LAND, LIBERTY & VALUE

Government must act in good faith treating all citizens equally ~ not favouring organised business lobbies and organised labour over an unorganised peasantry

SUBROTO ROY
The Statesman, 31 December

Every farmer knows that two adjacent plots of land which look identical to the outsider may be very different in character, as different as two siblings of the same family. Adjacent plots may differ in access to groundwater and sunlight, in minerals and salts, in soil, fertilisers, parasites, weeds or a dozen other agronomic factors. Most of all, they will differ in the quality and ingenuity of thought and labour that has gone into their care and cultivation over the years, perhaps over generations.

John Locke said: “Whatsoever that (a man) removes out of the state that Nature hath provided and left it in, he hath mixed his labour with and joined to it something that is his own, and thereby makes it his property… For this labour being the unquestionable property of the labourer, no one but he can have a right to what that once joined to, at least where there is enough and as good left in common for others” (Second Treatise of Government). Plots of land are as specific as the families that have “mixed” their labour with them. Locke wrote of labour being something “unquestionably” the labourer’s own property; in the same libertarian vein, Robert Nozick opened Anarchy, State and Utopia saying “Individuals have rights, and there are things no person or group may do to them (without violating their rights)”.

But as we recognise the universal sanctity of the individual person and his/her private property, we have to start qualifying it. If you purchase a field, forest or estate through which runs a pathway traditionally used by the public to get from one side to the other then even as the new owner you may not have a right to forbid the public’s use of the pathway. By extension, it is clear the State, the community of which you are a citizen, may approach you and demand there should be and will be a public road or thoroughfare through your property in the common interest. Such is the sovereign’s right of “eminent domain” recognised throughout the world, not only in times of war or natural disaster but also in normal times where private property may be taken for public use. The individual’s right to free use of his/her property is circumscribed as a result.

What may be certainly expected though in all matters is that the State will act in good faith, i.e., that it has conducted proper technical surveys and cost-benefit analyses as well as transparent public hearings, and has honestly decided that the road must be constructed using this route and no other. The doctrine of eminent domain implies that while the right to private property may be basic, it is not absolute, as indeed no right is, not even the right to one’s own life. In India, one key difference between the landmark Golaknath (AIR 1967 SC 1643) and Kesavananda Bharati (AIR 1973 SC 1461) rulings had to do precisely with the former recognising the right to property being fundamental as in our original 1950 Constitution, while the latter consented to the Indira Parliament’s denial of this.

When private property is taken, fair compensation must be paid. For example, the American Constitution says “no private property may be taken for public use without just compensation”. What is just compensation? Typically it would be the “fair market value” -- but that must be properly adjudged accounting for the best future use of the land, not merely the historical or traditional past use of the land. Consider, in a mature urban real-estate market, a plot made vacant because a warehouse located on it has accidentally burned down. What is the value of the plot now? Another warehouse could be built, but other bids could come in too for construction of offices or residential flats or a multi-storey garage. The plot’s value would differ depending on which use it is ultimately put to. And this value would be ascertained by calculating the expected cash flows into the future from each of these possibilities, discounted appropriately to account for the fact the future is less valuable than the present, with the highest value alternative being chosen.

That is how a mature private real-estate market works in theory, though in practice there would be zoning and environmental restrictions to account for the traditional nature of the neighbourhood as well as possible pollution by effluent waste etc.

In India, Government departments and ministries have inherited prime urban real estate from British times. Amidst the highest value real estate in Kolkata, Bangalore, Delhi etc. will be found a military camp or flats built for military personnel, having nothing whatsoever to do with furtherance of the nation’s defences today. The appalling state of government accounting and audit of our public property and institutions includes the fact that neither the Union nor State Governments and municipalities have the faintest idea of assets, including real estate, that they own. These public assets are frequently open to abuse by managerially uncontrolled government employees.

Fallacies even more curious seem to be currently at work in Indian policy-making, whether by this or that political party. The “eminent domain” doctrine requires a public purpose to exist for acquisition of private property by the State: e.g. construction of a road, bridge, dam, airport or some other traditional public good which is going to be used by the public. In India as elsewhere, “land reform” did involve taking an absentee landlord A’s land and distributing it to B, C, D and E who worked as peasants on it. But nowhere else outside formerly communist China has land been forcibly taken from peasants B, C, D and E and handed over to this or that private capitalist in name of economic development (in a reverse class war)! Eminent domain doctrine requires good faith on part of the State with respect to its citizens and that implies treating all citizens’ interests equally – not e.g. favouring an organised business lobby or organised industrial labour over the unorganised peasantry uneducated in the wiles of city people.

Also, there is no reason why Government should be interested in a particular product-mix emerging out of a given private factory (such as the so-called inflation-unadjusted “Rs one lakh car” instead of telecom equipment or garments or textiles). Dr Manmohan Singh’s statement last week that he wishes to see “employment-intensive” industries merely added to Government confusion: from Henry Ford to Japanese “lean business” today, everyone knows the direction of change of technology in the automobile industry has been towards robotics, making modern manufacturing less and less manpower-intensive! The Tatas themselves underwent a major downsizing and restructuring in the last decade, hiving off industries not considered part of their “core competence”.

Traditional agriculture of Singur’s sort represents the most labour-intensive employment-generating kind of rural economy. While such rural life may appear unsatisfying to the urban outsider, there is, as Tolstoy, Rabindranath, Gandhi and others knew, subtle happiness, contentment and tranquility there absent in alienated industrial sprawls. “Surplus” labour occurs in agriculture because of technological improvements in quality and delivery of agricultural inputs as well as new education and awareness (TW Schultz, Transforming Traditional Agriculture). It is mostly seasonal and all hands are used during the harvest when even urban migrants flock back to help. Industry did not leave Bengal in the 1960s and 1970s because of Mamata Banerjee but because of urban unrest, the culture of gheraos and lockouts, and bad regulations of the labour and capital markets associated largely with Ms Banerjee’s Left Front adversaries.

The basic fiction the Union and State Governments have made themselves believe is that their idea of an industrialisation plan is necessary for economic development. It is not. Real economic problems in West Bengal and elsewhere are financial to do with State budgets. “Debt overhang is there” is how the RBI Governor apologetically put it last week. Interest payments on the West Bengal State public debt consume larger and larger fractions of the revenue: these payments were at Rs 13 Bn in 1995 but grew to Rs. 92 Bn by 2004, and may jump to Rs 200 Bn in the next decade. The communists have been in power thirty years and no one but they are responsible. Making the State’s budget healthy would require tackling the gargantuan bureaucracy, slashing ministerial extravagance (foreign trips, VIP security) etc. It is much easier to hobnob with the rich and powerful while tear-gassing the peasants.

The author is Contributing Editor, The Statesman

Everyman's story

Barkha Dutt
Hindustan Times, 29 December

I didn’t own a mobile phone till I became a journalist. Even then, back in the mid-Nineties, I was always vaguely embarrassed about it (remember this was still a time when your sabziwallah didn’t take orders for potatoes on the phone). I felt then that I had become like the rest of my pinstriped, cuff-linked, yuppie friends on Wall Street, and would always offer defensive explanations on why I owned a cell-phone.

Looking back, and then forward, at how our daily lives have become desperately dependent on the mobile, the reverse snobbery of those years seems hopelessly daft.

Today, as any television journalist would testify, the mobile phone is the 21st century equivalent of the note-pad and pencil — all news breaks now arrive via sms. But more importantly, the cellphone is no longer a symbol of either ostentatious spending or class hierarchy.

On the contrary, for India’s once-notoriously passive middle-class, the mobile phone has become an unlikely tool of democracy and activism.

The simplicity of the technology has empowered those who used to believe they were too irrelevant to have a stake in the system. Indians who sometimes did not even bother to vote during elections have now found a new, albeit hostile and demanding, relationship with the political process. When NDTV 24x7 (along with several other television channels) opened the lines to get viewer support for the Justice for Jessica campaign, even we were astounded by the response: 200,000 text messages in just two days. Yes, we know what the critics say — this is lazy, shortcut, air-conditioned activism; think of those who actually sweat it out under the smouldering sun, devoting years of their lives to fighting for others. But that’s a frightfully limited and prejudiced prism to look through. A campaign driven by text messages is simply the modern equivalent of a signature petition. And just because it’s easy doesn’t mean it is not earnest or straight from the heart.

There is, of course, a dangerous flip side: popular opinion is often bigoted, blasphemous and banal. Every day in our newsroom, we see hate-filled messages streaming into our computer systems — whether it’s the Mohammad Afzal mercy plea debate, religious riots, reservation or caste discrimination. Thankfully, we can screen and censor these messages most of the time (except when they are going on ‘live’). Even so, there is always the danger that majority opinion can steamroll enlightened thought, and we, in the media, must be mindful of that.

But here’s the larger point: much as we hate the thought, we won’t always be able to moderate and mediate public opinion. If there’s one prediction I’m willing to make for 2007, it’s this: new technology is all set to shape India’s new citizen, and will challenge both the wisdom and relevance of conventional media. For good or for bad, and sometimes for both, that is how it’s going to be.

It’s already happening in the rest of the world. The magazine Time formally acknowledged the trend by making ‘You’, the information-age user, the Person of the Year, for “seizing the reins of the global media, and for framing the new digital democracy and for working for nothing and beating the pros at their own game”. Global networks in America were forced to stand up and take notice when home-made videos posted on YouTube.com snapped up more eyeballs than any of their prime time shows. And, writing in the New York Times Review of Books, Richard Posner described blogs (online diaries) as the “gravest challenge to the journalistic establishment”. America is grappling with the ethical contradictions of the New Media: it was a blog writer who first exposed US Congressman Mark Foley’s sexual abuse of young boys, but there are as many, if not more, examples of online writers who get it wrong, and get away with it, because they are accountable to no one.

