he hopes to bridge the gap with new technologies, frugal engineering and integrating software development into vehicles.

Industry executives say Indian industry could chart a new growth path by marrying its traditional strengths in software development with manufacturing. In some sectors, such as speciality chemicals, products are already being sold that combine these specialisations.

“India’s long-term prospects are upbeat. Domestic demand will remain an important growth driver, with strong investment and government spending as critical inputs,” said Aditi Raman, an associate economist at Moody’s Analytics.

She added that while more production bases were likely to emerge, India still needed to address glaring gaps between urban and rural infrastructure that had resulted in disparities, such as the varying cost of fuel across the country.

An Indian woman operates a fertiliser-spraying drone in Manesar, outside Delhi, as part of government-backed training initiative. India still needs to address glaring gaps between rural and urban infrastructure. Photo: AFP
An Indian woman operates a fertiliser-spraying drone in Manesar, outside Delhi, as part of government-backed training initiative. India still needs to address glaring gaps between rural and urban infrastructure. Photo: AFP

An uneven investment landscape will hamper the country’s manufacturing ambitions, analysts say, as robust physical infrastructure and minimal bureaucracy are crucial for global companies looking to shift operations away from China.

It’s clear India still has some way to go to catch up with its giant neighbour to the north.

“One indicator is the size of factories. In India, they tend to be small relative to those in China, but they are growing in size as infrastructure becomes better,” said Srividya Jandhyala, an associate professor of management at the ESSEC Business School, Asia-Pacific in Singapore.

Analysts say most global companies looking to move out of China are currently testing the waters by shifting some production capacity, but they’re not moving everything all at once.

“Many companies globally will remain significantly embedded with China, [even though] they may have the odd facility here and there,” said Subhabrata Sengupta, a partner at Asia-focused strategy consultancy Avalon Consulting.

One of the main reasons for this, he said, is that China accounts for nearly one-third of global demand in some product categories, while the country has also built entire manufacturing ecosystems.

“So, even in some cases where maybe the final assembly has moved from China to Vietnam or India, you may find that the components are still being sourced from China,” Sengupta said. “The nerve centres of these supply chains still remain in China.”

Indian companies, meanwhile, are only in the early stages of developing such supply chains.

An Indian man works at an electronic waste recycling shop in Gauhati, Assam state, in 2017. Analysts say the “nerve centres” of many supply chains still remain in China. Photo: AP
An Indian man works at an electronic waste recycling shop in Gauhati, Assam state, in 2017. Analysts say the “nerve centres” of many supply chains still remain in China. Photo: AP

“A lot of companies in India assemble circuit boards, but very few actually manufacture circuit boards. So, in that sense, I will say that the movement has been only partial here, though there has been a fair bit of progress,” Sengupta said.

India’s manufacturing sector accounts for only 17 per cent of its gross domestic product, compared with 28 per cent in China, said Bernard Aw, chief APAC economist at Coface, a global credit insurer.

“But there is no doubt India’s manufacturing activity is growing and the product mix evolving to include higher-value activities such as electronics,” he said.

US-India tech deal could further detach China from global supply chain

Global companies like Apple are expected to shift significant amounts of phone-and-components manufacturing to India within two to three years to diversify their supply chains out of China and build more resilience against possible disruptions.

But the move seems “to be driven more by political considerations” and such a “shift may help India towards a quicker industrialisation process”, Aw said.

“So clearly, this is an opportunity for India to seize, by having not just policies that directly promote the manufacturing sector but also policies to invest in public health, education and physical infrastructure.”

Posted on 22 March 2024 | 9:30 pm
Philippines to build Batanes islands port near Taiwan without US help
  • US involvement in the Batanes port could have stoked tension amid growing friction with China and Washington’s push to step up defence engagements with the Philippines
  • The channel between the Batanes islands and Taiwan is considered a choke point for vessels moving between the western Pacific and the South China Sea
Filipino soldiers take part in a flag raising ceremony on Mavulis Island in Batanes. The channel between the Batanes islands and Taiwan is considered a choke point for vessels moving between the western Pacific and the South China Sea. Photo: Reuters

The US military will not be involved in development of a port in the Philippines’ remote northernmost islands near Taiwan, the local governor said on Friday, removing a potential source of friction with China over the US presence in the region.

The governor of the Batanes islands, less than 200km (125 miles) from Taiwan, said in August she had sought US funding for a new port there. The US embassy had at the time confirmed its diplomats and US Army Pacific experts had been engaging local authorities on various support measures for the islands.

“At first they said they will help but later on, no more, so I asked help from PPA,” Governor Marilou Cayco said, referring to the Philippine Ports Authority (PPA).

Could 3-way meet with the US draw Japan to help Philippines in South China Sea?

The project was intended to help the unloading of cargo from the capital, Manila, during rough seas in the monsoon season, when an existing facility is often inaccessible.

The US embassy on Friday said it had no immediate comment on the issue.

US military involvement in the Batanes port could have stoked tension at a time of growing friction with China and a drive by Washington to intensify its long-standing defence engagements with the Philippines, which Beijing has viewed with suspicion.

The Bashi Channel between the Batanes islands and Taiwan is considered a choke point for vessels moving between the western Pacific and the contested South China Sea and would be a key waterway in the case of a Chinese invasion of Taiwan.

The Chinese military regularly sends ships and aircraft through the channel, Taiwan’s defence ministry has said.

In statement released to the media on Friday, the Chinese embassy in Manila said Taiwan was an internal matter for China so it should never become an issue between China and the Philippines.

It was not immediately clear what the statement was in response to.

“Any attempt to implicate the Taiwan question in the maritime disputes between China and the Philippines is dangerous,” the embassy said in a statement, without elaborating on the danger.

When asked why the US was no longer taking part in the port project, Cayco said she did not know. “Actually, we just made a proposal and because that’s not sure, we had sought help from the PPA.”

Posted on 22 March 2024 | 8:37 am
Amid China-India rivalry, Nepal’s political shift tips scales in favour of Beijing
  • China’s influence in Nepal’s economy and defence has grown significantly in recent years, marking a shift in traditional ties between Nepal and India
  • Analysts say Kathmandu must balance its ties with New Delhi and Beijing, and expect India not to be ‘overly bothered’ by the alliance shift
Nepal’s Prime Minister Pushpa Kamal Dahal won a vote of confidence in parliament earlier in March. File photo: Reuters

A recent political shift in Nepal with a new party alliance leaning towards China could steer Kathmandu further from India and affect the regional balance of power.

On March 13, Nepal Prime Minister Pushpa Kamal Dahal “Prachanda” won a vote of confidence in parliament. His Communist Party of Nepal (Maoist Centre)’s decision to ally with the Communist Party of Nepal (Unified Marxist-Leninist) – known for its Beijing ties – and move away from the New Delhi-leaning Nepali Congress, marks a significant shift in the country’s politics.

According to Nihar Nayak, research fellow at the Institute for Defence Studies and Analyses (IDSA), this change in alliance could have implications for the China-India rivalry in the region, as it aligns Nepal more closely with Chinese interests.

Will new trade deals be enough to mend strained India-Nepal ties?

“China always gloats when India loses its ground in Kathmandu. From global rivalry to regional competition, it always tries to get a major space in the Himalayan region,” Nayak said.

China’s influence in Nepal’s economy and defence has grown significantly in recent years. Beijing has become a major source of foreign direct investment (FDI) in Nepal, particularly through infrastructure projects under the Belt and Road Initiative. This has led to China surpassing India as the largest investor in Nepal, marking a shift in the traditional economic ties between Kathmandu and Delhi.

Nepal is also reportedly close to signing a belt and road implementation agreement with China after four years of negotiations on investment modalities.

Nepal’s Deputy Prime Minister and Foreign Minister Narayan Kaji Shrestha is set to visit China next week for a five-day trip. He will meet Chinese Foreign Minister Wang Yi and other senior officials, with the signing of the agreement expected during the visit.

In January, while serving as minister for home affairs in the previous government, Shrestha had indicated that Nepal and China would soon sign the belt and road plan.

Nepal’s Foreign Secretary Shankar Das Bairagi and China’s Ambassador to Nepal Yu Hong (left) exchange documents during a signing ceremony relating to the Belt One Road initiative in Kathmandu in May 2017. File photo: AFP
Nepal’s Foreign Secretary Shankar Das Bairagi and China’s Ambassador to Nepal Yu Hong (left) exchange documents during a signing ceremony relating to the Belt One Road initiative in Kathmandu in May 2017. File photo: AFP

Nayak from IDSA says the aim of Shrestha’s China visit is to ensure the Nepalese government rectifies the plan along the lines of the US Millennium Challenge Corporation (MCC) agreement between Nepal and India.

“Chinese are putting pressure on the Nepalese government that they should rectify the Belt and Road Initiative and also at the same time accept the Global Security Initiative and Global Development Initiative which have been recently proposed by the Chinese side to counter the Indo-Pacific strategy in the region,” he said.

Although signed in 2017, the text of the belt and road agreement has not been made public, nor has it been tabled in parliament for discussion. The same question was raised by the ousted Nepalese Congress party in the House of Representatives on Wednesday.

China’s belt and road projects set to gain ‘momentum’ as Nepal gets leftist PM

Nayak said India had strongly opposed the Chinese belt and road project, as it undermined territorial integrity and sovereignty of many neighbouring countries.

“Under MCC all the projects are well-defined, but nobody knows what projects China is going to invest under belt and road, it is elusive,” Nayak said, citing the Pokhara International Airport as an example of a project put under the Belt and Road Initiative by the Chinese government after its completion.

“So, India has to be worried when Nepal is going to finalise the belt and road implementation with China,” Nayak said.

Last September, China and Nepal signed 12 agreements, including seven MoUs, to boost cooperation in trade, road connectivity and information technology.

Chinese communist ties

China has long-standing connections with Nepal’s communist movement, especially with Prachanda’s Maoist Centre, which waged a decade-long insurgency against the Nepalese state. During this period, China provided ideological, logistical, and military support to the Maoist movement.

After the recent power shift, speculation is rife in Kathmandu’s political and diplomatic circles about whether Beijing played a role in encouraging the K.P Sharma Oli-led CPN-UML and the Maoist Centre to shake hands.

Leaders from the Nepali Congress and other parties have accused Beijing of actively working to unite the leftist parties, saying this pressure led Prachanda to change his alliance. The new government denied the allegation.

S.D. Muni, a professor emeritus at the School of International Studies, Jawaharlal Nehru University, said although China had been trying to bring Nepal’s communist parties together, it remained to be seen how the new government would function.

“The new government is of the communist parties, but much depends upon how it works. India so far has not openly opposed this [new] government. So, everybody is sort of watching how this government behaves,” said Muni, a former Indian special envoy and ambassador.

India has traditionally found it easier to deal with the Nepali Congress, due to the leadership’s inclination towards reinstating Nepal as a Hindu state.

China on their mind: why the India-Nepal border has become a flashpoint

Professor of law at Kathmandu University Bipin Adhikari told This Week in Asia there were always geopolitical considerations behind any political move in the country.

“Changes in government are common in Nepal. There are always forces which are active in Nepal that want to have their own government at the centre,” Adhikari said, hinting at Indian and Chinese influence on Nepal’s political parties.

Adhikari stressed the need for Nepal to maintain an equal distance between India and China, prioritising its economic interests without harming either neighbour.

“Though we have a good relationship with India, there is a need to balance such relations with China as well. You have to be objective,” he said.

The shift in Nepal’s foreign policy could deepen concerns in India, which traditionally considers Nepal as part of its sphere of influence. China’s increased influence in Nepal, a country sharing a long border with five Indian states, also raises concerns about potential strategic encirclement for India in South Asia.

Nepal’s Prime Minister Pushpa Kamal Dahal with his Indian counterpart Narendra Modi in New Delhi, India, in June 2023. Photo: EPA-EFE
Nepal’s Prime Minister Pushpa Kamal Dahal with his Indian counterpart Narendra Modi in New Delhi, India, in June 2023. Photo: EPA-EFE

The road ahead

Ranjit Rae, former Indian ambassador to Nepal, said India had strong equities in Nepal, with a wide-ranging relationship culturally and economically.

“I don’t think you can compare India’s relationship with Nepal to that of any other country. So, India won’t be overly bothered. India has to work with every government in Nepal, as was the case in the past,” he said.

Indian firms are major investors in Nepal, contributing over 30 per cent of the total approved FDI. In January 2024 India and Nepal signed a long-term Power Trade Agreement, aiming to import 10,000MW of electricity from Nepal in the future.

India and Nepal have a 1950 Treaty of Peace and Friendship that outlines reciprocal treatment for Indian and Nepali citizens regarding residence, property, business, and movement in both countries.

Will US, India benefit from Nepal’s latest political shifts at China’s expense?

India supports Nepal Army’s modernisation with equipment and training. About 32,000 Gurkha soldiers from Nepal serve in the Indian Army.

Rae said China had long been trying to unite all the communist parties, and “the coming together of all the left forces is a direction that the Chinese would obviously be pleased about, there is no doubt about it”.

If the belt and road plan was agreed upon and the projects under the plan started moving forward, “it will have implications for the entire region”, Rae said.

Kamal Dev Bhattarai, a Kathmandu-based journalist and policy commentator, said Beijing seemed upbeat about Nepal’s new government, expecting it to reaffirm the “one China policy”.

However, Bhattarai believed that relations with India were also likely to move ahead smoothly, citing the power-trade agreement as significant progress in bilateral ties.

Posted on 22 March 2024 | 7:30 am
China’s Australian coal imports surge, replacing Russia as top supplier, but hi-tech products to be ‘slow burner’
  • China’s imports of Australian coal increased by 3,188 per cent year on year to US$1.34 billion in the first two months of 2024 having stood at zero in January 2023
  • But Russia’s share fell from nearly half to 22 per cent during the same period amid improving relations between China and Australia

Australia surpassed Russia as China’s largest supplier of coal at the start of the year as bilateral relations continued to improve between Beijing and Canberra.

China’s imports increased by 3,188 per cent year on year to US$1.34 billion in January and February, according to Chinese customs data released on Wednesday, with shipments having stood at zero in January 2023.

Overall, Australian shipments made up 24 per cent of China’s total coal imports in the first two months of the year, up from 0.9 per cent a year earlier.

But Russia’s share fell from nearly half to 22 per cent during the same period, as shipments from its northern neighbour fell by 41 per cent to US$1.25 billion.

Relations between China and Australia deteriorated in 2020 when Canberra called for an investigation into the origins of the coronavirus.

But ties have since slowly improved, and Australian Prime Minister Anthony Albanese visited China in November.

And during his first visit to Australia in seven years this week, Minister of Foreign Affairs Wang Yi said that the two countries should deepen cooperation on all fronts amid ongoing differences over strategic and security issues.

Exports of Australian coal, cotton and barley, which were previously under official or unofficial bans, have gradually resumed since last year.

“China and Australia both want to ensure the opening of markets now,” said Wang Yong, a professor at the School of International Studies at Peking University in Beijing.

Australia was once the leading supplier of coal to China, accounting for nearly 60 per cent of its total imports in 2019.

But by 2022, Australia’s market share had dropped to 1.5 per cent, with Russia becoming the top supplier with a 40 per cent share.

Beijing, though, lifted restrictions and resumed coal imports in February last year, and the share of Australian shipments has risen rapidly to 18 per cent.

Businesses may strategically opt for Australian coal to mitigate potential repercussions from Western countries’ sanctions against RussiaAlberto Vettoretti, Dezan Shira & Associates

“Russian coal exports to China primarily rely on railway transportation, which has inherent limitations in capacity compared to sea transportation. Australia’s accessibility via maritime routes allows for larger shipments and smoother logistics,” said Alberto Vettoretti, a managing partner at business management consultancy firm Dezan Shira & Associates, who added Australian coal is often considered of a higher quality and as being more cost effective.

“Businesses may strategically opt for Australian coal to mitigate potential repercussions from Western countries’ sanctions against Russia.”

Purchases of Australian coal also enjoy zero import tariffs under the Regional Comprehensive Economic Partnership, as China and Australia are members of the Asia-Pacific trade pact.

China’s lithium battery shipments to Australia also soared by 90 per cent to 1.76 million units in the first two months of 2024 compared to a year earlier, topping US$95.8 million.

Indonesia, Thailand and Vietnam snap up share of China’s lobster trade

China’s electric vehicle (EV) exports by volume, though, fell by 9 per cent, with the value also falling by 17 per cent to US$350 million.

But Australia remained the third-largest EV buyer with 6.8 per cent of China’s total shipments by value.

“It’s likely that China will increase exports of hi-tech products like EVs, smartphones, and computers to Australia in the future, but it will be a slow burner,” added Vettoretti.

“Australia is going to keep this balanced, taking into consideration larger potential geopolitical concerns stemming from pressure from its allies and its own political agenda.”

Under the current situation, Australia may prioritise other issues, such as agriculture products exports.Alberto Vettoretti

The European Union is growing increasingly concerned about an overcapacity of Chinese EVs imports, and launched an anti-subsidy investigation last year, while the US already bars EV battery materials from China as a “foreign entity of concern”.

“While we cannot dismiss the possibility that Australia may follow a similar path as the EU and US regarding EVs, several factors come into play,” Vettoretti added.

“First, Australia’s automotive industry is not as robust as that of the EU or the US. The relative size and influence of the Australian market could impact how urgently EV concerns are addressed by the Australian government.

“Under the current situation, Australia may prioritise other issues, such as agriculture products exports.”

China has also increased wine imports from Australia, with the share rebounding to 0.6 per cent in the first two months of the year, but still far from the 37 per cent seen in 2019.

Beijing imposed tariffs of up to 218 per cent on Australian wine in March 2021, although they are also expected to be removed amid the improving relations.

“There’s a massive wine glut [in Australia] at the premium end that even if Chinese markets open up, it’ll take a year or more for exporters to take advantage of it,” said Stuart Orr, a professor and the CEO at the College of Practice Professors in Melbourne.

Wang Yong expects more high-level engagement would lead to a further lifting of trade restriction, including Australian lobsters returning to the Chinese market.

Overall, China’s imports from Australia fell by 1 per cent in the first two months of 2024 year on year, while exports fell by 7.54 per cent to US$10.8 billion.

Posted on 22 March 2024 | 7:00 am
Malaysia drops controversial citizenship plan after backlash: ‘abhorrent and regressive’
  • The cabinet rejected a proposal to amend the constitution that would result in such children having to apply for citizenship
  • Widespread backlash against the proposal points to the growing disillusionment toward Prime Minister Anwar Ibrahim’s government
A man displays bananas outside his shop with the Malaysia’s iconic Petronas Twin Tower in the background in Kuala Lumpur. The Home Ministry had initially planned to present a bill on the matter to parliament once it gained the cabinet’s approval. Photo: EPA-EFE

Malaysia abandoned its plan to do away with automatic citizenship for foundlings and abandoned children, following weeks of public criticism against the government.

The Malaysian cabinet rejected a proposal to amend the constitution that would result in such children having to apply for citizenship, Home Minister Saifuddin Nasution said at a briefing on Friday. The Home Ministry had initially planned to present a bill on the matter to parliament once it gained the cabinet’s approval.

The decision was made amid plans by civil society groups such as Undi18 to protest the proposal outside parliament on Monday.

Malaysia to amend citizenship law, give equal rights to foreign-born children

“These amendments transcend partisan politics as it directly affects Malaysian stateless children and their future,” Undi18 said ahead of Saifuddin’s briefing. It would have been the second street protest against the government in a month.

The widespread backlash against the Home Ministry’s proposal points to the growing disillusionment toward Prime Minister Anwar Ibrahim’s government. Anwar rose to power in 2022 promising institutional reforms, but his approval rating has dipped amid a moderating economy and attempts to appeal to conservative voters.

Saifuddin had previously warned that Malaysia’s existing citizenship laws were open to abuse from the 3.5 million foreigners living in the country. He told parliament on March 11 there were incidents of foreigners refusing to pay hospital fees after giving birth and abandoning their babies, knowing that they would be granted automatic citizenship.

