VIF News Digest: International Developments (30 July-5 Aug, 2018)

USA
Ahead of Asia trip, business lobby gives Pompeo an earful on Trade War, 1 Aug 2018

Secretary of State Mike Pompeo pledged on Monday to ramp up the Trump administration’s diplomatic engagement with Asia in a speech that followed a blistering attack on the president’s trade policies by a usually stalwart Republican business ally.

Thomas J. Donohue, the longtime U.S. Chamber of Commerce president and chief executive, introduced Mr. Pompeo at an Indo-Pacific business forum by criticizing protectionist trade measures that he said led to both the Great Depression and World War II. He said American commitment to free trade since then had kept the peace around the world. “If our companies lose access to foreign markets, they will struggle to remain competitive in the global economy,” Mr. Donohue said in a clear reference to President Trump’s trade war and tariffs. “Today, foreign policy is domestic policy.” Click here to read.... [2]

US Senate passes bill to waive sanctions against India for buying Russian arms, 2 Aug 2018

In a relief for India, the US senate on Wednesday passed a defence spending bill that also seeks to amend another law that threatens secondary sanctions against countries such as India which conduct “significant” business with Russia if New Delhi went ahead with plans to buy Russian air defence systems. The bill, called the National Defense Authorization Act (NDAA) 2019, had already been passed in the House of Representatives and is now headed for President Donald Trump for his signature. He is not expected to withhold approval given the support the White House has already extended to the bill.

“I am grateful for the strong commitment of members on both sides of the aisle to pass this year’s NDAA in record time. Together, they have demonstrated the deep and abiding bipartisan support our military enjoys,” Defense Secretary James N Mattis said in a statement. “It is now our duty to implement these policies responsibly and ensure a culture of performance and accountability.” Click here to read.... [3]

Ahead of two-plus-two talk, India, US hold military cooperation meet, 2 Aug 2018

A two-day Indo-US Military Cooperation Meeting began today as a prelude to 2 plus 2 Dialogue between the two countries scheduled next month. The meeting was co-chaired by Lt Gen Satish Dua, Chief of Integrated Defence Staff to the Chairman, Chiefs of Staff Committee (CISC) and Lt Gen Bryan Fenton, Deputy Commander, Indo-Pacific Command.

"The 2-day 17th Indo-US Military Cooperation Meeting co-chaired by Lt Gen Satish Dua, CISC and Lt Gen Bryan Fenton, Deputy Commander, Indo Pacific Command has begun today as a prelude to #2+2 Dialogue between the two countries scheduled next month," @HQ_IDS_India, the official handle of the Integrated Defence Staff, tweeted. Click here to read.... [4]

US passes defence spending bill; why it is threat for China, good for India, 2 Aug 2018

The US Congress has passed the USD 716 billion defence spending bill which has provisions that bar China from participating in the Rim of the Pacific Exercise (RIMPAC), the world's largest international maritime warfare drill, and prevent its companies from accessing certain telecom equipment for defence and security establishments.

The bill not only seeks to strengthen American defence in the Indo-Pacific region and take a number of restrictive measures against China, but also strengthens its military ties with countries such as India, Australia and Japan to collectively address the "aggressive" Chinese military behaviour. Click here to read.... [5]

India-US Military Communications Pact: US team in Delhi next week, India demands five assurances, 1 Aug 2018

As both India and the US aim to make a firm announcement about the signing of Communications Compatibility and Security Agreement (COMCASA) during the ‘2+2’ meeting on September 6 in New Delhi, there are five major issues of contention being negotiated between the two sides.

Official sources told The Indian Express that a team of US officials from its Hawaii-based Indo-Pacific Command will be in Delhi on August 6 and 7 to conduct final negotiations on the text of the pact. The Indian side during these negotiations will comprise officials of External Affairs Ministry, Defence Ministry and armed forces.

The negotiations have proceeded at a fast pace once the Indian side expressed its willingness earlier this year to sign the pact which is meant to provide a legal framework for transfer of communication security equipment from the US to India that would facilitate “interoperability” between their armed forces. Click here to read.... [6]

Poultry imports: US not willing to withdraw $450-million retaliation case against India, 31 July 2018

The US is not yet willing to withdraw its $450-million retaliation case against India at the World Trade Organisation (WTO) for restricting import of poultry from the country. This is despite New Delhi changing its import rules as per Washington’s wishes early this year and imports from the country starting in April. “The retaliation panel, which was to give its verdict on the dispute on July 20, has been asked by the US to hold its decision for another three months. The US is keeping India on tenterhooks despite all its demands being met,” a government official told Business Line .

Washington might be trying to ensure that consignments come in from the country worth huge commercial value before it withdraws the retaliation proposal, a Delhi-based trade economist said. “Till now, only small consignments have been imported from the US. But it is a factor of demand and import rules no longer have a role to play. The US should not keep the sword hanging on India any longer,” he said.