Personally, the onslaught of new media makes me shudder more than just a little bit. We have already seen some media blog writers in India crouch like cowards behind fictional names and identities, just so that they are able to lash out at people who they wouldn’t have the guts to criticise to their face. On many of these sites, salacious gossip and sexual innuendo have been dressed up as journalism. The personal lives, real and imagined, of colleagues are now being dragged on to the comments section of these sites. And the worst part — it’s all being defended in the lofty name of free speech.

At least, right now, despite the growing sensationalism of mainstream media, there are still a few conservative gatekeepers keeping watch. This past year, several networks refused to broadcast the MMS images of the alleged Kareena Kapoor ‘kiss’ or the pictures of a young DPS school girl filmed having sex with a classmate. But the time is not far when our refusal will be irrelevant — anything you want will be just one Google search away.

Yet, we must admit the merits of the democratisation of the media space; “the many wresting power from the few” is how Time describes it. Technology has both empowered and energised the news gathering process. Journalism is no longer a one-way street, where we-the-wise hand down information. It’s now a dialogue box, where people talk back. (So what if their comments sometimes make you worry for the future of India?)

And let’s face it — many of us are already dependent on our viewers to send in the first pictures of a train accident, a religious riot or even just images of the morning fog. In a country as large and diverse as India, people will always be ‘on the spot’ before reporters are able to.

So, as long as new-age ‘journalists’ don’t hide behind anonymity (and, therefore, escape accountability) let’s welcome them to the club.
Anyway, it’s not like we have a choice.

The writer is Managing Editor, NDTV 24x7 barkha@ndtv.com

Farmers clamour for a hearing

Statesman News Service, 29 December

Agitating farmers in Singur want Trinamul Congress chief Miss Mamata Banerjee in Singur before she meets the state government. The farmers said that they want to discuss certain issues with her so that she can raise them before the government.

Singur Krishi Jomi Raksha Committee leaders today held a meeting at Sanapara in Singur to decide their future course of action. The meeting was attended by Opposition leader Mr Partha Chatterjee, local MLA Mr Rabindranath Bhattacharjee, PDS leaders Mr Samir Putatunda, and Mrs Anuradha Putatunda.

“Farmers who have been waging a war against the state government since May are united in stand that they would accept only those decisions which would serve their interest,” Mr Shankar Jana, convener of the Singur Krishi Jomi Raksha Committee, said. “A large number of non-registered share croppers and landless agricultural labourers have been fighting against the government. The chief minister is still silent about their rehabilitation package. Issues to be discussed in the meeting between the government and the Opposition are not clear. The farmers have welcomed Miss Banerjee’s decision to end fast, but won’t compromise with any unfavourable decision,” Mr Jana said.

The farmers will take out a rally from Bajemelia on Sunday to intensify the movement, he said. Mr Kashinath Koley, who refused to relinquish his 6 bighas of property for the project, said: “If Miss Banerjee will agree to the government’s decision of providing alternative land to the land losers, farmers like us wouldn’t accept it.” Others like Mr Koley said that they wouldn’t part with their land “under any circumstances in the face of any kind of pressure.”

“We will prefer to die, but won’t part with our land,” Mr Manik Das of Beraberi Purbapara said. “Miss Banerjee should first come to Singur and listen to us. She will have to act as our representative during the talks with the government.”

“Issues related to the interest of the farmers, sharecroppers,unrecorded sharecroppers and landless agricultural labourers cannot be chosen by those who are not dependent on land,” Mr Tapan Kolay, a farmer of Bajemelia, said.

Left lost face: Saugata

“Apart from the immense mileage our party received, our leader’s fast drew to us several intellectuals who till recently did not criticise this government,” Mr Saugata Roy, senior Trinamul Congress leader, said. Even a leader of the stature of Mr VP Singh who is known for his proximity to the Left has been apprised of his political allies’ repression in the state, he said.

Didi matters to them
Kunal Chatterjee

From the state government and the Left Front leaders to the common man on the street, Miss Mamata Banerjee’s decision to end her fast may have come as a big relief, but for a small bunch of petty businessmen, the Trinamul supremo’s decision came as a rude jolt to their business proposition.

For the last 25 days, countless hawkers had found the area surrounding Miss Banerjee’s dharna manch a happy hunting ground for their trade with a healthy gathering ensuring good business for them.

Mr Subhas Das, a tea seller who had been camping near the stage, where Miss Banerjee had been on fast, says that he didn’t have to wander around for his business at least for these 25 days. “Thousands of people approached me for a cup of tea including the leaders I saw on the stage. Compared to one large kettle of tea I usually sell, I sold six kettles everyday,” said Mr Das.

Rakib and Rohan, two brothers who sell fruits and evening newspapers, are now experiencing the same hardship. Rohan says that since all evening newspapers had Miss Banerjee in their headlines, they sold like hot cakes.

“Generally, it is hard to sell 200 copies of evening dailies everyday, but here I was surprised that even 500 copies got sold in minutes and I had to rush to the dealer for more. My brother sold fruits near Miss Banerjee’s dais and both of us made a tidy sum,” Rohan said.

Peasant in penury: Singur A Faint Echo Of China

Dipak Basu
The Statesman, 30 December

Developments in Singur reflect a growing tendency of the government to force people to give up their land and houses for the private sector without paying proper compensation. They also reflect similar incidents in China. As India is trying to emulate China, the adverse effects of that country’s repressive policies towards farmers are also palpable here.

China’s booming economy is matched with considerable strife especially in the countryside. The minister of public security has acknowledged that 2005 witnessed 87,000 incidents of unrest, registering a 6.5 per cent increase from 2004. As many as 20 villagers were killed by the police in 1993 when they protested against the government’s seizure of farmland for a power plant. Peasants in Dongzhou blocked the access to the power plant last December.

Poor compensation

Land seized from peasants for the development of new industries and infrastructure reduces their minimal subsistence base, leaving them with what is called two-mouth lands that won’t feed a family of five. This has forced members of many households to join China’s 200 million migrants in search of work across the country. Peasants are losing their land to roads, power plants, dams, factories, waste dumps, and housing projects. Compensation for acquisition is minimal. It doesn’t compensate for the land lost by a rural society without social security, which was abolished in the drive towards capitalism. The state has lost much of its legitimacy. Another aspect of rural unrest stems from environmental pollution. China’s phenomenal growth has been achieved through the destruction of the rural resource base.

An important court case in China gives an example of the people’s struggle against an oppressive state. Yao Fuxin and XiaoYunliang, who were arrested recently in the city of Liaoyang, played a leading role in organising workers of China’s collapsing state-run industries. Protesting against unpaid and missing wages, official corruption, and factory closures, more than 50,000 former workers from 20 state-run industries took to the streets of Liaoyang. Among them were workers from the Ferroalloy Factory, where Yao and Xiao had been waging a four-year campaign for a living wage and against corruption.

Yao and Xiao were arrested. A charge of subversion has been filed against them by the Liaoyang Intermediate Peoples’ Court. If convicted, they face the penalty of death. Levelling a seriouis charge is China’s way of scuttling the labour movement.

The tragedy in China’s countryside signifies that the Beijing bureaucracy has nothing to do with socialism. Over the last two decades, the regime has been rapidly removing any constraints on the capitalist market and the inflow of foreign investment ~ a process that has widened the social divide and reintroduced the most brutal forms of exploitation. The bureaucracy and its associated capitalist entrepreneurs have made huge fortunes and can afford the best of education for their children. But public education for the vast majority has been badly eroded and the lack of funding has forced many schools to send out their students as cheap labour.

The Chinese government once claimed to provide nine years of free education to all children. Since the early 1990s, however, Beijing has ended that guarantee and made provincial governments responsible for funding schools in the rural areas where the bulk of the population still live. The national government’s education budget is overwhelmingly used for the wealthier urban areas and especially for higher education. Over one-third of national education funding is allocated to colleges and universities, which are attended by just 0.5 per cent of the population.

China will spend just 2.4 per cent of the Gross Domestic Product on education this year or 21.9 billion Yuan ($2.6 billion) ~ one of the lowest levels in Asia. By comparison, the average spending on education in so-called developing countries is 4.1 per cent of GDP, and 5.3 per cent in developed countries. Huge profits are generated through cheap child labour. The kids have to carry out tasks that are at once dirty and dangerous. Schools in China breed pigs, maintain farms, operate market stalls, sew, clean, or, in at least one area, assemble fireworks. The bulk of the profits do not flow to the students, parents or even the schools but to the various local officials and entrepreneurs involved.

The police crackdown on the Falun Gong sect has underscored the extreme nervousness of the Chinese bureaucracy confronted with deepening economic and social problems to any form of protest or opposition. The police are still pursuing the leaders of the peasant movement in January 2006 in the Daolin township of Hunan province. Up to 10,000 peasants took part in the protest.

The break-up of the collective farms in the early 1980s, and the restoration of market relations and de facto private ownership of land in the rural areas has resulted in an enormous growth in social inequality. A thin social layer generally connected with the government and ruling party bureaucracy has been able to enrich itself by gaining control of large tracts of land or the contracts to operate business.

At the same time, millions struggle to survive on plots of land. They are barely able to sustain a family. A large number of peasants have been reduced to hired agricultural labourers working for the new landowning class, or have been forced to take up employment in rapidly expanding rural firms. Indeed, there has been a mass internal migration from the countryside to the large industrial cities.

