Economic Crisis

Huge budget deficits and the need to spend on fiscal stimuli are bound to impact upon defence budgets and the ability to undertake long-term overseas operations. While India is likely to emerge from the crisis somewhat better off than most countries, the strategic shifts in global power may not all be to India’s advantage.

The ambitious policy measures taken by the Ranil Wickremasinghe government to revive the economy have yielded some positive outcomes though concerns remain over their implementation.

Though the Janatha aragalaya (people’s struggle) against the Rajapaksas was spontaneous, the role of the Left organisations in galvanising this into a movement that ousted the Rajapaksa family is an important landmark in Left politics.

Gotabaya Rajapaksa’s resignation is unlikely to bring the desired political outcome and the much-needed economic relief to the people of Sri Lanka.

Depletion in foreign reserves has led to uncertainty about Sri Lankan government’s ability to account for import of essential items and debt servicing. Analyses of government’s policy measures and global geopolitical-economic developments suggest that a state of uncertainty is hovering over Sri Lankan economy.

Prolonged political crisis, social unrest, pre-existing economic misery, and outbreak of a diplomatic crisis between Lebanon and the Gulf countries have left Lebanon in a debilitated state. Systemic reforms to tackle the economic, political, diplomatic and humanitarian challenges, are the need of the hour.

Demonetisation is an important step in the fight against the finance of terrorism. However, it should neither be the first nor the last, if the interlinked threats of corruption, crime and the finance of terrorism have to be controlled.

The ongoing global financial crisis has had an increasing strain on the defence budgets of different European countries. In the case of France, an intelligent and anticipatory/ preventive planning has mitigated the effects of the crisis but challenges remain, which have to be taken seriously and addressed effectively, if France wants to maintain its strategic autonomy.

While loans, grants and lines of credit offer a solution to deal with immediate crises, it is important to gauge the long-term impact of such Indian policies on India-Bhutan relations.

As China heads towards leadership changes after the 18th Party Congress, there is uncertainty both as regards economic policy as well as internal dissidence.