The KL Tower in Kuala Lumpur. The widespread backlash against the Home Ministry’s proposal points to the growing disillusionment toward Prime Minister Anwar Ibrahim’s government. Photo: Bloomberg
The KL Tower in Kuala Lumpur. The widespread backlash against the Home Ministry’s proposal points to the growing disillusionment toward Prime Minister Anwar Ibrahim’s government. Photo: Bloomberg

That reasoning did not go down well with critics. Malaysia’s Human Rights Commissioner Ragunath Kesavan last week said that the planned amendments were “abhorrent and regressive” and the government had not shown any justification for it during their engagements.

Other proposed amendments to Malaysia’s citizenship law, such as allowing automatic citizenship to be granted to children born abroad to Malaysian mothers – a right that already exists for Malaysian fathers – has received the cabinet’s greenlight, Saifuddin said on Friday. He added that he would hold an engagement session with backbenchers on Monday regarding the matter.

Posted on 22 March 2024 | 6:38 am
Malaysia eyes censorship powers over Netflix, other streaming content amid creeping conservatism
  • The home ministry says it hopes to prevent the streaming of LGBTQ, communist and Islamophobic content on platforms such as Netflix
  • Local filmmakers have been wary of censorship rules for years with two such individuals having faced criminal action for their content
Netflix application running on a TV. Photo: Shutterstock

Malaysia’s home ministry may soon seek to extend its censorship powers to Netflix and other streamers to prevent the screening of content with LGBTQ themes or stories deemed to have communist or Islamophobic messages, amid rising conservatism further stifling the creative works of local filmmakers.

First introduced by the British authorities in 1908, the film censorship board – which falls under the home ministry – has long been the bane of Malaysian auteurs and film-goers who accuse it of arbitrary and heavy-handed censorship that inhibits free speech and good storytelling.

On Thursday, Home Minister Saifuddin Nasution defended the board’s role, citing the need to protect the morals and culture of all races in Malaysia, as well as the people’s religions and beliefs.

“This film control and censorship activity will continue to control any film that may threaten the security and order of the country,” Saifuddin said in parliament.

He said a stronger censorship regime was necessary as more films are entering the Malaysian market that contain elements against the beliefs of Muslims, including those with LGBTQ storylines or plots deemed to be Islamophobic.

Acid attacks, death threats: Malaysian filmmakers in trouble with conservatives

“Of course, such films need to be censored and, if excessive, a decision not to approve for screening will be given,” Saifuddin said.

The minister, whose speech aimed to “empower” the censorship board, also said that he is open to discussing with the communications ministry on whether the censors’ scope should be broadened to cover content on Netflix and other streaming services in addition to TV and movie content.

“Is there a need to – in the future – include streaming services under the censorship board? That is a new matter raised and I am willing to sit with the communications ministry to look into it,” Saifuddin said.

While the home ministry is in charge of film censorship, its power does not cover streaming platforms as internet content currently falls under the communications ministry.

His comment was in response to a question by an opposition lawmaker from the Malaysian Islamic Party (PAS) on censoring streaming content.

‘Glorifying the British’? Malaysians oppose hosting 2026 Commonwealth Games

PAS has led the country’s turn towards conservatism since making gains in the 2022 election, putting pressure on Prime Minister Anwar Ibrahim’s government to crack down on books, films and music festivals deemed as against Islamic values.

Activists at the Freedom Film Network (FFN) have long been critical of the censorship board, saying it is not an independent organisation and its decisions can be swayed by pressure from other parties and arbitrarily applied.

These include the police, which has oversight of any scripts that reference the police force or military.

“When it comes to uniform bodies, no matter what, the [board] cannot say yes or no until the police say yes or no,” film producer Mo Bahir said recently.

Filmmakers must also navigate around other bodies including the Department of Islamic Development Malaysia (Jakim), a powerful department under the Prime Minister’s purview, which could also influence movie titles.

“I had to meet with JAKIM, and the Mufti to get their approval to use this title before we even started shooting the film,” said director Osman Ali regarding his serial drama Jalan Sesat ke Syurga – The Lost Road to Heaven.

As Malaysians feel the pinch from the ‘shringgit’, what can PM Anwar do?

Facing such barriers, filmmakers have in recent years used a loophole in the relatively unregulated streaming space to escape the censors and even then, it does not provide full protection.

In January, local authorities dragged film director Khairi Anwar and producer Tan Meng Kheng to court for “deliberately wounding religious feelings” with their movie Mentega Terbang, in an unprecedented criminal action against a filmmaker.

The coming-of-age movie, about a young girl’s exploration of religion and the afterlife in the face of her cancer-stricken mom’s looming death, was seen as insulting Islam, Malaysia’s state religion, and saw the film being taken down by the Hong Kong-based Viu streaming platform at the behest of the communications ministry.

Reacting to the charge, FFN called the move an “archaic form of content control” that goes against the need for open communication for people to share different perspectives in multicultural Malaysia.

“[The charges] send the signal that filmmakers are not protected in Malaysia and that filmmaking is actually a dangerous profession,” the group said in a statement.

Posted on 22 March 2024 | 6:30 am
Australia’s fears over US submarine supply cut unwarranted as Aukus has options to boost deterrence
  • Among the options are the co-production of submarines in Australia and the life extension of its Collins-class submarines, analysts say
  • Beyond the submarine issue, Australia, the US and other allies can partner in various areas to boost their capabilities to deter China
A Virginia-class nuclear-powered attack submarine of the type Australia is set to acquire from the early 2030s. Photo: US Navy

Concerns over the delivery of nuclear-powered attack submarines to Australia following a US budget cut are unwarranted as the three-nation Aukus alliance has options to build its naval deterrence in the Pacific.

There is no reason why Washington would not stand by one of its most important allies in the region, with a shipyard in New South Wales where Australia and the US could co-produce the submarines being one such option, security analysts say.

The US announced last week it would halve the number of submarines to be built next year, throwing its commitment towards Australia in their supply agreement into doubt.

Defence Minister Richard Marles said Aukus partners are still working to help Australia acquire the submarines. Former Australian prime minister Malcolm Turnbull, however, said Canberra had been “mugged by reality” over Washington’s wavering position.

Conceived in September 2021 primarily to counter China’s growing presence in the region, Aukus – made up of Australia, the United Kingdom and the US – aims to boost its joint defence capabilities ranging from naval defence and cybersecurity to artificial intelligence, with the delivery of nuclear-powered attack submarines to Australia identified as the primary objective.

Australia-China ties back on track as Wang Yi urges more bilateral cooperation

Under their agreement, the US has pledged to supply at least three Virginia-class submarines to Australia in the 2030s. The vessels are a stopgap before nuclear-powered submarines to be built in Adelaide enter into service in the 2040s.

Also known as the SSN-774 class, the Virginia class is the latest category of nuclear-powered fast-attack submarines in service with the US Navy.

Elizabeth Buchanan, an expert associate of the National Security College at the Australian National University, said the US administration’s budget cut for the production of Virginia submarines from two to one was just a starting point.

“This isn’t the final word on the funding front,” said Buchanan, adding that “as a customer” seeking to acquire the submarines, Australia should expect that things could change during negotiation over a decade.

“Counting submarines for counting sake is short-sighted,” Buchanan said, noting that there is no reason why Washington would not sell the submarines to Canberra.

‘Plug and play’: how closer Australia-Asean ties can boost regional stability

“It is in the US interests to have more Virginias in the region, it frees up the US Navy to not have to pick between North Atlantic waters and the Indo-Pacific.”

Australia should be thinking strategically about how it can work with the US and other like-minded states by utilising its strategic location to attract more defence vessels to station in Australian waters, she added.

“This releases Australia from pressure to operate say five Virginias, which is not just a challenge in terms of receiving the boats but in terms of having the infrastructure ready to operate them.”

Noting that Aukus’s raison d’être is not just about the submarines, Buchanan said Australian naval personnel are already undergoing related training and Australia has also forged partnerships with other countries on vessel maintenance and visits.

“We are growing our SSN know-how, that’s important,” Buchanan added.

Robert Peters, a research fellow for nuclear deterrence and missile defence at the Washington-based Heritage Foundation think tank, said if fewer Virginia-class submarines were to be delivered, Australia could still bolster its naval defence capabilities by extending the life of its Collins-class submarines.

The Australian-built diesel-electric submarines are considered among the most important operational assets of the Royal Australian Navy.

Aukus should have a shipyard in Australia producing nuclear submarines so that Canberra can field a fleet that is capable of “deterring and if necessary defeating Chinese aggression”, said Peters. An agreement for the licensing and co-production of these submarines between the US and Australia would be ideal, he added.

Going ahead with the plan might not be easy following strong objections from unions and residents this week against a proposed base to build nuclear submarines in Port Kembla in the eastern Australian state of New South Wales.

“We don’t want to be part of someone else’s belligerent nuclear plans,” said Arthur Rorris, head of the South Coast Labor Council, comprising unions representing 50,000 workers in the area.

The objections stem from concerns that the base can derail the fledgling clean-energy sector by taking up scarce land and lead to heightened security curbs due to the permanent presence of US warships.

Noting that challenges over the delivery of submarines would not surface until the 2030s, Peters said there is still time to address them given the strong ties between Australia and the US.

Australia should ‘end servility to US’, defuse Aukus deal: ex-Greek minister

“I believe that an expanding partnership between the US, Australia, and eventually Japan and South Korea to co-produce key platforms and munitions to deter and if necessary defeat Chinese and North Korean aggression will continue,” he added.

Nishank Motwani, a senior analyst at the Australian Strategic Policy Institute in Washington DC, said fewer submarines for Australia meant a reduction in crew strength and capabilities in maritime intelligence, surveillance, and reconnaissance.

But Aukus is an alliance with broad objectives that go beyond Australia’s nuclear submarines with Pillar 2 serving as “the glue” that binds the three members, Motwani said.

While Pillar 1 under Aukus aims to deliver nuclear submarines to Australia, Pillar 2 entails cooperation across critical and emerging technologies such as artificial intelligence and quantum computing.

A fundamental question is the current state of deterrence in the Indo-Pacific and how nuclear-powered submarines can produce the desired deterrent effects for Australia under Aukus, Motwani said.

“Each of the partners needs to think about what will sustain this agreement over many decades and move it forward against domestic and foreign currents that could harm its realisation.”

Posted on 22 March 2024 | 5:30 am
Malaysia rejects offer to host 2026 Commonwealth Games over cost
  • The government said the US$125 million offer was ‘not expected to be able to cover the entire cost of organising a large-scale sports event’
  • The Commonwealth Games Federation is scrambling to find a host after Australia’s Victoria state withdrew last year because of soaring costs
Fireworks erupt over the Alexander Stadium during the closing ceremony for the 2022 Commonwealth Games in Birmingham, Britain. Photo: AFP

Malaysia on Friday decided against hosting the 2026 Commonwealth Games because of the cost, the government said, in a fresh blow to an event seen as outdated by some.

The decision, made at a cabinet meeting chaired by Prime Minister Anwar Ibrahim, follows the withdrawal of the Australian state of Victoria last year.

“The Ministry of Youth and Sports today announced the government’s decision not to accept an offer from the Commonwealth Games Federation (CGF) to host the 2026 Commonwealth Games,” minister Hannah Yeoh said in a statement.

The CGF is scrambling to find a host after Victoria withdrew last July because of soaring costs.

The CGF offered Malaysia and other potential hosts 100 million pounds (US$125 million) to step in with just over two years to go until the Games are supposed to take place.

But the Malaysian government said the offer was “not expected to be able to cover the entire cost of organising a large-scale sports event”, Yeoh said.

“The government wants to focus on the development of sports as well as the welfare and well-being of the people,” she added.

‘Glorifying the British’? Malaysians oppose hosting 2026 Commonwealth Games

Victoria’s sudden move, and the lack of an obvious alternative, triggered debate about the future of the Games, which take place every four years and were last held in Birmingham in 2022.

The CGF earlier this month hailed Malaysia’s “fantastic track record”, the country having staged the Games – which mostly includes former British colonies – in 1998.

But the CGF also suggested that Malaysia was not the only country it had approached to host the Games.

Singapore recently said it was “assessing the feasibility” of the CGF’s proposal.

The wealthy city state also holds the Formula One night race annually and will be staging the World Aquatics Championships in 2025.

The prospect of Malaysia stepping in to host the Games had sparked fierce debate.

Mohamad Norza Zakaria, president of the Commonwealth Games Association of Malaysia, had called it a “once-in-a-lifetime opportunity” that could put Malaysia back on the sporting map.

Poverty looms over Malaysia’s elderly as low pay bites back in retirement

But doubts emerged last week over the idea after current and former senior officials expressed reservations.

Khairy Jamaluddin, a former youth and sports minister, rubbished the idea and called it “reckless” because the Games are coming up fast, leaving little time for planning.

Any host would need at least four years to upgrade venues, plan sponsorship and set up infrastructure, he said.

“The Commonwealth Games is not a significant, marquee sporting event,” he added.

“As far as multi-sports Games are concerned, it is nowhere near the Olympics or even the Asian Games in terms of participation, exposure and returns,” Khairy said.

Posted on 22 March 2024 | 3:46 am
McDonald’s Malaysia drops lawsuit against pro-Palestinian boycott group
  • The Malaysian operator of the fast food giant said it would not pursue its US$1.27 million lawsuit against the local chapter of the BDS movement
  • McDonald’s Malaysia had claimed that the boycotters had slandered its business and implied it had profited from the assault on Palestinians and conspired with Israel
Boycott, Divestment, and Sanction (BDS) supporters outside the Shah Alam High Court in Kuala Lumpur, Malaysia, on March 18, 2024. Photo: Hadi Azmi

The Malaysian operator of US fast food giant McDonald’s on Friday said it will withdraw its legal suit for damages against the local chapter of an Israel boycott movement, insisting they are aligned with the country’s position in support of Palestinians under siege in Gaza.

“We hope that the decision made today will allow all parties to move forward and focus on finding a resolution that upholds justice,” McDonald’s Malaysia managing director Azmir Jaafar said in a statement.

Lawyers representing both parties had met on Monday for their first round of court mediation, months after Gerbang Alaf Restaurants, the local franchise owner of the international fast food icon, filed a US$1.27 million lawsuit against the campaign group in December for alleging links between McDonald’s Malaysia and Israel’s armed forces.

A man reacts during a “Free Palestine” rally near the US embassy in Kuala Lumpur, Malaysia, in December 2023. Photo: EPA-EFE
A man reacts during a “Free Palestine” rally near the US embassy in Kuala Lumpur, Malaysia, in December 2023. Photo: EPA-EFE

Since Jerusalem launched a deadly assault on Gaza in October, Malaysian consumers have rallied behind a call by the local arm of the global boycott, divestment and sanction (BDS) movement against brands seen to have links with Israel, causing many of those companies to incur financial losses.

McDonald’s became a target of the boycott movement following viral social media posts showing videos of McDonald’s in Israel donating free food to the Israel Defence Forces (IDF) in the wake of the October 7 Hamas incursion into Israeli territory.

Gerbang Alaf Restaurants had previously justified its lawsuit by arguing that the movement had slandered its business and implied it had profited from the assault on Palestinians and conspired with Israel.

McDonald’s Malaysia says that they “do not support nor are we complicit in any conflicts or wars”, and that it stands by its commitment as a wholly Muslim-owned business towards transparency, ethical business practices and social responsibility.

McDonald’s franchisee, BDS Malaysia seek mediation over boycott movement

“We firmly condemn all forms of violence and pray for an end to the war and continued peace,” Azmir said in his Friday statement, adding that McDonald’s Malaysia continues to support Palestinians through its contribution to the Palestine Humanitarian Fund and various employee fundraising initiatives in support of relief efforts in Gaza.

The October 7 raid led to the deaths of over 1,200 Israelis, with scores more taken hostage into Gaza. In retaliation, the IDF has obliterated most of Gaza in the last five months, killing over 30,000 people – most of them civilians, according to the enclave’s Hamas-run health authority.

The boycott against Israel-affiliated businesses in Malaysia has affected more than just the American fast-food icon.

‘Brands that fatten them up’: Israeli dates under Muslim boycott in Southeast Asia

The local Starbucks chain has reported a 38 per cent year-on-year decline in revenue – falling to 182.55 million ringgit (US$38.5 million) in the October-December quarter, compared to 295.32 million ringgit during the same period in 2022.

The latest item to be thrust onto the boycott list are Israeli dates, a popular food eaten to break fast during the Islamic month of Ramadan, after Malaysians were warned over the alleged mislabelling of the sweet fruits imported from Israel for local sale.

Posted on 22 March 2024 | 2:48 am
Chinese war drone, Hong Kong’s Article 23 law, Philippines mail-order bride scheme: 7 highlights of the week
  • From China’s new war drone to a mail-order bride scheme in the Philippines, here are a few highlights from SCMP’s recent reporting
Chinese scientists report they have developed a drone that can rapidly split apart. Photo: Nanjing University of Aeronautics and Astronautics

We have selected seven stories from this week’s news across Hong Kong, mainland China, the wider Asia region and beyond that resonated with our readers and shed light on topical issues. If you would like to see more of our reporting, please consider subscribing.

1. ‘Air-separation technology’: China claims new war drone can split and multiply mid-air

Chinese scientists say they have developed a new type of war drone unlike any ever seen on the battlefield. Once it reaches the target airspace it can split in the blink of an eye into two, three or even six smaller drones, depending on what is needed in battle, the researchers say.

2. Will Hong Kong politicians be targeted over role in Article 23 law?

Lawmakers take pictures after the voting of the Article 23 bill in Hong Kong’s Legislative Council. Photo: Elson Li
Lawmakers take pictures after the voting of the Article 23 bill in Hong Kong’s Legislative Council. Photo: Elson Li

The passing of Hong Kong’s domestic national security law has heightened fears of repercussions against those closely involved in the legislation, prompting some political and business heavyweights to rule out trips to the United States in the coming months, the Post has learned.

3. In Japan, cows cross the zebra line to get away from irritating insects

A black-and-white striped cow. Photo: Kojima et al
A black-and-white striped cow. Photo: Kojima et al

They may produce some of the best wagyu beef in the world, but many of the Japanese Black of Yamagata prefecture no longer look like cattle. Increasingly, they are looking like zebras.

4. The key to happiness? It’s within us, one of world’s happiest people says

This bestselling author did not realise she had been born into what is considered one of the world’s happiest countries until she moved from Denmark to Paris to become a nanny at the age of 18. She soon discovered that values she had taken for granted at home were not so widely embraced in other places.

5. In Philippines, alarm over mail-order bride scheme that trafficks women to China

A Filipino activist yells during a protest in Manila on International Women’s Day earlier this month. Photo: Reuters
A Filipino activist yells during a protest in Manila on International Women’s Day earlier this month. Photo: Reuters

Filipino women escorted by Chinese nationals posing as their husbands have been intercepted attempting to leave the country, immigration officials say. Their seemingly genuine marriage certificates – costing tens of thousands of pesos each – suggest corruption and the involvement of organised crime.

6. Wealthy Chinese relocating to Singapore open art galleries, but concerns exist over local integration, lack of sales

Wealthy mainland Chinese families have been flocking to Singapore since the pandemic, drawn to the city state’s reputation as a safe haven for capital and its friendliness to Mandarin speakers. While Chinese buying power has yet to create a boom in local art sales, the new arrivals are making themselves felt in other ways: by starting their own art spaces.

7. China has drawn its territorial line in the Gulf of Tonkin. Is the South China Sea next?

The PLA conducts live-fire drills in the Gulf of Tonkin in 2021. Photo: Weibo
The PLA conducts live-fire drills in the Gulf of Tonkin in 2021. Photo: Weibo

China’s decision to draw a new territorial line in southern waters it shares with Vietnam has raised regional concerns that similar tactics could be used in the South China Sea.

