May 11, 2006

From Uganda to Britain: Success follows Indians

Immediately after he pulled off his '72 coup against President Oboto in Uganda, strongman Idi Amin -- full title: His Excellency President for Life, Field Marshal Al Hadji Doctor Idi Amin, VC, DSO, MC, Lord of All the Beasts of the Earth and Fishes of the Sea, and Conqueror of the British Empire in Africa in General and Uganda in Particular (and also, curiously, King of Scotland) --decreed Africa should be for Africans. One of his first decisions as lord of beasts and fishes was to eject all the Asians -- some 40,000 or so, who were third generation descendants of Indians who had come to work for the British colonial administration during the days of Empire and who, when the British Empire was dissolved, created commercial enterprises.

Two generations of Asian immigrants have had an extraordinary impact on British business. The Daily Telegraph today publishes details of Britain's richest Asians, in association with Eastern Eye, Britain's biggest selling south-Asian newspaper.;jsessionid=X2VFZ1FTNR44BQFIQMGSFFWAVCBQWIV0?xml=/money/2006/04/19/cnasian19.xml&menuId=242&sSheet=/portal/2006/04/19/ixportal.html

May 10, 2006

What Ails Afghanistan? pakistan

May 10, 2006; Page A18

Four and a half years after the fall of the Taliban, Afghanistan is still highly unstable. And it seems to be getting worse rather than better. Every few days now, the resurgent Taliban carry out another deadly attack on school children, aid workers, or local or international security forces. It is a grim return on the outside world's huge investment in Afghanistan. Yet while the international community has done an enormous amount to help the country recover from its failed-state condition, it has resisted tackling the problem at its very root -- Islamabad. Truth is, Afghanistan will never be stable unless Pakistan's military government is replaced with a democracy.

* * *

Pakistan's primary export to Afghanistan today is instability. On the most basic level, attacks in Afghanistan, including suicide bombings, are often planned and prepared at Taliban training camps across the border. Islamabad claims to be doing all it can to stop this infiltration. But President Pervez Musharraf's protests ring hollow when he has done so little to address the concerns raised by his Afghan counterpart Hamid Karzai, that Taliban leaders are operating out of sanctuaries in Pakistan.

One needs only to look at the military's close relations with religious radicals to understand how unreliable a partner it is in stabilizing Afghanistan. Militant Islamist groups that Mr. Musharraf banned under the international spotlight following 9/11 and the 7/7 London bombings still operate freely. Jihadi organizations have been allowed to dominate relief efforts in the aftermath of the October 2005 earthquake. The military has repeatedly rigged elections, including the 2002 polls, to benefit the religious parties over their moderate, democratic alternatives.

In short, Pakistan is ruled by a military dictatorship in cahoots with violent Islamist extremists. The military has no interest in democracy at home, so why does the outside world expect it to help build democracy next door?

If we are really going to get to the core of Afghanistan's instability, therefore, we must tackle Pakistan. Above all, this means returning the country to democratic rule. After seven years under the military, this is not an easy task, but some institutions are still surviving -- just. The judiciary, for example, has been badly degraded under Mr. Musharraf and his army colleagues; but there is enough left to give hope for some kind of gradual resuscitation.

Moderate political parties are also struggling to hang on; down but not yet out, they could recover relatively quickly if given a democratic chance. Pro-dictatorship voices regularly argue that those parties were highly corrupt and that it was their corruption that justified the 1999 coup that brought Gen. Musharraf to power. But they refuse to condemn or even acknowledge the military's large-scale, institutionalized corruption.

So much has been grabbed by the military that it will take years just to catalog it. The military has acquired vast tracts of state-owned land at nominal rates; its leaders dominate businesses and industries, ranging from banking to cereal factories. Their control of the economy has grown so great it will present an enormous challenge to any future democratically elected government.

That civilian government, when it comes, will also be moderate in character and far more inclined to tackle, in earnest, the scourge of Islamic radicalism. Even in the rigged 2002 election, the religious parties polled only 11% of the vote. A fully free and fair race will squeeze out radical forces that have thrived under military rule and which play havoc with Pakistan's weak neighbor to the northwest. In addition, unlike the military, which always thrives in a hostile environment, a civilian government will have a stronger interest in peace with India. And who wouldn't sleep safer knowing that Pakistan's nuclear bomb was in democratic hands?

