By Categories: Editorials, Misc

Recently India celebrated its 68th Republic Day, the highlight of which is an elaborate parade to show off India’s military might .

Soldiers goose-stepped and tanks rolled down Rajpath, New Delhi’s main ceremonial thoroughfare, as India’s president, Pranab Mukherjee, and this year’s guest of honour, Abu Dhabi’s Crown Prince Sheikh Mohammed bin Zayed al Nahyan, looked on. Fighter jets screeched overhead.

The annual display was particularly pointed this year, coming barely three weeks after Bipin Rawat, India’s new army chief, acknowledged in an interview the existence of the country’s “Cold Start” military doctrine. What is Cold Start and why did General Rawat, who took office on December 31st, mention it in public?

Cold Start is the name given to a limited-war strategy designed to seize Pakistani territory swiftly without, in theory, risking a nuclear conflict. It has its roots in an attack on India’s parliament in 2001, which was carried out by terrorist groups allegedly used as proxies by Pakistan’s powerful intelligence services (ISI).

India’s response to the onslaught was a flop: by the time its lumbering Strike Corps were mobilised and positioned on the frontier, Pakistan had already bulked up its defences, raising both the costs of incursion and the risk that it would escalate into a nuclear conflict. Cold Start is an attempt to draw lessons from this: having nimbler, integrated units stationed closer to the border would allow India to inflict significant harm before international powers demanded a ceasefire; by pursuing narrow aims, it would also deny Pakistan a justification for triggering a nuclear strike.

Yet India has refused to own up to the existence of the doctrine since it was first publicly discussed in 2004. Nor was its rumoured existence enough to stop Pakistani terrorists from launching devastating attacks in Mumbai in 2008, killing 164 people.

One reason for India to keep its cards close to its chest is that it may not be capable of acting on Cold Start. Indeed, India’s army chief admitted to civilian leaders after the 2008 attacks that his battalions were “not ready for war” with Pakistan. It probably did not help that India’s political leaders never signed off on it either, as a leaked diplomatic cable from 2010 suggested.

Yet things have taken a different turn since an assault last September on the Indian garrison of Uri in Kashmir, which left 19 dead. In a departure from India’s traditionally defensive posture, the government responded by authorising “surgical strikes” along the frontier, targeted at “terrorist launchpads” and “those protecting them”. By acknowledging the doctrine, which would demand a more potent retaliation than these commando operations, the army seems keen to signal that it has a range of strategic options, introducing an element of unpredictability in its response. Political leaders may have also come closer to embracing it.

The government has shown keen interest in national-security matters, moving India into the world’s top-five defence spenders, addressing servicemen’s grievances and mulling a wholesale revamp of the armed forces’ structure.

Whether the strategy will prove effective remains to be seen. By pursuing Cold Start, the army may have reaped “the worst of both worlds”, says Walter Ladwig, a scholar at King’s College London. Should it come after a terrorist attack prepared with the ISI’s knowledge, India’s response would lack the element of surprise. That makes Cold Start a dubious deterrent.

And Mr Rawat’s recognition of the doctrine’s existence provides further reason for Pakistan to develop “tactical” nukes—tiny warheads that could easily end up in inexpert or malevolent hands. The risk of overreaction on Pakistan’s side is heightened by India’s continued obfuscation about what exactly the concept means, making the whole premise seem misguided.

Indeed, Pakistani officials have already threatened to use nuclear weapons, should India put Cold Start into action. In conventional war, confusing an enemy can lead to victory; when two nuclear powers are involved it is a surer step towards a disastrous draw.


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  • Petrol in India is cheaper than in countries like Hong Kong, Germany and the UK but costlier than in China, Brazil, Japan, the US, Russia, Pakistan and Sri Lanka, a Bank of Baroda Economics Research report showed.

    Rising fuel prices in India have led to considerable debate on which government, state or central, should be lowering their taxes to keep prices under control.

    The rise in fuel prices is mainly due to the global price of crude oil (raw material for making petrol and diesel) going up. Further, a stronger dollar has added to the cost of crude oil.

    Amongst comparable countries (per capita wise), prices in India are higher than those in Vietnam, Kenya, Ukraine, Bangladesh, Nepal, Pakistan, Sri Lanka, and Venezuela. Countries that are major oil producers have much lower prices.

    In the report, the Philippines has a comparable petrol price but has a per capita income higher than India by over 50 per cent.

    Countries which have a lower per capita income like Kenya, Bangladesh, Nepal, Pakistan, and Venezuela have much lower prices of petrol and hence are impacted less than India.

    “Therefore there is still a strong case for the government to consider lowering the taxes on fuel to protect the interest of the people,” the report argued.

    India is the world’s third-biggest oil consuming and importing nation. It imports 85 per cent of its oil needs and so prices retail fuel at import parity rates.

    With the global surge in energy prices, the cost of producing petrol, diesel and other petroleum products also went up for oil companies in India.

    They raised petrol and diesel prices by Rs 10 a litre in just over a fortnight beginning March 22 but hit a pause button soon after as the move faced criticism and the opposition parties asked the government to cut taxes instead.

    India imports most of its oil from a group of countries called the ‘OPEC +’ (i.e, Iran, Iraq, Saudi Arabia, Venezuela, Kuwait, United Arab Emirates, Russia, etc), which produces 40% of the world’s crude oil.

    As they have the power to dictate fuel supply and prices, their decision of limiting the global supply reduces supply in India, thus raising prices

    The government charges about 167% tax (excise) on petrol and 129% on diesel as compared to US (20%), UK (62%), Italy and Germany (65%).

    The abominable excise duty is 2/3rd of the cost, and the base price, dealer commission and freight form the rest.

    Here is an approximate break-up (in Rs):

    a)Base Price

    39

    b)Freight

    0.34

    c) Price Charged to Dealers = (a+b)

    39.34

    d) Excise Duty

    40.17

    e) Dealer Commission

    4.68

    f) VAT

    25.35

    g) Retail Selling Price

    109.54

     

    Looked closely, much of the cost of petrol and diesel is due to higher tax rate by govt, specifically excise duty.

    So the question is why government is not reducing the prices ?

    India, being a developing country, it does require gigantic amount of funding for its infrastructure projects as well as welfare schemes.

    However, we as a society is yet to be tax-compliant. Many people evade the direct tax and that’s the reason why govt’s hands are tied. Govt. needs the money to fund various programs and at the same time it is not generating enough revenue from direct taxes.

    That’s the reason why, govt is bumping up its revenue through higher indirect taxes such as GST or excise duty as in the case of petrol and diesel.

    Direct taxes are progressive as it taxes according to an individuals’ income however indirect tax such as excise duty or GST are regressive in the sense that the poorest of the poor and richest of the rich have to pay the same amount.

    Does not matter, if you are an auto-driver or owner of a Mercedes, end of the day both pay the same price for petrol/diesel-that’s why it is regressive in nature.

    But unlike direct tax where tax evasion is rampant, indirect tax can not be evaded due to their very nature and as long as huge no of Indians keep evading direct taxes, indirect tax such as excise duty will be difficult for the govt to reduce, because it may reduce the revenue and hamper may programs of the govt.