Posted on 22 March 2024 | 12:00 am
Mekong River’s declining fish species an ‘urgent wake-up call’ for action, conservationists say
  • Highly endangered fish species are on the brink, as dam-building along the Mekong decimates the ecosystem which millions of people rely on
  • Experts say governments, investors and policy advisers must fish out a pact to save such species, and suggest the dam projects are aimed at ‘generating profits for a few’
A man throws a fishing net into a lake in Kandal province in the Mekong Delta. Photo: AFP

Conservationists have suggested a last-ditch recovery plan to save the “irreplaceable” biodiversity of the Mekong River, as unrelenting dam-building through China and Laos disrupts sediment flow and fish-breeding patterns crucial to keeping scores of endangered fish species from extinction.

The economic value of the Mekong’s fisheries – on which 40 million people depend as it winds more than 4,900km from its source in China into the Vietnam Delta – has also plunged as development decimates the river ecosystem, according to a recent report released by some two dozen conservation organisations led by the non-governmental organisation WWF.

A total of 74 fish species are listed as endangered in the “Mekong’s Forgotten Fisheries and Emergency Plan to Save Them” study. There are 18 fish species in the critically endangered Red List, including the giant catfish and the giant freshwater stingray – the world’s two largest freshwater fish – as well the climbing perch, anabas testudineus, known for its ability to leave the water and “walk” on dry land.

A 300kg giant stingray found in the Mekong in Cambodia. Photo: Handout
A 300kg giant stingray found in the Mekong in Cambodia. Photo: Handout

“The alarming decline in fish population in the Mekong is an urgent wake-up call for action to save these extraordinary – and extraordinarily important – species, which underpin not only the region’s societies and economies but also the health of the Mekong’s ecosystem,” said WWF’s Asia-Pacific Regional Director Lan Mercado.

The sharp decline in fisheries has largely been attributed by Mekong experts to 12 Chinese dams on the Lancang (the upper Mekong), and two dams downstream in Laos – the Thai-built Xayaburi dam and the Sinohydro construction on behalf of Malaysian developer of Don Sahong, which have drastically damaged the ecosystem.

Fishers in northeastern Thailand’s Mekong provinces, who live downstream from the Xayaburi dam in neighbouring Laos, say they have lost up to 70 per cent of their catch since the hydropower project began operations in October 2019.

The empty nets have devastated many riverine communities, depriving their children of essential nutrition and protein, as well as forcing fishers to seek other employment.

Thai villagers affected by the construction of the Xayaburi dam on the lower Mekong River in Laos attend a rally in Bangkok on August 7, 2012. Photo: AFP
Thai villagers affected by the construction of the Xayaburi dam on the lower Mekong River in Laos attend a rally in Bangkok on August 7, 2012. Photo: AFP

Six steps to save the river fish

WWF and its partners say governments, investors in dams and policy advisers must hammer out an agreement on saving the river species, suggesting six steps, including to protect free-flowing rivers, restore critical habits such as floodplains and to end the unsustainable management of resources, especially sand-mining.

Experts blame the fast-tracked change to the habitat of fish species, which have evolved in the river system over millennia, on the dams which cascade down the river system, starting with 12 Chinese dams operating on the upper Mekong and two more dams currently in operation downstream in Laos.

“Research has clearly shown hydropower dams have been the primary reason for the loss of free-flowing rivers,” Richard Friend, Associate Professor at the University of York in England, told This Week in Asia.

‘The biggest threat is hydropower’: 1 in 5 Mekong fish species face extinction

Hydropower projects break up the flow of the river, hampering the movement of the vital sediment which nourishes the river and surrounding areas, as well as trapping migratory fish species behind the walls of the dam, despite efforts by dam-builders to design breakthrough “fish-ladders” to allow them to pass.

Economic data from the Fisheries Department of the Mekong River Commission (MRC) shows annual fish catch of the four lower Mekong countries of Cambodia, Laos, Thailand and Vietnam, was valued at US$11 billion back in 2015. That slumped by US$3 billion within five years from the depletion of fish stocks.

While the MRC holds regular talks with dam developers, stakeholders from fishing communities and conservation groups are rarely invited to the table.

“It is significant that fishermen have been excluded, and the MRC has never consulted them,” said Friend, who was also a former consultant to the MRC. The fish emergency recovery blueprint also calls for inclusive planning, fully involving local expertise and fishing communities.

‘Transformative’: data-sharing for Southeast Asia’s longest river set to begin

The Communist government of landlocked Laos, which has vowed to uplift the nation’s economy in part by becoming the “Battery of Asia”, is wedded to major hydropower plans to be developed by Thai, Chinese and South Korean companies.

But questions over the demand for the electricity produced are mounting.

Already Thailand is buying electricity from the Xayaburi dam in Laos, and will be the main customer for seven more scheduled dams in the pipeline that pose a huge obstacle to implementing any new plan for fisheries conservation

“Thailand has a massive oversupply of electricity, with a reserve margin of 45 per cent in 2023,” said Gary Lee, Mekong region coordinator for International Rivers. “The key driver is not energy demand and security, but rather generating profits for a few at the expense of the many Mekong communities that depend on the river.”

It’s not too late to restore the Mekong, and bring its fishes back from the brinkZeb Hogan, fish biologist

In the case of the Luang Prabang dam currently under construction, the Laos government has rejected a recommendation from UN experts to stop the dam construction as it may endanger the Unesco World Heritage site and the protected riverside.

The MRC has no regulatory powers, and no veto power among the member states who have differing economic priorities despite sharing the river resource. Yet, in the absence of another body to steward the health of the river, the MRC’s critics urge a more front-footed approach to defending the environment rather than easing the way for developers.

“Dams are not really sustainable. It is long overdue for the MRC to employ its own publicly-funded science to question the discourse of sustainable hydropower,” Philip Hirsch, a Mekong specialist and emeritus professor at Sydney University, told This Week in Asia.

The Xayaburi dam. Fishers say this dam on the Lower Mekong has ruined their catch. Photo: Handout
The Xayaburi dam. Fishers say this dam on the Lower Mekong has ruined their catch. Photo: Handout

Cambodia may be a bright spot, campaigners say, after it rejected two major dam projects along its stretch of the Mekong from the Laos border to its Kratie province under a 2020 declaration of a moratorium on dam-building.

Conservationists have commended Cambodia’s decision to protect a globally important biodiversity zone, which hosts some 80 Irrawaddy dolphins and 41 critically endangered species.

“The good news is that it’s not too late to restore the Mekong, and bring its fishes back from the brink,” said Zeb Hogan, a fish biologist, explorer and lead researcher of the Wonders of the Mekong research project, which funded the report.

But the lack of urgency from the international community has alarmed researchers, who say time is fast running out to maintain a healthy river.

“Imagine the protests if rice paddies that had been feeding 40 million people were disappearing! I guess that’s part of the problem for decision-makers,” said Richard Lee, WWF’s communications lead on Freshwater Fisheries. “The Mekong’s fisheries are irreplaceable. Isn’t it time there was a local, regional and global outcry about the Mekong’s disappearing fisheries?”

Posted on 22 March 2024 | 12:00 am
Indonesian tycoon Jonathan Tahir struggles to sell US$12 million Singapore penthouse after 3 auctions
  • The five-bedroom suite at the St. Regis Residences, with a private pool and a 180-degree panoramic view, has failed to attract any bidders
  • This was the last chance for the property to sell at auction; it will now need to be offloaded privately
Indonesian tycoon Jonathan Tahir is struggling to sell his penthouse at St. Regis Residences in Singapore. Photo: Handout

In the past, a luxury penthouse for sale in Singapore would be one of the hottest properties in town. Not any more, after a condo with an asking price of almost US$12 million failed to attract any bidders this week.

The five-bedroom suite at the St. Regis Residences, with a private pool and a 180-degree panoramic view, received no offers during its third auction by property consultancy Knight Frank on Thursday. That is even after the price was lowered by 14 per cent from earlier this year, to S$15.5 million (US$11.5 million).

The property, owned by the son of Indonesian billionaire Tahir, is one of many luxury homes struggling to sell in a Singapore market slammed by a 60 per cent stamp duty on foreign buyers, along with a crackdown on money laundering. The moves have slowed purchases by the super-rich to a trickle.

Developers including City Developments Ltd., which built the St. Regis Residences more than a decade ago, have seen their stocks pummelled as a result. Other projects are faring little better. The Cuscaden Reserve, a luxury project near the prime Orchard Road shopping district, has slashed prices by a fifth, with nearly 70 per cent of its 192 units still unsold.

Connectivity is key even as more Singaporeans eye cheaper life in Johor Bahru

The malaise was on stark display at the auction conducted by Knight Frank. In a largely empty auditorium with fewer than 20 attendees, none of the 16 properties up for sale got any public bids – including multimillion dollar seafront villas with amenities like private pools and lifts.

The St. Regis apartment, spanning about 6,684 square feet (621 square metres), is owned by Jonathan Tahir, according to property records.

The Indonesian is the executive chairman of MYP Ltd., a property investment firm based in Singapore. He is a scion of the Tahir family, whose Mayapada Group conglomerate holds interests in everything from banking to healthcare.

This was the last chance for the property to sell at auction; it will now need to be sold privately. It attracted two offers before the auction, both below the guide price. It was one of two houses in the development that were on the block, with the other being a sixth-floor apartment owned by a subsidiary of MYP.

Posted on 21 March 2024 | 11:31 pm
As Asian cryptocurrency scams spike, investor education is key to combating menace
  • Online scam syndicates are growing exponentially as more investors fall for get-rich-quick traps amid surging prices of cryptocurrencies
  • Asian regulators can help safeguard investments in digital currencies by raising awareness of online scammers and their modus operandi
Man illegally viewing confidential files on a tablet. Photo: Shutterstock

Asia is facing a new cycle of criminality centring around online scams that have ensnared countless victims as losses continue to mount in the billions.

These criminal networks have proliferated in strife-torn Myanmar, Cambodia, the Philippines and elsewhere in the region. Their tentacles appear to be growing and targeting inexperienced investors who fall for get-rich-quick traps, particularly in cryptocurrencies.

Soaring prices of bitcoin, the most well-known digital currency, have raised concerns that more people will be lured into the dark web spun by scammers.

After hitting a record high of US$73,000 last week, the price of bitcoin declined to US$67,197 on Thursday evening (Hong Kong time), which was more than double from US$28,000 a year ago.

As a new generation of investors cheers the revival of bitcoin, many of them could become victims of scams conjured by burgeoning criminal networks that enlist more recruits to dupe unsuspecting investors.

How crypto investigators uncover scammers’ blockchain billions in Asia

The billion-dollar industry often targets individuals who are tricked into working at huge scam centres where, through violence and intimidation, they are forced to defraud legions of investors. Illegal cryptocurrency platforms are invariably used to swindle victims, experts say.

In Singapore alone, scam victims reportedly lost S$651 million (US$486 million) last year – likely an understated figure as many incidents are never reported by victims due to fear of stigmatisation.

The process usually starts with scam syndicates dangling bait for recruits.

The International Justice Mission (IJM), an anti-human trafficking organisation, says criminals typically use social media platforms to advertise supposedly lucrative jobs. When victims take the bait and arrive at locations arranged by the traffickers, their passports and mobile phones are confiscated to prevent them from leaving or calling for help.

Hundreds of thousands of workers have been enslaved to work for scammers in the region, according to IJM.

Jackie Burns Koven, a cyberthreat analyst, said, scammers often target their victims via a fraudulent cryptocurrency trading platform.

“So in most cases, there’s a sophisticated web layout where individuals or victims depositing funds will see that there are excellent returns on their investment every time they log into this platform, said Koven, head of Cyber Threat Intelligence at Chainalysis, a blockchain analysis firm.

“But that is all a sham. The funds are going straight to the scammer’s wallet. If you want to withdraw the money, investors are asked to pay steep fees that essentially leave them high and dry.”

Unsuspecting investors are often lured through emotional pitches of friendship and romance on messaging apps by people who appear to lead glamorous lifestyles. Once an initial pitch is accepted, offers of extravagant returns on cryptocurrency funds often follow.

Scammers typically exploit the emotional vulnerability of victims to gain access to their credentials through compromised private keys and networks.

However, since cryptocurrencies such as bitcoins run on a foundation of blockchain technology – a digitally transparent network – frauds can be traced, forcing scammers to move to other platforms.

Singapore and Hong Kong’s crypto goals on track despite US Bitcoin ETFs launch

Various scams from multiple digital domains are often carried out from the same physical site but operators can abandon their posts when they face an intensifying dragnet and shift to other locations quickly.

With a new pooled investment security in cryptocurrency introduced in the US in January and skyrocketing values, more first-time investors are likely to become entangled. Even prudent and savvy investors can fall victim due to the lack of awareness of online scams in some countries.

In the past year, Singapore and Hong Kong have unveiled new rules to safeguard investments in digital currencies.

Awareness campaigns are important to warn consumers of scams. But regulators should also up their game and stay ahead of scammers and be prepared for every new way they can think of to lure unsuspecting consumers.

With growth in the ecosystem of digital currencies accelerating, regulators must consider these campaigns as the top priority to combat the scam networks that threaten to spiral out of control in Asia.

Posted on 21 March 2024 | 10:00 pm
Australia insists Aukus nuclear-powered submarines ‘going to happen’ despite fears about costs, potential Trump return
  • Australian defence minister Richard Marles said Canberra, London and Washington are ‘working at pace to make this happen’
  • Some fear Trump could sink the pact if he wins this year’s presidential election, returning to his ‘America first’ style of foreign policy
British defence secretary Grant Shapps (left) and his Australian counterpart Richard Marles inspect the guard of honour in Canberra on March 21. Photo: Australian Department of Defence/Reuters

Australia insisted on Friday that a landmark deal to develop Aukus nuclear-powered submarines with London and Washington was “going to happen”, despite mounting fears about costs, capabilities and the possible return of Donald Trump.

Under the fledgling Aukus deal, the three long-time allies have pledged to jointly strengthen their military muscle in a bid to counter China’s rise.

Defence chiefs this week unveiled ambitious plans to supply Australia with nuclear-powered submarines, a key pillar of the agreement.

“The three governments involved here are working at pace to make this happen,” Australian defence minister Richard Marles told reporters on Friday.

“This is going to happen and we need it to happen,” he added.

Barely two years old, there are already signs that Aukus and its central project could be under threat.

Some fear Trump could jettison the pact if he wins this year’s presidential election, returning to his “America first” style of foreign policy.

Why Singapore’s possible hosting of future Aukus subs could provoke Beijing

With potential flashpoints emerging across the globe, and China taking an increasingly aggressive stance in the Taiwan Strait, visiting UK defence minister Grant Shapps said Aukus was as crucial as ever.

After decades of relative peace, Shapps said the planet was slowly shifting from a “post-war” era to a “pre-war” footing.

“We are living in more dangerous times,” he said during a tour of the Osborne Naval Shipyard in South Australia.

UK defence contractor BAE Systems has been enlisted to help construct Australia’s fleet of nuclear-propelled submarines.

Australia hopes to have eight nuclear-powered vessels in the water by the 2050s – a mix of the new Aukus-class subs built at home and in the UK, and Virgina-class vessels bought from the United States.

Marles said a “drumbeat” of Aukus-class submarines would then continue to roll off Australian production lines “every few years” in perpetuity.

“There is no country in the world which has obtained the capability to build nuclear-powered submarines, which has then turned that capability off,” he said.

“We will see submarines being produced here on an enduring basis.”

Although the financial details of the BAE deal are under wraps, Australian defence officials want to initially build at least five Aukus-class nuclear-powered submarines at a cost of billions of dollars.

The submarines will be quieter and stealthier than Australia’s existing diesel fleet, and capable of deploying over vast distances without surfacing, posing a potent threat to any foe.

BAE Systems, one of the largest defence contractors in Europe, said it was “already making good progress on the design and development of the next generation submarine”.

The company has a close relationship with the UK navy, and is responsible for building its Astute-class and Dreadnought-class nuclear-powered vessels.

Australia should ‘end servility to US’, defuse Aukus deal: ex-Greek minister

The scale of the project is vast, and questions have been raised about whether Australia – with limited nuclear experience and a relatively small navy – can pull it off.

Australian officials believe some 20,000 workers will be needed for the home-grown nuclear industry – among them an army of technicians, metal workers, electricians and welders.

The Australian navy has struggled to maintain its current fleet of ageing diesel-electric subs, which have been plagued by design flaws and cost blowouts.

In total, the Aukus submarine project could cost up to A$368 billion (US$240 billion) over the next 30 years.

Posted on 21 March 2024 | 9:20 pm
Japan is the only country with most people unhappy to live to 100, survey shows
  • Just 21 per cent of Japanese say they expect to be happy when they reach 100, according to a survey of six countries
  • Most Japanese say they fear being a burden to their families or have few new experiences when they hit the century mark
Elderly people take a walk in Tokyo. Photo: Xinhua

An overwhelming majority of Japanese people have no wish to live for a century in contrast to other nationals’ attitudes on longevity, according to a study on ageing covering six countries.

The report released on Monday shows that the Japanese “only focus on the negative aspects of living to be 100”, with just 21 per cent saying they expect to be happy when they reach 100.

“When we look at people’s views on life up to 100 years old, it becomes clear that Japan is the only country that does not see the positive aspects of the era of 100-year lifespans,” said Takashi Tanaka, the author of the report, in his conclusion.

“In other countries, while there are negative aspects, such as anxiety and difficulties associated with a 100-year lifespan, people there also focus on the positive aspects,” he added.

According to the report, the negative aspects the Japanese tend to focus on include not wanting to be a burden to family or friends as they age and the “difficulties” associated with being a centenarian, the report said. Respondents in the other countries involved in the study – the US, China, South Korea, Germany and Finland – also shared similar concerns.

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The Japanese respondents were markedly more pessimistic when it came to other questions as well. Only a mere 28.7 per cent said that they would have new opportunities to experience things at the century mark.

In contrast, 59 per cent of Americans and 58 per cent of Chinese said they expect to be happy when they reach 100, while 65 per cent of Americans and 51 per cent of Germans anticipate having new opportunities as they grow older.

Just 27.4 per cent of Japanese said they wanted to live to be 100, compared with 52.8 per cent of Germans, 53.1 per cent of South Koreans, 58.4 per cent of Finns, 65.6 per cent of Chinese and 66.7 per cent of Americans.

The study was conducted by the Research Institute for Centenarians to mark the United Nations’ International Day of Happiness on Wednesday, with researchers quizzing 2,800 Japanese people aged between 20 and 79 about their thoughts on ageing, along with a similar number of people in the other countries.

Kanako Hosomura, a 41-year-old housewife from Yokohama, says she would be “happy to live to 100, but only if I am physically and mentally able to take care of myself.

Has Japan baseball team batted away ‘Curse of the Colonel’ after ritual burial?

“I do not want to have to ask other people to do things for me, even simple things, because I would be a burden on them,” she told This Week in Asia. “But if I can get around and my mind is still sound, then why not live to 100?”

Hosomura said she worries that she may become more pessimistic about the future as she ages, but having family and close friends should provide her with a more positive outlook.

Makoto Suzuki, a 90-year-old cardiologist, said the people of Okinawa have a different attitude towards longevity than the rest of Japan.

“There are many reasons why people here live longer, but the basic one is ‘ikegai’,” he said, referring to the traditional idea of the reason a person has for living. For Suzuki, that is his work in the city of Naha and as founder of the Okinawa Research for Centre for Longevity Sciences.

In addition to a reason to live, many people in Okinawa still have a good diet that is high in vegetables, fruit and seafood while they have also preserved a strong sense of community, Suzuki said.

“Of course, I want to live to 100,” he said. “I can’t be sure that will happen, but I shall try my best.”

Tomoko Owan, a 64-year-old associate professor in the medicine faculty at the University of the Ryukyus, agreed that a positive outlook on life is critical and pointed out that she still teaches karate at the university in Okinawa.

“The key, I believe, is to be relaxed and have a positive attitude,” she said. “It also helps when you have a good, balanced diet.” Just as important is a daily session of karate, which acts as training for the body, mind and soul, she added.

“I’m healthy now and yes, I would very much like to live to even 120 years old if I can stay healthy,” she said.