The ability of peasant families to supplement farm income has been undermined by a sharp decline in new investment in rural enterprises, layoffs and shutdown. The option of migrating to the cities no longer exists given the record level of urban unemployment. Up to 15 million rural immigrants have returned to their villages and towns of origin. According to one estimate, there will soon be 200 million “surplus labourers” in China’s rural areas ~ an effective unemployment rate of 25-30 per cent.

Guiding principle

The process of industrialisation demands the conversion of farmland into industrial work places. However, in the developed countries there exist strict environmental laws relating to conversion of land and location of industries. The guiding principle is that Nature is a capital asset and ought to be regarded as such. Both China and India are ignoring the fact that destruction of Nature can cause environmental disasters.

In Japan, for example, farmers are entitled to receive at least double the current price of their lands plus a house or apartment in addition to a job in the new establishment or a very generous pension to compensate for their loss of assets, income and accommodation. In the former socialist countries like the Soviet Union, farmers would either retain their houses or would get new houses in different areas. They could work in the new industry or be transferred to another agricultural farm without loss of income or entitlements.

Only in a seemingly fascist state like China did the state force the farmers to vacate the land without proper compensation in order to promote private capitalists from Taiwan or Hong Kong. India is following the fascist regime of China. The incidents in Singur, Narmada Valley and Orissa are testament to this inhuman policy.

The author is Professor in International Economics, Nagasaki University, Japan

Dealing with global stresses

The Hindu, 30 december

The more analytical portions of the recently released World Bank publication, "Global Economic Prospects 2007: Managing the next wave of globalisation," deal with the state of the global economy over the next 25 years. The key findings, though not novel, need to be emphasised. By 2030, the global GDP is expected to more than double its size in 2005, growing to $72 trillion from $35 trillion, with the developing countries providing the impetus. Many other studies by global organisations, academics, and think tanks have also arrived at similar conclusions by extrapolating current economic growth rates of China and India. The Bank, however, has gone farther and worked out the likely costs of such globalisation-led growth. In its view the next wave of globalisation will intensify stresses on the "global commons", the environment as well as public goods that are the responsibility of all countries. Clearly the only way out is for nations to work together in mitigating global warming, containing infectious diseases such as the avian flu, and preventing the decimation of the world's fisheries. The rapidly integrating markets will enhance the competitive pressures in the job markets, with unskilled workers and less skilled white-collar workers becoming particularly vulnerable.

It is very likely that the average incomes would rise faster during the next 25 years than they did between 1980-85. The World Bank estimates that 1.2 billion people in developing countries — 15 per cent of the world population — will belong to the "global middle class," up from about 400 million today. With the purchasing power ranging from $4000 to $17000 per capita, they will have access to international travel, advanced consumer durables, and higher education. India and other developing countries will play a significant role in the global trade in goods and services, which is expected to treble to $27 trillion by 2030. Developing countries, which account for 40 per cent of manufactured imports of developed countries, will have their share increased to almost 65 per cent by 2030. The challenges of globalisation at the national level consist in minimising the consequences of iniquitous growth and containing potentially severe environmental pressures, while at the international level they lie in strengthening the global institutions.

Rivers, a national treasure

India's water resources belong to all its citizens. Only statesmen, not power-hungry politicians, can circumvent petty quarrels and work out water-sharing agreements.

V.R. Krishna Iyer
The Hindu, 30 December

INDIA HAS an abundance of water, so necessary for life, with rivers from the Ganga to the Cauvery. When I was Kerala's Minister for Irrigation and Electricity (1957-59), I thought it a high priority to prepare a water resources masterplan for the State. When it was ready, I presented it to Prime Minister Jawaharlal Nehru who greeted it as a great accomplishment. Nehru told me that I should start a large number of minor irrigation and electricity projects and referred, as an example, to the collective farms of the Soviet Union.

I did start a number of lift irrigation projects, and tried to put in place water projects in tune with local people's needs. Kerala has 44 rivers, big and small. I insisted on people's participation and labour, which came voluntarily and abundantly.

This productive contribution was largely drawn from the local villages, which gave the people a sense of possession and gram swaraj. This is economic democracy. Given some training, rural youth can play a substantially creative role.

We have failed to harvest even rainwater, so urgently needed for cultivation and drinking. How I wish the nation did harness the water resources of India and planned their use for the villages, the cities, and the desert areas.

India's water resources belong to all its citizens. Only statesmen, not power-hungry politicians, can circumvent petty quarrels and work out water-sharing agreements.

The Mullaperiyar project has worked for a century on the basis of humane considerations, not by inter-State rivalry and grab-water chauvinism. Why not choose three to five engineers with expertise in water use to make on-the-spot enquiries? They can request all information, meet people on both sides, study ther soil condition in both the States, and the other social and economic dimensions. Let the two States not adopt an acrimonious attitude as if it is a battle between two countries.

A court is incompetent to do justice without a serious study by experts and agriculturists.

Agriculturists from both sides must form a joint committee and advise the engineering specialists so that water can be put to the best common use.

Patriotism is not politicking; nationalism is not divisive challenges. Indian humanity — Tamil or Malayali — is one. Who gets more water is not the issue. More production with more water utilised in a planned process is the wealth of both the States.

Singur: now for the talks

With the Trinamool leader calling off her hunger strike, the spotlight will turn to the proposed dialogue between her and the West Bengal Government.

Marcus Dam
The Hindu, 30 December

NOW THAT the curtains have finally come down on the 25-day-old hunger strike by Trinamool Congress leader Mamata Banerjee, hopes have been rekindled for a dialogue between her and the West Bengal Government over the acquisition of land for the proposed car-manufacturing project at Singur in Hooghly district.

There is no denying that in the course of her fast Ms. Banerjee had started to find herself cornered. That she knew her movement against the alleged forcible acquisition of farmland for the Singur project was running out of steam was apparent in her flitting from one demand to another. She was under growing pressure from a section of her own party, which was increasingly convinced that the only dignified way out of a difficult situation was to accept the repeated offers for talks from the State Government.

And there were questions being raised whether Ms. Banerjee was losing control over the campaign she initiated under the banner of the Krishi Jami Raksha (Save Farmland) Committee. Some of its 19 constituents, including those belonging to different Naxalite factions, began getting quietly assertive in determining the agenda.

The question now is: what could have led Ms. Banerjee to comply with a second request from Prime Minister Manmohan Singh to call off the hunger strike? She had flatly turned down the first appeal less than a week ago. Could it have been that it was preceded by a letter from Chief Minister Buddhadeb Bhattacharjee whose undertones were conciliatory without being compromising?

It was the Chief Minister's fourth letter and by the time it reached her, could Ms. Banerjee have realised the futility of fending off invitations for dialogue, all the while hoping to extract some concession from an administration firm on seeing the Tata Motors project through? Had not the wind already been taken out of the sails of a campaign built anyway on dubious contentions?

In a round-about way, the State Government, anxious as it was over Ms. Banerjee's deteriorating health, could well be grateful to her for having provoked the corporate sector into endorsing the Government's plans for industrial resurgence despite the Trinamool's rather obstructionist ways.

What must have come as a shot in the arm for the Government was the remark of Ratan Tata, Chairman of the Tata Group, in an interview to a television channel, that he was "... unfortunately a person who has often said, you put a gun to my head and pull the trigger or take the gun away, I won't move my head."

His complimenting the leadership of the present State Government, whose Chief Minister has been reiterating that there will be "no going back" on the Singur project, could not have come across as particularly agreeable to Ms. Banerjee. She had, at the beginning of her campaign, threatened "a blood-bath across the State" if the proposed project was not shifted elsewhere. She appears to have hastily retreated from that stand as well as that of calling for a total boycott of all products manufactured by the Tata group of companies, at least for now.

Whether Ms. Banerjee has been successful in elevating the Singur issue to the national plane where she had hoped to mobilise opinion against the project is another imponderable. She has, so far, been able to get the National Democratic Alliance, of which her party is a constituent, to take up the cause on her behalf and hint at a nation-wide campaign against farmland acquisition for the project. This despite the fact that by endearing itself to her the Bharatiya Janata Party hopes to set up some base in a State where its influence is at best marginal. This has cost Ms. Banerjee a potential political ally in the Congress — which has distanced itself from her since the hunger strike began. There had been talk of their joining forces to see them through till the next major elections, well after the first automobile is scheduled to roll out of the Tata Motors factory at Singur less than two years from now.

For the present, the State Government will be waiting for Ms. Banerjee to bring her arguments on the land acquisition process at Singur to the discussion table for "appropriate action," as the Chief Minister's most recent letter to her puts it. The dismantling of the manch, which the Trinamool leader had made her home for the past 25 days, has already begun.

Saddam is hanged

Al Jazeera, 30 December

Saddam Hussein, the former Iraqi president, has been hanged, Iraqi officials have said.

The execution took place shortly before 6am (03:00 GMT) on Saturday at an Iraqi miltary facility in northern Baghdad.

Iraqi television later showed footage of Saddam being placed in a noose by hangmen, cutting away just before his execution.

The 69-year-old appeared calm, chatting to his hangmen as they wrapped his neck in black cloth and steered him towards the gallows.

Iraqi television later showed footage of his body.

Saddam was convicted last month of the killings of 148 Shias after a failed assassination attempt in 1982.

The Iraqi prime minister, Nuri al-Maliki, later urged Saddam's fellow Baathists to reconsider their tactics and join the political process.

"I urged followers of the ousted regime to reconsider their stance as the door is still open to anyone who has no innocent blood on his hands, to help in rebuilding an Iraq for all Iraqis," he said.

In Sadr City, a Shia area of Baghdad, people danced in the streets while others fired guns in the air to celebrate the former leader's death.

