11 April 2018

‘No Direct Confrontation’: Investors Voice Relief at Xi's Speech

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By Moxy Ying, Matthew Burgess, and Nguyen Kieu Giang

Asian stocks and U.S. futures jumped in Asian morning trading as Xi called for an upholding of the multilateral trade system and said dialogue was the way to resolve disputes, diffusing trade tensions with the U.S. In his keynote address to the Boao Forum for Asia, Xi vowed to open sectors of China’s economy from banking to auto manufacturing, increase imports and expand protection to intellectual property.

“There’s no direct confrontation” with the U.S., said Peter So, co-head of research at CCB International Securities Ltd. in Hong Kong. This suggests “possible room for improvement over the trade dispute.”

The MSCI Asia Pacific Index climbed as much as 0.8 percent and hit a session high after Xi started speaking. Japan’s Topix index, Hong Kong’s Hang Seng Index rose at least 1 percent, while S&P 500 Index futures jumped as much as 1.5 percent.

Here are some other investor reactions:
Long-Term View

India's Next Fighter?

By Daniel Darling
To observers of India's defense environment, the country's procurement process is a deeply bureaucratized labyrinth of incompetence and ineffectiveness. A 27-point internal memo prepared in 2017 by Minister of State for Defence Subhash Bhamre presented a sweeping denunciation of the tangled web of failures in Defence Ministry weapons-buying procedures and outputs. Most striking to note from media reports emerging back in February regarding the memo is that of 144 potential defense deals presented within the last three financial years (2015-2017), only 8-10 percent came to fruition within the stipulated time period.

Will India Become a Naval Superpower Thanks to Aircraft Carriers?

Robert Farley
With one large carrier in service and another on the way, India has become one of the world’s pre-eminent naval aviation powers. How did the program come about? Where is it going? And what is the strategic rationale for India’s massive investment in aircraft carriers?

The Origins of India’s Carriers

Despite considerable economic challenges, India took carrier aviation very seriously in the years after independence. Unlike China (or even the Soviet Union), India focused on carriers instead of submarines. INS Vikrant, a Majestic-class light carrier, served from 1961 until 1997, fighting effectively in the 1971 war. INS Viraat, formerly the Centaur-class carrier HMS Hermes, joined the Indian Navy in 1987 and served until 2016. These carriers gave the Indian Navy long-term experience in carrier ops, as well as a compelling organizational logic for maintaining a carrier capability.

Pakistan Calls India's Nuclear Bluff in a Subcontinent Standoff

The nuclear arms race between India and Pakistan will escalate as both countries seek to introduce new technologies and strategies. Pakistan's improved ability to retaliate to an Indian strategic nuclear strike will make it more difficult for India to deter Islamabad from using tactical nuclear weapons on the battlefield. If India acquires its own tactical nuclear weapons, New Delhi and Islamabad will be more likely to use nuclear weapons in the event of a major conflict between them. 

Give us 21st Century Justice

Alok Prasanna Kumar

What do we about the Indian judiciary?

It’s easy to put out the worrying numbers (as of date) because they are there in the public domain and well known: There are more than 4 crore cases pending at all levels in Indian courts. 37% of High Court vacancies are unfilled, as are 23% of subordinate judiciary vacancies78% of pending cases in the High Courts have been awaiting disposal for more than two years since filing; the figure is 53% for cases at the subordinate judiciary levelA shocking 23% of cases in the High Courts have been pending for more than ten years; the figure is 8.43% at the subordinate judiciary level

Not at the Cost of China: India and the United Nations Security Council, 1950

By Anton Harder
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In CWIHP Working Paper #76, "Not at the Cost of China: New Evidence Regarding US Proposals to Nehru for Joining the United Nations Security Council," author Anton Harder examines the controversy surrounding India's role in the United Nations Security Council in the 1950s. Using Indian archival material from the Nehru Memorial Museum and Library, this paper shows that America's interest in seeing India join the Security Council was motivated by the emergence of the People's Republic of China as a regional power, and that this episode was an early example of the United States attempting to use the United Nations to further its own Cold War interests.

Pakistan financial woes exposing more cracks in Belt and Road?