Democratic governance would also bring a much-needed opportunity to overhaul the country's education system. As the state system has consistently failed young people for decades, madrassas have taken up the slack, with the most extreme religious schools helping to radicalize tens of thousands of Pakistanis -- and Afghans -- filling heads with intolerant visions of Islam, far from the mainstream of South Asian Muslim society. The country needs a properly funded, state-run, secular education system.

Bringing all this about is an enormous task, but demilitarizing and deradicalizing Pakistan is truly the key to bringing about stability in Afghanistan and the wider region. Governments now working so hard to support Afghanistan will only be spinning their wheels until they make Pakistan a top priority and apply maximum pressure on Islamabad to ensure the 2007 elections are actually free and fair, by applying clearly defined benchmarks and insisting on competent international observers. As long as the military and the madrassas rule just across the border, Afghanistan will never find peace.

Lord Patten, former EU commissioner for external relations, is chairman of the International Crisis Group and chancellor of Oxford University.

May 7, 2006

The Other Immigration

Published: May 7, 2006

If you were to set out to design a story that would inflame populist rage, it might involve immigrants from poor countries, living in the United States without permission to work, hiring powerful Washington lobbyists to press their case. In late April, The Washington Post reported just such a development. The immigrants in question were highly skilled — the programmers and doctors and investment analysts that American business seeks out through so-called H-1B visas, and who are eligible for tens of thousands of "green cards," or permanent work permits, each year. But bureaucracy and an affirmative-action-style system of national-origin quotas have created a mess. India and China account for almost 40 percent of the world's population, yet neither can claim much more than 7 percent of the green cards. Hence a half-million-person backlog and a new political pressure group, which calls itself Immigration Voice.

of the commonly expressed view that Americans are not opposed to immigration, only to illegal immigration. Immigration Voice represents the kind of immigrants whose economic contributions are obvious. It is not a coincidence that the land of the H-1B is also the land of the iPod. Such immigrants are not "cutting in line" — they're petitioning for pre-job documentation, not for post-job amnesty. And people who have undergone 18 years of schooling to learn how to manipulate advanced technology come pre-Americanized, in a way that agricultural workers may not.

But Immigration Voice could still wind up crying in the wilderness. As the Boston College political scientist Peter Skerry has noted, many of the things that bug people about undocumented workers are also true of documented ones. Legal immigrants, too, increase crowding, compete for jobs and government services and create an atmosphere of transience and disruption. Indeed, it may be harder for foreign-born engineers to win the same grip on the sympathies of native-born Americans that undocumented farm laborers and political refugees have. Skilled immigrants can't be understood through the usual paradigms of victimhood.

The economists Philip Martin, Manolo Abella and Christiane Kuptsch noted in a recent book, "As a general rule, the more difficult it is to migrate from one country to another, the higher the percentage of professionals among the migrants from that country." Often this means that the more "backward" the country, the more "sophisticated" the immigrants it supplies. Sixty percent of the Egyptians, Ghanaians and South Africans in the U.S. — and 75 percent of Indians — have more than 13 years of schooling. Their home countries are not educational powerhouses, yet as individuals, they are more highly educated than a great many of the Americans they live among. (This poses an interesting problem for Immigration Voice, which polices its Web forums for condescending remarks toward manual laborers.)

So how are we supposed to address the special needs of this class of migrant? For the most part, we don't. The differences between skilled and unskilled immigrants are important, but that doesn't mean that they are always readily comprehensible either to politicians or to public opinion. When high-skilled immigrants who are already like us show themselves willing to become even more so, jumping every hoop to join us on a legal footing, it dissolves a lot of resistance. But it doesn't dissolve everything. It doesn't dissolve our sense that people like them are different and potentially even threatening.

If we consider our own internal migration of recent decades, this will not surprise us. You would have expected that big movements of people between states — particularly from the North to the Sun Belt and from Pacific Coast cities to Rocky Mountain towns — would cause increasing uniformity and unanimity. But that didn't happen. Instead, this big migration has coincided with the much harped-on polarization between "red" and "blue" America.

