New global economic pact: The French disconnection
France took the initiative this week to introduce some fresh thinking into how the economically developed world must reform the post-World War II Bretton Woods agreement that relied on international lending institutions based in Washington, like the IMF and the World Bank, helping economically poor nations out of the woods when in financial distress.
This week’s summit for a ‘New Global Financial Pact’ in Paris was ambitious, seemed even holistic, but will it be realistic? It has proposed a reform agenda, saying it is outdated and of no practical help to countries when in trouble, as assistance comes too late. Covid-19 struck a double whammy for several countries in Latin America, Africa and Asia already hit by debt abroad and corruption and mismanagement at home. Sri Lanka, in the pits last year, managed to clear the first hurdle for a bailout just in time, but is straining to clear the second as IMF conditions on how to manage the economy are stringent and can lead to socio-political instability.
The summit was attended largely by African nations that were former French colonies – which want a change of course from today’s IMF/World Bank-dominated world economy. Any change of the status quo will be resisted by the US, surely, to protect its dollar and its clout, as many emerging nations like India, Brazil, and South Africa also find inspiration in alternatives.
In its quest for a ‘systems change’, will the French initiative factor in global power politics indulged largely by the US and the West through the Bretton Woods system to coerce small nations to their worldview? There was no great enthusiasm shown by the US Treasury Secretary at the summit, and only neighbouring Germany’s Chancellor was there at the head-of-government level from the West.
US-led sanctions on Russia and Iran, imposed due to its differences with those countries, have a knock-on effect on international trade that disrupts poor nations doing normal business. As long as both the US and the EU also refuse to de-link economic issues from human rights and other political issues to further their global outreach, the Paris summit might merely see a miscarriage of a well-meaning French initiative for a new global financial pact.
For Sri Lanka and many other developing countries in the Global South, this is nothing new. It’s a familiar decades-long struggle for a more inclusive international financial system. A new World Economic Order needs an unlikely new World Order to succeed.
Terrorism: Another early warning from India
The detection last year of these persons and now brought to court, cannot be easily ignored. Back in 1970, the then Superintendent of Police of the Northern province sent a report to Police Headquarters under the heading “Smuggling and Politics in the North”, drawing attention to the political aspect which had become a contributory factor for the illicit trade between Ceylon and south India. Colombo ignored that early warning, and the rest is history.
Today, is history being repeated? A roaring illicit exchange centre for drugs, gold, cannabis, medicines, turmeric and what not prevails along the IMBL (International Maritime Boundary Line) dividing India and Sri Lanka and at least India officially treats what’s happening in these waters as a ‘humanitarian’ issue of the south Indian fishermen.
According to the charge sheet against the 13 accused, the men make use of the hawala networks and crypto platforms to circumvent the traditional banking system for whatever they are up to. Most of the Sri Lankans are from the south and it is the ‘filthy lucre’ that they are interested in, but for an Indian government agency to announce that these are attempts to revive the LTTE must surely ring alarm bells in Colombo.
Page 8 of this issue has a more detailed report, but it behoves the Defence and National Security authorities to send a team to India to gather more information on the matter and the Foreign Ministry to ask its deputy high commissioner in south India to keep Colombo posted on this case. Sri Lanka has a history of ignoring early warnings. Like in 1970, the Easter Sunday bombings warnings more recently, are telling reminders of the consequences that followed.
Indian drugs: A ‘sickening’ state of affairs
There have now been two confirmed, recorded deaths attributed to the Indian-manufactured “bupivacaine” anaesthetic branded “Zupivac-H”. The fatalities underscore a problem that threatens to worsen – one that New Delhi too ought also to pay attention to.
This brand of bupivacaine hydrochloride in dextrose form was one of the many drugs now being allowed into the country through special Health Ministry instructions – and the complicity of the National Medicines Regulatory Authority’s (NMRA) handpicked, politically-appointed top management – without local vetting or registration.
These are ‘walk-in’ offers by predominantly Indian drug manufacturers, intermediaries or agents. After the Health Ministry greenlights the procurement, the NMRA uses a legal provision that allows for “waivers of registration” (WoR) to wave the drugs through to the market without local oversight.
But the law specifies that the NMRA may issue WoRs only “in special circumstances”, none of which can explain the scale of what is happening now. Regulatory frameworks were introduced in the public interest and are public entitlements. If drugs continue to be issued to the health sector without any form of oversight or mandatory safety, efficacy and quality testing, there are likely to be more victims.
India did not call on Sri Lanka’s Health Ministry to ignore oversight procedures when buying drugs under its credit line or otherwise. India also did not require safe procurement to be overturned. If this continues, however, especially in a country like Sri Lanka which has historically not faced major problems with drug quality, it will be the reputation of the Indian pharma industry that aspires to be the affordable medicines and healthcare provider to the world, that takes the hit.
Sri Lanka’s notorious corruption levels, including in the health sector and its regulatory framework is too entrenched; the question is, does India want to be partners in it?