[Initially written in 1999 (updated subsequently)]
Background
The after-effects of nuclear tests by India and Pakistan in May 1998 have confirmed the validity of the above statement by Sir Edward Grey, the then British Foreign Secretary. India tested its nuclear bombs on 11 May 1998. A week later LK Advani, India's home affairs Minister said
"Testing the bomb has brought about a qualitatively new stage in Indo-Pakistan relations . . . it signifies India's resolve to deal firmly and strongly with Pakistan's hostile designs and activities in Kashmir."
Mumtaz Rathur, former Prime Minister of Azad Kashmir (Pakistani sector of Kashmir) offered his prognosis to the Independent "I think if war starts, it will not be an ordinary war but an atomic war, and will spoil the peace of the whole region".
In view of the outstanding dispute over Kashmir, dangers of nuclear war between India and Pakistan are very real. The deterrent theory that is believed to have preserved the peace between the East and the West is unlikely to work there. Pakistan may well feel that in the event of a conflict if it does not resort to the 'first strike', it may not have a chance for the 'second strike' as its entire defence structure, including its nuclear capability, is liable to be destroyed by India's 'first strike'. Consequently, the chances of miscalculation by the parties are real.
The grim reality of miscalculation by nuclear powers was brought home by the revelation made known in the late 1980s by joint US and Soviet enquiries into the Cuban missile crisis of October 1962, when 30 Soviet ships, some carrying missiles and nuclear warheads approached America's quarantine line off the coast of Cuba. Even President Kennedy did not know how close the world came to nuclear war. Each side had seriously misjudged the likely response of the other.
Krushchev believed that the United States would tolerate the presence in Cuba of nuclear missiles able to hit American cities. Similarly Kennedy who was under pressure from Congressional leaders and the majority of his advisers, including the service chiefs, to launch an air strike as a prelude to an invasion by 180,000 American troops, mistakenly believed that no nuclear warheads had reached the island.
Had Krushchev not retreated, Kennedy might have made the most costly miscalculation in human history: in addition to some 70 warheads for the ground-to-ground missiles Krushchev had provided his 43,000 man force in Cuba with at least 90 tactical nuclear weapons. It has since been calculated that 10 of them would have been sufficient to obliterate all five allied beachheads in Normandy in 1944. Robert McNamara, former US Defence Secretary who took part in Russian-American discussion in 1992, has said that if the weapons had been used against American troops a full-scale nuclear exchange between the USA and USSR would have followed. Today there are approximately 40,000 nuclear warheads in the world with a destructive power more than one million times greater than the bomb that flattened Hiroshima.
This shows the risks of miscalculations by India and Pakistan, given the outstanding dispute over Kashmir.
India and Pakistan
Flashpoints have already occurred between India and Pakistan. It was reported on 3rd December 1998, that about 60,000 Indian troops conducted India's largest military exercise this decade close to Pakistan's border following the failure of talks between the two countries on the disputed issues. It involved training in nuclear and chemical weapons warfare. Prithvi missiles, which were developed essentially for targeting at Pakistan, were deployed for the exercise with a view to arming them with nuclear warheads. Indian officials made it clear that the exercise was designed as a review of India's military doctrine in a situation of nuclear balance vis-à-vis Pakistan's nuclear capability. India seems to be acting on the deterrent theory to deter Pakistan from launching a strike by the display of its massive military/nuclear strength. However, this strategy could have the opposite effect. India and Pakistan came very close to conflict during military exercise in India known as 'Operation Brass Tacks' several years ago. Nuclear postures by India and Pakistan constitute a very dangerous game, but it is not a clever one. It could backfire with disasterous consequences. Past incidents provide illustrations of this. When Ziaul Huq was the president of Pakistan, the Indian exercise was reported to him as a massive military build-up with a view to launching an invasion. The generals asked his permission to move tanks and artillery to the border for defensive purposes. President Ziaul Huq pondered over the matter for about five minutes and then was said to have instructed the generals, "Don't bother. Instead move the missiles (which were armed with nuclear warheads) to the firing position. As soon as the invasion begins, I want a report of the attacks. I'll then issue an order for firing these missiles at Indian targets." As the missiles were being moved to their firing position, the US satellites spotted their movements. The US Government immediately contacted Islamabad and New Delhi and arranged for direct talks between them to defuse the situation.
Bruce Riedel, a senor director in the Clinton Administration's National Security Council revealed in May 2002 that the Pakistan Army had prepared its intermediate-range missiles with nuclear warheads for strikes against major Indian cities during a 1999 border conflict with India.
This shows the dangers of the current military/nuclear postures of India and Pakistan. While the Indians thought that they were doing their military exercise, the Pakistanis thought that an invasion was about to begin. This is the kind of misunderstanding that could start a nuclear war. If nuclear war does break out between India and Pakistan, it is very likely to follow this pattern. On this occasion, a small border incident could have started a full-scale nuclear war.
This saga was nearly repeated in May 1998. While Pakistan was exploding its nuclear devices in Baluchistan, a foreign military plane was sighted on the coast. The plane was thought to have been engaged in a reconnaissance mission. Pakistan took it as a prelude to an attack by India on its nuclear and defence installations for the purpose of their destruction. Pakistan issued a warning to India that any such attack would be met with a devastating response. The United Nations was also informed of such a response. By 'devastating response' Pakistan meant nuclear bombardment of India. India is a nuclear-equipped power with its own delivery system. While Pakistan's Shaheen and Ghauri (test-fired in April 1998) missiles have a range of 470 and 937 miles, India's Prithvi and Agni missiles are of 155 and 1500 miles range respectively. Pakistan's Ghuari-II (of 1,440 miles range) and India's Agni-II (of 1,375 miles range) ballistic missiles were test-fired in April 1999. Any nuclear attack on India by Pakistan would have provoked a nuclear response. As a result a full-scale nuclear exchange between the two countries would have followed with all its consequences. Pakistan is believed to possess as many as 30 tactical nuclear warheads,each with a capacity roughly two and a half times the bomb that destroyed Hiroshima. India is thought to have 65-90 nuclear warheads.
According to the Institute for Science and International Security in Washington, India has about 65 nuclear warheads against Pakistan's 40 (May 2002). Some estimates put the number of Pakistan's warheads to 30-50. However, according to the press report of 27 May 2002 Pakistan could assemble more nuclear warheads than the estimated 30-50.
Some estimates put the number of Pakistani nuclear warheads considerably higher. Furthermore there have been reports of China re-enforcing the Pakistani stocks of missiles.Overall there appears to be a nuclear parity between India and Pakistan. However, India enjoys an overwhelming superiority over Pakistan in terms of conventional weapons and forces.THERE LIES THE DANGER. India might make the assumption that Pakistan would be too frightened to use its nuclear weapons because India could survive Pakistan's first nuclear strike and then obliterate Pakistan altogether.Therefore India could take on Pakistan using its conventional forces and inflict a defeat.THIS KIND OF REASONING WOULD BE A FATAL MISTAKE. As I have stated below, PAKISTAN WILL USE ITS NUCLEAR WEAPONS IN TWO SITUATIONS, first if it is attacked with overwhelming military force leaving Pakistan with the only choice between defeat and the use of nuclear weapons and secondly if Pakistan mistakenly believes that it is being attacked with such a force. FOR THIS REASON PAKISTAN'S FIRST STRIKE IS VERY LIKELY TO BE A DECISIVE STRIKE LEAVING INDIA LITTLE CHANCE OF SURVIVAL.
Further consideration is that if India were to use nuclear weapons against Pakistan India itself would be exposed to massive radioactive fallouts endangering its own safety. Thus if Lahore, Rawalpindi and Islamabad were to die, the Indian State of the Punjab too will die with them as a result of Indian bombing. Because the prevailing winds are from the West, India is more likely to be affected by fallout from its own bombing of Pakistan than Pakistan itself. Radioactive dust, if bombs exploded on the ground, would kill people across hundreds of square miles. In fact, nuclear clouds drift up to 2000 miles on the prevailing winds. The fallout could drift into the jet stream, spreading radiation across the region. Thus the Punjab, Delhi, Gujrat, Rajasthan and much of the North Indian Plains, the heartland of India, could be at risk from India's own nuclear strikes in addition to Pakistan's possible nuclear attacks.
The so-called 'wild card' system of command and control that theoretically prevents accidental or unauthorised launches of nuclear missiles in the West and in Russia is probably not effective in India and Pakistan. Even if it were, a full scale war between them could lead to the break-down of central command, leaving the army generals in control of the missiles in different areas, who could then indiscriminately use them, thereby bringing about a nuclear holocaust.
Pakistan is likely to use its nuclear weapons in two sets of circumstances: First, if she is, in actual fact, threatened by an attack of an overwhelming military/nuclear strike; and second, if she takes the view mistakenly that she is being attacked by an overwhelming military/nuclear strike, even when no such threat is planned or is in existence. The kind of military exercise that India conducted close to Pakistan's border at the beginning of December 1998 could very easily create conditions in which such a mistaken perception by Pakistan could occur with all its repercussions. It could lead Pakistan to believe mistakenly that such a military/nuclear strike is imminent and resort to nuclear response. Indeed, in response to India's latest nuclear/military exercise close to Pakistan's border, the official in charge of Pakistan's atomic energy commission said on 2nd December 1998 that scientists had built the Sub-continent's most modern surface-to-surface missile and were awaiting a government signal to launch it.
The Pakistani military analysts believe that Pakistan will use its nuclear weapons in a third situation as well. That is to say that if Pakistan is economically strangulated by India the nuclear option will be resorted to. This refers to the stopping of the water flow into Pakistan by India from its Punjabi rivers in violation of the Indus Treaty 1960. It could have devastating consequences on Pakistan's agriculture by turning the area into a virtual desert.
According to M.V. Raman, an Indian nuclear physicist, a Pakistani warhead of 15 kilotons - about the size of the Hiroshima bomb - dropped on a city like Bombay would erupt in a furnace of shockwaves, fireballs, and screaming winds creating hailstorms of lethal debris. The sands on Bombay beaches would explode like popcorn. Granite would melt, buildings would vaporise and up to 860,000 people could die from a single missile strike. Depending on the wind direction and the location of the blast, millions more might be exposed to fatal radiation. Both India and Pakistan now possess more powerful nuclear warheads than the Hiroshima bomb. This shows that India and Pakistan could plunge the world into a thermo-nuclear war at any moment. Therefore the Indian military planners would be well advised to bear this consideration in mind while pursuing their strategies.
It demonstrates that a point has been reached in the Indo-Pak relations when a gigantic nuclear holocaust involving risks to over a billion population and those beyond has become a serious possibility. This calls for a search for the means to avoid nuclear war in the Indian Sub-continent.
We are considering the risks of nuclear weapons. One is also prompted to ask the question " How safe are the nuclear power plants in their hands?" In People's Union for Civil Liberties v. Union of India ( 2004 SOL Case No.012) - a case that reached the Supreme Court of India in 2004 the appellants sought disclosure of information relating to safety violations and defects in various nuclear installations throughout India. In that case it was revealed that a report of the Atomic Energy Regulatory Board of November 1995 had documented 130 instances of serious accidents in nuclear power plants in India. The implications of this type of accidents ought to be viewed against the background of the Chernobyl Nuclear Accidents which occurred on 26 April 1986 at the Chernobyl Nuclear Power Plant in Ukraine, then part of the Soviet Union. The human consequences of Chernobyl Nuclear Accidents have been well-documented.
