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Rise of the Dragon: Impending economic disaster or balancing of global power structure?

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Image courtesy freeliberal

By Gaurav Sharma

In the short span of three weeks this month, the Shanghai Stock Exchange shed a massive $ 4 trillion in stock value, sparking renewed suspicion on China as the economic counterpart to America’s hegemony in the global financial markets.

The abrupt crash, apart from casting a shadow on the strength of the Chinese currency and markets has also brought to question the reformist striving of Xi Jinping, who was given the mandate of not only sweeping-out rampant corruption from the Communist Party but also of economically empowering a burgeoning middle class.

But does the pitch alarm raised by Western media over the Chinese stock market plunge and notions of a Chinese “slowdown” hold any merit to predictions of an impending economic collapse or is it merely a classic case of jumping the gun via concoction of overblown fallacies?

Actual Situation

Almost as soon as it plummeted, the market bounced back with much gusto. Despite predictions that its growth would be laggard this year, the Chinese stock market has managed to sustain the 7 per cent quarterly growth rate it had aimed for.

Firstly, the notion that a vast majority of the Chinese population is invested in the stock market is a myth. The Financial Times has quashed this misconceived notion by stating that a meager 6 per cent of the Chinese people have invested in the market which largely include a small coterie of billionaires.

Moreover, the larger Chinese industrial workers do not have their wages held-up in stock options and neither does the elderly population have its retirement pension at risk. This is in stark contrast to the intertwined nature of the financial crisis that rocked the developed world in 2008.

(Employees had their salaries connected as part of stock-options with New York Stock Exchange and more than 50 per cent of the American population was invested in the stock market)

Secondly, the ‘free market’ in China is kept under close watch by the Communist Party, the founding and ruling party of China comprising of more than 88 million workers. Although many leaders in the party were indicted for corruption charges, people on the ground believe that with  the change in leadership, China would be restored back into a successful socialist society.

In fact, Xi Jinping has been described by the Economist as a leader enjoying ‘unusual popularity’, surpassing that of Mao Zedong, the renowned Chinese communist revolutionary who founded the Communist Party of China(CPC).

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In line with the new leadership of Xi Jinping’s ambitious ‘Going out’ strategy, China has shifted from an expansionary mode to an exporter of goods and services, a policy measure aimed to appease its South East neighbours of the hawkish military stance undertaken in the South China Sea.( Also known as ‘Peripheral Diplomacy’ in geo-political parlance)

Massive infrastructural projects spanning across construction of road, railways, bridges and hospitals have been put under the charge of Chinese state-owned companies in emerging nations such as Ecuador and the Galapagos Islands as part of its emergence into Latin America and the Pacific.

As a counterpart to US’ construction of the Panama Canal to link the Atlantic and the Pacific and serve as a detour of South America, China has decided to build a 170-mile canal cutting through Lake Nicaragua.

Under the One Belt One Project, China has mooted plans to revitalize the Silk route; comprising of the New Silk Road Economic Belt connecting it with Europe through Central and Western Asia and Maritime Silk Road providing China with connectivity to South Asia and Africa. China has also undertaken major construction activity in the Gilgit-Baltistan region, a disputed territory between India and Pakistan. It is building a 7000 megawatt power hydroelectricity plant in Bunji.  

For fostering such a development strategy, China has allocated a massive corpus of $40 billion to the “Silk Road Fund” to ensure financial flows within the network of global infrastructure plans.

Meanwhile, in the economic space, the Chinese state development bank has overtaken the World Bank in international lending. To add to the growing clout of its currency -the renminbi, China has launched an internationally funded organization called the Asian Infrastructure Investment Bank (AIIB), as a direct rival to the US-backed World Bank and the Asian Development Bank.

As a reminder of China’s emergence as the new economic powerhouse, the institution has drawn the support of 57 countries, including allies of USA. The unprecedented assent came despite attempts by the US to forestall such moves by kindling doubts about the loosening of lending standards.

Although the Eastern neighbors, Philippines and Japan refused to join the bank citing it as a plan to buy the loyalty of friends and working on “questionable” principles of governance and transparency, the bank is projected to grow to almost twice its size-from $ 50 billion to $100 billion.

The launch of the AIIB follows the establishment of the New Development Bank, popularly known as BRICS Bank– jointly funded by India, Brazil, India, China and Russia to counter IMF as a contingent reserve facility in 2010.

Declining western dominance?