India had asked the US to withdraw its retaliation case against it at the WTO in February after it made the final set of changes in its sanitary and phytosanitary requirements for imports to bring them in line with what the country had demanded. Click here to read.... [7]

Trump Tells Sessions to ‘Stop This Rigged Witch Hunt Right Now’, 1 Aug 2018

President Trump called on Attorney General Jeff Sessions on Wednesday to end the special counsel’s inquiry into Russia’s interference in the 2016 election, issuing an unambiguous directive on Twitter to shut down an investigation that even now is scrutinizing his tweets for evidence of obstruction.

The White House and Mr. Trump’s lawyers moved quickly to minimize the president’s statement, dismissing it as merely a case of venting by a president who has grown increasingly angry with an investigation that he considers illegitimate — and not a direct order to a cabinet secretary to interfere with a continuing federal law enforcement matter.

But in saying that Mr. Sessions, the United States’ top law enforcement official, should take specific action to terminate the investigation, the tweet crossed a line that Mr. Trump has never explicitly crossed — until now. It immediately raised more questions about whether Mr. Trump was attempting to obstruct justice, already an issue being examined extensively by Robert S. Mueller III, the special counsel leading the investigation. Click here to read.... [8]

Chinese goods may face 25% tariffs, not 10%, as Trump’s anger grows, 1 Aug 2018

President Trump escalated his trade war with China on Wednesday, ordering his administration to consider more than doubling proposed tariffs on $200 billion worth of Chinese goods to 25 percent from 10 percent, as talks between Washington and Beijing remain at a standstill.

Mr. Trump instructed the United States trade representative to look into increasing tariffs on Chinese imports like fish, petroleum, chemicals, handbags and other goods to 25 percent, a significant step in a dispute that is beginning to take a toll on industries and consumers in both countries. A final decision on the size and scope of the tariffs is not expected before September. Click here to read.... [9]

RUSSIA
As US-Russia ties blow hot and cold, Moscow wants same military deal America has with India, 1 Aug 2018

Taking a cue from the US, Russia has proposed a mutual military logistics support agreement with India. Moscow submitted a draft of its proposal to New Delhi last month, a senior defence ministry official told The Print. The Russian proposal comes almost exactly two years after India and the US signed a Logistics Exchange Memorandum of Agreement (LEMOA) in August 2016. Preliminary reviews of the Russian draft have made the Indian military positively disposed to it.

However, the US’s response to such an arrangement, which further deepens India-Russia military relations, can only be gauged at a later stage. Last week, the US indicated that it was actively considering a waiver of sanctions under the Countering America’s Adversaries Through Sanctions Act (CAATSA) to India. This, despite the country importing weapon systems (those underway and those that are proposed such as the S-400 missile defence project) from Russia.

Only on Tuesday, the US government also said it was raising India’s status as a major defence partner to “STA-1” almost on a par with its NATO allies. Click here to read.... [10]

Kommersant: Russian engines to keep on sending US Atlas rockets into space

Russia’s engine manufacturer NPO Energomash and the US United Launch Alliance (ULA) have entered into a new contract to supply six RD-180 rocket engines to the United States in 2020, as stated by Energomash’s Chief Executive Officer Igor Arbuzov on Tuesday. The negotiating process was tortuous, Vedomosti daily reports, adding that Russia’s Defense Ministry and Security Council doubted the reasonability of the transaction, while on the American side Congressmen were putting pressure on it. Arbuzov did not reveal the deal’s price tag, because of the requirement by the US side on non-disclosure of its financial details, a source in the space sector told the newspaper. Another source close to Roscosmos added "the precedent itself is important here rather than the cost."

Energomash delivers RD-180 engines for US Atlas III and Atlas V rockets and RD-181 engines for Antares launch vehicles. Moscow and Washington signed the first contract on supplies of 101 RD-180 engines worth almost $1 bn back in 1997. The US also obtained a license for the production of RD-180 engines and their analogues, but has failed so far to get their production up and running. Click here to read.... [11]

Baltic ports impose restrictions on Russian grain exports, 2 Aug 2018

Russian farmers are again facing restrictions on grain exports via ports in the Baltic states, the Vice President of the Russian Grain Union Alexander Korbut said in a letter to Deputy Prime Minister Alexei Gordeyev, according to Kommersant. The Baltic states, notably Latvia, serve for grain shipments, which are expensive and difficult to be exported via the ports in southern and northwestern Russia. Experts confirm that this year grain exports have faced greater restrictions compared with other cargo types.