Please see the articles entitled " Inside Chernobyl plus Nuclear Power Reconsidered " published in the April issue of 2006 National Geographic magazine ( at pages 32-63) . In this nuclear accident the volume of radioactive fallout was more than 400 times than that released at Hiroshima exposing those concerned to the then and future hazards of cancers and other forms of diseases.
India has 14 nuclear power reactors most of which are modelled after a design first built in 1957. While the Government releases no information about leaks or accidents at its nuclear power plants, Dhirendra Sharma, an Indian scientist who has written extensively on the matter has compiled figures based on his own reporting. According to him an estimated 300 incidents of a serious nature have occurred,causing radiation leaks and physical damage to workers. These have,so far, remained official secrets. ACCIDENTS AT NUCLEAR POWER PLANTS PRESENT THE RISKS OF OF A FAR MORE DANGEROUS HOLOCAUST THAN THAT OF A NUCLEAR WAR.
In view of the fact that carbon related emissions from the burning of fossil fuels causes global warming there is a growing demand for alternative sources of energy, particularly in the form of nuclear power. HOWEVER, SO FAR, NO SATISFACTORY SOLUTION HAS BEEN FOUND TO THE PROBLEMS OF ACCIDENTS IN NUCLEAR POWER STATIONS AND SAFE DISPOSAL OF NUCLEAR WASTE MATERIAL.
NUCLEAR POWER AS AN OPTION TO ENSURE FUTURE ENERGY SUPPLY IN THE UNITED KINGDOM
The Government of the United Kingdom announced in 2005 its intention to undertake a review of the above. The Government indicated its preference for nuclear power to ensure future energy supply by building sufficient number of additional nuclear power stations. This author acknowledges the importance of finding an alternative source of future energy supply other than the fossil fuels - coal, oil, gas etc. the burning of which results in carbon emissions causing global warming up and climatic change. This is responsible for drought and famine in the countries of Sub-Saharan Africa at the present time and potentially poses a grave threat to the lives of over a billion of population in Asia. The reader is referred to the website articles of this author entitled "A Federal Solution to the Conflict in Sudan" and "How to Avoid Nuclear War between India and Pakistan"- available on: www.angelfire.com/ok/mafazal/index.html
However, there are dangers associated with the option for nuclear energy. The object of this work is to draw attention to these dangers.
First there is the risk of accidents in nuclear power plants. The accident that occurred at Chernobyl Nuclear Power Plants in Ukraine on 26 April 1986 is well-known. It put at risk not only the population, animals, plants and environment locally but also elsewhere. The farmers in the Welsh mountains and in Scotland found that their farm animals were affected. There have been far more accidents in India with similar results. Please see this author's website article entitled “How to Avoid Nuclear War between India and Pakistan". If Britain were to adopt the policy of nuclear power as an option for future alternative source of energy supply that is likely to be followed by the rest of the world. In view of the experience in India there are serious doubts as to the ability of the Third World countries and the countries of the former Soviet Union to maintain adequate standards of safety requirements to avoid accidents that could pose grave threats to human health and environment of the living beings.
Secondly there is also the risk with regard to the safe disposal of nuclear waste material. Although the developing technology can ensure that there would be less of nuclear waste material than in the past but even the lesser amount of waste material has to be safely disposed of. In view of the durability of nuclear waste material even after its disposal no satisfactory solution has been found to the question of its safe disposal.
Thirdly as pointed out above, if Britain were to adopt this option as a policy that is likely to be followed by other countries of the world. Such a widespread network of nuclear power plants is likely to provide more vulnerable targets for terrorists' attack. It might be virtually impossible to protect these installations from the terrorists' attacks which are likely to become more sophisticated as the time passes.
Fourthly any country that has developed the technology to produce energy from nuclear power plants can use that know-how and the facility to make nuclear bombs. Again India provides the example. In the mid-1950s the Government of India decided to embark upon a programme to develop nuclear technology for peaceful purposes. Following that decision India was able to establish its own nuclear power plants with the assistance from Soviet Union. However, the Government continued its programme of research in nuclear technology for peaceful purposes. Subsequently it decided to make its own nuclear bombs. Thus India which has outstanding disputes with neighbours became a nuclear power with implications for international peace and security. Pakistan immediately followed suit thereby adding a new dimension to its conflict with India. The distance between nuclear power and nuclear weapons is a very short one in terms of time, technical know-how and the facilities required.
Iran is now using the same argument, namely that it is developing nuclear technology for peaceful purposes only. Quite understandably and justifiably the West does not trust Iran's promise not to develop nuclear weapons. Indeed the verdict of history is against Iran's position. The Indian experience shows that Iran would be able to do so in no time. This shows that if the countries of the world were to adopt nuclear power as an option for alternative source of energy supply the process is likely to end up in most of the countries possessing nuclear weapons. The world would become a nuclear planet in which the continued existence of man and other forms of life cannot be ensured.
WHAT ARE THE SAFE AND VIABLE OPTIONS?
If the option for nuclear energy is ruled out as not being safe the question naturally arises: what are the safe and viable alternative (alternative to fossil fuels such as coal. gas, oil etc.) options? It is submitted that adequate resources should be directed towards developing the following.
(a) RENEWABLE SOURCES OF ENERGY such as solar energy, wind power, sea waves etc. At present technology is not sufficiently developed to tap these sources on a scale that is required and commercially viable. Adequate resources should be made available for research and development of technology in this field as a matter of priority. Renewable sources of energy are clean and potentially unlimited. Therefore every effort should be made to tap these sources.
(b) RECYCLING OF WASTES, THEIR CONVERSION INTO ENERGY AND CONSERVATION OF ENERGY. It appears that architects are designing buildings to be in tune with nature so that hot air within the buildings and outside during the summer could be conserved so as to supply heating during the winter. Similarly cold air of the winter months could be conserved so as to provide cool air during the summer. If technology is sufficiently developed, the process might be expanded beyond the building architecture to other areas.
Again the industrialised countries are finding that they are unable to cope with the available volume of industrial and domestic wastes. The city of Nottingham has reportedly decided to burn wastes at rubbish dumps. If this method of disposal is repeated by other cities of the world that would make matters far worse in terms of carbon emissions into the atmosphere. However, if technology were available to transform this vast amount of waste material into energy that might go a long way towards solving the energy crisis without contributing to the global warming and climate change. The issue again boils down to the question of diverting adequate resources for research and development in promoting the appropriate technology for this purpose.
IF CARBON EMISSIONS COULD BE RECYCLED AND CONVERTED INTO ENERGY BY THE APPROPRIATE TECHNOLOGY THAT MIGHT PROVIDE ANSWERS TO THE QUESTIONS OF HOW TO FIND A SECURE SOURCE OF SUPPLY OF ENERGY TO MEET THE WORLD'S NEEDS AND HOW TO DEAL WITH THE PROBLEMS OF GLOBAL WARMING AND CLIMATE CHANGE.THE POLICY OUGHT TO BE ONE OF NOT SIMPLY RECYCLING CARBON EMISSIONS FOR SAFE DISPOSAL UNDERGROUND AS THE BRITISH PETROLEUM IS DOING IN ITS GAS PLANTS IN ALGERIA BUT ONE OF CONVERTING THEM INTO ENERGY.
Therefore these safe and viable alternative options are recommended to the Government for serious consideration for adoption as the appropriate energy policy.
APPROPRIATE RESPONSE TO CHALLENGES OF GLOBAL WARMING, CLIMATE CHANGE AND ENERGY CRISIS.
The response of governments, various official reports and international organisations has been to emphasise the importance of reducing carbon emissions to the atmosphere to avoid the impact on the world climate. In view of this author this approach is not practicable to deliver the desired results. It is not possible to reduce the level of carbon emissions required to make a meaningful impact within the time-scale contemplated. By the time the target is achieved (if it is ever achieved) it might be too late.
This author advocates an alternative approach which will involve three main elements. First, the greening of the main deserts both in the northern and southern hemispheres ought to be done by way of afforestation. The trees are likely to absorb carbon emissions thereby reducing their volume and discharge moisture into the air so as to bring about rainfall and thus to make the process self-sustaining. In the cases of Sahara desert, the deserts in the Middle East, the Thor desert in the Indian Sub-continent and those in central Asia, this approach will require concerted actions by the countries concerned, supported by resources and expertise from the outside world including in particular the West. Secondly appropriate technology ought to be developed for the purposes of recycling of wastes and carbon emissions and their conversion into energy. As a result, it should be possible to have (a) secure source of supply of energy and (b) to solve the problem of global warming and climate change by removing/reducing the available carbon level in the atmosphere- the cause of drought and famine in the sub-Saharan countries and elsewhere
Thirdly, appropriate technology ought to be developed to utilise renewable sources of energy such as solar energy, wind and wave power etc. As a result of global warming, it is anticipated that tropical and sub-tropical countries as well as southern Europe would be exposed to a much warmer climate and hot sun. This is likely to carry with it the risk of turning those areas into desert thereby destroying plants, crops and animals. However, such hot sun would at the same time offer the source of unlimited supply of energy, provided that the appropriate technology is available to produce solar energy on a scale that is required and at a price that is commercially viable. Once unlimited energy is available at a viable cost, any number of desalination plants could be built along the sea coasts to produce fresh water to be supplied inland by canals and tunnels for irrigation of land. This would result in the growth of crops and afforestation of deserts such as the Sahara desert and deserts in the Middle East, Indian Sub-continent, central Asia and other parts of the world. This could also apply to Australia which is expected to be turned into a desert by 2027. Global warming might be a means of dealing with the consequences of global warming itself. It could even provide an opportunity to turn poor countries including Africa into rich nations. It seems that the tropical belt of the planet Earth is expanding itself. This has a particular significance for Australia. The westerly wind with its rainfall is moving south of Australia thereby exposing the country to acute drought and desertification.
It appears that the southern hemisphere is being affected more immediately at the present time than the northern hemisphere by global warming. Australia is experiencing an acute drought and might become a complete desert by 2027. Lakes and rivers are drying up in South America. This cannot be the effect of industrial pollution and carbon emissions which are largely prevalent in the northern hemisphere. The solar activity might be the predominant factor in bringing about climate change and global warming. If that is the case, then cutting carbon emissions alone will not be the complete answer to the problem (although it might be a partial answer insofar as industrial pollution is a contributory factor). Please see the book entitled "The Chilling Stars" by Henrik Svensmark and Nigel Calder, published by Icon Books Ltd, 2007. In that case, the alternative approach advocated by this author i.e. Fazal's approach (namely the conversion of solar heat into energy through appropriate technology to produce an unlimited amount of fresh water from the sea using desalination plants for the irrigation of land, coupled with the effective treatment of the trees and plants affected by insects and diseases produced by the warming of the climate) would be the full answer to the problem.
Furthermore, the areas that are submerged under saline water from the rising level of the sea could be put to productive use. Thus in Bangladesh, as the rising sea level has pushed saline water inland contaminating rice fields and water supplies, thousands of farmers have turned their rice fields into shrimp farms. It has enabled them to earn a higher income. This demonstrates that rising sea levels and warmer climate together with its hot sun could be turned into an advantage whereby man can transform the existing and potential deserts into green farm lands and forests and enjoy a higher standard of living. Once the deserts turn green, the trees of the deserts are likely to absorb carbon emissions thereby reducing their levels and to discharge moisture into the atmosphere. This is likely to bring about rainfall, thus making the greening process self-sustaining.