A US and a Chinese flag wave outside a commercial building in Beijing, 09 July 2007. US Secretary of State Condoleezza Rice 06 July 2007 accused China of flouting the rules of global trade in its headlong economic expansion as the US administration "has not been hesitant" to deploy trade tools against China, including a complaint lodged with the World Trade Organization over copyright piracy. AFP PHOTO/TEH ENG KOON

American approach to the meteoric rise of China has been defensive, as a natural reaction to hold on to its fast slipping hegemonic power. It had castigated Britain for siding with the AIIB, saying that the bank would give China unilateral powers (26 per cent voting share).

While stating such an argument America innocuously forgets that under the Bretton Woods system, it possesses sweeping powers over the appointment of heads of World Bank while under the IMF quota it has almost four times as much power as China in its funding programs.

Europeans have pursued largely the same course, with the IMF being a puppet body in their hands. Back in 2010, almost every emerging market economy which was member of the IMF had opposed the Troika plan to bailout Greece through loans (a plan which would make it more indebted) and had instead argued for debt relief. The suggestions were ignored and have landed Greece to the brink of economic collapse.

Keeping in mind, the economic bullying that the world has seen through the domination of international financial bodies led by the US and EU, isn’t it appropriate for the world to side-line itself from the monopoly of US dollar and the Euro and instead settle financial exchanges in local currency?

Eurasian Dreams

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In line with China’s ambition for breaking the monopoly of the west in global financial transactions, Russia has made clear its plans for achieving economic independence by 2030.

Under the Shanghai Cooperation Organization (SCO), Russia and China are vying for merging China’s Silk Road plan with Russia’s Eurasian Economic Union. The fine-print of the plan is to fulfil Russia’s demand for capital, in light of the tighter western sanctions imposed against it while at the same time allow China the leeway to reach the west by crossing a single unified tariff zone.

Moreover, the membership to the SCO, which includes Central Asian nations such as Tajikistan, Kazakhstan, Kyrgystan, Russia, China and is expanding by the day. During the Ufa talks, Russian premier Vladimir Putin said that he will invite Iran to join the SCO while Azerbaijan, Armenia, Cambodia and Nepal will join the SCO as dialogue partners. Meanwhile, India and Pakistan will become full time members.

While critics view the rise of China with much suspicion, raising concerns that “American imperialism would now be replaced by Chinese imperialism”, a more correct assertion, will be that the rise of the dominant unipolar world after the cold war is being trampled over and replaced by a flourishing multi-polar realpolitik.

A multi-currency global financial structure spells doom for the American hijacking of the global economy. A new evolutionary phase in geopolitics is brewing, a welcome change indeed.

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Why Is India Still carrying The Social Stigma Of Women Infanticide?

The matter of female infanticide is something that has deeply touched our heart and we feel it as our prime agenda to raise our voice against it

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Female Infanticide has been going on for many years and has resulted in the deaths of countless girl foetuses. Wikimedia Commons
Female Infanticide has been going on for many years and has resulted in the deaths of countless girl foetuses. Wikimedia Commons
  • A lot of social evils which have disgraced our history are still very much prevalent
  • Female infanticide is known to be the intentional killing of female just-born owing to people preferring male just-born
  • In China and India alone, an estimated 2,000,000 baby girls go “missing” each year

Even after so many years of independence, we are not in a position to call our country a superpower. It is not hard to believe this because in an independent country like ours exist horrific acts like the merciless killing of the girl child. A lot of social evils which have disgraced our history are still very much prevalent. The matter of female infanticide is something that has deeply touched our heart and we feel it as our prime agenda to raise our voice against it.

Female infanticide is known to be the intentional killing of female just-born owing to people preferring male just-born. This has been going on for many years and has resulted in the deaths of countless girl foetuses. People are of the opinion that the girl child is inferior to the male child and this is clearly reflected in the fact that in many parts of the world, women are still not given a status equivalent to that of men. This is no doubt the highest level of brutality and the most destructive kind of bias existing in our country and in many other countries.

Also Read: Is The observance of Valentine’s day a Commination For The Indian Culture?

A direct proof of these facts comes from UNICEF which in its recent report concluded that 50 million girls and women are missing from the population of India because of this bias. As a matter of fact, in most countries for every 100 male births, there are approximately 105 female births. In our country, the 105 comes straight down to 93! This owes itself to 2000 odd abortions which happen illegally all over the country daily. Our people are of the opinion that only sons can provide income for the family. The system of dowry is still prevalent in some parts of the country. All these reasons have their roots in cultural beliefs of families and if female infanticide is to be stopped, then these beliefs have got to be challenged.