The report also suggested that Japanese people are less happy with their lives in comparison with others, with the country’s respondents averaging only 5.9 on a scale of 10 for happiness. That was the lowest of the six countries, with China emerging as the happiest nation at 7.4 out of 10, followed by Finland with 6.8 and Germany with 6.6.

In Japan, cows cross the zebra line to get away from irritating insects

Japanese were similarly pessimistic about the future of the country, ranking last in response to questions about the “overall brightness” of Japan, the possibility of increased happiness and economic growth.

“Looking at the results of the survey, to increase happiness and increase the number of people who are thinking about living a 100-year life it is as important to feel the happiness of the people around you as it is to think about your happiness,” said Tanaka.

Posted on 21 March 2024 | 8:00 pm
How Asia’s development push is driving migratory birds to extinction
  • The flocks of migratory birds making their annual journey across East Asia are dwindling because of unchecked destruction of their wetland habitats
  • Taking urgent action to preserve these wetlands from being overrun in the name of development will benefit not just bird populations but humans as well
Migratory birds at the Wolong Lake wetland in Shenyang, in China’s northeast Liaoning province, on March 12. Data suggests a population drop of more than 42 per cent in migratory bird species using the East Asian-Australasian Flyway, thanks in large part to habitat destruction and degradation. Photo: Xinhua

The skies over East Asia were once filled with the remarkable sights and sounds of millions of migratory birds making their annual journey between breeding and wintering grounds. Enormous flocks including shorebirds, cranes, geese and songbirds traverse the East Asian-Australasian Flyway, one of the world’s crucial bird migration routes, twice each year.

However, this spectacular natural phenomenon faces a significant decline. Evidence suggests a population drop of more than 42 per cent in waterbird species using the flyway. This alarming trend threatens the ecological balance and biodiversity of the region.

Many studies have closely examined migratory bird populations across this flyway. They have reported nothing short of a crisis – a catastrophic decline of migratory birds. Species such as the spoon-billed sandpiper saw a drop of 26 per cent between 2002 and 2009.

The most recent estimate is an 8 per cent annual reduction between 2014 and 2019. Over the past three generations, the reduction is suspected to have been 70-80 per cent. If we don’t take urgent action to protect these species and their habitats, the region’s skies could soon fall permanently silent.

These declines aren’t limited to shorebirds. The endangered yellow-breasted bunting, once one of the most abundant migratory songbirds in Asia with a population numbering in the hundreds of millions, has declined by 50-80 per cent in the last two decades.

Even birds such as the black-faced spoonbill, a conservation success story after being saved from the brink of extinction in the 1990s, are not entirely out of the woods. While their numbers have rebounded, the International Union for Conservation of Nature has listed them as endangered as a precaution because of the rapid population decline expected over the next three generations.

Black-faced spoonbills rest at the Mai Po wetlands in 2022. Photo: May Tse
Black-faced spoonbills rest at the Mai Po wetlands in 2022. Photo: May Tse

What is driving these losses? The answer lies in the relentless destruction and degradation of the wetland and coastal habitats that migratory birds depend on as staging areas during their journeys. East and Southeast Asia have emerged as the epicentre of this ecological crisis, grappling with rapid coastal development and wetland conversion amid breakneck economic growth and urbanisation.

Across China’s Yellow Sea coastline, a once-pristine landscape has undergone a rapid metamorphosis. Prime migratory bird stopover sites, once vital resting points for species traversing vast distances, have succumbed to the relentless push for economic development. These critical habitats have been paved over and transformed into cities and industrial zones, erasing centuries-old ecosystems in the blink of an eye.

The evidence paints a grim picture of the extent of habitat loss in the Yellow Sea region. Over the past five decades, more than 65 per cent of its coastal wetlands have vanished. The story is not unique to this region; similar patterns of destruction and degradation reverberate across Asia, signalling a broader ecological crisis with far-reaching implications.

The consequences of habitat loss extend beyond the immediate impact on migratory bird populations. Wetlands play a crucial role in maintaining ecological balance. They serve as nurseries for diverse aquatic life, act as natural buffers against flooding and purify water, benefiting both wildlife and human communities.

As East and Southeast Asia grapple with the dual pressures of economic development and environmental conservation, the urgency of preserving these vital habitats has never been clearer. Efforts to address this crisis must prioritise sustainable development practices that safeguard the rich biodiversity of these regions. Failure to act risks the continued decline of migratory bird populations and the unravelling of entire ecosystems, with far-reaching implications for the planet’s health and resilience.

There is a glimmer of hope amid all this concerning news in the form of the Regional Flyway Initiative, which the Asian Development Bank (ADB) launched in 2021 to safeguard vital wetlands across the Asia-Pacific. To achieve this, the ADB will partner with the East Asian-Australasian Flyway Partnership Secretariat, BirdLife International and other stakeholders to raise a substantial US$3 billion in the next decade to protect priority wetland clusters.

Furthermore, the rising tide of environmental consciousness among the younger generation has emerged as cause for optimism. A survey by EY in 2023 showed a profound shift in attitudes among young people worldwide as they expressed a deep desire for positive change.

This surge of youth activism is a potent force driving momentum towards sustainable practices and conservation efforts. It represents a seismic shift in societal values, where the preservation of natural ecosystems and the protection of biodiversity are increasingly seen as paramount concerns.

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This growing environmental consciousness offers a ray of hope. It aligns with ongoing efforts to implement innovative sustainable development practices and bolster established conservation initiatives along the East Asian-Australasian Flyway.

The convergence of these factors – the adoption of sustainable practices, the dedication of conservationists and the impassioned advocacy of younger people – presents a formidable arsenal in the fight to safeguard the future of the flyway and its avian users.

Now more than ever, there is a pressing need to act decisively to ensure Asia’s migratory birds can continue their journeys along the East Asian-Australasian Flyway for generations to come. Beyond the imperative of preserving individual species, this endeavour is about safeguarding one of the planet’s most awe-inspiring natural phenomena.

In this quest to protect the flyway, the voices of countless species echo a fervent plea for action. The skies, once filled with the vibrant hues of migratory flocks, must not fall silent. The fate of Asia’s migratory birds is intertwined with our own, and in their preservation we will find the preservation of our collective natural heritage.

Mohammad Yunus is currently pursuing a master’s degree in biological sciences at Khon Kaen University, Thailand

Posted on 21 March 2024 | 5:30 pm
Why India food app Zomato’s green-only vegetarian delivery fleet has users seeing red
  • Online users slam Zomato for being ignorant of divisions over food preferences along caste and religious lines in India
  • Indian Muslims and delivery workers have previously faced attacks by Hindus over the consumption of non-vegetarian food
A delivery worker of Zomato, an Indian food-delivery startup, prepares to pick up an order from a restaurant in Mumbai. Photo: Reuters

A U-turn by food app Zomato to roll out a fleet of vehicles decked in green colour to exclusively deliver vegetarian meals has put a spotlight on religious and social divisions over food preferences in India.

Zomato was forced to reverse its decision after it faced a flood of online criticisms this week for being ignorant about Indian caste dynamics.

On Tuesday, the app’s co-founder and CEO Deepinder Goyal announced plans to introduce the “pure vegetarian fleet”.

In a post on X, Goyal said: “Our dedicated Pure Veg Fleet will exclusively handle orders from pure vegetarian restaurants. This ensures that non-vegetarian meals, or even vegetarian meals from non-vegetarian restaurants, will never be delivered in the green packaging designated for our Pure Veg Fleet.”

His post immediately drew brickbats with many online users calling the decision “casteist” and “dangerous”. Some unions, activists and academics are concerned about the segregation of workers wearing separate outfits in green and red, the company’s corporate colour.

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Fatima Khan, a journalist on social media, said she would not be surprised if the ‘Pure Veg’ initiative were to lead to discrimination against delivery workers given past incidents where consumers had rejected deliveries based on religious reasons.

“Multiple instances have occurred where food deliveries were rejected because the delivery agent was Muslim. The rationale cited was often [we didn’t want our food purity to be tarnished],” said Khan.

Goyal initially stuck to his guns, saying on X on Tuesday: “I have received an overwhelmingly positive response on this launch from so many people. A lot of comments from young people who eat non-veg food saying ‘now my parents can also use Zomato.”

Just hours later, however, Goyal announced a reversal of his plan in a separate post. “While we will continue to maintain a fleet for vegetarian orders, we have decided to eliminate the on-ground segregation by removing the use of the colour green. All our riders, including those in our regular fleet and the fleet for vegetarians, will now wear [the usual] red uniforms.

“We now realise that some of our customers may face difficulties with their landlords, and we don’t want our service to cause such problems.”

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Food for thought

For many years, consumer choices over vegetarian and non-vegetarian food have been a politically charged issue in India.

Since the Bharatiya Janata Party (BJP) came to power in 2014, food controversies have also emerged over religious reasons. In particular, Indian Muslims have faced discrimination based on their food consumption habits such as halal meat in a country where many among the Hindu majority are vegetarians.

The animosity against non-vegetarians has intensified to the extent that some Indian states have imposed restrictions on the sale of meat during certain Hindu festivals. With backing from right-wing leaders, Hindu mobs have attacked Muslims suspected of consuming beef or other non-vegetarian food in public places in recent years, according to media reports.

In India, the preference for vegetarian food is often associated with upper-caste Hindus or other religions who view themselves as superior to other Indians including Muslims. As such, Indians would forge closer social relationships or limit interactions based on food preferences.

Even among Hindus, many of them - particularly the younger generations - often consume non-vegetarian food discreetly due to societal pressures.

Delhi University Professor Satish Deshpande told This Week in Asia that the issue is not just about food preferences but also the perceived privilege of upper castes that others have to conform to their worldviews.

“This is part of the entire feeling of entitlement that upper castes have had to define the country,” he said.

The dangers arising from food preferences are also faced by millions of delivery drivers who have reportedly faced harassment and attacks for sending non-vegetarian food into areas where there are many vegetarian residents.

Rajesh Kumar, a gig worker, said: “Apart from discrimination, we could easily become targets for anyone who opposes non-vegetarian food. We face mistreatment from owners if they discover that a tenant has ordered non-vegetarian food in the building.”

Alishan Jafiri, a journalist who has tracked such incidents in India, said delivery workers are more vulnerable to violence than other people.

He added: “People can get assaulted, incarcerated and in the worst scenario, even killed, for carrying or eating meat in India.”

Posted on 21 March 2024 | 11:13 am
UK’s BAE to build fleet of nuclear-powered submarines for Australia under Aukus pact
  • Australia would get at least five of the SNN-Aukus class subs, which will be delivered from the early 2040s, at a cost of billions of dollars
  • The subs – a key step in the Aukus security pact – will be quieter and stealthier than Australia’s existing fleet and will not carry nuclear weapons
US President Joe Biden, Australian Prime Minister Anthony Albanese and British Prime Minister Rishi Sunak deliver remarks on the Aukus partnership in San Diego, California on. March 13, 2023. Photo: Reuters

Australia said on Thursday the UK’s BAE Systems would build a fleet of nuclear-powered submarines, a key step in fulfilling the landmark Aukus security pact between Canberra, London and Washington.

Australia’s Submarine Agency said BAE would produce the state-of-the-art vessels, which will be delivered from the early 2040s.

The agency did not reveal the exact number of submarines that will be built or financial details of the deal, but Australian defence officials have said the country would get at least five of the SNN-Aukus class subs at a cost of billions of dollars.

The first of the vessels are expected to be built in Britain, and later ones at a shipyard in Adelaide, South Australia.

The deal is central to an effort to overhaul Australia’s military, as Aukus members seek to check Chinese military expansion in the Asia-Pacific.

The subs will be quieter and stealthier than Australia’s existing fleet, and capable of deploying over vast distances without surfacing, posing a potent threat to any foe.

Although the subs will not carry nuclear weapons, the technology underpinning their nuclear-propelled engines has been a tightly held secret between the United States and Britain for more than 60 years.

More details are expected when Australian and British defence and foreign ministers meet jointly in Adelaide on Friday.

But the scale of the project is vast, and questions have been growing about whether Australia – with limited nuclear experience and a relatively small navy – can pull it off.

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Australian officials believe some 20,000 workers will be needed for the home-grown nuclear industry – among them an army of technicians, metal workers, electricians and welders.

Australia has struggled to maintain a fleet of ageing diesel-electric subs plagued by design flaws and cost blowouts.

Successive Australian governments on both sides of the political spectrum have torn up their predecessor’s defence plans and started again, at enormous cost.

Because the submarines will take more than a decade to design and build, there is an added complication, with Australia expected to get at least three Virginia class nuclear-powered submarines from the United States in the interim.

In total, the Aukus submarine project could cost up to A$368 billion (US$240 billion) over the next 30 years.

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Some fear Donald Trump could scrap it completely if he returns to power next year.

In a joint statement, Aukus defence ministers tried to swat aside concerns that the project is dead before it hits the water.

“Australia, the United Kingdom and the United States remain fully committed to this shared endeavour,” said US defence chief Lloyd Austin, UK defence secretary Grant Shapps, and Australian defence minister Richard Marles.

“These steps to grow Australia’s submarine construction and maintenance capability are critical to the Aukus partnership.”

BAE Systems already has a close relationship with the UK navy, and is responsible for building its Astute-class and Dreadnought-class nuclear-powered vessels.

It will also develop SNN-Aukus class submarines for the UK’s Royal Navy and a Rolls-Royce plant in the UK will produce the nuclear reactors that are eventually installed in both the UK’s and Australia’s submarines.

Earlier on Thursday, UK and Australian defence ministers signed a new defence agreement in Canberra.

The agreement stops short of a full mutual defence pact, which would bind one side to intervene if the other was attacked.

But it does include a “commitment to consult” about emerging threats and establishes a “status of forces agreement”, which makes it easier to host soldiers from the other nation.

The “status of forces” agreement makes it easier for Australian sailors to train on the UK’s nuclear subs, and for British crew to be based in Australia.

Posted on 21 March 2024 | 8:02 am
Vietnam political star’s downfall shocks nation as graft purge widens: ‘who will be next president?’
  • Vo Van Thuong quit over than a year into the presidency after seemingly falling to a sweeping ‘blazing furnace’ anti-corruption campaign
  • The sudden resignation comes as Vietnam, one of Southeast Asia’s fastest-growing major economies, prepares to set its new leadership in 2026
People ride motorbikes past the Presidential Palace in Hanoi. Photo: EPA-EFE

The apparent purge of Vo Van Thuong, a rising political star and the second Vietnamese president to resign in quick succession, has sent shock waves across a public unused to seeing disorder at the top of a Communist Party which projects its strength as discipline and continuity.

On Thursday, the Vietnamese parliament formally accepted Thuong’s resignation, over a year into the largely-ceremonial job.

His departure leaves a potential gap in the candidate list for leadership roles as Vietnam’s most powerful politician, 79-year-old General-Secretary Nguyen Phu Trong, prepares to hand over power in the coming years.

Vietnamese told This Week in Asia they were both intrigued and unnerved by the latest signs of trouble at the top as another senior figure seemingly falls to the sweeping “blazing furnace” anti-corruption campaign, which has ensnared top ranking politicians and super-rich tycoons since 2020.

“It is fast and furious,” said Minh, a Ho Chi Minh City resident requesting anonymity in a one-party state where dissent is routinely punished. “Who will be the next president? I don’t have any idea how this country will be governed.”

Thuong follows former president Ngyuen Xuan Phuc of the powerful Politburo, as the purge scythes through senior Communist Party ranks.

Vietnam’s president quits after one year on the job

The sudden resignation comes as Vietnam, one of Southeast Asia’s fastest-growing major economies, prepares to set its new leadership in 2026, which will be responsible for steering an economy widely seen as the region’s next big bet by global corporations such as Intel, Apple and Microsoft, which are seeking to hedge risks by moving supply chains out of China.

Vietnam last year was the only country to welcome both US President Joe Biden and Chinese President Xi Jinping, in a sign of its strategic importance to both superpowers.

Thuong’s resignation gives him the ignominy of becoming Vietnam’s shortest-serving president, and appears to put a pin in the political ambitions of the 53-year-old, who was the youngest member of the party’s Politburo, the country’s top decision-making body.

Vo Van Thuong resignation gives him the ignominy of becoming Vietnam’s shortest-serving president. Photo: AFP
Vo Van Thuong resignation gives him the ignominy of becoming Vietnam’s shortest-serving president. Photo: AFP

“His departure is a big shock to Vietnamese politics,” said Nguyen Khac Giang, a visiting fellow at ISEAS-Yusof Ishak Institute, adding the departure of two presidents in under two years was not a good sign for a country often praised for political stability.

Although the role is mostly ceremonial, the presidency is one of the top four most powerful offices in the communist country’s political system. Thuong was also seen to have close links to General Secretary Nguyen Phu Trong, Vietnam’s most powerful politician and the primary architect of the party’s anti-corruption campaign.

Thuong was elected by the parliament in March 2023, around two months after his predecessor’s resignation for assuming responsibility in another anti-corruption case.

What’s behind Vietnam’s ‘blazing furnace’ corruption purge?

His fate appeared to have been sealed after police last month arrested the chairman of the Phuc Son Group, a private construction firm, for “violating accounting regulations causing serious consequences”, according to state media reports. The ensuing probe is alleged to have found links to contracts for infrastructure schemes, while Vo Van Thuong served as party chairman of central Quang Ngai province from 2011 to 2013.

His downfall also poses a bureaucratic quandary to the Party, which will hold its next congress in 2026 and is likely to elect a replacement for the ageing General Secretary Trong.

“There are only three members of the current Politburo who now qualify for selection to the four pillars of leadership – party secretary, prime minister, state president and chairman of the National Assembly,” said Carlyle Thayer, Emeritus Professor of Politics at the UNSW’s School of Humanities and Social Sciences.

“Thuong would have been the youngest of four if he had not resigned. Any other incumbent member of the Politburo would have to be given a special exemption from the mandatory retirement age of 65 to serve in one of the top four posts.”

Vietnam’s General Secretary Nguyen Phu Trong is set to hand over power in the coming years. Photo: AP
Vietnam’s General Secretary Nguyen Phu Trong is set to hand over power in the coming years. Photo: AP

Thuong’s departure will not disrupt the country’s business environment in the short term, experts say, but may negatively affect investor confidence.

“The political uncertainty might force investors to adopt a wait-and-see approach to make a decision,” Giang said.

Investors have raised concerns about the “blazing furnaces” anti-corruption campaign, as it has slowed routine transactions and bureaucratic processes as public officials become afraid of being implicated in a potential scandal.

In a National Assembly meeting in May 2023, lawmakers said officials were terrified of making mistakes because of an opaque legal system, without precise frameworks to protect officials and civil servants who wished to innovate, according to a state media report.

“Blazing furnaces” was in early 2020 claiming high-profile scalps and prosecutions, now including four Politburo members, two ministers, a deputy prime minister, and more than a dozen provincial and city leaders.

The campaign has also ensnared some of Vietnam’s tycoons, once seen as beyond the law.

Prosecutors seek death sentence for leader of Vietnam’s largest financial scam

Earlier this month, Vietnamese property tycoon, Truong My Lan, was found guilty of embezzlement, bribery and abuse of power through family and proxies, as well as employing “ghost” firms to obtain loans in a US$12 billion bank fraud.

Prosecutors on Tuesday proposed the death sentence for Lan.

Also on Tuesday, the chairman of property developer Tan Hoang Minh – Do Anh Dung, and his son, Do Hoang Viet – stood trial for illegal bond issues to obtain more than US$349 million, a case which has triggered public outrage for heaping debt on to thousands of people, according to state media.

Posted on 21 March 2024 | 7:30 am
Video of Philippine LGBTQ student given forced haircut sparks anger, calls for inclusive policies
  • The video shows a transgender student having a haircut in school after she was threatened with a denial of enrolment
  • The incident has prompted calls by LGBTQ advocates for schools to implement inclusive policies for students regardless of sexual orientation
Members of the LGBTQ community carry a giant rainbow flag at a pride march at a sports complex in Marikina City, east of Manila on June 30, 2018. Photo: AFP

A viral video of a transgender student at a Philippine public college receiving a haircut following a threat she faced of being denied enrolment has sparked public anger and calls for officials to review perceived discriminatory school policies against LGBTQ students.

