India: Momento Modi.
Also: Pakistan, Israel, Palestine, COP28 and Guinea-Bissau.
INDIA. Momento Modi.
The Bharatiya Janata Party is reminded it is mortal.
Exit polls for five state elections on Thursday showed a tight race for the BJP ahead of counting on Sunday. An unsealed indictment on Wednesday gave further details on an alleged plot by Indian agents to murder a US citizen in New York.
INTELLIGENCE. Narendra Modi has had a strong year, hosting the G20 and balancing India’s interests with the US and Russia. Yet as India readies for elections in the second quarter of 2024, problems are emerging. Ties are strained with the US on charges of a Sikh activist’s attempted killing. Climate pledges look hollow on record coal use and plans to triple underground mining. Supply chain reliability is being questioned over damaging rice export controls.
FOR BUSINESS. Indian exit polls can be unreliable and state elections often have little bearing on national politics, but any cracks in Modi’s façade will buoy the opposition Congress party, which he has tried to kneecap, including through phone taps and a trumped-up defamation suit on its leader. For now, the economy is in rude health – GDP rose a surprisingly fast 7.6% in the September quarter – but food inflation is stubborn at 6.6%, despite the trade bans.
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PAKISTAN. Nawaz, but is.
The return of Nawaz Sharif is almost complete.
An Islamabad court on Wednesday overturned a corruption conviction on ex-prime minister Nawaz Sharif, who returned last month from exile. Pakistan's election commission was accused on Thursday of redistricting to favour Sharif’s party.
INTELLIGENCE. With Pakistan’s other leading politician, Imran Khan, in jail, Sharif appears ready to retake power for the fourth time (pending the overturn of another pesky charge and a lifetime political ban). Sharif’s rehabilitation is a boon for his family’s business interests but says more about the military’s need to ensure a pliant civilian veneer to its ongoing rule. Khan – originally meant for that role – had too many independent thoughts and is now behind bars.
FOR BUSINESS. Sharif not only offers the military a degree of respectability, even if few are fooled, but a reasonable economic record. While Pakistan’s fiscal challenge is vast, if anyone can fix it – with the help of China, the Gulf, and the IMF – it’s him. Security problems, however, are more intractable. Terrorism continues on the Afghan border amid the return of 1.7 million refugees. An insurgency in Balochistan remains volatile, delaying major infrastructure plans.
With the brevity of a media digest, but the depth of an intelligence assessment, Daily Assessment goes beyond the news to outline the implications.
ISRAEL. PALESTINE. Pause buttons.
After hostages are freed in Gaza, violence flares again.
Israel’s truce with Hamas ended early Friday, though negotiations for the release of further hostages continued amid resumed fighting. Four Israelis were killed and six wounded after gunmen began shooting at a Jerusalem bus stop.
INTELLIGENCE. Hamas claimed responsibility for the Jerusalem attack, which sends a message not just to Israel but the West Bank’s Palestinian Authority. The attack came as US Secretary of State Antony Blinken called on Jewish settlers there to be punished after a recent surge in anti-Palestinian violence. Washington is mindful of rising global condemnation, but must retain its influence with Israel’s right-wing government, which is firmly backed by the settlers.
FOR BUSINESS. Hostage releases have been a relief, but the conflict’s drivers remain unresolved. Israel is yet to neutralise Hamas. Palestine is no closer to a two-state solution. US and Qatari diplomats have put a lid on escalation – as has Iranian risk aversion – but the conflict cannot last forever. The war is predicted to cost Israel $53 billion. The White House is reportedly reprising Reagan's 1982 peace plan, which could see Hamas fully relocate offshore.
CLIMATE CHANGE. Minimal damage.
The UN claims a minor victory in negotiations.
Delegates at Dubai’s Conference of the Parties summit agreed Thursday to a 'loss and damage' fund, which will help poorer countries cope with climate impacts. The EU, UAE, Germany, UK, US, and Japan pledged a collective $429 million.
INTELLIGENCE. Though met with a standing ovation, if the deal is high-water mark for COP28, it will be a failure. More substantive outcomes could be achieved, at reasonable cost, via a binding methane pledge, particularly now China has included the gas in its action plan (albeit without a firm reduction target). Carbon capture and storage, a focus for Dubai, could also help spur more oil and gas firms to join what has so far been a voluntary methane program.
FOR BUSINESS. Cutting methane emissions, at least in the gas sector, is genuine low-hanging fruit. Loss and damage, on the other hand, is seen by many as a distraction on the forest floor. It looks nice, but is merely (miniscule) aid under a new label, and plays the present against the past at the future’s expense. Higher ambitions, such as one to triple renewables capacity, reportedly backed by 100 delegations, meanwhile look utopian amid current constraints.
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GUINEA-BISSAU. Who’s coup.
West Africa may be running out of democracies.
Residents of Guinea-Bissau's capital woke to gunfire on Friday after national guardsmen took two ministers from police custody and retreated to their barracks. The ministers had been detained on graft charges. The president is in Dubai.
INTELLIGENCE. Coups often happen when a leader is abroad, and a lot of them are currently attending COP28. President Umaro Sissoco Embalo, elected in 2019, should know better. He saw off an attempted rebellion last year, one of ten coups or attempted coups since independence. It also follows a coup attempt last week in nearby Sierra Leone, growing instability in next door Senegal, and coup in its other neighbour, Guinea-Conakry, in 2021.
FOR BUSINESS. Unlike recent coups in Niger or Gabon, there is little resource wealth driving Bissau’s power struggles, but the former Portuguese colony is a major drug trafficking hub between South America and Europe. Its role in the trade increased after its 2012 coup and cartels are thought to have been behind the 2022 coup attempt. Known as Africa’s first narco-state’, Bissau is also thought to have been used by groups like Hezbollah to launder terrorist funds.