Kurds also welcomed the hanging and the office of the Kurdish regional president, Massud Barzani, issued a statement saying: "We hope that Saddam Hussein's execution will open a new chapter among Iraqis and the end of using violence against civilians."

Violence in Iraq continued on Saturday after Saddam's death and at least 30 people were killed when a bomb exploded in a fish market south of Baghdad in the first.

George Bush said that the execution was an important milestone on the country's path to democracy.

Bringing Saddam Hussein to justice will not end the violence in Iraq, but it is an important milestone on Iraq's course to becoming a democracy that can govern, sustain, and defend itself," the US president said in a statement.

An appeals court had upheld the death penalty on Tuesday and the Iraqi government rushed through the procedures to hang Saddam by the end of the year and before the Eid al-Adha holiday that starts on Saturday.

Saddam's half-brother, Barzan al-Tikriti, and a former judge, Awad al-Bander, also sentenced to death for their roles in the killings of the villagers in Dujail, will be hanged after Eid, officials said on Saturday.

The execution took place at an Iraqi army base in Kadhimiya.
The base was the former headquarters for Saddam's military intelligence where many of his victims were tortured and executed in the same gallows.

The northern Baghdad district is also home to one of Shia Islam's holiest shrines.

The government had kept details of the execution plan secret amid concerns that it may provoke a violent backlash from Saddam's supporters with Iraq on the brink of civil war.

"It was very quick. He died right away," an official Iraqi witnesses told the Reuters news agency.

"We heard his neck snap," said Sami al-Askari, a political ally of al-Maliki.

Another witness said: "He seemed very calm. He did not tremble."

As guards took him to the scaffold, according to witnesses, Saddam said: "There is no God but God and Muhammad is his prophet."

Criticism

During his three decades in power, Saddam was accused of widespread oppression of political opponents and genocide against Kurds in northern Iraq. His execution means that he will never face justice on those charges.

Others have questioned the timing of the killing, coming at the beginning of the Muslim holiday of Eid al-Adha.

Saddam insisted during his trial that he was still the president of Iraq. He said in a letter written after his conviction that he offered himself as a

"sacrifice".

"If my soul goes down this path [of martyrdom] it will face God in serenity," he wrote in the letter.

'Biased' trial

Saddam's defence team and human rights groups complained that the former Iraqi leader had not recieved a fair trial.

Najeeb Al-Nuaimi, one of the defence lawyers, told Al Jazeera: "There was bias, the prosecution sided with their politicians, it was an ethnically established court with three Shia and one Sunni."

The US-based rights group Human Rights Watch condemned the hanging, saying history would judge his trial and execution harshly.

Richard Dicker, a Human Rights Watch director, said: "Saddam Hussein was responsible for horrific, widespread human rights violations, but those acts, however brutal, cannot justify his execution, a cruel and inhuman punishment."

The Economist, 30 December

AT DAWN on Saturday December 30th Saddam Hussein was hanged. The same day, footage of him being taken to the gallows was broadcast on Iraq's state television, to convince any doubters that he had truly been killed. The immediate reactions were predictable enough. In Shia-dominated parts of the capital there were celebrations. Sunnis and former supporters of Mr Hussein had complained about his treatment. Possibly unrelated, a bomb exploded in a Shia city in southern Iraq. George Bush called the execution “an important milestone on Iraq's course to becoming a democracy that can govern, sustain, and defend itself, and be an ally in the War on Terror.”

The former dictator was convicted by the Iraqi Special Tribunal in Baghdad and handed a death sentence, in November, over the killing of 148 people in the town of Dujail, in 1982. Although a second trial is ongoing, it was widely assumed that Iraq’s new government—and its American ally—wanted to see Mr Hussein executed sooner rather than later.

There are reasons why the hanging might perhaps be welcomed. Justice demanded that he should be held to account for the many murders, the torture, the displacement and other crimes he committed while in power. If ever the death penalty were deserved, it would be for precisely such a dictator. Although the trial had serious defects, it was not entirely for show. He received the sort of hearing in court, the opportunity to speak out in his defence, that none of his victims enjoyed. And some may now hope there is a practical benefit. With the former leader dead, rather than languishing in prison, his supporters have lost any hope that they, through violence, could somehow bring him back to power.

Yet executing him has been a mistake. Not only is capital punishment wrong in itself, however wicked the guilty party, it is most unlikely to help bind Iraq’s wounds. His trial was flawed enough to provoke condemnation from Western human rights groups, among others, and to seed suspicion in some parts that the former tyrant’s execution has been less a matter of justice and more a case of revenge. Showing greater respect for human life than he ever did would have represented a rare moral victory for Iraq's rulers. Keeping Mr Hussein alive would have allowed other trials detailing far greater evils than Dujail to be completed—such as the one, already begun, in which he stands accused of instigating the so-called Anfal campaign against Iraq's Kurds, in which more than 100,000 people may have been killed and millions uprooted.

The decision whether to go ahead, however, was one for Iraqis to make. He himself said he would be “sacrifice” and a “true martyr” for Iraq. But the ongoing misery of daily killings is driven by many more forces than fighters loyal to their former leader—the bitter rivalry between and among Shia and Sunni groups, the influence of al-Qaeda, the activities of organised criminals and other factors matter rather more. Most Shias and many Kurds do not care a jot about the technical defects of the trial. As for the Sunnis who were loyal to the previous regime, it is the legitimacy of the present government, not the probity of the court, that is fundamentally in question. Mr Hussein's death will not, of course, make him a martyr. However, nor will it do anything to encourage the reconciliation or compromise that Iraq needs.

A year for diplomacy

The Economist, 28 December

Japan’s chance, in 2007, to warm ties with China

ONE of the biggest problems facing Japan’s new prime minister, Shinzo Abe, is how to get on better with the neighbours. That is why he visited both Seoul and Beijing barely a week after starting his new job. Japan’s relations with China and South Korea deteriorated badly under his predecessor, Junichiro Koizumi, as disputes over history and territory flared up, outweighing the boom in trade and investment between the three and preventing any summit-level meeting between Mr Koizumi and Chinese leaders since 2001. But can Mr Abe really do any better? He has been a habitual visitor to the Yasukuni war shrine in Tokyo that is held to symbolise Japan’s lack of contrition over its 20th-century history, and is on record as having questioned the legitimacy of the Tokyo war-crimes trials of 1946-48.

Simply not being Mr Koizumi will be a helpful start. Unlike his predecessor, Mr Abe has remained carefully evasive about whether he will visit the war shrine while he is prime minister; for Mr Koizumi it was a campaign promise that he dared not break. And having taken over the job in September, Mr Abe will have almost a year for diplomacy before the August 15th anniversary of Japan’s surrender in 1945, a day on which the domestic pressure to visit Yasukuni will become intense. There will, however, be a number of sensitive anniversaries for him to navigate during the year, for 2007 will be the 70th anniversary of the beginning of the Sino-Japanese war. On July 7th 1937 there was the so-called “Marco Polo Bridge incident”, when an alleged kidnapping of a Japanese soldier just outside Beijing triggered Japan’s attempt to take control of the whole of northern and eastern China. And December 13th marks the 70th anniversary of the notorious “rape of Nanking”, when Japanese soldiers ran amok in what was then China’s capital, with a resulting death toll of somewhere between 100,000 and 300,000.

Those anniversaries will be difficult moments in Sino-Japanese relations. But they could also provide Mr Abe with opportunities. As an affirmed nationalist, he may be the Japanese politician best able to blend contrition about the past with forthrightness about present-day issues. In his October 2006 summit with the Chinese leaders, he found a good way to do this by agreeing to set up a joint commission, involving Japanese, Chinese and perhaps other historians, to study 20th-century history and make recommendations, such as about school textbooks or even about the Yasukuni shrine itself. If he were to make this study serious rather than just a gesture, it would neatly defer arguments about the details of history until well beyond Mr Abe’s premiership.
An even likelier tactic will be to try to change the subject. If Mr Abe wants to look forthright in the face of Chinese bullying, he would be better served by focusing on the two countries’ dispute over oil and gas reserves under the East China Sea, in which Japan’s territorial claim is at least as well founded in international law and precedent as China’s, rather than tussling over history and apologies. An appeal to international arbitration would be one way to deal with the territorial dispute; another would be to propose that separate negotiations be held over the local Senkaku/Diaoyutai islets and over the undersea resources, which is how disputes in the South China Sea between China, Vietnam and the Philippines have been eased.

Trade would also be a good thing to talk about. Whereas political relations have been frosty, trade and investment ties have been red-hot: the two countries are each other’s second-biggest trading partner. Even as Japanese businessmen were complaining that Mr Koizumi’s shrine visits threaten their chances in China they were increasing their stock of foreign direct investment in China by almost 30% in 2005-06. China, Japan and South Korea are all enjoying the benefits of an increasingly integrated Asian economy.

What Asia lacks, however, is a proper regional free-trade agreement, to reduce barriers further and to manage disputes. Both China and Japan have muttered about initiating such an agreement in recent years, but they disagree about who should take part in it and what goods and services it should cover. Mr Abe is likely to attempt to revive the idea of a regional agreement, casting its proposed membership as far to Asia’s south and west as India. Just as in 2005 Japan succeeded in making India, along with Australia and New Zealand, a founder member of the first “East Asia Summit” in Kuala Lumpur, so in 2007 it will want to make India an ally in discussions over regional free trade. Indian membership could be tempting for some South-East Asian countries, and would be strongly backed by the United States too, which likes the world’s largest democracy to take part in Asian regional organisations, chiefly because it would prevent China from dominating them. Which is exactly why China opposes it.