Dozens of protesters in Manila marched on March 15 at the grounds of the Eulogio “Amang” Rodriguez Institute of Science and Technology (EARIST) over the video showing the tearful transgender student having her hair snipped off by a schoolmate. The video was shared on Facebook by the national LGBTQ alliance Bahaghari.

The school’s student handbook states male students should observe a “barber’s haircut” of a short back and sides while female students with colourful hair highlights are not allowed on campus.

Bahaghari leader Arri Samsico told This Week in Asia that EARIST’s haircut policy had affected more than 50 LGBTQ students, most of whom had to shorten their hair to be allowed admission. According to LGBTQ advocates, the policy fails to take into account the sexual orientation and identity of LGBTQ students.

Samsico said transgender students had been raising the issue of the school’s haircut policy with its administrators since October. The administrators later verbally agreed to allow transgender students to enrol for the first term without the haircut conditions.

Philippine transgender beauty contestant soothes nerves over Bangkok brawl

Yet administrators appeared to have backtracked and told the LGBTQ students earlier this month that they would not be able to enrol for the second term unless they comply with the haircut rules.

Other transgender students from different schools who faced similar experiences as the student in the video have begun contacting the group, according to Samsico.

Transgender content creator and advocate Mela Habijan said EARIST had violated the Manila LGBTQI Protection Ordinance of 2020, a citywide law that protects LGBTQ students against discrimination over their sexual orientation, and gender identity and expression.

Manila’s city council, which funds the local college, said it planned to investigate reports of the enforced haircuts.

EARIST agreed last Saturday to suspend its hair policy and review its handbook guidelines after a mediated dialogue with the Commission on Higher Education (CHED) – the governing body of colleges and universities.

In Philippines, alarm over mail-order bride scheme that trafficks women to China

Its chairman Prospero de Vera said CHED did not have explicit policies on haircuts or gender expressions for students in higher educational institutions.

“The rules on student haircuts and uniforms are up to each university. There are no CHED rules on that issue as that is part of their exercise of their right to administration of higher education,” De Vera told GMA News on March 15.

Habijan said governing agencies such as CHED have a duty to ensure all schools under its purview implement inclusive policies for students.

“It is the governing body of all colleges and universities. I firmly believe that CHED must have power and jurisdiction over all tertiary schools, especially when it comes to universal welfare and protection of rights and dignity of Filipino students,” she told This Week in Asia.

Samsico said Bahaghari will lobby for anti-discrimination policies to be applied to educational institutions and ban rules that repressed students’ gender expressions.

“Students can unleash their true potential when they can be free about their true selves. Educational institutions must become a space for learners to be confident, as this will help them gain more knowledge during their time in school,” Samsico said.

In April last year, Batangas State University announced it would uphold its existing dress code policy that prohibits cross-dressing amid calls to amend the rules to accommodate transgender students.

K-12 schools – encompassing kindergartens to senior high schools – also continue to implement haircut and dress code rules specifically for male and female students only despite the Department of Education (DepEd) reiterating in 2022 a memorandum upholding a gender-responsive basic education policy, protecting its students from gender discrimination.

“DepEd regional and division offices have circulated the memorandum to schools. But seeing a few schools abiding by the memo is a clear indicator that it has not been consistently and firmly implemented,” Habijan said.

The schools’ refusal was rooted in their belief that SOGIESC – sexual orientation, gender identity, gender expression, sexual characteristics – was a Western concept that was incompatible with local customs, according to Habijan.

Disagreeing with the notion, Habijan said, “Our history narrates that queer people existed in Philippine societies before the Spaniards came to the Philippines.” The country’s history included accounts of babaylan and asog, shamans who were “feminised men”, as well as Lakapati, a transgender goddess in local mythology, Habijan added.

Let’s talk about sex: Philippine sexologist faces uphill task after TV show ban

The advocate said the unpleasant experiences faced by LGBTQ students highlighted the need for lawmakers to pass a proposed anti-discrimination bill that was first submitted to Congress in 2000.

“Congress needs to pass the SOGIE Equality Bill to institutionalise inclusivity and acknowledgement of diverse identities in Philippine schools nationwide,” she said.

Habijan cited Quezon City, the country’s largest city, as an example of effective inclusivity. In February, its city council passed a “Right to Care” card, allowing queer couples to make healthcare decisions for their partners in the absence of a nationwide same-sex partnership law.

Advocates say, however, that achieving inclusivity across the Philippines is elusive for now.

“As a changing society, the rules and regulations must also adapt to the new times, especially in the talks of inclusivity,” Samsico said. “We must continue to be open to change when it comes to the better development of our nation’s future.”

Posted on 21 March 2024 | 6:58 am
Japan, US, Philippines vow to boost ties ahead of April summit
  • They agreed on close collaboration to reinforce a ‘free and open international order based on the rule of law’ and toward economic growth in the region
  • The US has been stepping up bilateral and trilateral defence cooperation with Japan and the Philippines to counter China’s territorial claims and military build-up
A man looks at the cherry blossom trees at the Chuo district of Tokyo. Japan’s Vice-Foreign Minister Masataka Okano, US Deputy Secretary of State Kurt Campbell and Maria Theresa Lazaro, an undersecretary of the Philippine Foreign Affairs Department, met in Tokyo on Thursday. Photo: AFP

Senior diplomats from Japan, the United States and the Philippines on Thursday pledged to further promote their cooperation, the Japanese Foreign Ministry said, paving the way for their first-ever trilateral summit next month.

The senior officials also acknowledged that any attempts to unilaterally change the status quo by force cannot be tolerated, according to the ministry, in an apparent criticism of China’s increasing maritime assertiveness in the Indo-Pacific region.

Japan’s Vice-Foreign Minister Masataka Okano, US Deputy Secretary of State Kurt Campbell and Maria Theresa Lazaro, an undersecretary of the Philippine Foreign Affairs Department, met in Tokyo.

The three agreed on close collaboration to maintain and reinforce a “free and open international order based on the rule of law” and toward economic growth in the region, the ministry said.

At the outset of the talks, Okano said they would ensure thorough preparation for the summit between Japanese Prime Minister Fumio Kishida, US President Joe Biden and Philippine President Ferdinand Marcos Jnr, scheduled for April 11 in Washington.

The diplomats also vowed to steadily advance their partnership in areas such as maritime security, cyber defence, economic security, strategically key infrastructure and securing energy resources, according to the ministry.

The United States has been stepping up its bilateral and trilateral defence cooperation with Japan and the Philippines in recent years to counter China’s territorial claims and military build-up in the East and South China seas, as well as around Taiwan.

Kishida and Biden are scheduled to meet bilaterally the day before the three-way summit. Kishida will visit the United States as a state guest, marking the first such visit by a Japanese leader since then-prime minister Shinzo Abe’s trip in 2015.

Posted on 21 March 2024 | 6:30 am
Why Japan is forced to take baby steps to normalise monetary policy
  • Japan’s central bank ending its negative interest rate regime comes not a moment too soon, but that alone will not return the economy to its heyday
  • Uncertainty over the outlook for growth and inflation persists, and the internal issues that led to the adoption of ultra-loose policy are still in place
Pedestrians walk past the Bank of Japan headquarters in downtown Tokyo on March 19. Japan’s central bank has raised its key interest rate for the first time in 17 years, ending a long-standing policy of negative interest rates to stimulate the economy. Photo: dpa

The odd one out in global monetary policy is returning to the fold. On March 19, the Bank of Japan (BOJ) took the first step in ending an unprecedented era of cheap money when it jettisoned its eight-year-long negative interest rate policy, raising borrowing costs for the first time since 2007 and scrapping several other measures that were introduced in an effort to vanquish deflation.

The BOJ also ditched its policy of capping the country’s 10-year bond yield at 1 per cent and will no longer purchase exchange traded funds and real estate investment trusts. Symbolically, the return to positive borrowing costs is a landmark event in Japan’s decades-long efforts to undo the damage wrought by the bursting of the late 1980s asset bubble.

The end of the negative rate regime – a radical, albeit controversial, policymaking tool that might have helped prevent deeper deflation but crushed financial institutions’ interest income – comes not a moment too soon. Doubts over the efficacy of the policy intensified in recent years, especially when inflation began to rise sharply because of the supply shocks triggered by the Covid-19 pandemic and Russia’s full-scale invasion of Ukraine.

The signalling effect of the BOJ’s policy shift is highly significant. Not only does it indicate the central bank is increasingly confident it can hit its 2 per cent inflation target in a sustainable manner, it underpins a dramatic rally in Japanese equities that caused the Nikkei 225 index to surpass its bubble-era peak last month.

Foreign investors, who are driving the stock market rally, are convinced Japan is back. The decision by the country’s largest companies earlier this month to award workers their biggest pay rise since 1992 was a crucial factor in the BOJ’s decision and is one of the reasons market sentiment is bullish, along with shareholder-friendly corporate governance reforms and geopolitical realignments working in Japan’s favour.

Japan’s split-screen economy: roaring stocks and shrinking GDP

In a report published on March 19, Morgan Stanley said the BOJ was able to call time on “exceptional monetary policy accommodation” because of “a much-improved macroeconomic environment” characterised by “a virtuous cycle of rising nominal GDP growth, wages, prices and corporate profits”.

Not so fast. While Japan will remain Asia’s “market of choice for investors”, in the words of Bank of America, uncertainty over the outlook for growth and inflation persists. The BOJ was at pains to stress that its exit from ultra-loose policy will be gradual and cannot be compared with the sharp increases in borrowing costs undertaken in the United States and the euro zone.

The central bank has said there were “extremely high uncertainties surrounding economic activity and prices” that warranted keeping financial conditions accommodative for some time. Japan will have enough problems normalising interest rates, never mind tightening policy.

First, the rise in the BOJ’s benchmark rate from minus 0.1 per cent to a range of zero to 0.1 per cent, coupled with the decision to keep the central bank’s bond-buying programme in place, attest to policymakers’ concerns about moving too fast. While there is a possibility of a sharper-than-expected wage-price spiral, the bigger threat is that growth and inflation prove weaker than anticipated.

External factors, not domestic ones, were behind the sharp increase in inflation. Japan only narrowly avoided falling into recession at the end of last year. Consumer spending – the key ingredient for self-sustaining growth – declined at a faster pace in the final quarter of 2023 thanks to the continued inflation-fuelled erosion of households’ purchasing power.

Second, Japan still suffers from the structural problems – demographic decline, the highest public debt burden in the developed world and persistently weak growth – that led to the adoption of ultra-loose policy in the first place. The International Monetary Fund expects the economy to slow this year amid a fade in the one-off factors that supported growth in 2023, including a surge in inbound tourism.

Third, even the most encouraging developments, such as wage growth, should be treated with caution. Although big companies have granted workers large pay rises, small and medium-sized firms, which are the backbone of Japan’s economy, have yet to follow suit. Broad-based wage growth is needed in order for policy normalisation to gain momentum.

Fourth, the BOJ ended negative rates at an opportune moment, when the gap between Japanese and US bond yields remains wide, maintaining downward pressure on the yen and contributing to inflation. However, when the US Federal Reserve starts cutting rates, the gap will begin to narrow, increasing the likelihood that the yen will strengthen and endangering reflation.

Why Japan’s Nikkei freak show should scare off Chinese investors

This will be the moment of truth when it becomes clear whether the domestic forces of reflation are strong enough for policy to become less accommodative. While deflation has been overcome, the task of normalising policy could prove more difficult.

Jesper Koll, publisher of the Japan Optimist newsletter, noted that while defeating deflation was the “overarching mission until now”, the challenge facing the BOJ in the coming months is to normalise policy “without really knowing what normal is or how best to get there”.

What is clear is that Japan has little choice but to proceed cautiously in its exit from unconventional policy. That negative rates are now a thing of the past is a huge milestone, yet the road to policy normalisation will be a long and bumpy one.

Nicholas Spiro is a partner at Lauressa Advisory

Posted on 21 March 2024 | 4:30 am
Indonesia’s Prabowo Subianto congratulated by China’s Xi, US’ Blinken over victory amid election challenges
  • The congratulatory messages came as Prabowo’s two rivals said they would issue constitutional challenges over the result, citing allegations of irregularities and fraud
  • The incoming leader is unlikely to make any ‘drastic changes’ to Indonesia’s China policy, but may lean closer to the West on defence issues, analysts say
Indonesia’s Prabowo Subianto won the February 14 poll with around 58.6 per cent of the vote. Photo: Xinhua

World leaders from China to Malaysia and the United States have congratulated Prabowo Subianto after Indonesia’s election commission announced he had won the presidential poll, with Chinese President Xi Jinping hailing the two countries’ friendly ties and seeking the “construction of a community with a shared future”.

“I attach great importance to the development of China-Indonesia relations and look forward to working together with President-elect Prabowo to lead the construction of a community with a shared future between the two countries to achieve greater results, create an example of major developing countries sharing a common destiny, unite, cooperate and seek common development, and serve as a model for the two peoples, that will bring more benefits to our people and inject strong impetus into regional and global prosperity and stability,” Xi said in a statement given to Chinese state news agency Xinhua on Thursday.

The congratulatory messages from Xi and others came as Prabowo’s two rivals, Anies Baswedan and Ganjar Pranowo, said they would issue constitutional challenges over the result, citing allegations of irregularities and fraud.

Some cry foul play as Indonesia’s Prabowo is set to be named president

Although analysts have been split over whether Prabowo will maintain outgoing President Joko Widodo’s economic cooperation with China – which has helped fuel much of Indonesia’s rapid infrastructure development over the last decade – or if he will adopt a more confrontational stance towards Beijing in line with some of his past nationalistic rhetoric, many believe he is likely to take the former route given his ambitious growth promises.

“I don’t foresee that there will be any drastic changes. China will still be one of the biggest investors in Indonesia,” said Yohanes Sulaiman, an international relations lecturer at the University of Achmad Yani in West Java.

“The only problem is if there is an escalation in the South China Sea, or when China does things that are considered offensive to Indonesian sovereignty. Prabowo is more nationalistic, he will be like [Philippine President Ferdinand] Marcos Jnr; his reaction will be very extreme,” he added.

In terms of defence collaboration, Sulaiman expected Prabowo to lean closer to the West than China, continuing the country’s partnership with the US and Europe that had been forged for decades.

“Militarily, Prabowo himself is closer to the US and Europe, than China. China cannot assume that it will get a replacement for Jokowi whose policies will be exactly like Jokowi’s. China must be more careful,” Sulaiman said, referring to Widodo’s popular nickname.

A protesters in Jakarta demand the impeachment of Indonesian President Joko Widodo over alleged electoral interference. Photo: AFP
A protesters in Jakarta demand the impeachment of Indonesian President Joko Widodo over alleged electoral interference. Photo: AFP

Indonesia’s election commission released its official tally late on Wednesday, declaring that Prabowo, who is Widodo’s defence minister, won the February 14 election with around 58.6 per cent of the vote.

Shortly after the announcement, Malaysian Prime Minister Anwar Ibrahim said in a Facebook post that he was the first world leader to congratulate Prabowo on his victory.

“This is quite meaningful because it symbolises the value of friendship between Malaysia and Indonesia, which is very special as a close and important neighbouring country,” Anwar said. “Both of us are determined to strengthen bilateral relations that cover various aspects as neighbouring countries and pledge to cooperate closely in various multilateral forums, especially within the scope of Asean.”

US Secretary of State Antony Blinken released a statement congratulating President-elect Prabowo and lauding “the Indonesian people for their robust turnout and commitment to democracy and the rule of law”.

“The United States and Indonesia are celebrating 75 years of our diplomatic relationship grounded in democracy and pluralism. As close partners and friends under our Comprehensive Strategic Partnership, we are working hand in hand to deliver a better future for our citizens. We look forward to partnering closely with President-elect Subianto and his administration when they take office in October,” Blinken said.

Will Indonesia’s Prabowo be investigated for pre-election fraud?

Japan’s Ministry of Foreign Affairs also released a statement on Thursday saying that Prime Minister Fumio Kishida had sent a congratulatory letter to Prabowo conveying “his intention to work together on bilateral cooperation in a wide range of areas as well as on regional and global issues, touching on the bilateral relationship that was elevated to a Comprehensive and Strategic Partnership last year, when the two countries celebrated the 65th anniversary of their diplomatic relations”.

Prabowo also received congratulatory cables from Saudi Arabia’s King Salman and Crown Prince Mohammed bin Salman, according to the Saudi Press Agency, in which they wished the Indonesian people further progress and prosperity.

US President Joe Biden sent a congratulatory letter to Prabowo on March 12, which was delivered by Yohannes Abraham, the US’ ambassador to Asean.

“Together, we have also safeguarded international stability, including forging a future for the Indo-Pacific that is free, open, prosperous, and secure. Your partnership as Indonesia’s Minister of Defence has been critical in these efforts,” Biden wrote.

Japanese Defence Minister Nobuo Kishi (right) and his Indonesian counterpart Prabowo Subianto in Tokyo on March 28, 2021. Japan on Thursday congratulated Prabowo on his election. Photo: Kyodo
Japanese Defence Minister Nobuo Kishi (right) and his Indonesian counterpart Prabowo Subianto in Tokyo on March 28, 2021. Japan on Thursday congratulated Prabowo on his election. Photo: Kyodo

Election challenges

Despite the announcement of the Prabowo’s victory by Indonesia’s election commission, his two challengers do not consider the results a settled matter.

Anies on Thursday filed a complaint with the country’s Constitutional Court contesting Prabowo win over allegations of irregularities and fraud.

“We officially submitted the request for an election dispute petition to the Constitutional Court,” Anies’s legal chief Ari Yusuf Amir told reporters outside their campaign headquarters.

Prabowo’s campaign has been mired in allegations that President Widodo had interfered in the electoral process in a bid to establish a political dynasty. His eldest son, Gibran Rakabuming Raka, was in the race as Prabowo’s vice-presidential running mate.

Will Jokowi seek to lead Indonesia’s oldest party to ‘secure his legacy’?

Anies’ team said the aim of the complaint was to improve future elections and Indonesia’s young democracy, which emerged from decades of autocratic rule in the late 1990s.

In October, Widodo was widely criticised after the Constitutional Court, then led by his brother-in-law, issued a controversial ruling that allowed political candidates to be exempted from the minimum age requirement of 40, if they had previously been elected to office, paving the way for 36-year-old Gibran, the current mayor of Solo, to join Prabowo’s ticket.

“[Anies’ complaint] is a good thing, because this is the worst election that we have after Reformasi,” said Bivitri Susanti, a constitutional law expert with the Jakarta-based Jentera Law School. Reformasi refers to a period where Indonesia transitioned into democracy following the resignation of dictator Suharto in 1998.

“From the start, the legitimacy of the Prabowo-Gibran pair was already low. Gibran could run in the election by using the connection that he has in the Constitutional Court, which was his uncle. In other countries, this would be a big scandal,” she said. “Aside from filing a lawsuit to the Court, I think that political parties in the House of Representatives should use their rights to inquire against the government.”

Members of the legal team of Anies Baswedan file a petition over the February 2024 elections at the Constitutional Court in Jakarta on Thursday. Photo: AFP
Members of the legal team of Anies Baswedan file a petition over the February 2024 elections at the Constitutional Court in Jakarta on Thursday. Photo: AFP

Anies’ team said the aim of the complaint was to improve future elections and Indonesia’s young democracy.

Anies, who earned 24.9 per cent of the vote in the election commission’s official tally, refused to concede after the results were released, condemning Prabowo’s route to victory.

“Leadership that was born out of a process tainted by cheating and violations will result in a regime that will produce policies that are full of unfairness, and we don’t want this to happen,” he said in a statement.

Ganjar Pranowo, who was the candidate for the ruling Indonesian Democratic Party of Struggle (PDI-P), also said on Thursday his team was preparing to file a complaint with the Constitutional Court over the election results, that would be submitted on Friday or Saturday.

