Event ReportsPublished on Apr 12, 2012
As Myanmar moves forward, there is an opportunity for India to strengthen its traditional links, create new links and increase its presence. But to do this, India should "change its mindset" about Myanmar, says leading journalist Dr. Bharat Bhushan after a visit to the country.
India needs to change its mindset about Myanmar

Myanmar today is at a critical juncture in its history. The country is in the middle of a historic political transition from the long years of military rule to democracy. People in Myanmar have both "expectation and apprehension" about the changes taking place in the country, asserted Dr. Bharat Bhushan, a leading journalist, while initiating a roundtable discussion on "Political Transition in Myanmar" organised by Observer Research foundation on 12 April, 2012. There is expectation because people think the transition to democracy may be real and apprehension because if the transition is to fail, the country may return to military rule.

In the current scenario, the "optimists outnumber the pessimists" and there are "good reasons" for optimism, Dr. Bhushan emphasized. He pointed out that while it will not be easy to make a U-turn, there are "bottom-lines". He cautioned that if the military leadership sees the new policies creating more problems than it solves, then it may have a "rethink."

Based on a recent trip to Myanmar, Dr. Bhushan provided insights on the internal dynamics of the country’s democratisation process. He began his observations by providing an understanding of the "calibrated transition" and identified key drivers of the current transition to democracy in Myanmar.

Why the change?

Four key drivers motivated the military leadership to initiate the reforms, Dr. Bhushan argued. First, there was an "internal urge" to change. The military generals realised that the world was changing and that they have been left behind because of their "insularity" and that their past policies were working neither at home nor abroad.

Second, another important motivation was the role of the Association of Southeast Asian Nations (ASEAN), said Dr. Bhushan. As a member of the regional grouping, Myanmar was supposed to take the ASEAN chair in 2006. However, the founding members of ASEAN prevented Myanmar from taking the chair for its repressive policies. This was a setback to Myanmar. The ASEAN leaders continued urging the Myanmar leadership with the promise that if the country keeps performing, it will get rewarded. Myanmar’s chair was coming again in 2016. But when the ASEAN leaders saw progress in 2011, they offered Myanmar the chair in 2014. Myanmar desperately wants to be part of the international mainstream and ASEAN has played a critical role in facilitating that process, he observed.

Myanmar is also hosting the ASEAN Games next year and in 2014 when it begins the chairmanship, it will oversee the transition to ASEAN Free Trade Agreement (AFTA) in 2015. Given these high stakes, the Myanmar government will not do anything that would compel ASEAN to rethink about its role.

Third, it would be wrong to say that sanctions had no impact at all, Dr. Bhushan argued. International sanctions since 2003 have indeed taken their toll on some sectors although people did not starve because of them. The garment sector, which employed more than 50,000 people in about 500 factories, suffered a big blow as 300 factories had to shut down. Foreign banks did not want to trade with Myanmar and the big US and European companies pulled out of the country. There was also a strong "psychological" aspect to the sanctions as Myanmar was isolated in international fora and there were UN resolutions adopted against it annually.

Fourth, over the years, the army generals and their cronies have amassed huge wealth. This also was a push factor because they want to invest their money. Once the country opens up, they are in an advantageous position to do business with the outside world, which ordinary Burmese cannot, he added.

Apart from these four key drivers, the calibrated transition to democracy as opposed to full democracy also suited the West, Dr. Bhushan observed. The Western countries realised that sanctions were futile if they did not lead to regime change and Myanmar was so resource rich - it has minerals, precious stones, oil, gas, coal, water and food in plenty - that people were not starving. Even more important seems to have been the realisation that the relative ineffectiveness of the sanctions could lead to loss of influence in a strategic region -- leaving the field open to China. And this, at a time when China was already well on its way to converting Myanmar into its captive resource hinterland.

For 20 years, the West tried to change the military regime in Myanmar but to no avail. Therefore, sending Ms Aung San Suu Kyi to Parliament somehow would give them the opening they need to lift the sanctions and start doing business with Myanmar. This would create an oppositional political space in Parliament and prepare the ground for incremental democratic changes in the years to come. It would tamper with the actions of the military backed government and prepare the ground for a popular government after the 2015 General Election.

The transition also suited Ms Aung San Suu Kyi and the National League for Democracy (NLD), argued Dr. Bhushan. The NLD realised that the current government was serious about the transition to democracy after seeing that the new government was moving ahead as it had promised. President Thein Sein released thousands of political prisoners¬ (although many are still in jail); political exiles were allowed to come back; some restrictions on the media were lifted; and political party registration act was changed. These developments convinced the NLD to contest in the recent by-elections where they won a landslide victory.