Georgians take up jobs on Wall Street and New Englanders unload their U-Hauls in Texas. The sky doesn't fall — but neither do cultural or political tensions between respective regions of the country. Consider the diatribes that followed the last election, in which "red" America stood accused of everything from ignorance and bloodlust to knee-jerk conformity. Or consider North Carolina. As the state filled up with new arrivals from such liberal states as New York and New Jersey, political pundits predicted the demise of its longtime ultraconservative senator Jesse Helms. But Helms won elections until he retired in 2002, largely because many of those transplants voted for him enthusiastically. The sort of Yankees who moved to North Carolina had little trouble adopting the political outlook of their new neighbors. But you didn't notice North Carolinians begging for more of them.

While Immigration Voice looks like an immigrant movement that Americans can rally behind, its prospects are mixed. A recent measure sponsored by Senator Arlen Specter of Pennsylvania to nearly double the number of H-1B visas was passed through committee, then killed and then revived. The fate of skilled immigrants hinges on public opinion, and that is hard to gauge. Even an employer delighted to sponsor an H-1B immigrant for a green card might have no particular political commitment to defending the program, or to wringing inefficiencies out of it. The arrival of skilled individuals arguably makes America a more American place. But not necessarily a more welcoming one.

Christopher Caldwell is a contributing writer for the magazine.

May 5, 2006

Females Don't Always Go for Hottest Mate

May 5, 2006; Page B1

At first glance, the "sexy son hypothesis" makes perfect sense. According to this pillar of evolutionary biology, a female who chooses a high-quality male will have sons who inherit dad's allure. They, too, will therefore have their pick of females, allowing mom to hit the jackpot: grandmotherhood.

But when scientists followed male flycatchers whose dads were real catches (as judged by a forehead patch that is this bird's equivalent of perfect abs), they found no such thing.

The sons "did not inherit their father's ... mating status," the Swedish researchers wrote in the February issue of American Naturalist. As a result, mom got fewer grandkids than did females who settled for less-attractive males. The studs were so busy mating they had no time to raise offspring, causing their health and fecundity to suffer. Homelier birds were better dads, raising sons who had more mating success.

Poor Darwin. After he developed his theory of how organisms change through variation and natural selection, his thoughts turned to sex. Because females have few eggs (compared with males' limitless sperm), their best strategy is to select the highest-quality males for mates, he wrote in 1871. That way, their progeny also would have superior traits. The offspring would survive and reproduce better, making mom's fondest wish -- to become a grandmother -- come true. (In evolution, success means reproduction, not only for you but for your descendants unto the nth generation, too.)

The theory of sexual selection -- that females choose males with the best genes, causing those genes to become more prevalent in succeeding generations -- is invoked to explain why peacocks have rococo tails and bucks have huge antlers. Neither trait has real survival value, but females choose males that have them, exerting selective pressure for ever-showier versions.

Or so textbooks say. Just as Darwin's theory of natural selection is under attack by America's religious right, his less-known theory of sexual selection is catching flak from some biologists. "In a number of species, reproductive behavior does not conform to Darwin's theory of sexual selection," says biologist Joan Roughgarden of Stanford University. "The idea that females choose the genetically best males is wrong. Instead of choosing mates who will increase the genetic quality of their offspring, females make choices that will increase their number of offspring."

As in the flycatcher study, mating with "sexy" males isn't necessarily the way to a plethora of descendants. True, in species where males contribute nothing but genes to offspring, this strategy may work. But biologists are finding more and more examples where females benefit from a different strategy.

Female crickets mate with just about any male that asks, for instance. Through promiscuity, not choosing the "best" male, they increase the genetic diversity of their offspring, improving the chances that some will survive no matter what pathogens and enemies the kids encounter.

Other females are not as enamored of sexy traits as theory claims. While big-antlered red deer are busy fighting each other to show a female who has the best rack, the doe sneaks off to mate with less well-endowed stags. Female red-winged blackbirds are not easily impressed, either. Having the most macho plumage has no detectable effect on how many offspring a male sires, David Westneat of the University of Kentucky reported in American Naturalist this week.