The means to avoid nuclear war in the Indian Sub-continent
The above discussion makes it necessary (indeed essential) to consider ways and means to avoid a nuclear war between India and Pakistan. I anticipated this in my book "A Federal Constitution for the United Kingdom - An Alternative to Devolution" (1987, Ashgate - Dartmouth ISBN 1 8552 8763). In Appendix 5, in answering a questionnaire issued by the Commission on Centre-State Relations in India of January 1984, I suggested at pp. 253-256 three models for a political settlement amounting to some form of re-unification of the sub-continent. These are:
1. a federal/confederal solution based on the model constructed in my book, ie. that the units of the confederation viz. India, Pakistan and Bangladesh will retain their membership of the United Nations and their role in foreign affairs to the extent indicated in chapter six of the book, the status of Kashmir being determined by the parties viz. India, Pakistan and the representatives of the people of Kashmir including those engaged in armed struggle - a procedure comparable to the peace process in Northern Ireland, in accordance with the wishes of the people of Kashmir;
2. collaboration among India, Pakistan and Bangladesh based on the model of the European Union, the subsidiarity principle dictating the division of functions between the Union and the Member States;
3. establishment of an Inter-governmental Council based on the model of the Anglo-Irish Inter-governmental Council to deal with the question of Kashmir and overall relations between India, Pakistan and Bangladesh.
I have spelt out my ideas on how to approach the issue of Kashmir for a solution. The dispute over Kashmir is the greatest stumbling block for the improvement of overall relations between India and Pakistan. So long as the dispute is unresolved the risk of a deadly nuclear war breaking out between India and Pakistan will remain. The importance of finding a solution to the problem of Kashmir is underlined by the outbreak of the third undeclared war over the disputed territory during May/July 1999 (known as the Kargil Conflict) between India and Pakistan, both of which are now nuclear powers. During this period, the conflict had always the potential of developing into a full scale nuclear war affecting the peace and well-being of the whole of the Sub-continent.
I have recommended certain procedural steps to be taken. Actual solution is for the parties themselves to work on. There is a wide range of possibilities - accession of Kashmir to Pakistan or India, independent Kashmir, special status for Kashmir within the confederation of India, Pakistan and Bangladesh (as proposed by myself) etc. It would be up to the parties themselves to decide as to which option is preferable.
As to the parties to the dispute, I recognise that there are three parties viz. 1. India; 2. Pakistan; 3. the Representatives of the People of Kashmir including those engaged in the armed struggle. It is extremely important to bring those engaged in the armed struggle to the conference table. Therefore, my recommendation is that there should be a Round-Table Conference on the question of Kashmir where these three parties viz. 1] the Government of India, 2] the Government of Pakistan, 3] the Representatives of the People of Kashmir on both sides of the Line Of Control, including those engaged in the arms struggle, would be represented. It will be the job of this Round-Table Conference to find the actual solution to the dispute over Kashmir. Originally I considered the machinery of an inter-governmental council for dealing, inter alia, with the question of Kashmir. However in view of the gravity of the situation over this dispute, it would be more appropriate to provide the procedure of a Round-Table Conference to deal exclusively with this issue. The question might arise as to what should happen if the parties represented at the proposed Round Table Conference were to fail to agree to any specific solution. The answer is that under my proposal the Round Table Conference ought to be guided by the wishes of the people of Kashmir in its deliberations on the matter.Thus I have stated "The eventual settlement of the Kashmir questions ( embracing both the Indian and Pakistani sectors of Kashmir) will have to be based on the consent of the people of Kashmir" [ M.A.Fazal,A Federal Constitution for the United Kingdom - An Alternative to Devolution ( 1997) at p. 256 ].
In Appendix 4 (at pp. 207-212) of the same book my recommendation for Northern Ireland was similar, I said:
"Almost endless rounds of talks between the British Government and the 'constitutional parties' in Northern Ireland seem to have got nowhere while violence continues, increasingly affecting the mainland of Great Britain. It is submitted that any search for a settlement ought to have two objectives in view. First, the settlement, to be a durable solution, must be arrived at by way of broad consensus on both sides of the divide, i.e. the Protestants and the Catholics. Secondly, the settlement must result in the restoration of peace and security both in Northern Ireland and on the mainland of Great Britain."
"These two objectives dictate that the constitution process ought to assume the form of a Round Table conference. To secure wide acceptance representatives from all sections of both the communities must be invited to attend. These would include not only the constitutional parties but also the churches on both sides and those engaged in violence. It ought to be appreciated that the constitutional parties alone cannot deliver a settlement which would restore peace and security and secure consensus across the board. For this reason the stigma about talking to the terrorists has to be overcome. Indeed, it is only if the terrorists are able to play a part in the constitutional process that they are likely to abandon violence. The objective of restoring peace and security cannot be achieved without their participation in the process of settlement."
This proposition was acted upon for Northern Ireland by the Mitchell Commission.
As I see it, this is the only way to end violence in Kashmir.
Each of these solutions calls for public discussion. As for instance, if the common market model on the basis of the second solution were adopted, Pakistani and Bangladeshi industries might not be able to compete with the Indian industries which are more advanced in relation to others. If the Pakistani and Bangladeshi industries cannot stand in competition with their Indian counterparts their factories will close down and the people will be thrown out of employment. Indeed this might prove to be the greatest hurdle. One solution could be that of the European Economic Community. That is to say, the unification could proceed by stages and the customs barrier could be progressively lowered at each stage, unanimous decisions being required over whatever the parties consider to be important issues. During the transitional stages each of the parties could specialise on certain industries, Pakistan and Bangladesh being given priority over industries in which they enjoy certain advantages, India deciding to slow down the growth of those industries (in which priority has been assigned to Pakistan and Bangladesh). These decisions will be a matter of negotiation between the parties as is the case with the Council of Ministers of the European Union.
In order to succeed the system adopted must be one that benefits all the parties and not one where the strong wins and the weaker parties lose out. If successful, such a union of the Indian Sub-Continent could be enormously beneficial to all concerned. A billion population could create a much more powerful economy than that of the European Union. A successful economic and political union could bring prosperity not only to the peoples of the Sub-continent but would also contribute to the stability and growth of the world economy.
Implementation of the Fazal Proposal for a Confederation of India, Pakistan and Bangladesh Coupled with a Just and Fair Settlement of the Dispute over Kashmir as a Means of Avoiding a Nuclear War between India and Pakistan
The Governments of India, Pakistan and Bangladesh ought to consider the above proposal as contained in this article for necessary actions. The way forward in search of peace and security in the Indian Sub-continent on the basis of this proposal will involve the following steps:
(1) Public discussion of this proposal in the press, media and Parliament.
(2) Discussion of the same among the Governments of India, Pakistan and Bangladesh with a view to setting up the appropriate machinery for pursuance of the Fazal proposal, viz. (a) Indo-Pak-Bangladesh Intergovernmental Council to examine the proposal for the confederation (please see M A Fazal, 'A Federal Constitution for the United Kingdom - An Alternative to Devolution (Dartmouth/Ashgate, 1997) pp. 253-256 on this) and (b) a Round Table Conference on Kashmir (as stated above).
(3) Establishment of the machinery as envisaged here to pursue the Fazal proposal.
Restoration of Environmental/Ecological Balance Calls for a Sub-continental Approach
According to the press reports made available in May 2000, the arid zones of India, and Pakistan were badly affected by acute drought. It appears that the areas experienced successive drought for the previous three years. In India, in particular, Gujarat and Rajastan suffered heavy losses of cattle amounting to hundreds, possibly thousands. People were being driven from rural areas to the towns in search of water. In fact drought has been recurrent in the Indian Sub-continent since 1965. The climate of the Sub-continent is very much affected by the presence of the Thor desert. There is evidence to prove that the desert has been expanding itself in all directions, and now comprises Pakistan and central and western regions of India. There is every reason to believe that the desertification is proceeding east- and southwards. The presence of the arid zones of India and Pakistan is decisive in influencing the climate, causing frequent occurrences of drought in the Sub-continent. Therefore, any attempt to restore ecological cum climatic balance of the Sub-continent must take account of what happens to the arid zones of India and Pakistan, as well as to Nepal and Bangladesh.
This author tried unsuccessfully to persuade the Governments of India, Pakistan, Bangladesh and Nepal to adopt a Sub-continental approach on the utilisation of water resources, flood control and restoration of an ecological balance. Due to inherent mistrust between the countries of the Indian Sub-continent, their Governments are not prepared to collaborate on the issues that affect the life and death of the population. In fact the issues are of immediate and enormous importance. Unless they are satisfactorily and speedily resolved, a holocaust of gigantic proportion could descend on these countries owing to the breakdown politically, economically and socially caused by the desertification of what is the most densely populated area in the world. This could involve tragedies of unprecedented magnitude. Therefore, it is of utmost importance that the countries concerned collaborate on these matters. The proposal for such collaborations are to be found in the articles of this author entitled 'Utilisation of Water Resources and Flood Control in India, Bangladesh and Pakistan', Asian Studies, 1981 and 1982, published by the Center for Asian Studies, Jahangirnagar University, Bangladesh, and in 'Transnational Perspectives', (1979) Vol. 5, No. 3 p. 16.
Since such collaboration was not forthcoming from the countries of the Sub-continent, it would make sense for them to pursue such a strategy once the proposed confederation of India, Pakistan and Bangladesh comes into existence. Indeed such a confederation would remove the air of mistrust and suspicion, and create the necessary and desirable political climate for collaboration in the sphere of ecological and environmental protection.
The measures recommended by this author included the afforestation and soil conservation of the Thor desert embracing the arid zones of both India and Pakistan and the same along the entire length of the Himalayas running between the eastern and western ends of the mountain range. The object was, inter alia, the recreation of the conditions in which the ancient civilisations of Mohenjo-Daro and Harappa flourished about five thousand years ago. The archaeological findings suggest that the climate of the areas concerned were wet at that time with a considerable amount of rainfall which required drainage facilities for these cities. Once these conditions are recreated, the re-emergence of an advanced civilisation would once again become a possibility in that part of the world. However, if the Pakistani part of the Thor desert remains unchanged, no amount of afforestation within the Indian part alone could bring about the change of climate and rainfall necessary to recreate the conditions for the growth of the Mohenja-Daro and Harappa civilisations. Conversely if the current drought persists that could spell the destruction of the existing civilisation, as was the case with the ancient civilisation of Mexico about 560AD. This again shows the importance of this proposal for a confederation involving India, Pakistan and Bangladesh which is essential for the afforestation of the whole of the arid zones of the Indian Sub-continent.
This recommendation has now assumed a new dimension. Owing to global warming the glaciers of the Himalayas are melting. The average temperature in the Himalayas is said to have risen in 2005 by 1C since the 1970s. As a result the glaciers are getting smaller and smaller. Thus the Khumba Glacier at the foot of the Everest has retreated more than three miles since 1953. It is apprehended that China, the countries in the Indian Sub-continent and South East Asia could face a catastrophe of biblical proportion. It is likely to result in the overflowing of rivers which are liable to wash away the homes, farm lands and communities in these countries. This phase would be followed by drought as the rivers' flow dwindles. Then could come the third phase with a deluge -an immense volume of water which will break through the thin walls of frozen earth sweeping away everything on its path - bridges,dams and human habitation. The most dramatic effect of this is likely to be on the glacial lakes which form when melted ice builds up around a glacier in a valley. Sometimes these lakes are held in by a thin layer of rock and frozen earth which can collapse releasing walls of water which rush down the valley.