The China-led Belt and Road Initiative (BRI) is putting strain on Pakistan’s public finances and currency, some are saying, casting a shadow over Xi Jinping’s signature connectivity plan. Jonathan Rogers writes in The Asset on potential hiccups for the grand infrastructure scheme. “[Pakistan’s] current account worsened substantially last year on the back of a sharp increase in imports due to trade activity related to the Belt Road initiative. “This in turn has put pressure on the Pakistan rupee, which was the worst performer in the Asian currency complex last year and which has experienced downside revaluation pressure since December, with two sharp legs down met with a depletion of the central bank’s foreign exchange reserves.


By Harsha Kakar
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The west, led by the United States, is presently involved in a new cold war with Russia. Post the re-election of President Putin and Donald Trump’s congratulatory call, it appeared that the relations could again be moving forward. However, to support the United Kingdom on its tough stand against Russia over the poisoning in London on 4 March of Sergei Skripal, a former Russian Military Intelligence officer who acted as a double agent for the UK in the 1990’s and 2000’s, the US led the way by expelling 60 Russian diplomats, including 12 from its mission to the UN in New York. It also ordered the closure of the Russian Consulate in Seattle.

How China Sees Russia

By Fu Ying

At a time when Russian relations with the United States and western European countries are growing cold, the relatively warm ties between China and Russia have attracted renewed interest. Scholars and journalists in the West find themselves debating the nature of the Chinese-Russian partnership and wondering whether it will evolve into an alliance. Since the end of the Cold War, two main views have tended to define Western assessments of the Chinese-Russian relationship and predictions of its future. The first view holds that the link between Beijing and Moscow is vulnerable, contingent, and marked by uncertainties—a “marriage of convenience,” to use the phrase favored by many advocates of this argument, who see it as unlikely that the two countries will grow much closer and quite possible that they will begin to drift apart. The other view posits that strategic and even ideological factors form the basis of Chinese-Russian ties and predicts that the two countries—both of which see the United States as a possible obstacle to their objectives—will eventually form an anti-U.S., anti-Western alliance.

Here Are the Major Takeaways From Trump's Tariff List

China and the United States again upped the trade ante with their latest tit-for-tat tariff measures announced this week, as Washington continues to implement its trade and investment agenda against Beijing. Although negotiations have begun behind the scenes and China is offering certain concessions, it is not clear whether the United States is willing to accept them; more likely than not, most of these tariffs will be implemented in the future.So far, China has responded in kind to each move the United States has made and will continue to do so as Washington wraps up its third front against China in the coming weeks: restrictions on Chinese investment into strategic sectors in the United States.

Why China could get hurt more from a trade war in the tech sector

Saheli Roy Choudhury

China could potentially end up losing more than the U.S. from the ongoing trade tensions that are now spilling into the technology sector, according to Gavin Parry from Parry Global Group. That is because major U.S. tech firms operating in China are already under pressure from President Donald Trump to shift their manufacturing businesses back to the United States and create more jobs domestically, Parry said. Earlier this week, Trump unveiled a list of Chinese imports his administration aims to target as part of a crackdown on what the president deems unfair trade practices. Sectors covered by the proposed tariffs include products used for robotics, information technology, communication technology and aerospace.

Could Tibetan clouds save China from drought?

DIVERTING water from the south of China to the north is not the country’s only crazily ambitious drought-alleviation scheme. The government is also thinking about setting up what would be the world’s largest cloud-seeding operation in Tibet. China already uses the technique more than most. Now, says the South China Morning Post, a Hong Kong newspaper, a state-owned defence company has built 500 burners on Himalayan ridges in the path of the monsoon. They are testing a system that involves lofting particles of silver iodide from the machines into the atmosphere. When the water-laden air of the monsoon hits the particles, ice crystals are supposed to form and later fall as rain or snow. The hope is to build tens of thousands of these burners and increase rainfall by up to 10bn cubic metres a year in an area the size of Iran that feeds the Yangzi and Yellow rivers as well as others upon which China’s neighbours depend.

Why a trade war with China would hurt the U.S. and its allies, too

David Dollar and Zhi Wang

Two-thirds of world trade now occurs through global value chains that cross at least one border during the production process, and often many borders. As a result, the typical “Chinese product” that the United States imports has a lot of value-added from countries other than China. It often has value-added from U.S. firms with operations in China, as well as from parts suppliers in Japan, South Korea, and Taiwan. Hence, in any trade war between the United States and China, there will be collateral damage on third countries.