Glass half full

The following article has been writtten by the editorial board of TOI. In fact, it's a new year gift to cheer up the sunken souls of its members holding a glass of Scotch half filled and seeing through dead drunk eyes the vision of 'India Shining' fulfilled. - International Post

Editorial
TOI, 30 December

The India story is for real. We heard business houses and international leaders say it, now the findings of the National Sample Survey Organisation bear this out. Engel's law, which says that as family income rises the proportion spent on food declines, is actively at work.

Urban India spent 43 per cent of its total consumption expenditure on food in 2004-05, against 64 per cent in 1974-75. In rural areas, this share has fallen from 73 per cent to 55 per cent over three decades.

During the same period, the number of poor fell from about half the total population to 22 per cent. Within the food basket, the share of cereals has fallen in favour of milk, beverages, vegetables and meat products.

While urban India has been living it up, the condition of rural India has improved as well. With the New Year around the corner, it is time to put the usual rhetoric of despair in perspective.

Earlier, there were islands of plenty in a sea of penury; now, we are on our way to reversing this picture. Fifteen years of moderate-to-high growth have reduced poverty by 15 percentage points. While growth can create inequality, as the World Bank has pointed out in the case of India, it certainly tends to lift everyone.

Reforms unleashed entrepreneurial spirits in services in particular. If rural India has looked up despite a productivity crisis in agriculture, it is because of growing trade and urban-rural linkages. Branded goods are available everywhere, in no small measure due to the sachet revolution.

In a year of farmers' suicides, let us not forget that the bottom of the pyramid is better off than it was in the days of garibi hatao. Where do we go from here?

As Joseph Stiglitz points out, India was in a position to take advantage of the global shift towards services, thanks to its investment in higher education in earlier years.

It needs to consolidate here, by increasing access to quality education in order to address the skills shortage in manufacturing and services.

India's savings, at 29 per cent of gross domestic product, should be mobilised for the creation of both physical and educational infrastructure. An economy on the move, however, is faced with a major embarrassment:

According to the National Family Health Survey-III, 75 per cent of all infants between six and 35 months of age are anaemic; over a third of children up to the age of three are stunted and a sixth too thin for their age. We cannot afford to lose a generation like this.

Let's make schools centres of both intellectual and physical nutrition and focus on governance problems in this respect on a war footing.

Singur Lesson

TOI, 26 December

The next time government acquires agricultural land for industrial purpose, it will deploy top bureaucrats to explain the project to landlosers instead of relying on the district administration. That is the key learning from the Singur experience.

Speaking to TOI , industries secretary Sabyasachi Sen admitted the government had faltered by asking district and block officials from the land department to acquire consent from land-owners and farmers in Singur.

"Sending land department officers to the field was a mistake.

The focus of district land reforms officer and block land reforms officer is land acquisition and not explaining the project and its benefits. In any case, they are not equipped to meet the queries of land losers," Sen said.

While absentee land holders were quick to respond to the lucrative price offered, most Singur-based land owners, farmers and sharecroppers withheld consent till industries director M V Rao was deputed to the site two months ago.

"Rao's presence made a huge difference. Not only was he in the know on the project, having interacted with Tata Motors officials, he could provide details on job opportunities in the factory and outside. He personally met land holders, explained the project and clarified their doubts.

Soon, consents poured in," Sen said. He now feels that the current imbroglio could have been avoided had Rao been deployed earlier.

Lack of adequate information with DLRO and BLRO and absence of initiative on their part allowed misinformation to breed. "Some told villagers that the cheques being issued by the government would not be honoured.

Others said the Tata Motors project would sully the ground water, making it unfit to drink," he said, adding that Tatas would have rolled out social development projects in September but for the agitation. There had also been a realisation that paucity of time had made the situation complex.

"We have to be patient, listen to people's apprehensions, hopes, beliefs and misgivings. Convincing one to give up land takes time. Each is entitled to explanation on what the project objectives and benefits. That should happen first. Not after a project is announced," Rao said.

Sen also acknowledged that financial compensation was not enough; a livelihood compensation was also required. That is what activist Medha Patkar has been rallying on as well.

"The objective is not to displace croppers and make them unemployed but offer alternative employment," he said, adding that efforts would be made in Singur to hike land productivity outside project area through irrigation.

Sen, however, clarified that apart from special economic zones, it was not possible to device a standard compensation package as projects differed vastly. "We have to look what can be sustained from without and outside," he said.

It’s time for Asia to look beyond the dollar

Winner of the 2001 Nobel prize for economics, Joseph Stiglitz is a trenchant critic of the “market fundamentalism” of the International Monetary Fund. In an interview in New Delhi recently, he discusses some of the ideas in his latest book, Making Globalisation Work (Viking, 2006), including the need for an alt ernative to the dollar reserve system.

Siddharth Varadarajan
The Hindu, 28 December


Both Thomas Friedman and you start your books in Bangalore but he discovers the world is flat while you discover the path to globalisation is full of potholes.

The amusing thing is that Friedman went to Bangalore and visited Infosys a month after I did. I heard exactly the same stories and we were both struck in some of the same ways. But I say that not only is the world not flat but in many ways it’s getting less flat. Some countries are doing much better — India and China are growing at historically unprecedented rates, and this has a lot to do with globalisation — but Africa doesn’t have either the education or resources to take advantage of these new technologies. As a result, disparities are actually increasing. The Uruguay trade agreement was so unfair it made the poorest countries in the world worse off.

In your book, you also argue that the rules of the game — the financial architecture, corporate domination, IPR regimes — are all making the world less flat, more unequal. Can you give us an
example?

One manifestation is that for the first time we have a global monopoly in an industry that is the pivotal industry, IT — Microsoft, Intel. This may not be a permanent monopoly but clearly we have a dominant firm that is dominant for a considerable number of years and gained its dominance through anti-competitive practices. Judges in the U.S. and Europe have ruled it engaged in anti-competitive practices. In the case of Standard Oil, there was a monopoly, so they broke it up. Here, they don’t know what to do, so they’ve allowed it to continue, and it has continued to engage in anti-competitive practices.

You mentioned India as a success. How sustainable is its current growth?

If you look at the sector where India has grown, it’s been IT. And the success of IT is largely based on heavy government investments in the past on education, the IITs, science. These are investments made over 50-100 years that have started to pay fruit.

What about public investments in heavy industry — the fact that India was able to reach a critical level in manufacturing?

I haven’t studied the Indian economy that thoroughly but my impression is that the real engine has been the IT sector and that’s related to education and to the good fortune of the world changing in ways that suddenly gave new opportunities India was able to seize. There are many things which facilitated that — over-investment in fibre optics in the U.S., for example, brought down telecommunication costs. Some telecom policies of liberalisation meant the cost of communications were lower. And there were things the government could have done that would have messed things up. For example, in Mexico, the cost of telecommunications is very high because they have a monopoly provider and monopoly providers raise the price. They privatised, but not in the right way. So India did a number of things in the right way, some over a long period, some in the short run, and the world changed in a way that was just right for India.

There is a debate on the sustainability of India’s growth rate without the manufacturing sector also playing a larger role. Economists are talking about the need for a course correction.

I think the view that you need to have a particular sectoral composition is wrong. The U.S., for example, is now two-thirds services, and manufacturing is down to 11 per cent.

But the share has come down after 100 years of growth. Recent research on employment elasticities suggests India's over-dependence on IT and services may not be the best strategy. Can a country of India's size develop without manufacturing being a major contributor?

The view that everybody has to go through the same historical sequence is wrong. The world today is different from what it was 50 years ago, there was no IT then, and there is no particular reason you have to go through the same sequence. It may be that for India it is appropriate to skip the manufacturing stage, that China may have a comparative advantage in manufacturing. I'm not saying that's true, but there is no a priori reason to stress manufacturing. We should ask what the comparative advantages are, and, from a global perspective, whether one can have sustained growth based on a service sector economy. The answer is clearly yes. Can you have heavy exports related to services? Again, the answer is yes. Creating jobs is an important issue, but it may be that, for instance, part of the strategy for creating jobs will involve expanding tourism, which is a very labour intensive service sector. The problem in manufacturing is that modern technology doesn't use much labour. Most modern technologies in manufacturing are very capital intensive.

India now has an employment guarantee scheme to provide income support for the poor. How do you rate such welfare schemes against the objection that they boost fiscal deficits?

I think they're absolutely necessary for long-term sustainable growth. Latin America has shown what happens with high degrees of inequality. You get political and social instability. You have high crime rates and an environment that's not good for investment. What's also very clear is that trickle-down economics doesn't work. It hasn't worked anywhere. It hasn't worked in the United States. Even though GDP is going up, most Americans are worse off today than they were six years ago.

In fact, a survey just came out here — the Focus report on the status of children under six — which shows that despite six per cent growth for nearly a decade, the nutritional status of Indian children hasn't improved.

Yes, I just saw that and these are very, very disturbing numbers. Nutrition is a more reliable indicator than income because it is a physically observed characteristic. Growth is not trickling down so doing something about this exclusion is absolutely necessary. Even if there was just a transfer of income, this would be a benefit. But if these schemes are well-designed, they can be used to create infrastructure in the rural sector as well.

Manmohan Singh has once again started talking about capital account convertibility for India. What would your advice to him be?

I share the sentiments of those who have very strong reservations. The overwhelming evidence is that convertibility doesn't bring faster economic growth. It brings more instability. You can't build factories with money that's going to come in and out overnight but this money can wreak havoc on an economy. You have to look at the balance of benefits and costs. The costs are clear and the evidence is strong, the benefits are weak and the evidence in favour of these benefits is very weak.