THE MOST SERIOUS RISK OF THIS DEVELOPMENT IS THAT WHEN THAT VOLUME OF WATER PASSES THROUGH A MOUNTAINOUS AREA IT IS LIABLE TO BECOME SEISMIC EVEN WHEN THE AREA IS A EARTHQUAKE FREE ZONE WITH CONSEQUENCES FOR THE POPULATION LIVING FURTHER DOWN IN THE PLAIN. Imagine the consequences of the Aswan Dam being destroyed by an earthquake for the population of Egypt. It is thought that the waves of the River Nile would be sixty feet high when the flood water reaches Cairo.THIS AGAIN EMPHASISES THE NEED FOR AFFORESTATION OF THE HIMALYAS ALONG THE ENTIRE LENGTH RUNNING BETWEEN THE EAST AND THE WEST.
Sir Edmund Hillary, Sir Chris Bonington and Sir David Attenborough, the leading naturalists in Britain launched a campaign to place Mount Everest and other Himalayan peaks and ranges on the United Nations endangered list because of the impact of climatic change. Their call was to be taken up at a meeting of the UNESCO World Heritage Committee in Durban, South Africa on 12 July 2005.
GLOBAL DIMMING: SIGNIFICNACE FOR THE FAZAL PROPOSAL FOR GREENING THE THOR DESERT AND THE ARID ZONES.
Scientists looking at five decades of sunlight measurements have reached the disturbing conclusion that the amount of solar energy reaching the Earth’s surface has been gradually declining – drop in the sunlight: 22% in Israel, 10% in the USA, nearly 30% in parts of the former Soviet Union and by 16% in parts of the British Isles. This is also confirmed by the rate of water evaporation in Australia. Dimming appears to be caused by air pollution. Burning coal, oil and wood, whether in cars, power stations or cooking fires produces not only visible carbon dioxide (the principal greenhouse gas responsible for global warming) but also tiny airborne particles of soot, ash, sulphur compounds and other pollutants.
The visible air pollution reflects sunlight back into space, preventing it reaching the surface. Furthermore the pollution changes the optical properties of clouds. Because the particles seed the formation of water droplets, polluted clouds contain a larger number of droplets than unpolluted clouds. This makes them more reflective than they would otherwise be, again reflecting the Sun’s rays back into space. Scientists are now worried that dimming, by cooling the air over the sub-tropical parts of the worlds such as Ethiopia and sub-Saharan Africa caused droughts which claimed millions of lives in the 1970s and 1980s. Normally the hot air over these areas attracts wet air from the tropical parts of Africa and brings about rainfall. However, cooling of atmosphere in these areas through industrial pollution in Europe and North America prevented this happening and disturbed the normal pattern of rainfall resulting in famine.
The question is: will this happen to Asia- home to half the world’s population- in view of the fact that India, China and other countries in the region are rapidly industrialising themselves? “My main concern is that global dimming is also having a detrimental effect on the Asian monsoon”, says Prof. Veerhabhadran Ramanathan, one of the world’s leading climate scientists.“ We are talking about billions of people” (whose lives could be at risk).[The source of this information was made available on the BBC’s Horizon programmes broadcast in the United Kingdom on 13 and 15 January 2005]. A nuclear war, global or local, which can produce a large amount of soot in the atmosphere (which could linger in the upper atmosphere for up to a decade) will have similar effects in cooling the air by several degrees centirigrade. This is liable to affect the world climate with consequences for food production.
This is the reason why this author has serious reservations about the proposal to cool the atmosphere above the earth. Currently the scientists are trying to devise various means of cooling the air in order to deal with the consequences of global warming. One of such consequences has been the damage to the tropical forests due to the appearance of insects in the trees. The scientists ought to develop appropriate treatment for the trees against such pests and diseases rather than cooling the earth's atmosphere.
The Fazal proposal for the greening of the Thor desert and other arid zones of the Indian Sub-continent in the context of its proposed confederation of India, Pakistan and Bangladesh coupled with a just and fair settlement of the Kashmir dispute might prevent such a drought. Such a large scale afforestation and greening of the arid zones involved in the process are likely to bring about rainfall in the areas concerned. That could be the only way forward to avoid such a cataclysmic event.
It seems that global dimming caused the Darfur conflict in Sudan. In Darfur the nomadic tribes from the north of the region move south with their cattle in search of grass and water during the dry season of the year on to the lands of the settled tribes. In the past they used to come after the harvest and were in fact welcomed by the settled tribes as the presence of cattle on their lands used to fertilise the soil. However, the climate changed in the 1970s owing to the failure of rain as mentioned above. As a result the nomadic tribes arrive before the harvest and inflict damage to the crops standing in the field. This has led to clashes between the nomadic tribes who are mostly Arabs and the settled African tribes. The conflict in Darfur demonstrates that once global dimming affects the pattern of the monsoon rain in Asia there could be political consequences of unimaginable proportion.
The monsoon wind originates in the Indian Ocean not very far from the African coast and proceeds eastwards over Sri Lanka and the peninsular India towards the Far East. At the that time of the year ( March to May) the air over the north Indian plains gets hot and move upwards leaving beneath it a vacuum which attracts the wet monsoon air from the Indian Ocean. A substanial part of the monsoon is thus diverted towards the north-eastern direction till it reaches Asam where its movement is halted by the Himalayas. At that point the monsoon moves westwards causing rainfall in Asam, Bangladesh, the north Indian plains and right up to Pakistan. The monsoon rain thus caused is the source of food production for over a billion population in the Indian Sub-Continent.If industrial pollution causes global dimming resulting in the cooling of the air over north India, Bangladesh and Asam, it will no longer attract the wet monsoon air from the Indian Ocean and there will be no monsoon rain. In the absence of the monsoon rain there will be drought and famine affecting over a billion population of India,Pakistan and Bangladesh. This again shows the importance of greening the Thor desert and other arid zones of the Indian Sub-continent.
THE EFFECT OF GLOBAL WARMING ON THE INDIAN SUB-CONTINENT
It is thought that 10% of the Earth's water is contained in the ice caps of the North Pole and South Pole. However, owing to global warming the polar ice caps are melting. As a result the sea level is rising. Consequently the low-lying areas are likely to be submerged under water. In particular the delta areas where the rivers flow into the sea are liable to be exposed to such risks. In addition to these areas being inundated by the sea water thereby enhancing saline intrusion inland for both surface and ground water, there is further risk wherever the rivers discharge their water load into the sea. For the waters of the rivers to flow into the sea two conditions have to be met. . First, it must be above the sea level. Secondly it must slope down towards the sea. However, these two conditions cannot be met if the level of sea water rises to that of the waters of the rivers or above. The condition would far worse during the flood season. Thus at the height of the monsoon the discharge of the combined flow of the rivers ( the Ganges, the Brahmaputra, the Meghna and other rivers) is estimated to be about 5 million cubic feet per second in Bangladesh. If the flow of this volume of water is blocked by the rising sea level then almost whole of the river basin is likely to be permanently waterlogged. In Bangladesh it is bound to affect the entire population of 135 million. The story would be similar elsewhere in India and Pakistan. This author has proposed diversion of surplus flood water from the North-East of the Indian Sub-continent westward as a measure of flood control for afforestation of the Thor desert to deal with the consequences of climate change (See M.A. Fazal, Utilisation of Water Resources and Flood Control in India, Bangladesh and Pakistan" (1981) Asian Studies 49 and (1982) Asian Studies 67).
In the context of the rising sea level and waterlogging of the river basins such westward diversion of water from the North-East of the Sub-continent would assume new significance in reducing the level of waterlogging ( although it might not eliminate the problem altogether).However, India ought to act in this matter in agreement with Bangladesh and other countries of the Sub-Continent. INDIA MUST NOT DIVERT WATER UNILATERALLY FROM THE NORTH-EAST DURING THE DRY SEASON. The Brahmaputra diversion coupled with the Ganges diversion during the dry season will have made certain that most of Bangladesh will be affected by salinity and eventually turned into desert with all that it implies for its 135 million population. This has already happened to Aral Sea in Kazakhstan.
Head of State
Since the object of this proposal for a confederation is power-sharing amongst the federating units, the institution of the head of state and its powers ought to be considered in this context. The proposition that the office of the president ought to rotate amongst the units of the federation/confederation in turn amongst India, Pakistan and Bangladesh respectively is recommended for adoption.
As regards the powers of the president, this could be either symbolic or substantial. If the US model of the presidential system of government is adopted, the president’s powers would be substantial. If, on the other hand, the British system of parliamentary government is chosen, the powers of the head of state would merely be symbolic. The cabinet with its prime minister would be the holder of real power in the state. The cabinet would be answerable to the lower house of the federal parliament which may be dominated by the largest federating unit (in this case, India). Such a position is likely to be inconsistent with the objective of “power-sharing” among the federating units. For this reason, this author’s preferred option for recommendation for the federal government would be the US model of the presidential system of government rather than the British model of parliamentary system of government. The US model would provide for greater power-sharing (among the federating units) if the office of the president is held by each of them in turn.
However, the state/provincial government and parliament under the proposed federation as distinct from the federal government and parliament could be based on the British system of parliamentary government as this would not detract from the principle of power-sharing at the federal level.
The Upper House of the Proposed Federal/Confederal Parliament
Introductory
The strategy behind this model for the upper house is two-fold. First, the countries constituting the proposed confederation ought to retain much of their current independence at the state level. Secondly, they should all have a meaningful share of power at the centre. This objective is the guiding consideration behind the formulation of the detailed proposals for (a) composition, (b) powers and (c) for devising machinery for the resolution of deadlocks/disputes between the lower and the upper houses of the confederal/federal parliament. A federation normally comprises large and small states, the latter being apprehensive of domination by the former. As a consequence, the second chamber is so designed as to be able to protect the interest of the weaker states as against the stronger states.
Composition of the Upper House
The question of composition involves two issues, viz. (1) distribution of seats i.e. how many seats each of the territories comprising the federation ought to have in the upper house of the federal parliament. (2) Representation of the territorial units in the upper chamber. On the first point, since some states are likely to be more populous than others, a compromise is called for. Thus the US model gives two seats in the Senate to each State in the USA irrespective of population so that small states are not swamped in a parliament elected on the basis of population. In Germany, on the other hand, the compromise formula gives neither equal representation to states, nor is it strictly based on population. Thus Art. 51 of the German Constitution provides,
“(1) The Bundesrat [the upper house] consists of members of the Länder [states] governments which appoint and recall them. Other members of such governments may act as substitutes.”
(2) Each Land has at least three votes; Länder with more than two million inhabitants have four, Länder with more than seven million inhabitants six votes.
(3) Each Land may delegate as many members as it has votes. The votes of each Land may be cast only as block vote and only by members present or their substitutes.”
The effect of the Art. 51 formula might be that larger states are under-represented (e.g. the state of North Rhine Westphalia have almost thirty times the population of Bremen, but has only double the number of Bundesrat seats), but it provides a strong voice for the small states or under-populated areas. Therefore, the German model is recommended for adoption for the proposed confederation. However, weighted voting for the countries constituting the confederation (as distinct from the federating units such as the states in India) might deserve consideration.