According to the Russian Grain Union, during this agricultural year, the grain harvest may reach 105-114 million tons, with the record-high carryover stocks of grain estimated at 20.4 million tons. Amid the expected decline in production in Ukraine and Europe and a sound market environment, this creates conditions for exporting 42-45 million tons, the Union said. Last year, some 1.76 million tons of grain and 1.2 million tons of fat-and-oil and sugar products were sent through Baltic ports. Click here to read.... [12]

Izvestia: Risk of recession in Russia down to 20%, experts forecast, 31 July 2018

The risk of recession in Russia has dropped from 50% in early 2017 to 20%, a macro-forecast by the Plekhanov Russian University of Economics analyzed by Izvestia shows. The most probable scenario of Russia’s economic development points to a growth rate of 2%, the experts say. Meanwhile, the Economic Development Ministry believes that Russia’s economic growth will not exceed 2% before 2020. The ministry expects that the GDP will grow 1.9% by the year-end and 1.4% next year. Russian Economic Development Minister Maxim Oreshkin earlier attributed this slowdown to a hike in the VAT (value added tax) from 18% to 20%.

Upbeat forecasts for Russia’s GDP growth are encouraged by high energy prices, moderate volatility of the ruble rate and this summer’s FIFA World Cup in Russia. According to experts questioned by Izvestia, the championship could spark a 1.3% increase and its contribution to the annual economic growth would reach 0.13%.Click here to read.... [13]

AFRICA
Zimbabwe Opposition face wave of detentions, beatings after election loss: The Guardian, 5 August 2019

Security agencies continued a crackdown on opposition activists in Zimbabwe on Sunday, less than three days after historic presidential elections won by Emmerson Mnangagwa, the leader of the ruling Zanu-PF party.

Human rights groups reported dozens of abductions, beatings and rapes carried out by unidentified men overnight in the centre and north-eastern areas of the former British colony. Click here to read.... [14]

South Sudan rivals sign final power-sharing deal: africanews, 5 August 2018

The government and rebels of South Sudan signed a power-sharing agreement in Khartoum on Sunday to end a deadly civil war ravaging the world’s youngest country. Under the agreement, Riek Machar will join a government of national unity and become first vice president.

President Salva Kiir’s team will take 20 positions in the new 35-member government, nine positions will go to Machar’s group and the rest will go to other small opposition groups. The Parliament will have 550 members, 332 from Kiir’s group and 128 from Machar’s group. Click here to read.... [15]

Unresolved Eritrea-Djibouti tensions threaten regional peace: allAfrica, 5 August 2018

When Eritrea and Ethiopia agreed last month to end their decades-long conflict, the international community responded enthusiastically. Less than a day after the countries signed a joint declaration of peace, United Nations Secretary General António Guterres suggested that sanctions against Eritrea, imposed for alleged support of al-Shabab, an extremist group based in Somalia, may soon be lifted.

That action would further undo Eritrea’s isolation. But lingering grievances with its neighbor, Djibouti, could complicate regional integration, experts say. Click here to read.... [16]

Africa cannot grow unless Nigeria grows - World Bank: allAfrica, 3 August 2018

World Bank said it takes Nigeria as a "high priority" in its considerations on how to promote ideas and programmes that can aid development of the African region. The bank said it was looking forward to ways it can assist the Nigerian economy to grow faster and achieve developmental goals. World Bank vice president, Mr Hafez Ghanem, said the World Bank's objective in Africa was to help Africa grow.

"If we talk about growth in Africa, we have to think of Nigeria because it is the largest in Africa. So Africa cannot grow unless Nigeria grows so for us in the World Bank, Nigeria is a very high priority and we want to see how we can support and help the Nigerian economy grow faster and achieve all developmental objectives," Ghanem said when he led a delegation of the bank to Nigeria's finance minister, Kemi Adeosun. Click here to read.... [17]

Congo declares new Ebola outbreak in Eastern Province: Reuters, 1 August 2018

Four people have tested positive for Ebola in eastern Democratic Republic of Congo just days after another outbreak that killed 33 people in the northwest of the huge country was declared over, the health ministry said on Wednesday.

Twenty people have died from hemorrhagic fevers in a densely populated area near the town of Beni close to the Ugandan border, the ministry said in its statement, without saying when these occurred. The ministry said there was no evidence linking this outbreak with the last one, which began in April and occurred over 2,500 km (1,553 miles) away. Click here to read.... [18]

Somalia, Eritrea mend ties as change sweeps Horn of Africa: VOA, 30 July 2018

The presidents of Somalia and Eritrea on Monday signed an agreement to establish diplomatic ties after over a decade of animosity, in the latest lightning rapprochement between Horn of Africa rivals.

Somali President Mohamed Abdullahi Mohamed's three-day visit to Asmara coincides with an extraordinary peace process between Eritrea and Ethiopia — part of dizzying change in a region burdened by war, proxy conflicts, isolation and iron-fisted rule. "The two countries will establish diplomatic relations and exchange ambassadors," read a "joint declaration on brotherly relations" signed in Asmara by Eritrean President Isaias Afwerki and Mohamed. Click here to read.... [19]