“If Ganjar and his team do file a lawsuit with the Constitutional Court, then the trial process will be more intense and more dynamic,” said Wasisto Raharjo Jati, a political researcher with the National Research and Innovation Agency.

‘Vulgar’: Indonesia’s Jokowi slammed for awarding Prabowo 4-star military rank

The open-trial nature of the court could “educate the public that this year’s elections are not completely free and fair in principle. Many behind-the-scenes dealings are in opposition to that principle”, Wasisto said.

“If it is proven that there have been serious violations of the law, there could be potential for re-election, but the chance for that is still small.”

Prabowo was widely predicted to win the presidency on his third attempt, after losing in 2014 and 2019.

His legal team was confident the result would not be successfully challenged because of his majority and wide margin of victory, local media has reported.

He will take over for Widodo in October after a transition period.

Additional reporting by Agence France-Presse

Posted on 21 March 2024 | 3:29 am
Australia’s tougher student visa rules set to kick in as soaring migration squeezes rental market
  • From Saturday, a new ‘genuine student test’ will be introduced to crack down on students who look to come to Australia primarily to work
  • The move came as migration hit another record high, piling pressure on an already tight rental market
Students from China walk along the waterfront by the Sydney Opera House in Australia. Photo: Reuters

Australia will begin enforcing tougher visa rules for foreign students this week as official data showed migration hit another record high, which is likely to further exacerbate an already tight rental market.

From Saturday, English language requirements for student and graduate visas will be increased, while the government will get the power to suspend education providers from recruiting international students if they repeatedly break rules.

“The actions this weekend will continue to drive migration levels down while delivering on our commitments in the migration strategy to fix the broken system we inherited,” Home Affairs Minister Clare O’Neil said in a statement.

A new “genuine student test” will be introduced to further crack down on international students who look to come to Australia primarily to work, while the imposition of “no further stay” conditions will be used on more visitor visas.

The moves follow a raft of actions last year to close off Covid-era concessions introduced by the former government, including unrestricted working hours for international students. The government at the time said rules would be tightened for students that could halve its migrant intake over two years.

More Australians turn to shoplifting groceries as food prices remain high

Australia boosted its annual migration numbers in 2022 to help businesses recruit staff to fill shortages after the Covid-19 pandemic brought strict border controls, and kept foreign students and workers out for nearly two years.

But the sudden influx of foreign workers and students has exacerbated pressure on an already tight rental market.

Date released by the Australian Bureau of Statistics on Thursday showed net immigration rose 60 per cent to a record 548,800 in the year to September 30, 2023, higher than the 518,000 people in the year ending June 2023.

Overall, Australia’s population rose 2.5 per cent – the fastest pace on record – to 26.8 million people in the year to last September.

Why a move by Australia’s government may scare off foreigners from buying homes

The record migration – driven by students from India, China and the Philippines – has expanded labour supply and restrained wage pressures, but it exacerbated an already tight housing market where rental vacancies hovered at record lows and elevated construction costs restricted new supply.

O’Neil said the government’s actions since September have led to a decline in migration levels, with recent international student visa grants down by 35 per cent on the previous year.

Posted on 21 March 2024 | 1:15 am
Malaysians could pay more for vegetables as worker exodus sparks supply fears: ‘locals don’t want the jobs’
  • The country’s farms rely on millions of workers from Bangladesh, Indonesia, who return home every year to observe Ramadan with their families
  • Farmers warn the labour shortage could cause a supply slump at a time the government is seeking to limit the flow of migrant workers
A vendor sells vegetables at a night market in Langkawi, Malaysia. Photo: Shutterstock

Malaysian vegetable farmers have warned supply could fall by 40 per cent next month due to a labour shortage caused by the annual Ramadan exit of Muslim foreign workers, but exacerbated by a hard May 31 government deadline for new migrant workers to enter the country.

Millions of workers from Bangladesh, Indonesia and Nepal staff swathes of essential but low-paid jobs in construction and manufacturing, plantations and farms – jobs Malaysians balk at doing.

Prime Minister Anwar Ibrahim’s administration wants to change that by limiting overseas worker numbers and encouraging Malaysians to raise their incomes – and allow him to slash the subsidy bill – by taking up domestic jobs instead.

As Malaysians feel the pinch from the ‘shringgit’, what can PM Anwar do?

Farmers warn the seasonal shortfall of workers will cause a slump in vegetable production in April, which will be compounded by the government plan to choke off the flow of migrant workers the following month.

“All our farms use foreign workers. Locals don’t want the jobs, and now even foreign workers are picky as most prefer working in factories over the hard work at farms,” said Lim Ser Kwee, the president of the Malaysian Federation of Vegetable Farmers Association, which has 6,000 members.

Lim, who also runs a farm in southern Johor state, said around one-fifth of the estimated 40,000 foreign workers hired by the federation’s members had been expected to return to their home countries during the Ramadan fasting month to beat the Eid rush.

That could drag output down by 40 per cent at their next harvest cycle next month, he said, adding that workers often took months to return to their jobs.

This means households and restaurants may have to pay more for leafy greens such as spinach and bok choy, which are mainly produced locally due to their short shelf life.

Migrant workers at a vegetable farm in Cameron Highlands, the largest vegetable-producing region in the Malaysian peninsula. Photo: AFP
Migrant workers at a vegetable farm in Cameron Highlands, the largest vegetable-producing region in the Malaysian peninsula. Photo: AFP

Lim said farms in the hilly enclave of Cameron Highlands – the largest vegetable-producing region in the peninsula – typically send down between 500 tonnes and 600 tonnes of fresh vegetables daily.

Fewer hands mean the farms may not be able to harvest everything in time, and potential wastage, as vegetables that don’t meet market standards end up on the scrap heap, he said.

While the Ramadan exodus is an annual affair, the government’s move to cap foreign labour hiring by May 31 will coincide with the lowest point of employment across the year.

Grocers reject the likely looming passing of farm gate costs up the supply chain, saying the Ramadan worker shortage is no surprise.

“We all know people will go back [home] at this time of year and in anticipation of this, farmers have to do their own planning, just like in retail we do our own planning,” said Ameer Ali Mydin, the managing director of local hypermarket chain Mydin.

“I sympathise with the farmers who have to deal with floods and bad weather which are not within their control … but this is not the right excuse to use to increase prices.”

Malaysia to slash migrant workforce amid vitriol, Bangladeshi job scam crisis

Earlier this month, the government announced a cap on new migrant worker intake to 2.55 million people, with a deadline of May 31 set as the last day for employers to bring in new workers into the country.

Immigration department records count 2.13 million migrant workers currently actively employed in the country. This leaves a remaining quota of 412,011 jobs for migrant workers that the government expects will be filled out by the deadline.

This included a foreign labour recalibration programme that allowed employers to secure work permits for undocumented workers – and a rehiring and repatriation programme for mostly Bangladeshi foreign workers who lost thousands of dollars to job scams.

A vendor sells vegetables and fruits in Pahang, Malaysia. Photo: Shutterstock
A vendor sells vegetables and fruits in Pahang, Malaysia. Photo: Shutterstock

Alongside pressure on its foreign workforce, Malaysia has over the past three decades seen its food import bill balloon as domestic demand outstrips farm production.

Food imports cost the country 78.8 billion ringgit (US$16.6 billion) in 2023, nearly double its exports valued at 46.5 billion ringgit over the same period, according to a March 18 report on the country’s food security by Bank Muamalat.

Last month, the ringgit rattled markets and the public after it fell to a 26-year low. It ranked only behind the Japanese yen as Asia’s worst currency over the past two years.

Experts pin the persistent weakness in Malaysia’s fiat currency as a key reason why food inflation has spiked, even as headline inflation settled at 1.5 per cent in January, one of the lowest rates in the region.

Posted on 21 March 2024 | 12:00 am
Singapore jails man for threatening PM Lee Hsien Loong on Facebook
  • Kong Chee Kian said someone should assassinate Lee following the shooting of former Japanese prime minister Shinzo Abe
  • He was sentenced to four months’ jail for one count of inciting violence electronically
Singapore’s Prime Minister Lee Hsien Loong attends the Asean-Australia summit in Melbourne on March 6. Photo: AFP

Disgruntled with the government and the prime minister, a man made a comment on a Facebook post about the shooting of former Japanese prime minister Shinzo Abe, saying someone should do the same to Singapore’s prime minister.

Kong Chee Kian, a 46-year-old Singaporean man, was sentenced to four months’ jail on Wednesday for one count of inciting violence electronically.

The court heard that Kong did not like the Singapore government and Prime Minister Lee Hsien Loong, who is the head of the government.

He had difficulty finding permanent employment due to health issues and was “looking for someone to blame”, so he chose to blame the government, the prosecution said.

On July 8, 2022, Kong was at home browsing the internet on his handphone.

He read an article about a man being taken into custody after Abe was shot.

The article was posted by CNA on its Facebook page with an accompanying caption stating that the man is believed to have shot Abe.

Kong left a comment on the Facebook post, saying: “Pls someone do the same to our PM.”

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Another Facebook user replied him and asked if this was a threat to Lee.

The police received a report soon after from an anonymous person who stated that someone had made threats to “our PM” and that they hoped action could be taken. The person said they were “not sure if this is a troll”.

Kong was arrested that same day.

Investigations revealed that he had made other online comments related to Lee.

After making the comment on CNA’s Facebook page, Kong saw a post by the prime minister.

Lee had uploaded a photo of himself with Abe on his page, stating his shock over the shooting and condemning the “senseless act of violence”.

Kong left a comment in Mandarin, which was translated in court documents to: “If you are going the right way, afraid that people would plot against you but you are not.”

Kong later said he was trying to express his view in this comment that PM Lee “was not a good person”, therefore “other people will plot against him”.

Kong posted another comment on a Facebook post by Yahoo Singapore about Abe’s death after the shooting.

He wrote that “your good friend LHL will join you”.

About a month before, Kong responded to a post on Instagram depicting a Tamagotchi toy that asked users to comment what it was, with “wrong answers only”.

Kong replied saying the Tamagotchi was “the only weapon against [Singapore] PM”.

Deputy Public Prosecutor Delicia Tan sought four-and-a-half to six months’ jail for Kong.

Both sides referred to the 2013 case of Gary Yue, which set a benchmark of three months’ jail for cases of incitement to violence.

Tan asked for a higher jail term compared with Yue, who got two months’ jail.

She said the use of the internet and social media has become more prevalent as compared with a decade earlier and that Yue’s case was dated.

A deterrent sentence should be given in Kong’s case, so a message is sent out that the use of social media to incite violence against others will not be tolerated, added Tan.

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Kong had also expressly targeted the head of the government, and senior members of the government should be inoculated from such threats, said Tan, adding that Kong’s offending was “sustained”.

Defence lawyer Rajoo Ravindran from Kertar & Sandhu law firm asked the court to consider two months’ jail instead.

Comparing the case with Yue’s, Rajoo said Yue’s case was against a larger group of people which also included heads of government and state.

The degree of potential harm was therefore much higher in Yue’s case than Kong’s, said the lawyer.

He added that Kong is a first-time offender who fully cooperated with the police and is remorseful.

He has also sought counselling help.

“Kong’s elderly father, who is about 80 plus, he is also in court today and the family will be providing the necessary support for Kong after his incarceration and promises this honourable court that he will remain on the right side of the law,” said Rajoo.

Kong Chee Kian arrives at the State Courts in Singapore on March 20. Photo: CNA
Kong Chee Kian arrives at the State Courts in Singapore on March 20. Photo: CNA

In response, the prosecutor said the threat in another cited case was to beat people up whereas Kong’s incitement was to assassinate Lee, which is “more serious”.

District Judge Kamala Ponnampalam in sentencing told Kong that he must know by now that his offence was a very serious one.

“This is a serious offence warranting a custodial sentence. No fine. A fine would be unsuitable,” she said.

She noted that Kong’s comments were sustained and not just isolated. They were targeted at the head of state, with a specific threat to assassinate and not just to beat up.

“Weaponising social media platforms to incite violence today must be dealt with more firmly,” said the judge.

“The aim of such a sentence is to deter like-minded offenders.”

For incitement to violence, Kong could have been jailed for up to five years, fined, or both.

This story was first published by CNA

Posted on 20 March 2024 | 11:53 pm
Japanese baseball star Shohei Ohtani’s wife clutching US$30 bag in Seoul wins over fans
  • Mamiko Tanaka was spotted with the shoulder bag at the LA Dodgers team dinner in the South Korean capital
  • Fans praised Tanaka’s frugality, saying she was ‘worth emulating’
Shohei Ohtani and his wife Mamiko Tanaka arrive at Incheon airport in South Korea on March 15. Photo: Getty Images/TNS

Japanese MLB superstar Shohei Ohtani, now with the LA Dodgers, and his wife Mamiko Tanaka, have been attracting attention for their modest lifestyle, as evidenced by Tanaka’s choice of a 40,000 won (US$30) bag during their visit to South Korea for the first-ever 2024 MLB World Tour Seoul Series.

The Ohtanis attended a dinner organised by the LA Dodgers at a hotel in Yeouido, Seoul, on March 16. Photos shared on social media by Dodgers photographer Jon SooHoo show Tanaka in a light grey knit and black trousers, carrying a small shoulder bag.

Japanese media speculated that Tanaka’s bag is a 5,000 yen (US$33) item from the SPA brand Zara. Ohtani, who signed a groundbreaking 10-year, US$700 million contract with the Dodgers, is seen in a new light by fans, as they praised his wife’s frugality with comments like “much better than showing off one’s wealth,” “worth emulating” and “feels approachable.”

Shohei Ohtani’s wife Mamiko Tanaka (right) was spotted with a Zara bag at the LA Dodgers team dinner in Seoul. Photo: Instagram/jon.soohoo
Shohei Ohtani’s wife Mamiko Tanaka (right) was spotted with a Zara bag at the LA Dodgers team dinner in Seoul. Photo: Instagram/jon.soohoo

Tanaka’s visit to Gocheok Sky Dome in Seoul on March 18 to watch a practice game between the South Korean national team and the LA Dodgers also drew plenty of attention.

Without make-up and dressed casually, she enjoyed the match from the stands with Ohtani’s mother and sister.

Japanese sports media highlighted that “Ohtani’s wife sat in the regular seats, not VIP,” with netizens commenting, “It’s nice to see a superstar’s family not in a skybox or special seats,” and “The Ohtani family is humble, not taking advantage of privileges,” showing their support for the baseball star.

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Ohtani, who surprised Tanaka, a former Japanese professional basketball player, with a marriage proposal, just before flying to Seoul, made their first public appearance together in South Korea. Even in the photos taken in front of the plane to South Korea, Tanaka was seen in a simple black tracksuit.

Ohtani took part in the opening game of the 2024 Major League Baseball season, the Seoul Series between the LA Dodgers and San Diego Padres, at Gocheok Sky Dome in Seoul on Wednesday.

This story was first published by The Korea Times

Posted on 20 March 2024 | 9:10 pm
Will India’s long election season help Modi ‘create history’ – or throw up a last-minute surprise?
  • India is holding a seven-phase vote, during which PM Modi will have time to pace himself at events and stretch the opposition’s limited resources
  • Despite the opposition lacking a charismatic leader, analysts say their massive alliance would require the ruling BJP to win by bigger margins to maintain their majority
A Bharatiya Janata Party supporter holds up a cutout of Indian Prime Minister Narendra Modi in Kolkata on March 6. Photo: EPA-EFE

India’s coming national polls from April 19 to June 1 will be held in seven phases – a prolonged voting exercise that is likely to give Prime Minister Narendra Modi an edge in the close election battle, analysts say.

In the country’s second-longest voting exercise, 73-year-old Modi, the star campaigner of the ruling Bharatiya Janata Party (BJP) party, will have time to pace himself at events held amid the blazing summer heat as well as stretch the opposition’s comparatively limited resources.

But observers believe the polls in the world’s biggest democracy are still likely to be a close fight, rather than a cakewalk, for the BJP. Despite the opposition bloc lacking a charismatic leader who can take Modi head on, analysts said their strategic alliance-building would mean the ruling party may find it tough to maintain the majority it secured in the last elections.

Ab ke baar 400 paar”, or “We will create history with a 400-seat victory”, is the slogan upbeat BJP workers have been chanting at rallies recently, optimism fuelled by opinion polls showing Modi’s popularity remains undimmed after two consecutive five-year terms in office.

Indian Prime Minister Narendra Modi gestures to supporters at Bharatiya Janata Party public meeting in Barasat, on the outskirts of Kolkata, on March 6. Photo: AFP
Indian Prime Minister Narendra Modi gestures to supporters at Bharatiya Janata Party public meeting in Barasat, on the outskirts of Kolkata, on March 6. Photo: AFP

The BJP won 303 seats out of 543 in the Lok Sabha, the lower house of parliament, in the 2019 general election. This year, it aims to win 370 seats on its own and 400 together with allies under the National Democratic Alliance (NDA).

“I think the target of 370 for the BJP and 400 for the NDA is a rhetorical tool for motivating its workers. It is not going to intimidate the opposition because the reality is very different,” said Uday Chandra, a professor of government at Georgetown University in Qatar.

The BJP will need to secure 272 seats to gain a clear majority, but even meeting its tally in the last election would be tough because the opposition, under the Indian National Developmental Inclusive Alliance (INDIA) alliance front, have cobbled together a seat-sharing arrangement in major states to field a common candidate, preventing them from undercutting each other’s votes.

That would mean the BJP and the India alliance are together likely to capture 90-95 per cent of the total vote in those political constituencies where the opposition will be putting up a common candidate, requiring the winning candidate to secure half or more of the total vote.

The BJP’s earned around a third of the total vote in the last two national elections. It’s only possible to win with that kind of margin when there are at least three major parties in the fray, Chandra noted.

“The threshold for victories has become much higher this time,” he said.

Changing political equations

The BJP launched into its election campaign in January with the high-profile opening of a grand temple devoted to the Hindu god Rama in the northern town of Ayodhya, built at a disputed site where a mosque once stood, aimed at wooing its core base of Hindu voters in northern, central and western India.

But the ruling party will have to expand its influence further to southern and eastern parts of the country, where it has historically had difficulties, because the opposition alliance is likely to cut into the number of seats it will secure in its heartland states compared to previous polls, Chandra said.

The BJP is also staring at a changed political landscape because the Indian National Congress, the main opposition party, has ceded more seats to influential regional parties such as the Samajwadi Party in the northern state of Uttar Pradesh, he said.

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In the western state of Maharashtra, the seat of India’s financial capital Mumbai, a split within the regional Shiv Sena Party, with which the BJP won handsomely last time, has altered the political equation dramatically.

The Congress party is siding with Shiv Sena’s Uddhav Thackeray faction, led by the son of party founder and revered Maharashtra leader Bal Thackeray.

In eastern India’s West Bengal state, the Trinamool Congress party’s leader, Mamata Banerjee, has not joined any alliance but chances are that she will arrive at a last-minute arrangement with the opposition alliance by ceding one or two seats to other parties, Chandra said.

Not all the opposition’s new alliances may work out in their favour. Chandra noted that in the eastern state of Bihar, the BJP is likely to benefit from an about-face by the state’s chief minister, Nitish Kumar, who was offered a key leadership position in the India alliance. Chandra said Kumar’s popularity was likely to suffer during the coming elections because of that turnabout.

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Still, the BJP does not have a wide margin to work with when it comes to maintaining its dominance, Chandra said. “If the BJP loses 35 to 40 seats from the last elections, then it would have lost its majority.”

The ruling party is likely to make inroads into hitherto unconquered territories such as southern India’s Tamil Nadu, but it’s too soon to tell how much it will gain, experts say.

That said, the opposition alliance is still struggling to get its act together without having outlined a common theme or a slogan to take on the BJP.

Neither has a new march campaign by Rahul Gandhi, the de facto Congress party leader, which began in the troubled northeastern state of Manipur and ended in Maharashtra last weekend, created any serious buzz in the local media.