In the European Union the Council of Ministers is represented by the Member States on the basis of weighted voting. Where the Council is required to act by qualified majority voting, the votes of its members are weighted as follows:
Belgium 5 Denmark 3 Germany 10 Greece 5 Spain 8 France 10 Ireland 3 Italy 10 Luxembourg 2 Netherlands 5 Austria 4 Portugal 5 Finland 3 Sweden 4 United Kingdom 10
(EU Treaty, Art 205(2))
Representation in the European Parliament is weighted as follows:
Belgium 25 Denmark 16 Germany 99 Greece 25 Spain 64 France 87 Ireland 15 Italy 87 Luxembourg 6 Netherlands 31 Austria 21 Portugal 25 Finland 16 Sweden 22 United Kingdom 87
(EU Treaty, Art 190(2))
In our model, the Council of Ministers and the European Parliament of the European Union ought to be perceived as comparable to the upper and lower houses of the proposed confederation.
On the second issue the territorial representation of the federating units in the upper chamber may be achieved through either (a) governments of the states e.g. through appointment by the state governments as in Germany or (b) state assemblies as in India or (c) the people i.e. direct election as in the USA or Switzerland. Election of the upper house by the state assemblies or by the voters might make the chamber democratically accountable but the elected members have no automatic connection with the state government of the area they represent; nor do they provide any meaningful link between the upper house of the federal parliament and the respective state assemblies.
We have stated at the outset that our guiding consideration is to ensure that the countries constituting the proposed confederation must have a meaningful share of power at the centre. This consideration dictates that we should adopt the German model i.e. representation of state governments to constitute the upper house. The German Parliament is the only example in the world where the upper house is entirely composed of members of the government of the federating states. The German Bundesrat is said “to be closest comparator to the European Council of Ministers. There are considerable advantages associated with such a system:[a] It creates a real institutional link between the states and the centre…[b] It makes intergovernmental relations transparent …[c] It genuinely binds regional and national concerns together. Because state governments can scrutinise national policy and because they bring their own policy concerns to the table, this fosters a better understanding between the states and the centre and allows joint strategies to be developed. It may even result in territorial governments being prepared to effectively ‘pool’ their powers to legislate upwards – since they have an opportunity through the upper house to influence national legislation” [Meg Russell Representing the Nations & Regions in a New Upper House (1999,The Constitutional Unit , UCL,) p.13 ].
However, we are not advocating a wholesale adoption of the practices and procedure of the German Bundesrat (i.e. the upper house) . It has been said that “the German Bundesrat is not a parliamentary chamber in the usual sense of the term. It meets only once every six weeks, for a session which generally lasts around half a day. There are no lengthy debates in plenary sessions, with much negotiation going on in committee. Instead plenary sessions, which are generally poorly attended, are quick and efficient events where positions negotiated in committee are formally voted on. Meanwhile the committees themselves are attended almost exclusively by civil servants, who deputise for ministers” (Meg Russell, op. cit. 13-14).
We envisage the upper house of the proposed confederation to be a full scale legislative chamber.
Powers of the Upper House
In true federal systems (as opposed to quasi-federal ones) the upper chamber tends to be more powerful. Thus in the USA bills are introduced in either house but the Senate can amend or veto any legislation including financial legislation (although finance bills have to be introduced in the lower house). Constitutional amendments have to be passed by a 2/3 majority in both houses. In addition the Senate has powers to approve executive appointments, ratify treaties, declare war etc.
In Germany the upper house has the opportunity to see and comment on all the bills before their introduction in the lower house. Constitutional amendments have to be passed by a 2/3 majority in both houses of the federal parliament.
The upper house of the federal parliament in Germany has an absolute veto on all bills affecting the jurisdiction of the states – around 60 per cent of bills. This is because the states administer most federal laws. One commentator has said “ The German Bundesrat is successful at binding the states and the national parliament together because of the particular nature of German federalism . Whilst most policy is decided in outline at national level ,the implementation of this policy and consideration of its detail ,goes on in the Länder (i.e. the states). The Länder are the mechanism for implementation of government policy and thus central to decision-making. This is reflected in their powers in the Bundesrat ,where they have an absolute veto on all bills affecting their work –around 60 per cent of legislation. This includes most financial legislation. The existence of two categories of legislation in Germany and the power of the Bundesrat veto over one of them, further strengthens the institution and the links between national and state levels. If the powers of the Bundesrat were not so considerable ,it would not be able to maintain the involvement of senior government ministers from the Länder. This would not be feasible if, for example, the upper house had only the power to delay legislation … If a chamber is to function effectively as a territorial upper house …it must be given some genuine powers over territorial issues [i.e. issues affecting the states] (Meg Russell, op. cit. 14)
In Germany the upper house is decisive on European matters affecting the states in addition to its role in electing the judges of the federal Constitutional Court and for ‘state of defence’. The above consideration ought to be borne in mind in prescribing the powers of the upper house in our proposed confederation.
Resolution of Disputes between the Upper and Lower Houses
In devising an appropriate procedure/machinery to resolve disputes between the houses of parliament we will be guided by our starting premises viz. 1. that the countries constituting the proposed confederation ought to be able to safeguard their allocated sphere of independence/ autonomy and 2. that they should have a real share of power at the centre. The possible options for such procedure/machinery are as follows.
A. The ‘suspensive veto’ as exercised by the British House of Lords. It merely interposes a delay between the introduction of a bill and its final passage into law. Ultimately the will of the House of Commons which is elected on the basis of population prevails. In the context of our proposed federal framework this will not provide the necessary checks and balance as envisaged. Therefore this option is ruled out.
B. The endless shuttle of bills between the two houses as experienced in Australia. This is also unsatisfactory. The process could only end by dissolving both houses of parliament.
C. Joint sitting of two houses of parliament. This is used in India. The objection to this device in a federal context is that under this procedure the will of the lower house which is generally elected on the basis of population will prevail as its members are likely to be more numerous. Under this system the smaller states cannot possibly safeguard their position against the more populous states.
D. Joint committee of both houses of parliament. This procedure is used in Germany and the USA. It is thought to be more productive than other devices. “Taking discussion off the floor of the house is likely to create a more constructive and less confrontational atmosphere in which to negotiate” [Meg Russell, Second Chambers: Resolving Deadlock (The Constitution Unit, UCL, 1999) p. 5 ]. However, as Meg Russell states in the paper cited here adoption of this device calls for consideration of the following questions.
1. Who can call the joint committee ?
In Germany the request will generally come from the upper house if they receive a bill they cannot agree with. However, the request may also come from the lower house or government in response to an upper house veto. Whoever requests all the parties are bound to co-operate. The German procedure is to be recommended as it provides the opportunity to all the parties involved to initiate the process.
2. Who are the members of the joint committee ?
In Germany the upper house is composed of the members of the states. One member from each of the 16 states is represented on the committee. These will be senior members of the state governments. Considering the fact that the consent of the upper house is required to a bill where the state jurisdiction is involved ( and Bundesrat will have a veto over such a bill) this is a satisfactory way of safeguarding the states’ interests even at the committee stage of a bill and is therefore recommended.
3. Ad hoc or permanent committee
In Germany a permanent committee is set up at the start of each parliamentary session, comprising of senior figures (as in the USA). Because it consists of senior figures its recommendations are likely to be weighty and therefore acceptable. Being a permanent committee its members are likely to develop trust and co-operation (which is less likely on ad hoc committees). For this reason permanent committee is recommended.
4. What can the joint committee discuss ?
In the USA the committee is limited to the specific clauses of the bill which are in dispute. In Germany the committee’s remit is somewhat wider. It is restricted only to matters which are specified in the motion to convene it. This might permit the committee to add a new clause not previously covered by bill.. The German Constitutional Court ruled in 1986 that this was permissible but that it was ‘close to the limit of the legally acceptable’. Nonetheless the German procedure provides for flexibility and is recommended.
5. How is the joint committee decision taken ?
In the USA the groups representing the two houses vote as blocks with one vote each, agreement depending on a majority among representatives of each house. The decision is very often a compromise between the parties.
In Germany the decision is taken by a majority of votes of committee members. Here the decision is a compromise among the states. In the joint committee the states have one representative each but in the upper house the states have different number of votes. The committee have to take this fact into account.
On our approach it is the interests of the states rather than of the parties that matter most and consequently the decisions have to reflect a compromise among the states. For this reason the German model is recommended.
6. Can joint committee proposals be amended by the house?
In the USA and Germany the committees’ proposals may not be amended by either house when they are discussed in the house, unless the committee itself recommends otherwise. It is submitted that this position is preferable in the interest of the integrity and status of the committee.
7. Who has the last word?
In Germany there are two classes of bills – (1) The upper house has a veto on bills that affect the jurisdiction of the states. (2) On the remaining bills the lower house has the last word. On a bill that is subject to veto by the upper house, once the committee has been called (a committee may be called on any bill where the houses disagree either by the lower house or by the federal government or by the upper house), its recommendations must be accepted or else the bill dies.
In the USA all legislation must be agreed by both houses. The recommendations of the joint committees are subject to the same rule. Failure to agree results in the death of the bill or in another committee being called.
It is submitted that the German procedure of joint committee (in which each of the sixteen states are represented by one vote) provides a far more effective voice for the states and is recommended for adoption.
Overall the objectives of maximum independence/autonomy for the countries joining the confederation and their having a significant share of power at the centre are better served by the adoption of the German model for the upper house than any other in existence. For this reason, the German model is recommended for adoption subject to the modifications noted above.
Machinery and Model for the Removal of Regional Disparity
Maintenance of integrity and unity of a federation requires measures to maintain a comparable standard of living, employment opportunities and economic development throughout the country. Relative backwardness of some states compared with others tend to set in process disintegrating forces. This is why Pakistan was dismembered owing to the fact that East Pakistan was perceived to be at a disadvantage economically. This is also recognised by the European Union where Art 158 of the Treaty provides,
“In order to provide overall harmonious development, the Community shall develop and pursue its actions leading to the strengthening of its economic and social cohesion. In particular, the Community shall aim at reducing disparities between the levels of development of the various regions and backwardness of the least favoured regions or islands including rural areas.”
Art. 263 has established the Committee of the Regions where the Member States are represented as follows:
Belgium 12 Denmark 9 Germany 24 Greece 12 Spain 21 France 24 Ireland 9 Italy 24 Luxembourg 6 Netherlands 12 Austria 12 Portugal 12 Finland 9 Sweden 12 United Kingdom 24
Art. 265 has imposed a mandatory duty on the Council of Minister and the European Commission to consult the committee of the Regions “where the Treaty provides and in all other cases”.
Model for Development of Regional Parity
In his answer to the questionnaire (q. 5.6.) issued by the Commission on Centre-State Relations in India as to whether a special federal fund for ensuring ‘faster development in economically backward areas relative to other developed areas of the country’ is necessary, this author suggested a model for development in the following terms:
“I have indicated … that such a fund is clearly necessary in the case of India. It could be funded by taxes on petrol, gas or other forms of energy, or alternatively on consumption of good and services. The Finance Commission is not the appropriate body to administer such a fund which would involve regional planning. It has got to be the planning commission acting in collaboration with the state governments concerned. The strategy would be first to develop the economic infrastructure. When that is done, a balanced development – balanced between the urban and rural sectors – would be aimed at. This would be an all-round development of the villages involving an integration of trade, industry and agriculture coupled with the restoration of ecological balance and afforestation as a part of soil and environmental conservation measures. Elimination of the distinction between the town and the villages in terms of amenities and economic activities ought to be set as the objectives. It is submitted that each Thana [the size of a police area in the British- ruled Bengal] should be taken as a unit of development. This model roughly corresponds to, but is not identical with the commune system in China. It is designed to prevent drift to the cities and deprivation of rural areas.”