The New Shape of the Middle East

By George Friedman

The Middle East has assumed a different shape and structure in recent years. Nowhere is this more visible than in the April 4 meeting in Turkey between Russia, Iran and Turkey. This group has become critical in defining the Middle East. It is not necessarily a cohesive group, and its staying power is uncertain. But for the moment, the United States, formerly the defining power of the region, is moving to the margins, and a new architecture has emerged.

Choosing Sides

The change was rooted in two events: the defeat of the Islamic State in Iraq and the Arab Spring. IS was defeated by U.S. troops and Iraqi Shiite irregular militias. The Iraqi militias were supported and in many cases led by the Iranians, who are also Shiites. When IS shattered, the Iranians gained a dominant role in shaping Iraqi foreign policy.

Here's What's Actually Different About the Latest North Korea Talks

By Rodger Baker

Their impending dialogue notwithstanding, mistrust between the United States and North Korea still runs deep. But the new generation of North Korean leaders, the unique political profile of U.S. President Donald Trump and the advanced state of Pyongyang's nuclear program leave an opportunity (however slim) for a different outcome. Otherwise, the two sides could find themselves back on track toward containment or even U.S. military action. The saying goes that the more things change, the more they stay the same. On the Korean Peninsula, the reverse seems to be true: The more things stay the same, the more they change. Six months ago, the discussion about the peninsula was whether it could avoid unilateral U.S. military action to stem North Korea's nuclear weapons program. Today the conversation has turned to whether Pyongyang's current diplomatic offensive offers hope for a nonmilitary resolution to the conflict, a lingering holdout from the Cold War, or whether it's just another of North Korea's attempts to buy time to secure the government with a viable nuclear deterrent. Having studied North Korea and the issues surrounding the peninsula for more than two decades, I am torn between optimism (however thin) that real change may finally be in the offing and the natural pessimism that derives from experience.

The Good, the Bad and the Ugly of a U.S. Pullout From Syria

President Donald Trump is pushing for a withdrawal of U.S. forces from Syria, citing the considerable resources the United States has expended in the Middle East. A U.S. pullout from Syria could pave the way for an improvement in relations with Turkey and Russia. A withdrawal could also damage U.S. credibility, hamper the fight against the Islamic State and weaken Washington's ability to pressure Iran. 


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AT 48 YEARS old, Kersti Kaljulaid is Estonia’s youngest president ever, and its first female president. A marathon runner with degrees in genetics and an MBA, she spent a career behind the scenes—mostly as a European government auditor—before being elected by Estonia’s legislature in 2016. Two years later, she’s continuing Estonia’s push for global digital security while deflecting military and cyber threats from Russia, which occupied Estonia for 50 years until its liberation in 1991.

Hamas and the Mass Protests in Gaza

By Bernard Avishai
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Last Friday, thirty-five thousand Gazans staged a march to the border fence with Israel under the banner of “Return.” The demonstrations have thinned but not abated this week; large tents have been set up within the sight of Israeli snipers, as if base camps for future acts of daring. Some demonstrators encroached on what the Army has designated a prohibited area, three hundred metres in front of the fence. Others slung rocks, or burned tires. Since the demonstrations began, including clashes over the past seven days, nineteen Palestinians have been shot and killed, and a thousand have been wounded, according to reports from Gaza hospitals. Another march is called for Friday. Hamas, which has organized it, hopes to bring out as many as fifty thousand people, and eventually, week by week, turn the demonstrations into a cause the civilized world, such as it is, cannot ignore.


The United States today faces a number of actors who employ a wide range of political, informational, military, and economic measures to influence, coerce, intimidate, or undermine U.S. interests or those of friends and allies; many of these measures are often collectively referred to as "political warfare." This report analyzes political warfare as it is practiced today by both state and nonstate actors, and provides detailed recommendations regarding the most effective ways that the U.S. government, along with its allies and partners, can respond to or engage in this type of conflict to achieve U.S. ends and protect U.S. interests.