Privatisation & land acquisition

In India today, there is no political support for privatisation but many reform-oriented economists consider this a bad thing. How do you see this issue?

It depends very critically on what is being privatised and how things are being privatised. When you privatise a natural monopoly before you put in a regulatory structure, the firm is more interested in raising prices. Second, based on Latin American evidence, privatisations do not, in general, lead to greater efficiency. It is true that if you artificially tie the hands of an industry by restricting investment — and IMF accounting often makes it difficult to engage in investment because it treats borrowing by the government for a public enterprise in the same manner as borrowing for social services or anything else — and then you privatise and release the artificially imposed investment constraint, privatisation can then sometimes increase efficiency. But the answer to that is to get rid of the artificial investment constraint. The benefits come from release of that constraint, not privatisation. Third, privatisation is very problematic in oil, mining sectors, etc., where the resources of a country have been turned over at bargain-basement prices.

In India, most of our privatisations involved serious valuation problems.

Revenue is an issue. One of the countries market fundamentalists often cite is Chile. I once asked the President of Chile his opinion and he said, "We were successful because we didn't follow the Washington Consensus." He went on to point out they only privatised half the copper mines. The government mines are just as efficient as the private ones but bring in 10 times more revenue for the government. So in terms of generating revenue that can be used for public purposes, privatisation was a big mistake. A lot depends on the pace and manner of privatisation but the evidence is that it is extraordinarily difficult to do it well. And there are some theoretical problems why this is so.

Agency problems?

Broadly speaking, yes. You talk about corruption and one of the arguments for privatisation is often that governments run things inefficiently and corruptly. But when you privatise, the incentives for corruption are even greater. The incentive is to try and get it at bargain-basement prices. Because you capitalise all future returns.

The rent seeking associated with the life of the asset being privatised is compressed at one moment in time.

Yes, and because it is compressed at one moment, the incentive to cheat becomes all the greater. The willingness to go beyond bounds of normal behaviour becomes all the greater. So privatisation doesn't solve the agency problem, and by compressing it, it may exacerbate it.

One of the paradoxes of market `reform' in India is that if you are a big company and are planning to set up a factory, you want a free market to buy equipment and hire workers but expect government intervention to acquire land. Can this be justified on the basis of first principles?

There is a general view that where there are large externalities — urban renewal programmes, for instance — there may be grounds for government to try and buy land and help renew a city or part of a city. But the dangers of doing this when there is a single firm without externalities are enormous. This is because the government often uses the right of eminent domain with compensation below market price.

So future rents are shared between the firm for whom land is acquired and the original land owners in a very unequal way...

That's right, exactly, and that's why these firms turn to the government. In general, there is a price at which people would sell their land. The reason these firms ask the government to do it is because they don't want to pay that market price. So once you get into that mindset, it becomes a very dangerous precedent.

The argument made in India is that land holdings are fragmented, that there is no land market.

You have a problem when land is fragmented, or there are land market inefficiencies, and difficulties in getting clear title. Markets might be so poorly developed that businesses can't acquire land and that becomes an impediment to development. Of course, the right answer is to solve the problem of the land market and not to solve it for this particular person by taking over that particular piece of property!

Asia and the dollar's decline

One of the most interesting arguments in your book is where you talk about a new global reserve system. Given Washington's resistance to such ideas in the past, including to Japan's proposal for an Asian Monetary Fund, how feasible is this, especially since there's a link between the role of the dollar and the global power, the seigniorage, the U.S. derives from this?

The system of seigniorage to the U.S. is inequitable. The foreign aid from developing countries to the U.S. is greater than the foreign aid the U.S. gives and the system has a downward bias in aggregate demand. This is a very peculiar and unstable system where the only thing keeping global demand strong is if the richest country in the world consumes beyond its means. As the U.S. gets more and indebted, confidence in the dollar erodes, and it no longer is a good store of value.

Rather than holding dollars as reserves, countries should hold an internationally created `bancor' or global greenback — a `money' that's used in reserves and is convertible into ordinary currency. The idea is similar to special drawing rights but the SDR system is periodical and subject to veto by the U.S., which mistakenly thinks it gains from the system. I argue it doesn't. It gains seigniorage, but it loses stability. My proposal is for a regular rather than periodic system and one that is automatic and rule based.

The current dollar system is fraying. We might go to a two-currency reserve system, which simply maintains the problem and divides it between the U.S. and Europe. This would be better than the current system but is not a good solution. As countries recognise the problem, there will be demand for change. There are two reasons why I think it is politically feasible, besides the fact that the current system is crumbling. First, the major source of savings in the world today is Asia and a lot of Asian countries are asking, "Why are we subsidising the U.S.?" This is a weird system! The Chiang Mai initiative was a framework of exchanging reserves, which is really basically the same idea. Rather than using the U.S. dollar as a reserve, we use each other, and all you have to say is that if we're using each other, we'll create a currency. One of the proposals I talk about in my book is to make this an open architecture. We'll have a cooperative agreement, and anybody who wants to join can do so, and there will be a rule that over time you have to put more and more of your reserves in the members of the club. That will put a strong incentive for countries outside the club to join, namely the U.S.

For this to work, Asia will have to take the lead.

Very much. That is the core thing. A new reserve system is not going to happen overnight but it's getting discussed.

Can Asian countries push the debate by pricing trade, especially natural resources like oil, in currencies other than dollars? Would that provide the critical mass for us to move in the direction of a new system?

It's already happening. The U.S. would like to keep the dollar as the reserve currency, and all the seigniorage. But as it realises it is fighting a losing battle — that people are moving out of the dollar — it will not be able to keep the dollar as the sole reserve currency. So the U.S. may realise that it would benefit from the greater stability that a new system would bring.

Malnutrition Is Cheating Its Survivors, and Africa’s Future

MICHAEL WINES
NYT, 28 December

SHIMIDER, Ethiopia — In this corrugated land of mahogany mountains and tan, parched valleys, it is hard to tell which is the greater scandal: the thousands of children malnutrition kills, or the thousands more it allows to survive.

Malnutrition still kills here, though Ethiopia’s infamous famines are in abeyance. In Wag Hamra alone, the northern area that includes Shimider, at least 10,000 children under age 5 died last year, thousands of them from malnutrition-related causes.

Yet almost half of Ethiopia’s children are malnourished, and most do not die. Some suffer a different fate. Robbed of vital nutrients as children, they grow up stunted and sickly, weaklings in a land that still runs on manual labor. Some become intellectually stunted adults, shorn of as many as 15 I.Q. points, unable to learn or even to concentrate, inclined to drop out of school early.

There are many children like this in the villages around Shimider. Nearly 6 in 10 are stunted; 10-year-olds can fail to top an adult’s belt buckle.

They are frequently sick: diarrhea, chronic coughs and worse are standard for toddlers here. Most disquieting, teachers say, many of the 775 children at Shimider Primary are below-average pupils — often well below.

“They fall asleep,” said Eteafraw Baro, a third-grade teacher at the school. “Their minds are slow, and they don’t grasp what you teach them, and they’re always behind in class.”

Their hunger is neither a temporary inconvenience nor a quick death sentence. Rather, it is a chronic, lifelong, irreversible handicap that scuttles their futures and cripples Ethiopia’s hopes to join the developed world.

“It is a barrier to improving our way of life,” said Dr. Girma Akalu, perhaps the nation’s leading nutrition expert. Ethiopia’s problem is sub-Saharan Africa’s curse. Five million African children under age 5 died last year — 40 percent of deaths worldwide — and malnutrition was a major contributor to half of those deaths. Sub-Saharan children under 5 died not only at 22 times the rate of children in wealthy nations, but also at twice the rate for the entire developing world.

But below the Sahara, 33 million more children under 5 are living with malnutrition. In United Nations surveys from 1995 to 2003, nearly half of sub-Saharan children under 5 were stunted or wasted, markers of malnutrition and harbingers of physical and mental problems.

The world mostly mourns the dead, not the survivors. Intellectual stunting is seldom obvious until it is too late.

Bleak as that may sound, the outlook for malnourished children in sub-Saharan Africa is better than in decades, thanks to an awakening to the issue — by selected governments, anyway.

South Africa provides nutrient-fortified flour to 30 million of its 46 million citizens. Nigeria adds vitamin A to flour, cooking oil and sugar.

Ethiopia’s government hopes to iodize all salt by year’s end. United Nations programs now cover three in four sub-Saharan children with twice-a-year doses of vitamin A supplements.

Ethiopia may, in fact, have the most comprehensive program in all Africa — a joint venture with United Nations agencies that regularly screens nearly half of its 14 million children under 5 for health and nutrition problems. Since 2004, the program has delivered vitamin A doses and deworming medicine to 9 in 10 youngsters, vaccinated millions against childhood diseases and delivered fortified food and nutrition education.

Unicef’s Ethiopia representative, Bjorn Ljungqvist, said the effort sprang from a disastrous 2003 drought in which global aid agencies fed 13.2 million Ethiopians — the most costly aid undertaking ever in Ethiopia.

When the aid effort ended, he said, international donors and government officials decided that “we have to ensure that we don’t get into this situation again.”

The program may be a model for Africa: similar ones try to improve youngsters’ health, but none, Dr. Ljungqvist said, addresses the nutritional deficiencies that leave children with lifelong disabilities. The effort saves 100,000 lives a year, by Unicef estimates. And because it focuses not just on handouts, but on preventive care and nutrition education, the effects could be lasting.

Beyond that, as African nations develop Western-style mass markets, with brand names and national distribution networks, sales of vitamin-fortified foods are slowly becoming common in urban areas, just as in the West decades ago.

But much of the continent has far to go.