“The upsurge in the Third World urban population has overwhelmed resources. Sprawling slums, massive traffic jams, chronic unemployment, breakdown of essential services etc. are causing communal tensions (as happened in Bombay and Hydrabad in 1984). In 1984 the population of Delhi, Karachi and Calcutta is estimated to be 7 million, 7 million and 11 million respectively. By the year 2025, the population projection of these cities is expected to be 20-30 million each. The development that I am advocating here i.e. a balanced development between the rural and urban sectors is designed to stop the drift to the towns and avoid the urban explosion.”
[M A Fazal, A Federal Constitution for the United Kingdom – An Alternative to Devolution (1997, Dartmouth/Ashgate) pp. 256-257]
It is submitted that appropriate machinery and model for the removal of regional disparity is crucial to ensure the success of the proposed confederation.
EQUALISATION IN THE PROPOSED CONFEDERATION/FEDERATION
The model for our proposed confederation/federation is one of maximum decentralisation. It is likely that regional disparities among its constituent units of such a federation would be significant. As stated above, marked regional disparities among the constituent units are fatal to the integrity of a federation. The states will compete with each other in order to attract business and industry. To be able to do that successfully they must have the necessary infrastructure and be in a position to supply quality services. This calls for the incorporation of the appropriate equalising mechanism.
The equalising principles devised to cement the unity of a federation are of two types:
1. Regional Equalisation designed to achieve broadly uniform economic development and uniform standard of living throughout the territories of a federation; and
2. Fiscal Equalisation.
Article 104a (4) of the German Constitution reflects the concept of the first type by stating that the Federation may grant the Länder (the States) financial assistance for particularly important investments by the Länder or communes or association of communes, provided that such investments are necessary to avert a disturbance of the overall economic equilibrium or to equalise differences of economic capacities within the federal territory or to promote economic growth.
Regional Equalisation.
The principles of regional equalisation are embodied in the provisions of the Treaty of the European Union. Thus Articles 2 and 3 of the Treaty state that one of its tasks is to "promote throughout the Community a harmonious, balanced and sustainable development of economic activities, a high level of employment and of social cohesion, […] the raising of the standard of living and quality of life, and economic and social cohesion and solidarity among Member States". Title XVII of the Treaty headed: Economic and Social Cohesion develops this concept further. Thus Article 158 states that "[i]n order to promote its overall harmonious development, the Community shall develop and pursue its actions leading to the strengthening of its economic and social cohesion. In particular, the Community shall aim at reducing disparities between the levels of development of the various regions and the backwardness of the least favoured regions or islands, including the rural areas".
In addition to permitting Member states of the Union to grant aids to achieve regional parity under Article 87 [see for instance, Preussent Elektra v. Schleswag (2001) All E.R. (EC) 330 containing a ruling of the European Court of Justice on the interpretation of Article 87] the Treaty provides by Article 159.
"Member States shall conduct their economic policies and shall coordinate them in such a way as, in addition, to attain the objectives set out in 158. The formulation and implementation of the Community's policies and actions and the implementation of the internal market shall take into account the objectives set out in Article 158 and shall contribute to their achievement. The Community shall also support the achievement of these objectives by the action it takes through the Structural Funds (European Agricultural Guidance and Guarantee Fund, Guidance Section; European Social Fund; European Regional Development Fund), the European Investment Bank and the other existing financial instruments".
Article 160 states that "[t]he European Regional Development Fund is intended to help redress the main regional imbalances in the Community through participation in the development and structural adjustment of regions whose development is lagging behind and in the conversion of declining industrial regions".
Article 161 authorised the setting up of a Cohesion Fund to provide a financial contribution to projects in the fields of environment and trans-European networks in the area of transport infrastructure.
Therefore the measures to deal with regional disparities are undertaken at two levels:
1. The EU financial assistance provided via the Structural Funds and 2. regional aids granted at national levels by the national governments in conformity with the law of the European Union. The reform of the Structural Funds in 1988 gave rise to four Funds: the European Regional Development Fund ( ERDT) to finance infrastructure, productive investment to create jobs, local development projects and assistance to small and medium-sized firms, the European Social Fund (ESF), to help the workforce adapt to changes in the labour market and help the unemployed and other disadvantaged groups to get back to work, in particular by funding training and recruitment schemes, the European Agricultural Guidance and Guarantee Fund (EAGGF) to finance rural development measures and assistance to farmers, mainly in regions whose development is lagging behind, but also under the common agricultural policy of the EU and the Financial Instrument for Fisheries Guidance (FIFG) to finance structural reform in the fisheries sector. Further EU assistance is provided by other institutions such as the European Investment Bank. The Structural Funds are used to provide the EU financial assistance to regions and groups in need of assistance. They are based on the following seven objectives set out in the "Framework" Regulation 2052/88 [substantially amended by Regulation 2081/93 and by the decision of the Council of the European Union of 1 January 1995 adjusting instruments concerning the accession of the new Member States to the EU: (1995) O.J. L1/1. The latter added Objective No.6]:
Objective 1 - To assist regions whose development is lagging behind. Objective 2 - to revitalise regions affected by serious industrial decline, Objective 3 - to combat long term un-employment, Objective 4 - to integrate young people in the labour, Objective 5a - to adjust agricultural schemes, Objective 5b - to develop rural areas, Objective 6 - to promote the development and structural adjustment of regions with an extremely low population density.
As a result of the EU Regional Equalisation Policy, average per capita income in the three least prosperous countries (Greece, Portugal and Spain) increased from 68% of the Community average to 79% in 1999.
Therefore I would recommend the incorporation of the EU objectives into the laws and the constitution of the proposed confederation/federation with the emphasis on the overall uniform economic development of its constituent units and the aim of realising uniform standard of living throughout all the territories.
Fiscal Equalisation
The principle of fiscal equalisation seeks to deal with two types of fiscal imbalances (i.e. the gap between the revenue capacity and the expenditure responsibility): 1. Vertical Fiscal Imbalance and 2. Horizontal Fiscal Imbalance. Vertical fiscal imbalance is said to arise where the revenue capacity of a level of government cannot match its expenditure responsibilities. Generally vertical fiscal imbalance is in favour of the federal government and against the state or regional government (as in Australia). Indeed it is unwise and can be dangerous to invest the centre with too many constitutional responsibilities and too few taxes and resources. This is what was done in Germany under the Weimar Constitution with disastrous consequences. The federal government was forced to cover its budget deficit by issuing debts resulting in hyper-inflation. That in turn caused the rise of the Third Reich which brought about the Second World War [Carsten Hefeker," The Agony of Central Power: Fiscal Federalism in the German Reich" (2001) 5 European Review of Economic History 119-142]. It is equally undesirable to endow regional/state governments with power to issue debt without appropriate constitutional safeguards.
Horizontal fiscal imbalance arises among the constituent units of a federation because of
(a) differences in the costs of providing equivalent services in the individual states and
(b) differences in their capacities to raise their own-source revenues.
The statement of the principle of fiscal equalisation adopted by the Commonwealth Grants Commission in Australia [an independent body established in 1933 that advises the federal government on (i) fiscal equalisation and (ii) distribution of funds for programme to assist the indigenous population - Commonwealth Grants Commission -Annual Report : 2000-01, p.7 ] is that,
"State governments should receive funding from the Commonwealth (i.e. the Federation) such that if each made the same effort to raise revenue from its own sources and operated at the same level of efficiency, each would have the capacity to provide services at the same standard" [Commonwealth Grants Commission, Report on General Grants Relativities 1999, Volume 1, Main Report, p.4].
The principle is intended to ensure that each State Government has the financial capacity to provide the same level of service to its residents. In using the principle to calculate relativities the Commission takes into account differences among the States in (i) their per capita capacities to raise revenues; (ii) the per capita amount they would spend if they were to provide the average level of services; and (iii) their per capita receipts of SPPs [ Specific Purpose Payments-40% of the total federal transfers to the States in 2001: Commonwealth Grants Commission : Report on State Revenue Sharing Relativities: 2002 Update, p.5].
The methods used to calculate these differences involve
(1) the preparation of the FINANCIAL STANDARDS (the per capita average of total State expenditure or revenue for each function),
(2) the STANDARD BUDGET (the collection of all the expenditure and revenue categories and then calculating (i) for each State service, the per capita expenditure each State would require if it were to provide the average level of service and (ii) for each source of State revenue, the per capita revenue each State would raise if it applied the Australian average revenue raising effort to its revenue base;
(3) EXPENDITURE ASSESSMENT methods (to adjust the standard expenditures to allow for influences beyond the control of individual States that require a State to spend more or less per capita than others to provide the average standard of service to arrive at the state's cost of service provision. The influences thus recognised would relate to characteristics of State population or physical and economic environment because these would influence the State's costs in providing services.).
(4) REVENUE ASSESSMENT methods (to take account of the influences beyond a State's control that would result in it raising more (or less) revenue per capita than other States if it applied Australian average rates of tax to its tax bases. Tax bases are generally measured using the value of transactions in each State that would be taxed under the average tax policy). A State's per capita requirement for a share of the pool of funds available for distribution in each assessment year is then calculated as follows:
• An equal per capita share of the pool plus adjustments for;
• the effect of assessed influences on demand for and cost of providing services - expenditure needs;
• the effect of assessed influences on revenue capacities - revenue needs;
• the specific purpose payments ( SPPs) it has available to fund its expenditure requirements
(5) CALCULATION OF PER CAPITA RELATIVITIES i.e. the measures of relative needs used to distribute the GST (Goods and Services Tax) and HCG (Health Care Grants). The final phase of the process is to use the assessments for the past five years to calculate per capita relativities to apply in the future. Each State's relativity is the average of its per capita requirements for a share of the pool in each of the five past years.
In 2001-02, about $2150 million (equivalent to 6% of the total GST/HCG pool and budget balancing assistance) was required to bring the financial capacities of those States with below average capacities up to the average (to meet their aggregate needs) [Commonwealth Grants Commission: Report on State Revenue Sharing Relativities 2002 Update, pp.4 - 7]. On 1 July 2000 major reforms reflecting the Inter-governmental Agreement on the reform of the Commonwealth-State Relations (IGA 1999) came into force: A New Tax System (Commonwealth-State Financial Arrangements) Act 1999. Under this provision the Commonwealth introduced a broad-based consumption tax called the Goods and Services Tax (GST). The 1999 Agreement specifies that the distribution of the GST revenue among the States will be based on horizontal equalisation principles - per capita relativities recommended by the Commonwealth Grant Commission as explained above. It also commits the Commonwealth to provide additional assistance (known as ' budget balancing assistance') during the transitional years prior to the abolition of some State taxes and imposition of additional expenditure responsibilities on the States (to ensure that no State will be worse off than it would have been, had the tax reforms not been implemented).
Horizontal Equalisation
The States' revenue capacity can vary significantly, thereby affecting their capacity to provide services of the national average. The principle of horizontal equalisation seeks to remedy this defect. Thus Mitchell Sharp, the federal finance minister of Canada said in 1966
"The fiscal arrangements should, through a system of equalisation grants, enable each province to provide an adequate level of public services without resort to rates of taxation substantially higher than those of other provinces" [ Canada, Federal-Provincial Tax Structure Committee, Proceedings of a meeting held in Ottawa, September 14-15,1966 (Ottawa, Queen's Printer,1966), 14].