The government has initiated a lot of programmes to bring about a change in the attitude of people and stop these kinds of social evils. Wikimedia Commons
The government has initiated a lot of programmes to bring about a change in the attitude of people and stop these kinds of social evils. Wikimedia Commons

In countries with a history of female infanticide, the modern practice of sex-selective abortion is often discussed as a closely related issue. In several nations such as China, India and Pakistan, female infanticide remains to be a major cause of concern. It has been argued that the “low status” in which women are viewed in patriarchal societies creates a bias against females. The practice of female infanticide is found dominant among the indigenous peoples of Australia, Northern Alaska and South Asia, which seems to be “almost universal”, even in the West.

In 1990, Amartya Sen writes in the New York Review of Books estimated that there were 100 million fewer women in Asia that would be expected and that this amount of “missing” women “tells us, quietly, a terrible story of inequality and neglect leading to the excess mortality of women.”  Initially, the Sen’s suggestion of gender bias was contested and it was suggested that hepatitis B was the cause of the alteration in the natural sex ratio.

Also Read: Padman Review: Social Issue Presented Right

The numerical worldwide deficit in women is widely accepted due to gender-specific abortions, infanticide and neglect. Before Islamic culture became established in Arabic country in the seventh-century, female infanticide was widely practised.  According to scholars, the fact was attributed that women were deemed “property” within those societies. Some speculated that some women wanted to prevent their daughters from a life of misery, and thus would kill the child. But with the introduction of Islamic rule, the practice was made illegal.

People in India are of the opinion that only sons can provide income for the family. Wikimedia Commons
People in India are of the opinion that only sons can provide income for the family. Wikimedia Commons

In India, dowry system is one given reason for female infanticide; over a time period spanning centuries, it has become embedded within Indian culture. Although, there are several steps taken to abolish the dowry system but the practice still persists. For the rural families, female infanticide and gender-selective abortion are attributed to the fear of being unable to raise a suitable dowry and then being socially boycotted.

In 1789, during the time of British colonial rule in India, the Britishers discovered that female infanticide in Uttar Pradesh was openly acknowledged. A study by the scholars shows that the majority of female infanticides in India during the colonial period occurred for the most part in the North West. However, not all the groups were involved in this practice it was widespread. It was only after a thorough investigation by the colonial authorities in 1870 that the practice was made illegal.

Also Read: 7 new-age social issues in India that need a check

Some age-old practices seem to be deeply rooted in the Indian culture and making India undergoing a type of “female genocide”. As per one of the reports of the United Nations, India stands out to be the most deadly country for female children, and that in 2012 female children aged between 1 and 5 were 75 percent more likely to die as opposed to boys. One of the children’s rights group called CRY has acknowledged that of 12 million females born yearly in India 1 million will have died within their first year of life. According to the United Nations, there could be a possibility of such a severe crisis that less number of females will lead to a sharp increase in sexual violence.  A consequence of this will be a complete deterioration of social values. This practice of deselecting females is mainly due to factors like religion, economic factors and socio-cultural factors.

In several nations such as China, India and Pakistan, female infanticide remains to be a major cause of concern. Wikimedia Commons
In several nations such as China, India and Pakistan, female infanticide remains to be a major cause of concern. Wikimedia Commons

The economic factor arises from the belief that sons will provide economic stability to the family by earning wages, providing farm labour for family business and support parents during old age. People tend to think that after marriage, a son brings a female addition to the family who provides help in household work as well as dowry payment brings some sort of an economic advantage.

Coming to the socio-cultural factor, it is believed that having at least one male child is essential to continue the familial line and the respect of a family in the society is proportional to the number of male children in it. According to a certain Hindu tradition, only sons are permitted perform the funeral of their parents which assists in the attainment of salvation for the deceased.

Also Read: Today’s Social Issues and their Answers to Children

The government has initiated a lot of programmes to bring about a change in the attitude of people and stop these kinds of social evils by introducing various laws, schemes and acts which favour the education of the girl-child, equal rights and equal property share. In spite of all these steps taken, there is much left to be desired.

In China and India alone, an estimated 2,000,000 baby girls go “missing” each year. They are selectively aborted, killed as newborns, or abandoned and left to die. Other countries with similar cultural traditions, who have also faced this problem are South Korea and Nepal. The root causes of female infanticide are similar but not exactly the same in Confucian countries like China and South Korea, versus predominantly Hindu countries such as India and Nepal.