Modern Political Warfare

by Linda Robinson, Todd C. Helmus, Raphael S. Cohen, Alireza Nader, Andrew Radin, Madeline Magnuson, Katya Migacheva

What is political warfare?
How is it (or an appropriate analogous term) applied today?
How might the U.S. government, along with its allies and partners, most effectively respond to or engage in this type of conflict to achieve its ends and protect its interests?

The United States today faces a number of actors who employ a wide range of political, informational, military, and economic measures to influence, coerce, intimidate, or undermine U.S. interests or those of friends and allies; many of these measures are often collectively referred to as "political warfare." This report analyzes political warfare as it is practiced today by both state and nonstate actors, and provides detailed recommendations regarding the most effective ways that the U.S. government, along with its allies and partners, can respond to or engage in this type of conflict to achieve U.S. ends and protect U.S. interests.

Lessons Learned in Modernization

Aleyzer Mora and Linda O. Jones

An Army commander must be able to communicate with geographically dispersed forces to command effectively. A home station mission command center (HSMCC) increases a commander's ability to communicate with military partners anytime, anywhere. Streamlining modernization of the Army's home station mission command centers requires close coordination among stakeholders, from home station to the battlefield. (Photo Credit: (Image by Scott Sundsvold, I3MP Strategic Communications))

Cryptocurrency in Threat Finance: The Manipulation of Non-Fiat Digital Currencies to Finance Nefarious Actors

This paper focuses on emerging tactics, techniques, and procedures (TTP) in the threat finance world concerning cryptocurrencies. It will examine critical vulnerabilities in the crypto market, explore how non-fiat currencies have altered conventional money laundering techniques, and consider potential adversarial use of distributed computational infrastructure. This study will conclude with policy recommendations to US Government officials at the national, strategic, and operational levels that are designed to enable greater scouting of emerging technologies, which may be exploited.

The Rise of Cryptocurrency

The 4 Key Elements to Successful Senior Leadership

Donald C. Bolduc

“I'm starting with the man in the mirror. I'm asking him to change his ways. And no message could have been any clearer If you want to make the world a better place. If you want to make the world a better place takes alook at yourself, and then make a change.”

-- Lyrics from the song Man in the Mirror

The reason I am writing this article is because I received a lot of feedback on my article published in Small Wars Journal on leadership. The comments below are a sample of what I received from readers. These comments speak to the problem we are having in the military with humility, top-cover for mistakes, understanding how to manage failure, and organizational change.

Google employees protest Pentagon AI program

By: Brandon Knapp 

An MQ-9 Reaper sits on the flight line prior to takeoff at Holloman Air Force Base. The Pentagon wants to use artificial intelligence to process intelligence video gathered by drones in the Iraq and Syria. Employees at Google have signed a letter protesting the company’s involvement in Project Maven, the Department of Defense program that plans to use artificial intelligence (AI) in analyzing drone footage, according to the New York TimesThe letter, signed by 3,100 employees and dozens of senior engineers, was addressed to Google CEO Sundar Pichai in order to raise concern about the program, which they believe could be used to improve the accuracy of offensive drone strikes.

Marines’ Love Affair With 3D Printing: Small Is Cheap, & Beautiful


"My eyes are watering with what our young people can do right now," the Assistant Commandant said. "They’re really smart and they’ve got a lot of really good ideas," Commandant Neller said. "We would be well served to turn them loose." WASHINGTON: Why are the Marines in love with 3D printing? Like most romances, it starts with the small things, things too small for the conventional supply system to manage, like a two-cent plastic button that preempts a $11,000 repair. Big defense contractors, take notice.

How artificial intelligence went from an advantage to a worldwide threat

By: Mark Pomerleau  

Each spring, the nation’s top intelligence officials make a pilgrimage to Capitol Hill to solemnly discuss the threats the United States faces. What emerged following a pair of hearings in the House and Senate and hours of testimony is a laundry list of terror and a detailed accounting of exactly what keeps military leaders up at night. This year’s presentations also revealed a strategic shift as the Pentagon and intelligence agencies prioritize threats from China and Russia over terrorism for the first time since 2001. “We will continue to prosecute the campaign against terrorists that we are engaged in today, but great power competition, not terrorism, is now the primary focus of U.S. national security,” Jim Mattis, the secretary of defense, said in January 2018 while unveiling a new national defense strategy.