Nor is flaunting their charms and competing against other males necessarily the best reproductive strategy, as Darwin thought. In some species, cooperation can bring greater success. Bluegill sunfish, for instance, form trios of one small female, one large territory-holding male and one small male that infiltrate that territory when the female releases her eggs. That lets the little scrawny guy, despite the lack of female-attracting heft, become a dad.

Such strategies, Prof. Roughgarden says, show that "each kind of male has its own way of going about its life. Each works out fine." As she and colleagues wrote in February in Science, "animals cooperate to rear the largest number of offspring possible."

Another problem with sexual selection is that it fails to explain the persistence of, shall we say, homely males. If females choose the male with the best traits, as claimed, then after enough generations every peacock should have a tail to die for. But they do not. Every flock has studs and duds. "Shouldn't all the tails be great?" asks Prof. Roughgarden.

Other scientists are not ready to jettison sexual selection, calling it (as biologist Jerry Coyne did in a review) "powerful and largely correct." But some aren't so sure. Primatologist Sarah Blaffer Hrdy (pronounced "herdy") calls it "ill-advised" to "give precedence to [females'] quests for supposedly the 'best' genes" when they choose a mate.

Mating can indeed be a competitive sport (see: spring break). But many traits that attract females have nothing to do with good genes. For mysterious reasons, females just developed an attraction for them. Men on a quest for perfect abs can take that as fair warning.

Wave of retiring workers could force big changes

TOYOHASHI, Japan — No one knows spindles like Katsuya Hyodo.

For more than three decades, the diminutive factory worker, armed with only a junior high school education, has studied and designed the whirring cylinders at the heart of automotive machine tools. "I like spindles," Hyodo says. "There are so many different kinds."

His expertise and passion are priceless to a small company like his employer, machine tool manufacturer Nishijimax (annual revenue: $30 million). Just one problem: Katsuya is 72 years old. That's why he spends Sunday afternoons at home transcribing everything he knows about spindles into his computer. He wants to make sure his wisdom reaches the next generation. "I am not just doing it for myself," he says.

All over Japan, companies are bracing for a demographic wave that will wash away many of their most experienced employees. The Japanese call it their "2007 problem." Beginning next year, members of what Japan considers its baby boom generation will start hitting 60 and dropping out of the workforce. Some might postpone retirement, but they can't work forever. Plunging birth rates mean there won't be nearly enough young people to replace them.

"We face a big problem," says Shigeyoshi Yoshida, executive director of the Japan Aging Research Center. "Over the next three or four years, 10 million people will retire."

Japan is starting to lose workers just when it needs them most. After more than a decade of stagnation, the Japanese economy is growing again. The unemployment rate was at an eight-year low of 4.1% in March. Employers began complaining about a labor shortage early last year, the Bank of Japan says, and it's bound to get worse. Japan's population fell in 2005 for the first time, to 126.1 million, and is expected to shrink by nearly 38 million by 2050.

Nowhere is the labor market tighter than here in central Japan's Aichi Prefecture (state), a magnet for auto suppliers drawn to the area around Toyota City. In February, there were 1.72 job offers for every job seeker in Aichi — the highest ratio in Japan, according to the Ministry of Health, Labor and Welfare.

The problem isn't just a shortage of bodies, notes Jesper Koll, chief economist at Merrill Lynch Japan Securities: It's also a mismatch between what employers need — engineers, nurses, retail clerks and skilled factory hands — and the workers that are available, particularly construction workers idle since the government started cutting pork-barrel public works spending several years ago. For the first time, Koll says, fiftysomething Japanese men, including ex-construction workers, are working behind cash registers, ringing up sales in convenience stores — service jobs that would once have been considered beneath their dignity.

Skilled labor is in especially short supply. Already, the country needs 170,000 software engineers, says Shiro Kaizuka, CEO of the Tokyo job-placement firm Fullcast Technology. Companies are snapping up new college grads — in fields such as engineering and finance — as fast as they can. "You want to be reborn as a 22- or 23-year-old Japanese," Koll says.