“The opposition is a bit constrained and, at the moment, it appears that all the activity is happening in BJP’s ranks. The [local] media is giving greater coverage to the BJP, so much so it seems that even if a fly goes in and out [of its office it’s reported],” said Nilanjan Mukhopadhyay, an independent political commentator.

Large cutouts of India’s Congress party leaders Sonia Gandhi and her son Rahul Gandhi are carried by supporters during a campaign rally in Mumbai on March 17. Photo: AFP
Large cutouts of India’s Congress party leaders Sonia Gandhi and her son Rahul Gandhi are carried by supporters during a campaign rally in Mumbai on March 17. Photo: AFP

Last-minute surprise possible

The Congress party’s campaign has suffered following the results of three state elections late last year in Rajasthan, Madhya Pradesh and Chhattisgarh, in which the BJP secured resounding victories that boosted the morale of its rank and file.

Subsequently, the BJP appointed virtually unknown figures to helm the chief minister positions in those states, a decision analysts said could have positive and negative consequences. On the one hand, it could be seen as rewarding hard-working, low profile leaders, and on the other, it sends a message that only certain key leaders around Modi are indispensable, they added.

The BJP’s election campaign is centring itself around Modi himself, with a slogan simply saying: “I am the choice.”

Some of the party’s other planks are the ideology of Hindutva, or Hindu nationalism, welfare programmes like free food for the poor, as well as running down the opposition, Mukhopadhyay said.

“At the moment, the BJP is in the pole position, but we really don’t know. It just requires a small development to turn an entire election on its head,” he said, underscoring that historically, a large percentage of Indian voters made up their minds at the last minute.

Posted on 20 March 2024 | 8:00 pm
Thailand’s prime minister suspends national police chief on concerns of possible power struggle
  • PM Srettha Thavisin said the orders were not meant as punishment but to ensure that an investigation could occur without interference
  • Thailand’s national police agency has a tradition of fierce internal politicking, as well as a long-standing reputation for corruption at all levels
Chief Royal Thai Police Torsak Sukvimol (left) and Duputy Chief the royal Thai Police Surachate Hakparn embrace after a press conference in Bangkok. Thailand’s national police chief and a deputy were ordered to be suspended by the Prime Minister on Wednesday, following a feud that escalated over the past few weeks, pointing to serious conflicts within the highest echelons of the police department. Photo: AP

Thailand’s national police chief and one of his deputies were temporarily suspended under the order of Prime Minister Srettha Thavisin on Wednesday, as accusations that the deputy was involved in an illegal online gambling ring sparked concerns about a possible power struggle in the police department.

Torsak Sukvimol, who was appointed to the top police post in October last year, and Surachate Hakparn, one of his deputy chiefs, were temporarily moved to inactive posts in the Office of the Prime Minister, which directly supervises the police department.

Surachate has been accused of involvement with illegal online gambling websites, a charge he denies.

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Surachate’s home in Bangkok was raided in September last year in an operation police said was related to the bust of a major illegal online gambling network. Eight of Surachate’s subordinates were arrested on the day of the raid over the case.

The raid occurred as a new national police chief was set to be named, and Surachate was considered one of the front runners. Torsak was appointed to the post days after the raid.

Thailand’s national police agency has a tradition of fierce internal politicking, as well as a long-standing reputation for corruption at all levels.

The prime minister on Wednesday said the transfer order is effective immediately and that he is forming a special committee to investigate the situation, adding he would consider lifting the suspension orders after 60 days. Srettha said the orders were not meant as punishment but to ensure that an investigation could occur without interference.

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Torsak and Surachate were called into the Prime Minister’s Office hours before reports of the transfers came out and later held a news conference together, denying any personal rift between them.

Jaroonkiat Pankaew, the deputy chief of the Central Investigation Bureau, said last month that Surachate was accused of abuse of power and bribery, after money trails linked him to bank accounts used by the online gambling websites. He also said investigators would pursue a money laundering charge against Surachate, who has yet to be arrested or formally charged.

Through his lawyers, Surachate has denied any wrongdoing, claiming the accusations were made to discredit him and accusing other top-ranking police officers of taking money from the gambling operators.

Posted on 20 March 2024 | 9:08 am
Solomon Islands PM praises China’s governance while criticizing democracy as immoral
  • Solomon Islands Prime Minister Manasseh told a campaign rally that democracy allows you to ‘do whatever you want’
  • He lauded China’s system of government and its economic success at a time when Beijing is trying to increase its influence on the Pacific nation
Solomon Islands Prime Minister Manasseh Sogavare addressing the 78th United Nations General Assembly at UN headquarters in New York City on September 22, 2023. Photo: AFP

In a fiery campaign speech, Solomon Islands Prime Minister Manasseh Sogavare criticised democracy for promoting LGBTQ culture and lauded China’s system of governance for its economic success.

It comes at a time when Beijing is vying with Australia and the US for influence over the Pacific nation, with Sogavare being the foremost proponent for closer ties with China.

The prime minister, who is widely expected to win reelection on April 17, told a campaign rally in Auki, the capital city of Malaita Province, that democracy allows you to “do whatever you want”.

“Men can marry men, women can marry women – [those] are the principles associated with the values of democracy,” he said.

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“You have to ask yourself, what values are you comfortable with as a Christian country?”

The Solomon Islands is a highly conservative Christian-majority nation in which same-sex relations are illegal for both men and women.

Sogavare also said China had embraced a “socialist system of government” that was “Chinese style”, which fuelled its economic progress.

“You don’t see beggars in China asking for money … [you] see that in every major city in the United States [and] it’s supposed to be the number one economy in the world,” he said.

Sogavare added his decision to switch diplomatic recognition from Taiwan to China “put the Solomon Islands on the map”.

Chinese President Xi Jinping and Solomon Islands Prime Minister Manasseh Sogavare shake hands at the Great Hall of the People in Beijing, China July 10, 2023. Photo: Handout via Reuters
Chinese President Xi Jinping and Solomon Islands Prime Minister Manasseh Sogavare shake hands at the Great Hall of the People in Beijing, China July 10, 2023. Photo: Handout via Reuters

The Solomon Islands established a bilateral relationship with Beijing in 2019 after cutting ties with Taiwan, attracting large amounts of aid and investment from the economic giant.

Last year, China rolled out the red carpet for Sogavare and signed a raft of deals, including one allowing it to maintain its police presence in the island nation until 2025.

The two sides also signed a security pact in 2022, alarming the US and Australia, who feared that China could use it to establish a military foothold in the South Pacific.

During his speech in Malaita, which opposed switching ties in 2019, Sogavare touted the economic benefits of aligning with China.

“For the past 45, years we have been struggling to make headway in development under [the previous] arrangement [with Taiwan],” he said.

The four-time prime minister said the ruling party’s “superior understanding of the new political reality has allowed him to make astute foreign policy decisions”.

The country hosted the 2023 Pacific Games in a new China-funded stadium that Sogavare projected as a key achievement of his government.

Solomon Islands hosts China-funded Pacific Games amid big-power rivalry

In 2021, he announced plans to suspend the 2023 election to manage the event, triggering anti-government riots that resulted in the capital city of Honiara’s Chinatown being torched.

Peter Kenilorea Jnr, Sogavare’s main rival, has pledged to revoke the security agreement with Beijing if he takes office.

“The burden to develop our beloved Solomon Islands does not rest on the shoulders of any of our development partners, no way, [it] rests squarely on the shoulders of the government and people of Solomon Islands themselves,” Australia’s public broadcaster ABC quoted him saying.

Meanwhile, Sogavare’s party last week accused the electoral commission of not being “impartial” and claimed Australia, a major donor for the agency, was trying to influence the next month’s poll.

Chief electoral officer Jasper Anis rejected the allegations, saying the commission was an independent body.

Posted on 20 March 2024 | 8:00 am
Vietnam’s president quits after one year on the job amid signs of political turmoil
  • His resignation is a sign of political turmoil that could hurt foreign investors’ confidence in the country
  • The president holds a largely ceremonial role, but is one of the top four political positions in Vietnam
Vietnam’s President Vo Van Thuong looks on at the Presidential Palace in Hanoi. The Vietnamese Communist Party on Wednesday accepted the resignation of President Vo Van Thuong, the government said in a statement citing “shortcomings”. Photo: AFP

The Vietnamese Communist Party on Wednesday accepted the resignation of President Vo Van Thuong, the government said in a statement citing “shortcomings”, in a sign of political turmoil that could hurt foreign investors’ confidence in the country.

The government said in a statement that Thuong violated party rules, adding that those “shortcomings had negatively impacted public opinion, affecting the reputation of the party, state and him personally”.

The Central Party Committee, a top decision-making body in Communist Party-ruled Vietnam, approved Thuong’s resignation just about a year after his election.

The president holds a largely ceremonial role, but is one of the top four political positions in the Southeast Asian nation.

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The committee’s meeting preceded an extraordinary session of Vietnam’s rubber-stamping parliament scheduled on Thursday, when deputies are expected to confirm the party’s decisions.

Major leadership changes in the one-party state have recently been all linked to the wide-ranging “blazing furnace” anti-bribery campaign, which is aimed at stamping out widespread corruption, but is also suspected by critics to be a tool for political infighting.

Thuong, 53, quit days after Vietnamese police announced the arrest for alleged corruption a decade ago of a former head of central Vietnam’s Quang Ngai province, who served while Thuong was party chief there.

Thuong was widely regarded as being close to General Secretary Nguyen Phu Trong, Vietnam’s most powerful figure and the main architect of the anti-corruption campaign.

Last year, when former president Nguyen Xuan Phuc quit after the party blamed him for “violations and wrongdoing” by officials under his control, it took one month and a half for lawmakers to appoint Thuong as his successor.

The current political crisis may well be resolved with the swift election of a new president, but risks remain that repeated reshuffles of top leaders hurt business sentiment in a country that is highly dependent on foreign investment.

The Ho Chi Minh City stock exchange, the country’s main bourse, shed on Monday nearly 3 per cent in the first hours of trading after news began circulating about the imminent resignation of the president.

Foreign investors’ net sales in the first two days of the week amounted to about US$80 million, according to brokerage Mirae Asset Securities.

Thuong’s “removal could see policy and administrative decisions slow further as officials are more anxious about the arc of the anti-corruption campaign”, said a Vietnam-based adviser to foreign corporates, noting however that Vietnam’s position on key policies would not change.

Posted on 20 March 2024 | 7:48 am
Australia, China should take ties ‘far’, Wang Yi says, as he urges more bilateral cooperation
  • In a ‘positive’ meeting, Chinese Foreign Minister Wang Yi says both countries should always seek to be partners and respond to global challenges together
  • Australian businesses and academics welcome the prospect of more partnerships with China as key to boosting bilateral ties and social and economic benefits
China’s Foreign Minister Wang Yi meets Australia’s Foreign Affairs Minister Penny Wong at Parliament House in Canberra on Wednesday. Photo: AAP via Reuters

Chinese Foreign Minister Wang Yi has asked Australian businesses and academics to visit China more and increase partnerships with Chinese counterparts, particularly in green energy, while reaffirming the two countries’ relations are back on track after a successful reset.

In a first visit by a Chinese foreign minister to Australia since 2017 amid thawing relations, Wang met Australian Foreign Minister Penny Wong for the seventh Australia-China Foreign and Strategic Dialogue in Canberra on Wednesday before speaking privately to a group of Australian leaders.

These include Australia China Business Council (ACBC) president David Olsson, Rio Tinto iron ore chief executive Simon Trott, and defence expert and Australia National University professor Hugh White.

Chinese Foreign Minister Wang Yi with his Australian counterpart Penny Wong during the seventh China-Australia Foreign and Strategic Dialogue in Canberra, Australia, on Wednesday. Photo: Xinhua
Chinese Foreign Minister Wang Yi with his Australian counterpart Penny Wong during the seventh China-Australia Foreign and Strategic Dialogue in Canberra, Australia, on Wednesday. Photo: Xinhua

Wang told the group China was committed to transforming its economy into one with a “green, high-quality, growth model”, according to a statement from the ACBC.

Olsson said this would offer significant upside to Australian exporters and help “Australia’s own decarbonisation efforts and the longer-term industrial transformation of Australia’s economy”.

Wang and the group also discussed investments, education and digital trade, as well as China’s engagement with the United States and Asia.

“It was a free-ranging discussion reflecting a diverse range of views and voices from the Australian side, reflecting the conversations that are taking place in Australia about the future direction of the bilateral relationship,” Olsson said, adding that the tone of the meeting was “positive”.

Wang also said both countries had more in common than differences and thus should always seek to be partners than opponents.

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Bilateral relations sank to an all-time low at the start of the pandemic following frictions stemming from a rise in Sinophobia in Australia, suspicions of Chinese foreign interference in Australia, the banning of China’s Huawei in Australia and Beijing blocking Australian exports in recent years.

Wang proposed that Australia and China respond to global challenges such as climate change together, and said the stability of bilateral relations contributed to global certainty.

With relations clearly moving in the right direction, both countries must keep up the momentum and “strive to continue to move well together and steadily, taking the journey far”, Wang said.

At the meeting with Wong, Wang said he was willing to increase high-level exchanges between the two countries and support cooperation in all fields.

Australian wine (second from right) is displayed among other wines at a shop in Beijing in December 2020. Photo: AFP
Australian wine (second from right) is displayed among other wines at a shop in Beijing in December 2020. Photo: AFP

Vicki Thomson, chief executive of the “Group of Eight Australia” university coalition, said research collaboration between nations in particular was important and “central to enhancing our long-standing friendship … and to navigate the shared challenges ahead”.

“These partnerships deliver enormous economic and social benefits to both countries, but also foster enduring people-to-people ties, support soft diplomacy efforts, and boost practical cooperation between Australia and China,” Thomson said.

In recent years, however, Chinese academics have been raided in Australia by security agencies, prompting concerns over visits to Australia.

On the lifting of China’s trade restrictions on Australian exports – imposed after the former Morrison government suggested an independent investigation into China over the pandemic – Wong told a press conference that she welcomed China’s interim decision to lift export-prohibitive Chinese tariffs on Australian wine and looked forward to the easing of blocks on beef and lobsters.

The Chinese market is crucial to the profitability and growth of Australian wine as well as lobster producers.

Protesters hold placards demanding the release of Australian academic Yang Hengjun during a rally outside Parliament House in Canberra, Australia, on Wednesday. Photo: AFP
Protesters hold placards demanding the release of Australian academic Yang Hengjun during a rally outside Parliament House in Canberra, Australia, on Wednesday. Photo: AFP

But Wong said Australia’s recent decision to end an anti-dumping ban on Chinese wind turbines was not in response to China’s move to ease trade with Australia.

She said on Wednesday that she had also spoken to Wang about the shock suspended death penalty for detained Australian academic Yang Hengjun, human rights abuse in Xinjiang, Tibet and Hong Kong, and unsafe conduct in the South China Sea.

Wang said China and Australia had no historical grievances or conflicts in relation to these issues and asked that both countries respect mutual sovereignty.

On a lighter note, Wong said it was likely two pandas on loan from China since 2009, and due to return this year, would extend their stay in Adelaide Zoo.

“And I did say to the foreign minister that my children would be very pleased,” she said.

Former Australian prime minister Paul Keating in 2016. Keating has been vocal in his opposition of Australia’s Aukus arrangements. File photo: AFP
Former Australian prime minister Paul Keating in 2016. Keating has been vocal in his opposition of Australia’s Aukus arrangements. File photo: AFP

The positive meeting between the two nations was momentarily upset by allegations from right-wing publication The Australian that former Australian prime minister Paul Keating’s meeting with Wang while he was in Canberra – through an invitation from Beijing – would be Keating’s most “extraordinary intervention” in his campaign to oppose the Albanese government’s foreign policy.

Keating has been vocal in his opposition of Canberra’s Aukus submarine arrangements with the United Kingdom and the US – aimed at countering China and media suggestions of an invasion of Australia by China.

Keating said in a Monday statement that meeting Wang was part of the “intercourse of national and international discussion” and that commentary by The Australian should be “contemptuously ignored”.

“Australia has moved substantially from the counterproductive baiting policy the Morrison government applied to China to now something much more civil and productive,” he said.

“The Australian newspaper, for its part, remains trenchantly anti-Chinese.”

Posted on 20 March 2024 | 7:30 am
‘Curse of the Colonel’ lifted? Japan’s Hanshin Tigers hope ritual ceremony bats away years of bad luck
  • After jubilant fans threw a statue of KFC founder Colonel Sanders into a river in 1985, the baseball team suffered decades of poor performance
  • The Tigers clinched last year’s championship, raising hopes they can now hit it out of the park
A statue of KFC’s Colonel Sanders is displayed by Osaka city officers on March 11, 2009. It was recovered nearly a quarter of a century after fans of Hanshin Tigers threw it into a river. Photo: AFP

Japan’s Hanshin Tigers professional baseball team is hoping it has finally banished the so-called Curse of the Colonel, after the life-size statue of KFC founder Colonel Harland Sanders tossed by the team’s fans into a river nearly 40 years ago underwent a religious cleansing ceremony and burial.

Fans of the Osaka-based team have long had a reputation for being among the most fervent in the country and for many successful seasons before 1985, fans would celebrate victories by leaping off the bridge over the Dotonburi River in central Osaka.

The river was filthy and deep – and there was at least one fatality as a result of a leap from the bridge – but Hanshin supporters did not earn their reputation for being fanatics without good reason.

After winning the Central League pennant in 1985, a group of Tigers fans outdid themselves and seized a plastic statue of Colonel Sanders from outside a nearby KFC outlet. Evading police, they threw the iconic statue into the river, where it promptly sank into the mud and was lost.

An enthusiastic fan of the Hanshin Tigers dives into Dotonbori River in Osaka, western Japan, on September 15, 2003. Photo: AP
An enthusiastic fan of the Hanshin Tigers dives into Dotonbori River in Osaka, western Japan, on September 15, 2003. Photo: AP

That act of vandalism was the start of what became known as the “Curse of the Colonel”, when the team’s fortunes plummeted and fans began to wonder if they would ever win another championship.

In March 2009, dredging operations on the river discovered the battered statue. After it was recovered from its watery resting place, hopes were raised that the curse had been lifted, but the Tigers continued to underperform.

Until the 2023 season.

Relatively unheralded, the Tigers went on a winning streak that finally saw them win the championship after a 7-1 victory over local rivals, the Orix Buffaloes, on November 4.

Free of the curse at last, the management of Japan KFC Holdings decided it was finally time to give the statue, which had been on display in another KFC restaurant in Osaka since its recovery, a fitting send-off.

A statue of KFC founder Colonel Sanders dressed up for Christmas in front of one of the fast food chain’s outlets in Japan. Photo: Shutterstock
A statue of KFC founder Colonel Sanders dressed up for Christmas in front of one of the fast food chain’s outlets in Japan. Photo: Shutterstock

Earlier this month, the statue – missing its glasses and left hand, which were never found – was taken to the Sumiyoshi Taisha Shrine, where a priest performed a ritual cleansing ceremony traditionally done for dolls.

Takayuki Hanji, president of KFC Holdings Japan, attended and laid flowers on the altar. He also made a ceremonial offering of sake and a portion of KFC chicken. In a statement, the company said the saga of the statue had “contributed to raising the value of our brand name”.

The Curse of the Colonel is the most infamous hoodoo to have hit a Japanese sporting team, but there are plenty of other teams around the world that fans feel have been subjected to similarly superstitious misfortunes.

The Argentinian team was long believed to have suffered from misfortune caused by the “Curse of Tilcara”, named for a small city where the team prayed for victory ahead of the 1986 World Cup. The team’s manager at the time, Carlos Bilardo, vowed to return to thank the city’s Virgin of Copacabana if they lifted the trophy. Argentina won the tournament but Bilardo and the players never returned.

In subsequent tournaments, Argentina suffered shock loses to Cameroon and Romania, and lost the 1990 final to Germany. Under pressure, the 1986 team finally returned to Tilcara to express their thanks – and Argentina won the 2022 World Cup.