Well over half of sub-Saharan children under 5 lack iron, vital to developing nervous systems, the Micronutrient Initiative, a Canadian research organization, reported in 2004. They often have trouble concentrating and coordinating brain signals with movements, like holding a pencil, that are crucial to education.

Another 3.5 million children lack sufficient iodine, which can lower a child’s I.Q. by 10 or more points. More than a half million suffer vitamin A deficiency, which cripples young immune systems; merely ensuring adequate vitamin A can lower child mortality by more than one- fifth. Children lacking vitamin B12, regularly measured nowhere in Africa, have impaired cognitive skills and do poorly on tests.

In most foods, these vital nutrients exist in traces — vitamins A and B12, iron, iodine, folic acid. Denied them in the womb and in infancy, children suffer irreversible brain and nervous-system damage, even if they appear well fed.

“Even trained people can’t always see them,” said Mark Fryars, the director of program services for the Micronutrient Initiative. “You may see a kid whose skin is very pale. You may go into a classroom where a child wanders off, or falls asleep, or doesn’t go out to play because he’s too tired. Multiply that into whole villages, and that translates into an impact on the society.”

In richer parts of the world, nutritional deficiencies are a nonissue. Three percent of American children are malnourished. American flour and cereals have been fortified with vitamins and iron — by law — since the 1930s.

In sub-Saharan Africa, however, lost productivity from vitamin and mineral deficiencies costs nations $2.3 billion a year, Unicef reports, and losses of productivity in Mozambique, Zambia and Malawi exceeded 1 percent of gross domestic product.

Many African children sometimes receive nutrient supplements, courtesy of the World Food Program, Unicef and charities. Still, donors cannot meet the need. In Ethiopia, for example, a venture between the government and United Nations agencies is caring for 20,000 acutely malnourished children at 100 sites.

“But we can count 70,000,” said Iqbal Kabir, the chief nutrition expert at Unicef offices in Addis Ababa, Ethiopia’s capital. “We can’t treat them all.”

Shimider is but a hundred or so stone and reed homes, one room each, in a mountain valley in the Amhara region, 250 miles north of Addis Ababa. The slopes here have been intensively farmed for thousands of years, and their soils are exhausted.

Twenty-two years ago, a famine here killed more than one million people. Today, hunger is measured in squandered lives.

Thirty percent of Amhara’s children under 5 are stunted, with another 26 percent severely stunted, evidence of lifelong, acute hunger. One in 15 pregnant women experiences night blindness, indicating vitamin A deficiency and a diet devoid of protein and red or yellow fruits and vegetables.

Among both malnourished children and their mothers, the impact of such privation is achingly evident.

One recent Sunday, Tewres Beram, a woman in her early 20s, carried her daughter Mekdes to a free immunization clinic. Mekdes, severely malnourished, sat suckling fruitlessly at her mother’s breast. “We don’t have enough food,” her mother said, “so there’s not enough milk to feed her.” A year old, Mekdes does not crawl. Her sister, 2, has barely begun to crawl. “Both of them are like little dead bodies,” their mother said.

Sirkalem Birhanu, 40, clasps Endalew, age 2 and unable even to hold up his head. “He’s always sick,” she said. Endalew has company, she said; his 13-year-old brother “is very tiny, and he loses weight.”
“And he’s always been sick,” she added.

And there is Berhane Gebeyew, 36, whose malnourished 18-month-old daughter, Genet, is a lump in her lap, despite receiving six months’ worth of fortified food last May from the governments.

Mrs. Gebeyew split the food among Genet and her four siblings, ages 6 to 15. “The other children, when they stare at my eyes, I give it to them,” she said.

She and her husband feed their children two daily meals of injera, a spongy flatbread of fermented barley, occasionally with four ounces of bean sauce. When the children attend Shimider Primary, each gets 10 ounces of vitamin-fortified meal mixed with cooking oil. But attendance is spotty, especially when they help harvest crops in November and December.

And by the time children reach school age, much of malnutrition’s damage has already been wrought.

Wondewosen Fekadu is the headmaster at Shimider Primary. Mr. Fekadu worked last year in Tseta, a lowland village where families eat better and drink milk. The difference in their students, he said, is striking. “Children there are relatively smarter and more active,” he said. “There are students here who are up to fourth grade and they cannot even read and write, even attentively following the classes.”

Three of Mrs. Gebeyew’s children attend Shimider Primary. Mogus, a 10-year-old third grader, is three and one-half feet tall — wide-eyed, sweet and flummoxed by academics.

“He’s on the poor level — very slow,” his teacher said. “He doesn’t give attention when I’m teaching. He doesn’t concentrate.” In a classroom of 60 children, Mogus ranks 46th.

Mulu, 13, her ribs prominent through rips in her green school dress, races from home to get to her beloved third-grade class. But Mulu is 47th in a class of 60.

Fifteen-year-old Yirgalem, about two inches taller than Mulu, has a teenager’s diffidence toward school. “It’s not that tough,” he said. His second-grade teachers differ. “When he comes to school, I don’t even think his mind is normal,” one of his teachers, Amelework Ejigu, said.

There is great promise that this region’s future youngsters will not be hobbled by mental disabilities. Virtually all nutritional deficiencies can be easily and cheaply prevented, sometimes for pennies per child, through programs like universal salt iodization, fortification of flour and semiannual doses of vitamins.

Such efforts already are under way in some nations, and they are a foundation of most United Nations children’s programs. But in just as many places, they remain a promise.

At Tefera Hailu Memorial Hospital in Sekota, across a mountain from Shimider, the nutrition ward’s 10 beds are filled with worried mothers and shrunken babies. Among them are Adna Berhanu and her 5-month-old son, Agnecheu.

Mrs. Berhanu’s huge goiter is decorated with blue tribal tattoos. Her skeletal baby is severely iodine deficient, surely impaired for life should he survive.

Although iodine deficiency is endemic in Amhara Province, “I’ve been here a year, and we have no iodine in this ward,” the nurse on duty said. Beyond a blood test to estimate iron content, the attending physician said, no one even analyzes children’s nutritional status. Such tests, he said, are luxuries.

“We focus on saving lives; that’s our long-term focus,” he said. “We can’t focus on what happens to them afterward.”

War in Somalia

Another front in the fight against terrorism has exploded.

Washington Post, 27 December

IN THE PAST week a dangerous round of warfare has erupted in Somalia, a failed state in the Horn of Africa that the United States tried in vain to rebuild in the early 1990s. Troops from neighboring Ethiopia who were defending a U.N.-backed transitional government were attacked by forces of the Islamic Courts movement, which for the past six months has controlled much of the southern part of the country. Ethiopia responded by launching a full-scale offensive against the Islamists; by yesterday its forces had captured several towns and were said to be advancing toward Mogadishu, the capital.

For the Bush administration there was both good and bad news in these developments. The Islamic Courts movement poses a potentially serious security threat to the United States: Its leadership includes a U.S.-designated terrorist, and it is known to be harboring al-Qaeda militants, including several who helped carry out the 1998 bombings of U.S. embassies in Kenya and Tanzania. In recent months it has been inviting radical Muslims to Somalia, and thousands have reportedly arrived from such countries as Syria, Yemen and Libya. In short, the Courts-controlled portion of Somalia has begun to look a lot like Afghanistan under the Taliban before Sept. 11, 2001.

Ethiopia's actions, however, are problematic. The country's autocratic government and a slight majority of its population are Christian; this has fueled resistance to its intervention from Somalis and Muslim governments that might not otherwise support the fundamentalist Courts. According to U.S. and U.N. reports, millions of dollars in funding and arms have flowed to the Islamists from Saudi Arabia, Egypt and other Arab states, while neighboring Eritrea, a bitter adversary of Ethiopia, has deployed its own troops. Some experts warn that the fighting could morph into a regional war; others say Ethiopia could get bogged down in a prolonged guerrilla war with local and foreign Muslim insurgents.

Having floundered through a series of failed Somalia strategies, the administration appears to have a somewhat confused view of the latest fighting. Earlier this month it pushed for a U.N. Security Council resolution that called for an end to foreign intervention, the deployment of a peacekeeping force and negotiations between the rival Somali governments. President Bush spoke yesterday with the president of Uganda, which had offered peacekeepers. Yet even while reiterating its call for negotiations, the administration also appears to be supporting the Ethiopian offensive: The State Department said that Ethiopia had a right to defend itself against the Islamists and that its troops were there at the invitation of a legitimate authority, the transitional government.

Maybe the Ethiopian forces will crush the Islamists and their al-Qaeda allies and thereby rescue the United States from its predicament. More likely, the administration will have to prepare for much more active U.S. engagement in what is emerging as a hot new front in the war on terrorism.

Letter in Hussein's Name Urges Iraqis 'Not to Hate'

Sudarsan Raghavan
Washington Post , 28 December

BAGHDAD, Dec. 27 -- A farewell letter posted on the Internet Wednesday in the name of Saddam Hussein declared the former president to be victimized by foreign armies but ready to die and "be with the merciful God." The letter urged Iraqis not to hate the foreign peoples whose armies invaded the country, just their leaders.

Released a day after Iraq's highest court upheld his death sentence and opened the way for his execution within 30 days, the letter said: "I call you now and invite you not to hate, because hatred does not leave space for a person to be fair and it will blind your vision and close all doors of thinking."

Published on several Iraqi Web sites, the letter was written in ancient Arabic verse. Though Hussein took power a generation ago as a secular leader, in later years he mirrored the rise of religious fundamentalism in the Middle East, depicting himself as devoted to Islam. Much of the letter reflects that tone.