The above statement was explained as follows: It would provide that any province in which average provincial tax rates (not its own tax rates) would yield less revenue per capita than the yield in Canada as a whole would be entitled to an equalisation payment. However, changes in energy supplies and values in the 1970s and 1980s resulted in the sudden shift in the relative positions of provinces in Canada that produced oil and provinces that consumed it. This had effect on the equalisation formula. The automatic response of the equalisation formula to the increases in provincial oil revenues was to increase the entitlements of the recipient provinces. Thus the federal government faced the prospect that one of its major spending programmes would escalate uncontrollably [David B.Perry, Financing the Canadian Federation, 1867 to 1995: Setting the Stage for Change (Canadian Tax Foundation, 1997),,pp.124 and 133.]. This called for a review of the equalisation formula in the light of developments.
In Australia the Intergovernmental Agreement (signed on 1 July 1999) provides that the interstate distribution of the GST will be based on per capita relativities determined by the Commonwealth Grants Commission. At the first meeting of the Ministerial Council for Commonwealth-State Financial Relations (established under the IGA 1999) held on 30 March 2001, New South Wales and Victoria complained that they received much less than equal per capita share of funding under the HFE (Horizontal Fiscal Equalisation) relativities determined by the CGC. The problem is that while vertical imbalance is reduced significantly (in the absence of equalisation arrangements) by equal per capita payments to the States or payments in proportion to the tax collected in each State, horizontal equalisation is achieved best by payments or grants that take accounts of differences in costs of providing services and revenue capacities. However, payments or grants to the States on the latter basis would result in unequal per capita amounts. Nonetheless formula-based approaches implemented by an independent institution are preferable to political negotiations as mechanism for the equalisation process.
Elaborate equalisation mechanism exists also in the German federal system. In view of the fact that income taxes are shared between the federal and state governments in fixed proportion (50% going to the federation and 50% to the states) the vertical fiscal balance is achieved in Germany mainly by varying the V.A.T. This is done by federal legislation which requires the consent of the Bundesrat (the upper house of the German Parliament: Article 106 of the Constitution). Vertical equalisation was last revised in 1992 when the Eastern states were included in intergovernmental fiscal arrangements (taking effect in 1996). As a result, the states' shares of the V.A.T. have increased reflecting the need of the Eastern states to reach parity with their Western counterparts. At present the federal share of the V.A.T. stands at 50.5 percent.
Horizontal fiscal balance is achieved in three steps.
1. The regional apportionment of the V.A.T. Three quarters of the states' shares are apportioned on the basis of population. Another quarter is reserved for the states considered to be "financially weak". They receive supplementary transfers from the V.A.T. to bring their fiscal potential to per capita up to 92 percent of the average.
2. An interregional redistribution scheme. The 'rich' states compensate the 'poor' states through financial transfers. This is also done on the basis of federal legislation which requires the consent of the Bundesrat, "due account being taken of the financial capacity" (i.e. the taxable capacity) of the states and not of the specific burdens (Article 107(2) of the German Constitution (Grundgesetz). The German Constitutional Court in its ruling of 11 November 1999 emphasised that the Constitution requires the federal Parliament to take measures to equalise the differences in the financial capacity of the states. This refers to actual financial resources and not to a relationship between revenue and specific expenditure needs. It is different from the equalisation practices of Australia. The interstate equalising transfer is unique to Germany and does not exist anywhere in the Commonwealth or elsewhere.
3. Supplementary Grants. Thus Article 107(2) of the German Constitution states that the above mentioned federal statute may also provide for grants to be made by the Federation from federal funds to financially weak Länder in order to complement the coverage of their general financial requirements. Such transfers have been widely used after unification of Germany. In particular "gap filling" grants have been introduced that guarantee at least 99.5 percent of the average fiscal capacity for all states. Furthermore, nine states out of sixteen receive federal grants to relieve the costs of "political management" and the new Eastern states (as well as some Western counterparts) receive federal grants in compensation for "special burdens" [Paul Bernd Spahn," The German Constitutional Court takes on the principle of 'solidarity' ( Federations, vol.1, number 1, March 2001)].
The German equalisation system seeks to achieve what is known in Europe as "interregional solidarity". However, recently it has come under criticism from some of the rich states. Thus in the above mentioned case of 1999 three Southern states (Baden-Wurttemberg, Bavaria and Hessen) mounted a challenge before the Federal Constitutional Court against the system of intergovernmental fiscal arrangements. They complained that it redistributes wealth to an excessive degree and creates negative incentives. In fact they wanted to replace it with 'competitive federalism'. Up to a point the challenge succeeded. The Court was particularly critical of the federal equalising grants. At present these have a strong equalising effect (99.5% of the state average for all states). As a result the federal government will have to reduce the number of grants as well as their magnitude.
On horizontal equalisation according to the Court, the Constitution mandates that population be adopted as the sole criterion for distributing resources among the states as opposed to an approach based on needs as in Australia. I have some sympathy with this approach of the Federal Constitutional Court. It is much more difficult to establish objective "needs criteria" than population as a criterion even among entities with comparable responsibilities at sub-national levels, let alone those between governments at national and sub-national levels where there may not always be comparable responsibilities. As for instance, defence is a major national responsibility but it is absent at sub-national levels.
On vertical equalisation the Court ruled that the Constitution demands a definition of 'necessary expenditures' at each level of government and 'a fair compensation' among jurisdictions on the basis of objective statistical data and medium term planning. The Court criticised the existing practice of weighting population as a method to express burdens in the case of the city states. The Court called for a scientific procedure of balancing, based on accurate data. However, the federal government wants to retain the weighting in the case of the city states (such as Berlin). There are some positive elements in the ruling of the Court. However, it will require a fundamental review of the existing German equalisation law.
Meanwhile political pressures are also building up for the introduction of competitive rather than co-financing federalism in Germany. Under the Solidarity Pact 11 signed on 23 June 2001 between the Federation and the States the financial support for East German Länder will end in 2019. Moreover, the reform of the German system of co-financing as a whole has been scheduled for 2004, the year of the next European Intergovernmental Conference which will decide upon a delimitation of powers within the European Union. Within the European legal framework Länder and regions have become competitors in attracting investments. The national state such Germany is losing its capacity to protect those Länder which are less successful. Therefore, the progress of European integration is pushing federal reform in Germany forward.
However, the system of fiscal equalisation has its rationale. Its rationality lies in the maintenance of uniformity of living conditions and the provision of comparable public services throughout the territories of the federation. Any departure from the equalisation principle will carry with it the risk of disturbing the social cohesion and solidarity and a threat to the integrity of the country. Therefore the decision-makers would be well-advised to bear this warning in mind.
India
There are two financial institutions in India which were designed primarily to deal with the issue of vertical fiscal imbalance between the centre (technically known as the Union) and the States, and, to a lesser extent, with that of the horizontal fiscal imbalance. The first is the quinquennial Finance Commission set up under the Constitution (Article 280). The task of the Finance Commission is to make recommendations to the Union Government on the following: (1) the distribution of the net proceeds of the specified taxes (income tax, federal excise tax etc.) between the Union and the States; (2) the principles governing the Union grants-in-aid to the various States (the resource poor States); (3) the transfer to the States needed to supplement the resources of the Panchayats (local rural self-government institutions) and the Municipalities (urban local self-government institutions). Up to 1978 the two criteria used as the basis of distribution were the contribution of each State to revenues (between 10 and 20 percent) and population (80 and 90 percent). Since then two further criteria have been added. These are the per capita income of each State (adopted in 1978) and a complex of backwardness including population of scheduled castes and tribes and the number of agricultural labourers (introduced in 1989). At the time of the Tenth Finance Commission covering the period 1995-2000 formula for distribution of the States' share of income taxes were as follows: 20% according to population, 60% on the basis of per capita income, 5% in relation to economic and rural infrastructure needs and 10% in relation to tax effort. Somewhat similar complex formula was also prescribed for distribution of the States' share of the federal excise duties. Thus population as the dominant criterion for distribution of resources has been somewhat downgraded.
Another financial institution is the Planning Commission, an agency of the federal government which recommends assistance to the States by way of grants and loans in support of various schemes coming under the Five Year Plan Programmes for poverty alleviation, employment generation and specific development projects. The Planning Commission acts on criteria such as 'special category States' (all the seven States in the Northeast), non-special category States, population, poor per capital income of States, distance factors and fiscal performance (tax effort, fiscal management, fulfilment of national objectives and special problems). These two financial institutions operating independently of each other are said to have undermined the overall coherence of equalisation efforts in India [Bhattacharyya, "Federalism, Decentralisation and State-Building in India: Aspects of Centre-State Fiscal Relations" in R Bird and T Stauffer, eds. Intergovernmental Fiscal Relations in Fragmented Societies (Bale, Helbing and Lichtenbahn, 2001) pp.247-317].
Neither regional equalisation, nor the principle of horizontal fiscal equalisation has played a major part in the programme and activities of the Indian Finance Commission and the Planning Commission.
United Kingdom
There is no formal system of explicit equalisation in the United Kingdom either of resources or of needs of the type available in Australia and Germany. However, a formula-driven pattern of resource distribution appeared with the emergence of the administrative territorial division of the United Kingdom. It first appeared in 1888 when Sir George Goschen applied a formula (which came to be known as Goschen Formula) to Scotland. It became necessary after Scotland had acquired a territorial administration with the creation of the Scottish Office in 1885. The Scottish Office had the responsibility to distribute central government grant to local authorities in Scotland. The formula was extended to Ireland in 1888. Wales was at that time deemed to be part of England but its administration was transferred to the Wales Office in 1964.
The Goschen Formula decreed that proceeds of the wheel tax, horse tax and half the revenue from probate should be allocated to England, Scotland and Ireland in the ratios 80, 11 and 9 respectively. This formula was not based on population, nor on needs but on the contribution each country made to probate duty revenues. It was not an equalising formula but simply a device to recycle some taxes back to the territory where they were collected. The formula continued to operate till 1958 when it was abandoned. Thereafter funding for the Scottish, Welsh and Northern Ireland Offices became the subject of annual negotiation between the three territorial Secretaries and the Treasury at Westminster. The practice continued until 1978 when Barnett Formula was introduced in the anticipation of Scottish devolution.
Notwithstanding the fact that devolution did not materialise at the time it has continued since then [McCrone, G. (1999) 'Scotland's Public Finances from Goschen to Barnett' (Fraser of Allander Institute Quarterly Economic Commentary, vol.24. No.2)]. The Barnett Formula operates only on increments, not on the base, allocating to each devolved territory a population based percentage of the increase in comparable expenditure in England. Thus for any spending programme, where there is a territorial responsibility such as education, any increase to English budget results in an automatic increase to Scotland, Wales and Northern Ireland's budgets. For every £1 per head extra spent on England, £1 per head extra should also go to each of the devolved territories. The population of each devolved territory is expressed as a fraction of England's population and not as a fraction of total UK population. It does not affect all public spending in the devolved territories. For example, in 1998-99, £25.7bn was identified by the Treasury as the total sum spent in Scotland. Of this only £15.6bn was in the block of spending controlled by the Scottish Executive. Most of the remaining £10.1bn was social security spending which comes directly from the central government. The Barnet Formula operates only on the devolved subjects and not on subjects reserved to Westminster. Even within the Scottish Executive budget about 14% of spending budget is not covered by the Barnett Formula. This is mainly on agriculture and is determined by the EU decisions. Neither does the Barnett Formula determine the overall levels of spending in Scotland, Wales and Northern Ireland. It only determines the changes made to the overall spending totals. If there is no increase in the English spending programme, the devolved territories receive no increase. If there is a reduction, the devolved territories also have their spending reduced [Twigger, R. (1998) The Barnett Formula, House of Commons Library Research Paper 98/8]. The Barnett Formula is not based on any assessment of needs for public spending but on population. In fact both the assessment of needs and basing spending programmes on it are not easy. For instance, the British Treasury conducted a study in 1976-78 in anticipation of devolution in Scotland and then discovered that the figures of actual spending in Scotland and Northern Ireland were considerably higher than those based on needs. Implementation of the needs-based figures would have involved significant cuts in the spending programmes for Scotland and Northern Ireland. Any such cuts could have provoked a political reaction from those territories. For this reason the needs-based figures were not implemented. The Barnett Formula seems to be unique in the developed world. There is no country other than the UK that allocates resources at a sub-national level using a formula based on changes rather than levels of spending in relation to assessed need [David Bell and Alex Christie, "Finance - The Barnett Formula: No Body's Child ?" in Alan Trench (ed) The State of the Nations 2001 (The Constitution Unit, ULC (2001) p. 139)]. Therefore we might conclude by saying that the Barnett Formula does not offer any lesson for a solution to the questions of (a) regional equalisation, or of (b) horizontal fiscal imbalance in the broad sense. It is of limited value as a prescription for bringing about uniform standard of living throughout the territories of the proposed confederation/federation.