May 4, 2006

Latin Energy Fad

May 3, 2006; Page A14

Latin culture is all the rage these days, from Botero sculptures and Shakira's "Hips Don't Lie," to burritos and margaritas. So maybe we shouldn't be surprised that Bolivia is getting in on another Latin craze: the abrogation of contracts.

We refer to President Evo Morales's pronouncement on May 1 -- not a coincidental date -- to tear up Bolivia's agreements with foreign investors in the natural gas industry and take, in his words, "absolute control" of Bolivia's natural resources. Kicking out foreign investors by executive decree sounds a lot like the same authoritarian nationalist populismo that has earned Bolivia the only prominence it has ever enjoyed: South America's poorest nation.

The Morales move shocked markets but not for its originality. The newly inaugurated president is following the lead of Venezuelan President Hugo Chávez, who is a knock-off of Argentine strongman Juan Peron. Peron is long since dead but his spirit lives on in his party, which has been the 21st century's trend setter in the assault on property rights. In 2001 and 2002, Argentina's Peronistas reneged on their commitments not only with foreigners but with their own people, declaring a debt moratorium, tearing up utility contracts, confiscating dollar bank accounts and devaluing the peso.

Señor Chávez followed suit after a fashion. He canceled contracts with foreign oil companies last month, demanding that the government oil company be given majority ownership and operational charge of oil fields. New terms offered to investors are also far less profitable. Some have agreed to stick it out, but Exxon Mobil sold its operations and when France's Total and Italy's ENI SpA refused to give in, Mr. Chávez responded by seizing their operations.

Like all fads, this one has its surface appeal. Argentina cleared its balance sheets by sticking it to its creditors and tearing up contracts. Its economy is still growing four years after its theft of private-sector assets, and it may even believe it's gotten something for nothing.

Yet the real predictor of a country's economic future lies in its investment rate. Economists estimate that to achieve steady long-term growth of 3.5% to 4%, Argentina needs an investment-to-GDP rate of at least 23%. To reach 5%, a more reasonable target for a quasi-developed country, it needs 25% investment to GDP. Yet last year's investment rate was a measly 19.8% and today's rate is only 22%. In other words, there are lots of places to put capital these days and few are rushing into Buenos Aires.

It may be that Mr. Morales has been emboldened by the petro wealth of Venezuela. But that country, too, is having trouble sustaining investment in energy production. Thanks to rampant corruption and the government's use of energy profits for buying support for socialism at home and around the region, Venezuela's oil fields are suffering from under-investment. Given an annual depletion rate of 25%, the only thing not clear is how long it will take to run the sector completely dry.

Bolivia to date has had only about $3.5 billion in foreign investment in natural gas, not nearly enough to exploit its vast reserves in the future. Even if Brazil's Petrobras and Spain's Repsol YPF decide to stay and accept the operating terms laid down by President Morales -- including a tax of 82% on natural gas extracted from country's two biggest fields -- new investment is unlikely to be nearly so brave.

Which means Bolivia would become either less productive or highly dependent on state-owned foreign companies from Venezuela or perhaps Russia. Neither option bodes well for the country's sovereignty, much less its prosperity.

May 2, 2006

Govindraj Ethiraj: India's 21-day disadvantage

This opinion piece is simply beautiful in its explanation of why India is so disadvantaged when it comes to manufacturing.


Govindraj Ethiraj / Mumbai May 02, 2006

The conference room has a busy, workman's look about it, with a long table in the centre. Around, on the two of the walls hang shirts with premium labels; Abercrombie & Fitch, Nordstrom, Tommy Hilfiger & Hugo Boss. Through the large, sealed window, is the familiar Shanghai sprawl of skyscrapers stretching across. It's raining outside.

We are in the China sales offices of the $500 million Esquel, a Hong Kong headquartered shirt maker, among the world's largest. Rebecca, a young merchandiser of Taiwanese origin, is taking my friend Vijay through a corporate presentation. She mentions, by the way, that her founder, Marjorie Yang was voted one of the most powerful women business leaders in the world by Fortune. Yang is also MIT and Harvard educated.