In interviews on Wednesday, two of Hussein's defense attorneys based in Amman, Jordan, said the letter was authentic and written by Hussein on Nov. 5. That was the day he was sentenced to death by hanging for the killings of 148 Shiite residents of the town of Dujail following an attempt on his life there in 1982.

"Yes, it is true," said Khalil al-Dulaimi, one of his attorneys.

The second lawyer, Saleh al-Armouti, said the letter was Hussein's way of expressing contempt for his sentence and for the Bush administration.

"He's not an enemy of the American forces. He's an enemy of Bush," said Armouti. "There are a lot free people in the United States who are against the American occupation, and who should be respected for their opinions."

There was no independent way to verify that the letter was written by Hussein.

In the letter, Hussein said he was expressing his sentiments because the Iraqi High Tribunal and its chief judge "did not give us a chance to say what we want to say." The court, the letter continued, "issued its verdict without any explanation and read us the sentence -- according to orders of the invaders -- without presenting the evidence."

Turning to the future, the letter says: "Here, I offer my soul to God as a sacrifice, and if God wants He will lift it up to where the first believers and martyrs are and if His decision is postponed, then He is the most merciful. . . . So be patient and depend on Him against the unjust nations."

Addressing the "generous, loyal people," the letter bids them farewell. "I say goodbye to you, but I will be with the merciful God who helps those who take refuge in Him and God won't disappoint any honest believer."
Portions of the letter praised Americans who assisted Hussein in his trial, an apparent reference to former U.S. attorney general Ramsey Clark, who joined Hussein's defense team.

"You should know that among the aggressors, there are people who support your struggle against the invaders, and some of them volunteered for the legal defense of detainees, and one of them is Saddam Hussein," the letter said. "Others exposed the scandals of the invaders or condemned them.

"Some of these people cried profusely and honestly when they said goodbye to me," the letter added.

Armouti, acknowledging that Hussein was referring to Clark, said that his team had met many American judges and lawyers who supported its view that the trial was unfair and improperly conducted. "We met Americans who are condemning this American intrusion in Iraq," he said.

Iraqi government officials have said that the nine-month trial was conducted properly. They disputed allegations that the court was politicized and dispensed victor's justice.

The letter was posted on the same day that loyalists warned, through a posting on a Web site of Hussein's former Baath Party, that they "are determined to retaliate, with all means and everywhere, to harm America and its interests if it commits this crime," referring to his execution.

According to Iraq's constitution, President Jalal Talabani and two vice presidents must ratify the court's decision if Hussein is to go to the gallows. On Tuesday, a spokesman for Talabani said his approval may not be legally necessary. An Iraqi High Tribunal provision that requires the implementation of the death sentence could outweigh the constitution, said the spokesman, Hiwa Osman.

"Some people believe there is no need for his approval," Osman told the Associated Press. "We still have to hear from the court as to how the procedure can be carried out."

On Wednesday, a New York-based human rights group accused the Iraqi High Tribunal of bowing to political pressures and issuing "its final judgment at worrying speed."

"The Appeals Chamber's ruling was issued far too rapidly for a case involving complex international crimes," said Miranda Sissons, head of the Iraq program of the International Center for Transitional Justice, which works on issues of accountability for atrocities.

"The Chamber should have conducted a serious revision of the evidentiary and fairness issues in the Dujail trial to ensure that justice was done," Sissons said. "That clearly hasn't happened."

First Settlement in 10 Years Fuels Mideast Tension

STEVEN ERLANGER
NYT, 27 December

JERUSALEM, Dec. 26 — Israel announced plans on Tuesday to construct a Jewish settlement in the occupied West Bank for the first time in 10 years, prompting Palestinian anger and American concern.

The announcement, by the Defense Ministry and settler groups, seemed to run counter to the prevailing effort by Prime Minister Ehud Olmert, who had offered a series of gestures to the Palestinians several days ago, after meeting with the Palestinian Authority president, Mahmoud Abbas.
Even before that meeting, Mr. Abbas was being criticized by his political rivals, Hamas, who preach Israel’s destruction, for carrying out what they called an Israeli and American agenda with little to show for it.

One Israeli official hinted that the new settlement might be part of a deal with Jewish settlers to get their tacit acceptance of the removal of illegal settlement outposts from the West Bank.

Another Israeli official, however, insisted that the settlement was not “new,” exactly, but a revival of a settlement approved in 1981, which had become a military training site by the mid-1990s.

The defense minister, Amir Peretz, the dovish leader of the Labor Party, gave his approval to a promise made by his predecessor — Shaul Mofaz, the current transport minister — that houses would be built on the site of an army base in the northern Jordan Valley to resettle some Israelis forced to leave settlements in the Gaza Strip in 2005, according to a Defense Ministry official.

Pressed by Washington to help build up Mr. Abbas, Mr. Olmert promised last week to give him $100 million in Palestinian funds withheld by Israel, about 20 percent of the amount being held, but only for humanitarian purposes.

Abbas aides, however, said the money would be used to strengthen his Fatah movement and pay salaries to Fatah loyalists. Mr. Olmert also promised to dismantle 27 of the 400 or so checkpoints in the West Bank, despite criticism by Israel’s West Bank commander.

Additionally complicating matters, Islamic Jihad on Tuesday fired seven more Qassam rockets into Israel from Gaza, including one that seriously wounded two teenagers in the border town of Sderot.

The planned new settlement will be called Maskiot, and approval was given for the construction of some 30 houses. The Israeli official insisted that all construction would be privately financed.

The housing will be used by the 20 families of the hawkish Gaza settlement Shirat Hayam, which resisted evacuation. To get them to leave Gaza peacefully, the army promised to keep them together.

The decision, the official said, “sort of went through and now it’s done and would be very hard to undo.”

Israel essentially decided to stop the building of settlements in 1992 when Yitzhak Rabin became prime minister, although it has allowed existing settlements to grow, even as it has publicly promised to freeze settlement activity under the so-called road map for peace.

Emily Amrusy, a spokeswoman for the settlers’ council known as Yesha, said that the families would move into trailers on the site while construction began on more permanent housing.

A spokeswoman for the American consulate in Jerusalem, which deals with the West Bank, said a new settlement would be troubling. “We’re looking into it, and if turns out to be a new settlement, we would be very concerned, given Israel’s obligations under the road map,” said Micaela Schweitzer-Bluhm, the spokeswoman.

The road map calls for a freeze in settlement building in the first phase and a Palestinian push to dismantle terrorist groups. Israel says that the dismantling should come first and that no such action has taken place.

But it has separately promised the Bush administration that it would build only within existing settlement structures to account for natural growth, “thickening” the settlements but not expanding them physically.

Israel also promised that it would dismantle more than 20 illegal outposts set up since March 2001, but it has dismantled only one, under an Israeli court order. Peace Now, a leftwing Israeli lobby that opposes the settlements and follows them closely, says that there have been more than 50 outposts established illegally since March 2001, and that there are more than 100 illegal outposts in the West Bank altogether, many of them, like the semi-settlement of Migron, built on private Palestinian land.

Much of the world considers all Israeli settlements in the West Bank to be illegal under international law; the United States, which used to call them illegal, now calls them “obstacles to peace” that prejudge final-status negotiations. The outposts are illegal under Israeli law because the government has not authorized them.

An aide to Mr. Abbas said the announcement ran counter to understandings Mr. Olmert and Mr. Abbas reached at their meeting Saturday night. “We condemn this act and this decision, especially as it comes after the Israeli side committed itself to stop all unilateral actions,” the aide, Saeb Erekat, told Agence France-Presse. “This is certain to destroy the atmosphere created after the meeting with Olmert, where they committed to many issues, especially to stop unilateral actions.”

The Palestinians want to establish an independent state in the West Bank, Gaza Strip and East Jerusalem and consider any Israeli building there to be an act of thievery. Israel says that it accepts the idea of a Palestinian state but that the exact contours have to be negotiated.

Yariv Oppenheimer, director of Peace Now, criticized the decision on new construction as contrary to the government’s stated aims and programs and noted that it had not been approved by Parliament. “This is a veritable scandal, all the more so that this decision was taken by Amir Peretz,” himself a former advocate with Peace Now, Mr. Oppenheimer said. What may begin with 30 houses could easily become more because of “thickening,” Peace Now said.

There have also been reports that some settlers have moved temporarily into the ruins of the Homesh settlement in the West Bank, one of four West Bank settlements destroyed along with the Gaza settlements in 2005.

Of the seven Qassam rockets fired into Israel on Tuesday by Islamic Jihad from Gaza, one hit Ashkelon and two reached Sderot, seriously wounding the two teenagers, one critically; both were being treated at a hospital.

The injuries will put more pressure on Mr. Olmert to respond militarily. Since a supposed cease-fire was agreed to on Nov. 26 between the Palestinians and Israel, more than 55 Qassams have been fired from Gaza, about half of which have landed in Israel. The truce did not include the West Bank, but Islamic Jihad says its rocket firing is a response to Israeli military actions there.

On Tuesday, Israel arrested an Islamic Jihad commander, Mahmoud Saadi, 26, in the northern West Bank town of Jenin. Israel also announced the arrest in Ramallah on Nov. 2 of a senior commander of Al Aksa Martyrs Brigades, Muhammad Sayidi, 36, who had been wanted for several years on charges of killing an Israeli in 2000.

Separately, Israeli officials said that Mr. Olmert would travel to Egypt, probably on Jan. 4, to meet the Egyptian president, Hosni Mubarak, and Palestinian officials said that Mr. Abbas and Prime Minister Ismail Haniya of Hamas were expected to meet soon in Jordan for further discussions on how to end their political impasse and the violence between their factions.