The Hanshin Koshien Baseball Stadium, the home stadium for the Hanshin Tigers. Photo: Shutterstock
The Hanshin Koshien Baseball Stadium, the home stadium for the Hanshin Tigers. Photo: Shutterstock

Birmingham City Football Club in England has also laboured under a 100-year hex after moving into a new stadium that was built on land that had been used by Romani people until they were evicted.

There is also a well-known curse claimed to afflict players who appear on the cover of Electronic Art’s hugely popular Fifa video game series, with Wayne Rooney, Kaka, Jack Wilshire and Eden Hazard all suffering season-curtailing injuries after fronting the game.

Another infamous baseball superstition involves the Boston Red Sox, which had to contend with the “Curse of the Bambino” after selling Babe Ruth to the New York Yankees in 1920, after which they went 86 seasons without clinching a World Series.

For the Hanshin Tigers, however, the omens are once again dark as the baseball season gets under way this week. Of the 14 preseason matches it played, the team lost 11 and only won two, putting them dead last in the preseason rankings for the 12 professional teams in Japan.

Posted on 20 March 2024 | 7:14 am
Indian couples are struggling to conceive. Why is the world’s most populous nation facing this challenge?
  • A recent study shows infertility affects roughly 10-14 per cent of Indian couples, and is more common in cities, where one out of every six couples is seeking help with conceiving
  • While infertility still carries social stigma in many parts of India, more couples are turning to methods such as surrogacy, egg donations and IVF to tackle the issue
An Indian couple enjoys some street food in Mumbai. Official data shows the total fertility rate in India has dropped 20 per cent in the last 10 years to below replacement levels. Photo: EPA-EFE

Sruti Das and her husband were part of the estimated one in six Indian couples who struggle with infertility. While they enjoyed an affluent lifestyle, she made the difficult choice to quit her high-paying but stressful job after she was diagnosed with polycystic ovary syndrome, to focus on one of the condition’s known treatments – getting fit and eating healthy.

It took her six years, but Das, 34, was eventually able to conceive and give birth to a healthy girl.

India, the world’s most populous nation, paradoxically has an infertility problem. Official data shows the total fertility rate (TFR) has dropped 20 per cent in the last 10 years to below replacement levels, while certain measures of infertility have increased in recent years, leading to increased demand for treatments such as in vitro fertilisation.

Will India’s surrogacy ban drive childless couples and poor women underground?

“Infertility is a serious health issue, affecting approximately 15 per cent of couples worldwide. Of 60–80 million infertile couples globally, between 15 million and 20 million [25 per cent] are in India alone,” said Dr Sulbha Arora, clinical director at the Nova IVF Fertility in Mumbai.

A country’s TFR refers to the average number of children a woman is expected to conceive. A falling TFR can be attributed to numerous factors, including increased economic opportunities for women, later marriages and increased infertility.

A 2021 study by the Indian Society of Assisted Reproduction highlighted that infertility affects roughly 10-14 per cent of Indian couples, and is more common in cities, where one out of every six couples is seeking help with conceiving.

Another study published last year by the PLOS One journal, based on data from National Family Health Surveys, found that secondary infertility among Indian couples increased from 19.5 per cent in 1992-1993 to 28.6 per cent in 2015-2016. Secondary infertility refers to a couple’s inability of a couple to conceive another child after already having one.

Hindu couples take part in a mass marriage ceremony on the outskirts of Ahmedabad on February 27. Late marriages are among the factors affecting India’s falling fertility rates. Photo: AFP
Hindu couples take part in a mass marriage ceremony on the outskirts of Ahmedabad on February 27. Late marriages are among the factors affecting India’s falling fertility rates. Photo: AFP

In many parts of India, infertility still carries social stigma, with the woman usually held responsible, even though it is often not their fault.

“The reasons for infertility could be female factor, male factor, both, unexplained and others,” said Dr Arunima Halder, an IVF and infertility specialist at Manipal Hospital Whitefield in Bengaluru.

According to a 2022 WHO report on infertility in India, approximately 50 per cent of cases were due to “male factor” infertility. Stress and poor diets, as well as environmental and industrial pollution, were cited as contributing to declining sperm quality and testosterone levels in Indian men.

However, doctors say a number of social and cultural factors are also behind the country’s falling fertility rates.

“Late marriages and female career options are reducing the appetite for growing families. Cell phones are a distraction for regular sexual life. South India is already below the replacement levels,” said Dr Arun Muthuvel of the Chennai-based Iswarya Fertility Centre.

According to the latest National Family Health Survey data, the fertility rate in South India is 1.9 children per woman, below the replacement rate of 2.1.

A couple tends to their newborn baby at a maternity ward in a government hospital in Hyderabad on February 29. Photo: AFP
A couple tends to their newborn baby at a maternity ward in a government hospital in Hyderabad on February 29. Photo: AFP

In recent years, Indian couples have come to accept that infertility is a medical issue and are increasingly looking for solutions. Methods such as surrogacy, egg donations and IVF have become more popular in recent years.

Industry data shows that demand for IVF treatments in India has been surging, with the market projected to be worth US$3.7 billion by 2030, compared with US$793 million in 2020.

As the starting costs for IVF treatments are at least US$1,200 in India, they are out of the reach of many families. However, governments are concerned enough about fertility rates that they are taking action to make them more widely available.

“The governments in many states are opening IVF centres in government medical college and hospitals for easier access to [the] general population, as it is expensive,” Halder said.

But most state-funded health centres are ill-equipped to deal with cases of infertility, which has given rise to many unregulated private IVF clinics that follow unscrupulous practices. The Assisted Reproductive Technology Regulations were introduced in 2023 to tighten the IVF industry.

More women in India are turning to methods such as surrogacy, egg donations and IVF to tackle the infertility issue. File photo: Reuters
More women in India are turning to methods such as surrogacy, egg donations and IVF to tackle the infertility issue. File photo: Reuters

Neera Batra, 37, an advertising professional in New Delhi, said a private clinic overcharged her after multiple tests and consultations with specialists that never bore results or led to a diagnosis. She eventually stopped going to them and after three years conceived naturally.

“In many cases, patients get stressed about the whole process, which itself is counterproductive,” said Arora of Nova IVF Fertility. “One must go to an approved clinic or a good hospital, and also relax so that stress does not create new problems.”

Neera said there was much greater awareness about infertility in India these days due to people opening up about it on social media.

“Celebrities who have undergone fertility treatments or egg freezing, opening up and speaking about these issues, have helped to destigmatise the problem of infertility to a great extent,” she said.

Posted on 20 March 2024 | 7:00 am
China has ‘bigger fish to fry’ despite Japan upping interest rates for first time in 17 years
  • Bank of Japan ended eight years of negative interest rates on Tuesday, raising the cost of borrowing for the first time in 17 years
  • But analysts do not expect any direct impact on China, with the People’s Bank of China prioritising the stability of the yuan over rate cuts
The Bank of Japan (BOJ) on Tuesday met market expectations by ending eight years of negative interest rates. Photo: AFP

Japan’s decision to raise the cost of borrowing for the first time in 17 years this week is seen to offer yen assets a boost, but the impact of higher rates on China’s currency and cross-border capital flows might be marginal, according to analysts.

The Bank of Japan (BOJ) on Tuesday met market expectations by ending eight years of negative interest rates in an attempt to stimulate the country’s stagnating economy that has also struggled with deflation.

The move briefly drove up Japanese stocks, with the Nikkei 225 index having gained 19.5 per cent since the start of the year, while the yen is up 5.9 per cent against the US dollar.

But analysts do not expect any direct impact on China as overseas investors are more concerned with the effectiveness of Beijing’s easing measures, which are aimed at supporting sustainable economic growth in the world’s second-largest economy.

China’s domestic economy is struggling to get out of first gearHarry Murphy Cruise, Moody’s Analytics

China’s economy posted a strong rebound in the first two months of the year, putting it on course for 5 per cent growth in the first quarter, although its prolonged property market slump remains a drag on its overall economic recovery.

The People’s Bank of China (PBOC) is seen to be walking a fine line between maintaining the stability of the yuan and rate cuts, because lowering interest rates could increase pressure on its currency, which has already depreciated 1.47 per cent against the US dollar since the start of the year.

Further yuan weakness against the US dollar could trigger fund outflows from yuan-denominated assets, a move that could be destabilising for China’s capital markets.

“The PBOC has bigger fish to fry than [the] BOJ hike. China’s domestic economy is struggling to get out of first gear, held back by the collapsing property market and hesitant households. The need to turn that around trumps all else,” said Harry Murphy Cruise, an assistant director and economist at Moody’s Analytics.

Explainer: Rebound or false alarm? 6 takeaways from China’s January-February economic data

China’s state-run funds have stepped up buying stocks to support domestic prices since January, when the onshore stock market kept falling, further dampening investors confidence in the country’s overall economic resilience.

Chinese regulators have pledged to continue efforts to facilitate cross-border investment and financing.

“As to capital outflow out of [mainland] China and Hong Kong, investors’ interest in Japan currently is driven more by equity than fixed income or interest rate considerations. So we would not expect significant impact there either,” said Louis Kuijs, chief Asia-Pacific economist at S&P Global Ratings.

In the near term, there may be some temporary effect [on outflows]Chen Zhiwu, University of Hong Kong

According to the US-based Institute of International Finance, Chinese stocks posted inflows of US$9.6 billion in February following six months of outflows on the back of state-led buying, with scarring effects from the coronavirus pandemic also beginning to ease.

But Chinese debt remained in the midst of an outflow episode, losing US$6.5 billion in February, the data showed.

Analysts also said China’s economic performance or policy changes, as well as the US Federal Reserve’s decisions and monetary policy outlook, are the major factors influencing the yuan and capital movement.

“In the near term, there may be some temporary effect [on outflows], because as the interest rates go from negative to positive in Japan, the Japanese stock market prices may have some short correction period,” said Chen Zhiwu, chair professor of finance at the University of Hong Kong.

Is China in danger of Japanification? What can it do to avoid lost decades?

Lynn Song, chief economist for Greater China at ING, said the PBOC has been pushing back on depreciation since the start of the year, and the interest rate increase in Japan is unlikely to cause a substantive shift in the trajectory of the yuan.

“In the near term, there is still a level of depreciation, while we expect the yuan to appreciate in the second half of the year once global rate cuts are under way,” he said.

A survey released by Bank of America on Wednesday indicated that global fund managers viewed Japan as a “market of choice” as investors had been gearing up for the government declaring an official end to deflation by June.

Japan has been suffering from long-lasting but mild deflation since the latter half of the 1990s.

In the long run, the return of foreign investment to China depends on the improvement of domestic fundamentalsChina International Capital Corporation

The Bank of America survey showed that while overseas investors had become more “enthusiastic” about China’s economic outlook after an extended period of pessimism, many respondents had chosen not to allocate funds to Chinese equities.

“However, the long-term view is still uncomfortably dispirited, with 77 per cent of investors subscribing to a structural derating view for China equities,” the Bank of America said.

Chinese financial service company, China International Capital Corporation (CICC), said on Sunday that there could be some inflows into Chinese assets emanating from investors aiming to hedge against short-term corrections in Japanese stocks.

“However, in the long run, the return of foreign investment to China depends on the improvement of domestic fundamentals,” CICC said.

Posted on 20 March 2024 | 5:44 am
Should Malaysia host 2026 Commonwealth Games? Look at Victoria and Birmingham, critics say
  • The Commonwealth Games Federation is offering Malaysia US$127 million to stage the event, after Australia’s Victoria state withdrew from hosting over costs
  • As Malaysia mulls over the ‘once-in-a-lifetime opportunity’, the public has pushed back against big spending and also criticise the event as being a relic of a bygone colonial era
The opening ceremony of the Commonwealth Games in Kuala Lumpur in September 1998. Photo: AFP

Scepticism and unease over frivolous spending has greeted a proposal for Malaysia to host the 2026 Commonwealth Games after Australia dropped out citing high costs, with the public questioning both the need to support a legacy of the British empire and the wisdom of laying on a last-minute sporting event.

Inaugurated in 1930 as the British Empire Games, the Commonwealth Games brings together competitors from Britain’s former colonies in a multi-sport event held every four years.

The Australian state of Victoria won the rights to host the 2026 edition of the event, but withdrew in July 2023, citing a projected budget blowout.

Victoria won after Malaysia’s capital Kuala Lumpur, alongside Cardiff, Calgary, Edmonton and Adelaide, pulled out from the race, citing financial concerns.

Now, without a host just two years ahead of the games, the Commonwealth Games Federation is dangling £100 million (US$127 million) for Malaysia to help pay for the event.

As Malaysians feel the pinch from the ‘shringgit’, what can PM Anwar do?

The Malaysian government is deliberating over the matter, with its Olympic Council (OCM) proposing a stripped-down version of the games.

“It doesn’t have to include 15 sports. It could be 10 sports, resulting in a smaller opening and closing ceremony,” said OCM Secretary General Mohamad Nazifuddin Najib, who is the son of disgraced former premier Najib Razak.

OCM’s president Mohamad Norza Zakaria called it a “once-in-a-lifetime opportunity” to put Malaysia “back onto the world sporting map”, and build on the success of the 1998 edition of the games, which Malaysia hosted.

But the idea has been widely pilloried by the Malaysian public over the need for the inevitable extra expenses at a time when the currency is see-sawing around a historic low, and after Prime Minister Anwar Ibrahim preached for more prudent spending and a pledged “no mega projects”, which often incur ballooning costs and come packaged with corruption.

“We do not have enough time to set up venues, prepare volunteers, organise security aspects and involvement of other agencies,” former Youth and Sports Minister Reezal Merican Reezal was quoted as saying by news agency Astro Awani.

The closing ceremony of the Commonwealth Games in August 2022. Photo: Reuters
The closing ceremony of the Commonwealth Games in August 2022. Photo: Reuters

The 1998 Commonwealth Games in Kuala Lumpur is already a high watermark for the country, as it became the first Asian member of the collective to host the event.

Aside from the 2010 Delhi Games, every subsequent edition of the Commonwealth Games has been hosted by either a British or Australian city.

The sitting Sports Commissioner from the Youth and Sports Ministry, Suhardi Alias has also questioned why the country would take an unnecessary burden with little time to make sure it is a success.

“Victoria willingly paid such a large amount of money as compensation to withdraw from organising the games,” Suhardi told local newspaper Sinar Harian. “We also need to see what happened to Birmingham after hosting the 2022 edition, even after being advised early on not to go on with it.”

Malaysia looks at ‘downsized’ Commonwealth Games, or collaborating with Singapore

Birmingham, UK’s second-largest city, declared itself effectively bankrupt a year after hosting the Commonwealth Games, citing a £760 million (US$966 million) bill that it needs to settle.

The proposal’s champion, Mohamad Nazifuddin, is also not winning any favour from the public who view him suspiciously for being the son of disgraced former prime minister Najib, who is in jail for his part in the 1MDB corruption which burdened Malaysia’s economy with a massive debt that goes until 2039.

“The number one reason we should not host is because Najib’s son wants us to,” quipped X user Nizam Bakeri.

Nazifuddin, along with his siblings and their father, was cited by the inland revenue office for failing to pay 1.7 billion ringgit in taxes in 2019, which is being contested by the family in court.

Mohamad Nazifuddin, the head of Malaysia’s Olympic Council Malaysia. Photo: Handout
Mohamad Nazifuddin, the head of Malaysia’s Olympic Council Malaysia. Photo: Handout

To date, Malaysia has had to fork out 48 billion ringgit (US$10.1 billion) to repay the debt incurred in that scandal.

Over on Malaysia’s loud social media scene, the hashtag #TolakKomanwel – #RejectCommonwealth – has been making rounds with the public outlining a variety of reasons why Malaysia should not accept the offer, ranging from the aforementioned economics and timing to it being a relic of a bygone colonial era.

“The Commonwealth Games is no longer relevant. Why are we glorifying the British colonial powers that plundered our land?” asked Facebook user Rashid Noor.

While the 1998 Games brought an economic boom to the host city Kuala Lumpur, with the construction of a new national stadium, the Kuala Lumpur International Airport and the country’s first rapid transit system, present-day spin off bonuses are less positive.

Aside from only having two years until the opening ceremony, the man who organised the 1998 Games said that making it happen again this time is an impossible feat financially.

“The total bill for the 1998 Games came to 200 million ringgit, just imagine how much it will cost to host the games now?” said Hashim Mohd Ali, the executive chairman of the corporation formed to organise the previous event.

Speaking to the local newspaper New Straits Times, Hashim said that even after 26 years, the accounts of the 1998 Commonwealth Games had yet to be closed, and the whole endeavour posted a loss of 11.6 million ringgit (US$2.45 million).

Poverty looms over Malaysia’s elderly as low pay bites back in retirement

Other commenters added that if the brand meant so much to Britain, it should foot the bill instead.

Commonwealth Games Federation president Louise Martin has acknowledged they need to “understand and acknowledge the legacy of the [British] empire” on the lives of the people in the Commonwealth under their rule.

“Born out of the British empire, we are very aware of our history,” Martin, the federation’s first female head, said last November. “However, we are proud of our role in helping to bring together the nations and territories of the Commonwealth through sport, as friends and equals.”

Posted on 20 March 2024 | 5:00 am
South Korea’s notorious child rapist gets new jail term for violating curfew
  • Cho Doo-soon, 72, was released from prison in December 2020 after serving a 12-year term for raping an eight-year-old girl in 2008
  • He received a three-month jail sentence on Wednesday, for violating a criminal law mandating him to wear a GPS-enabled anklet and adhering to curfew laws
Silhouette of a depressed man sitting with head in hands. Violation of the electronic anklet law and related curfews in South Korea carries a penalty of up to one year of imprisonment or a fine of up to 10 million won (US$7,460.). Photo: Shutterstock

Convicted child rapist Cho Doo-soon has been placed behind bars again after receiving a three-month jail term on Wednesday, for breaking his court-mandated curfew.

The Ansan branch of the Suwon District Court issued the sentence to the 72-year-old for violating a criminal law mandating him to wear a GPS-enabled electronic anklet and adhering to related laws on curfews, stressing that even a single case of such violations should not be taken lightly.

“The implementation of electronic monitoring devices is aimed at facilitating the reintegration of offenders into society while ensuring public safety. Any deviation from these measures cannot be tolerated,” the judge said, delivering the verdict.

South Korean residents fear for safety as child rapist exits jail

The court also noted that Cho has shown no signs of remorse for violating the curfew. He requested reduced fines from the investigative authorities and prosecutors, and complained that he had no choice but to leave the house due to his wife.

Cho was accused of breaching a legal order not to leave his home between 9pm and 6am He was indicted for leaving his residence in Ansan, Gyeonggi Province, around 9.05pm on December 4 last year.

On that day, Cho wandered outside his house alone for a few minutes before his probation officers spotted him via surveillance cameras. He told officers that he left home after a squabble with his wife, and stayed outside for about 40 minutes in total.

Violation of the electronic anklet law and related curfews carries a penalty of up to one year of imprisonment or a fine of up to 10 million won (US$7,460.) Explaining their decision to imprison him once again, the court deemed that imposing a fine would be insufficient punishment considering Cho’s economic status.

Protesters lay on the road to oppose the release of Cho Doo-soon in front of a prison in Seoul in 2020. Photo: AP
Protesters lay on the road to oppose the release of Cho Doo-soon in front of a prison in Seoul in 2020. Photo: AP

Cho reportedly displayed disrespectful behaviour throughout Wednesday’s trial, interrupting the judge’s remarks with comments such as, “The judge is speaking prettily, but I can’t hear her”.

He was immediately taken into custody following the sentence.

Cho was released from prison in December 2020 after serving a 12-year term for raping an eight-year-old girl in 2008. The convict, then 57, violently raped the child in a church restroom in Ansan after kidnapping her while she was on her way to school. The victim was left with injuries so severe that they resulted in permanent internal damage.

Following his release, Cho was subject to strict probation rules, including the requirement of wearing the electronic anklet for seven years. Due to the concerns of neighbours, the city government installed additional surveillance cameras near his house and the police assigned probation officers to monitor him around the clock via these cameras.

Posted on 20 March 2024 | 4:28 am