The next slide is on Esquel's production (60 million shirts) facilities. I notice their largest manufacturing plant is in Gaoming, near Guangzhou on the east coast. The plant employs some 21,000 workers. The rest are in Malaysia, Vietnam, Mauritus and even Sri Lanka. I can understand they are big in China but how come they are not in India? I ask Vijay who wants to import Esquel's yarn-dyed (a speciality) fabric for Indian garment makers.

The next day we visit Syed, a GAP Inc converter or fabric sourcer, in another Shanghai office block. Right next to one of the citys six elevated roads. Translated, its a 14 km, six-lane flyover that runs above the city. Syed hails, interestingly, from one-time textile city Davangere in Karnataka. Trained as an engineer, he went to Dubai 14 years ago but wandered into textiles and fabrics.

Syed says only 20 per cent of his fabric consignments head for India. The rest go all over the region, including Bangladesh and Sri Lanka. Why is India not a bigger buyer, particularly in this post quota world ?, I ask him. Syed takes a pen and paper. We work mostly with the big brands. Their lead times are small and orders big. And a garment manufacturer in India will find it tough. Assuming he has the capacity, he says.

Why is that ? I ask. Compounded delays, says Syed. A consignment of fabric can take upto 25 days to reach the manufacturer in India, particularly in Mumbai or Delhi, compared to 15 in Sri Lanka. Customs clearance can be tricky. It might be three days in Chennai but upwards of 10 days in Mumbai. Depending on whether you have a full container or not. And then comes the long march; negotiating inter state barriers, octroi check points and bad roads.

Moreover, Syed says the containers don't come straight to India. Mostly they are trans-shipped (transferred from one vessel to another) in Singapore or Colombo. Like I was on my Singapore Airlines flight back to Mumbai. But why Colombo? I ask. Well, they have a bigger and more efficient port, he explains. Anyway, that's another two-three days lost. And additional costs.And it's the same story on the outbound, though time at customs is less.

So that's one reason companies like Esquel are in Colombo and not in India. And Syed is exporting there. Customs clearance is brisk both ways, the garment factories are close by and labour, like the rest of the region, is cheap. Not to mention flexible. But we are managing, aren't we ? I ask Syed, thinking of all the IPO-fuelled expansion plans of the Indian garment makers.

Of course, he replies. But then it is about the opportunity lost. China exports almost ten times as much garments as India. But lost opportunity is only part of the problem. Says Syed, You have to remember the supply chain is always getting shorter and tighter. Deliveries are usually expected with 120 to 150 days of placing an order. Sometimes less. Depending upon the kind of fabric and whether its in stock. And the order size.

Syed says that increasingly, big brands in the US and Europe are creating `fast track segments. Like demanding that 15 per cent of the total order must be delivered within 60 days. That's not possible for an Indian garment maker to match, even with locally sourced fabric. Though a garment maker based out of Sri Lanka could potentially deliver, he says.

As we leave Syed's office and proceed for an Indian lunch, I collect my thoughts. An Indian garment exporter will almost always be at a 15 to 21-day logistics disadvantage. Come to think of it, it's the same reason Intel has to think so much before investing in an Indian chip fab. Its one thing to invest for local growth. Another to create a cog in a smoothly turning global supply chain wheel.

A multi-location garment maker, like Esquel, will hesitate to put India on its global manufacturing map. Not surprisingly, there is little or no Foreign Direct Investment in this sector. And thus more jobs. As long as it takes weeks to clear customs and days to transport the product from the ports to the factories. So, the bad news is that customs and procedures are one of the key causes for the delays. That’s the good news as well. Revamping should be simpler than building infrastructure.

May 1, 2006

Mid-Day Mumbai and Indian media's pseudo-secularism

I am thoroughly pissed after reading Mid Day Mumbai's account of the massacre of 22 Hindus The article does not even mention the word Hindus. It's the same case with the Hindu.
Taking a look at the list of sites on google news carrying this story, Indian papers are conspicuously avoiding the mention of Hindus in the title of their articles and even in the body! Why such hypocrisy in the Indian media? Is to avoid hurting the "sentiments" of the minority community, which is a majority in Kashmir?
However, foreign media have no such qualms in telling the truth of the matter.