Equalisation Machinery
The question of status and standing of the machinery making the equalisation decisions is of utmost importance to its success. In most Commonwealth federations the actual determination of financial equalisation is made by the federal government but it is based on the recommendations of an expert commission as in Australia, India and South Africa or upon an intergovernmental council as in Pakistan and Malaysia. In all these cases the recommending expert institution is an advisory body. The extent to which its recommendations are accepted by the federal government has varied between these countries. In Australia and India the advice of the expert body on equalisation has invariably been accepted by the decision-making body while in South Africa the federal government has emphasised that the expert body (the Financial and Fiscal Commission set up under ss. 220 and 221 of the Constitution) is merely an advisory body and that it is the federal Minister and Department of Finance that exercise the real decision-making power. Furthermore, this is done overtly [Watts, R L, Comparing Federal Systems (1999, 2nd ed., Montreal and Kingston: McGill -Queen's University Press)]. It is thought that the success of fiscal equalisation in Australia is due to the fact that the Commonwealth Grants Commission is de facto, if not de jure the decision-making body on the matter.
I have addressed myself to this issue in the following terms:
"The need for such a body in a federal system arises from the fact that the federal government being itself an interested party could not be made the arbiter over allocation of resources between the Centre and the Regions. To ensure the autonomy of the Regions an independent body is called for. This raises the question as to the nature of the body. Should it consist of the negotiating parties or should it be an impartial body; should it be a permanent body or should it be an ad hoc body set up periodically; should it act in an advisory capacity or should it be an adjudicatory body with power to make binding decisions? If permanent, should it have a specialist staff and a permanent secretariat? Should it be able to act by a majority decision or need it follow the rule of unanimity?" "The inter-governmental financial institution proposed has a major role to play in our federal scheme. It would periodically review the tax-sharing arrangement between the Centre and the Regions and consider its adjustments, allocate shares of taxes between the two, allocate the shares of regional taxes among the states, decide on applications for borrowing by the states and administer an ambitious programme for equalisation […] to remove regional disparities between the states involving billions of pounds. It would have power to take economic decisions of immense importance, power of conciliation and adjudication over conflicting claims and authority to offer economic advice to governments at the central and regional levels. To be effective, such a body has to be impartial standing apart from and above all the interested parties. The atmosphere in the meeting of the bargaining body is inconsistent with the functions contemplated in this proposal. The atmosphere of a bargaining meeting is dominated by political stress and strain, groupings and alliances, the strongest tending to have the last word. The experience of the Australian Grants' Commission shows that impartiality and independence are essential to earn public confidence which is sine qua non for its success. From this it follows that the composition of the body cannot be entrusted to one of the interested parties. Following the precedent of S.32 of the Government of Ireland Act 1920 the Joint Exchequer Board of the United Kingdom federal system should consist of a member nominated by each federating unit, one member nominated by the federal government and the chairman appointed by the Monarch not on the basis of ministerial advice of the federal government but having regard to his expertise in Treasury affairs, impartiality (as between different governments) and independent judgment. Such a body ought to be constituted on a permanent basis. A permanent body will have the advantage of gaining expertise and consistency which an ad hoc body will lack. The drawback from these bodies suffered in most of the new federations (by contrast with the Australian Grants' Commission) was the lack of continuity, each body being appointed afresh at the time of each review. An ad hoc body is appropriate for functions of an ad hoc nature, but not for the nature of functions envisaged in this proposal for the Joint Exchequer Board. It follows that the Joint Exchequer Board ought to have the power to make decisions of a binding nature and not of advisory nature. The foundation of this proposal is the division of powers and functions between the Centre and the Regions with the Joint Exchequer Board acting as a third party allocating resources and adjudicating between them. If this body were to act in an advisory capacity only and the decision-making powers were to belong to the Centre the system would cease to be federal".
"S. 32(5) of the Government of Ireland Act 1920 empowered the Joint Exchequer Board to act by majority decision. It is submitted that the rule of majority decision is a sound one . If the rule of unanimity were to apply and the members could exercise a veto on decisions of the Joint Exchequer Board on which would depend the budgets of the federal and state governments the whole system would become unworkable. However, it is extremely vital that the Chairman of the Board be impartial….[T]o make the Joint Exchequer Board less political and more independent the costs of the Board (including salaries of the members and staff) should be charged on the federal Consolidated Fund. The Constitution will ensure that these could be increased but not reduced by the federal parliament." [M A Fazal, A Federal Constitution for the United Kingdom - An Alternative to Devolution (1997) pp. 107-109].
The case for an independent and impartial decision-making equalising machinery as opposed to a merely an advisory body cannot be too strongly emphasised.
Conclusions on Equalisation
Appropriate provisions of equalisation are crucial to the success of our proposed confederation/federation. However, mere fiscal equalisation of the vertical type is not sufficient for the purpose. Horizontal equalisation is vital to ensure both the revenue capacities and funding for the expenditure needs of all the states of the proposed federation. Even achievement of vertical and horizontal fiscal balance on its own might not be able to ensure uniform standard of living conditions and the same level of prosperity throughout the territories of the federation. This will call for what I have labelled as 'regional equalisation' to establish broadly uniform levels of economic development among all the states of the federation. This, in turn, calls for the establishment of an independent financial institution entrusted with the task of allocating resources between the federation and the states and between the states inter se to bring about the goal of equalisation. In most Commonwealth federations the financial institution in question acts in an advisory capacity, the final decision on the matter being vested in the federal government. My own preference would be to vest the equalisation decision-making power (as distinct from its being merely a recommendation) in the financial institution itself. The relevant measures ought to be embodied in the federal constitution giving the institution the appropriate status and independent authority to take the necessary measures to bring up the relatively backward regions to the common level of economic growth and performance. It is hoped that the equalisation measures recommended here will lay the foundation of a durable and successful federation/confederation, sine qua non, for the preservation of peace and security in this region.
Concluding remarks
There appear to be, at the present time, two almost insurmountable obstacles to the establishment of a confederation of India, Pakistan and Bangladesh as proposed here. First, there is the dispute over Kashmir which requires a just and fair resolution.
THE LESSON OF HUMAN HISTORY IS THAT WHERE THERE IS NO JUSTICE AND FAIRNESS IN THE DEALINGS BETWEEN NATIONS THERE IS WAR.
Secondly the Ayodhya movement launched by the right-wing Hindus is liable to make the idea of a confederation a non-starter as far as Pakistan and Bangladesh are concerned. This movement has, as its objective, the destruction of mosques and building of temples on those sites in various parts of India. It claims that Ayodhya in the state of Uttar Pradesh is the birth place of the Hindu God Rama but that is simply a pretext for pursuing its real objective. If this movement gains the upper hand it will pose a grave threat to the stability and well-being of the Indian society in addition to making the realisation of the proposed confederation a virtual impossibility.THE AYODHYA MOVEMENT HAS TO BE RESTRAINED AND NOT PAMPERED. Therefore, these two obstacles must be removed in order to create a favourable climate for the establishment of the proposed confederation. The choice is for a population whose destiny is likely to be affected decisively by the course the history of these countries will take.
I would recommend that, in addition to agreeing to a fair and just settlement of the dispute over Kashmir, India make the following positive gestures to the Muslims in order to create a favourable climate for the establishment of the Confederation of India, Pakistan and Bangladesh as proposed here:
1. The process of destruction of mosques and building of temples on those sites initiated by the Ayodhya movement has to be reversed. Wherever mosques have been destroyed, they have to be re-built on those sites. THIS MEANS THAT THE AYODHYA MOSQUE WHICH HAS BEEN DEMOLISHED MUST BE RE-BUILT ON THE ORIGINAL SITE. The same goes for other mosques similarly destroyed.
2. The plight of the Indian Muslims has to be addressed. Since the partition of India in 1947, the condition of the Muslims in India has not improved much compared with the other sections of the population. IT IS SUBMITTED THAT A COMMISSION OF INQUIRY CHAIRED BY A JUDGE OF THE SUPREME COURT BE APPOINTED WITH APPROPRIATE TERMS OF REFERENCE TO INVESTIGATE THE CAUSES OF THEIR RELATIVE BACKWARDNESS AND TO MAKE RECOMMENDATIONS TO REMEDY THE SITUATION COUPLED WITH A PLEDGE TO IMPLEMENT THEM.
3. When the defence forces of India, Pakistan and Bangladesh are integrated under the proposed Confederation, a prestigious mosque should be built in Delhi or wherever the Confederation defence headquarters might be located, for use by the Muslim members of the integrated defence forces.
The peoples of the Indian sub-continent are at a cross-road at the present time. They could proceed along the road to nationalism, engage in nationalistic wars and destroy themselves. They have certainly acquired the capacity to do so. Alternatively, they could choose for themselves a positive and constructive path and lay the foundation for a bright future. They have the potential for such a development. The need for sheer physical survival alone dictates the choice for the latter. Speaking of the Cuban missile crisis Robert McNamara said "to initiate a strike against another nuclear-equipped opponent would have been suicide".
The same would be true today and in the future as between India and Pakistan. One hopes that they would opt for the better course.
In this article entitled “How to avoid a nuclear war between India and Pakistan” (www.angelfire.com/ok/mafazal/index.html), I have proposed a federation/confederation of India, Pakistan and Bangladesh. Under this proposal the federal government will assume the jurisdiction over defence including nuclear weapons. IN THIS WAY THE PAKISTANI NUCLEAR WEAPONS WILL BE PUT IN SAFE HANDS THEREBY ENSURING BOTH THE REGIONAL AND INTERNATIONAL PEACE AND SECURITY. MIGHT I INVITE THE UK AND US GOVERNMENTS SUPPORTED BY THE EUROPEAN POWERS TO PURSUE MY PROPOSAL WITH THE GOVERNMENTS OF INDIA, PAKISTAN AND BANGLADESH. I have recommended in the above website article that the process should begin with an attempt to solve the dispute over Kashmir between India and Pakistan. My proposal is based on the federal model constructed in my book entitled “A Federal Constitution for the United Kingdom – an Alternative to Devolution” (Dartmouth 1997). This provides for the maximum possible autonomy / independence to the federating units, their role in foreign affairs including, where appropriate, their membership of the United Nations and other international organisations and machinery for the removal of economic disparities between the regions of the federations. This model might conceivably provide a framework for the re-unification of India, Pakistan and Bangladesh.