The Myanmar army

The Myanmar army has also made changes to allow the transition to democracy, Dr. Bhushan argued. The current President was handpicked by General Than Shwe and there is a general view in Myanmar that President Thein Sein was a "good choice" because he is seen as a "soft-liner" who is "sincere" about transition to democracy.

The army and ex-army officers play a "dual" role. They have a military role as well as a political role, and this political role has been institutionalised in the 2008 Constitution, he noted. The military controls the legislature, the executive and the judiciary. Dr. Bhushan asserted that the transition to democracy is being initiated not by a Myanmar army in retreat, but a "confident" army which has consolidated its position.

Before quitting as dictator, General Than Shwe also retired the top military leadership up to the two-star level. Today, the entire top army brass is under 55 years of age. The army has also insured that the nominees to the parliament are not senior officers. All the army officers to take up the 25 per cent seats in the two houses of parliament are captains and majors. They do not participate in any parliamentary debate, but when told to vote in a particular direction, they just follow orders, he noted.

The current commander-in-chief Min Aung Hlaing is seen as a "strong defender" of army’s role of being in parliament. However, he also admits that the Myanmar army has lost the respect of the people and that they need to regain that respect by not running the government directly. His deputies are also not reputed to be "hardliners". Vice President Tin Aung Myint Oo is supposed to be a "hardliner", but the vice chief does not support him.

Aung San Suu Kyi and the NLD

The NLD’s members of parliament will not change the composition of the parliament. The 43 out of 44 seats the NLD won form less than 6 per cent of the total strength of the house. Therefore, the legislative power of the combined team of Union Solidarity and Development Party (USDP) and the 25 per cent army nominated members of parliament will continue, he observed.

However, Ms. Suu Kyi’s charisma and popularity will ensure that her clout will be far more important than the number she has in the parliament. Therefore, going just by numbers may be misleading, he pointed out. Numbers are important for changing the constitution which she cannot change and changing laws will also be very difficult. However, she will be able to moderate the policies of the government or push them in certain direction. What remains to be seen is how she is going to perform in the parliament, he added.

Her best bet would be to mobilise other opposition parties, Dr. Bhushan noted. Up till now, there is no "pan-Myanmar" opposition party in parliament. For the first time, there will now be a pan-Myanmar opposition party and this opposition party, if it works with other regional parties and ethnic parties, may be able to push some policies through, he argued.

Although Ms. Suu Kyi has said that she does not want to join the government, in the run up to 2015, if she joins or her members of parliament join a national government of some kind (which looks unlikely at present) -- a government could be formed among the USDP, the NLD, and the ethnic parties. If that happen, things will move at a faster pace, he observed.

The most serious problem for the NLD is that the party is not one person -- Ms Aung San Suu Kyi is not NLD -- but Ms Suu Kyi is just the most charismatic leader of the NLD. There are questions about the capability of other NLD leaders and the long term survival of the party. The other problem is the aging leadership of the NLD. Many of the top leaders are aging. Ms Suu Kyi herself is 66 years old. There is no obvious plan to nurture young talent, although the party claims that it is engaged in this process, he asserted.

There are a lot of people who are critical of the NLD. Some feel that the NLD is "losing steam", he pointed out. Many also feel that Ms Suu Kyi is being reduced from a national leader to a party leader and from a national leader to an opposition leader and if she joins government, then she will be just one of the ministers. Dr. Bhushan disagreed with the view that Ms Suu Kyi’s stature is being eroded by joining democratic politics. He said this view come from the "purists" who thinks she should not join government, but should have waited and changed the constitution. But others are of the view that this was the "most pragmatic" thing to do because there was no other option. It is better to change politics by joining politics and push for greater democracy than staying out of it without achieving anything, he noted.

Economic reforms

Political reforms have preceded economic reforms even as both are still evolving in Myanmar, observed Dr. Bhushan. The government has initiated gradual economic reforms by introducing policy changes in some sectors such as import and export, leasing of land by private sector and opening up oil and gas and the telecommunication sectors. To fully engage the world economy, Myanmar needs serious reforms in its fiscal and monetary policies and modernise its banking sector and information technology, he argued.

In this context, a unified exchange rate that had happened earlier this month and a foreign investment amendment bill passed by parliament in March were seen as steps toward that direction. However, despite all the new policies for economic reforms, the execution is going to be a problem, he pointed out.

Today, a number of foreign companies are going to Myanmar which Dr. Bhushan asserted was a move to position themselves for the real change, when it takes place. Furthermore, in the absence of human capacity, overnight changes in the economy is unlikely to happen, he pointed out. The country needs work force, development, IT, e-governance and all Myanmar’s neighbours have to help it, he added.

China’s role

Contrary to the perception that Myanmar is under "Chinese thumb", Dr. Bhushan noted that Myanmar is an "extremely nationalistic" country and there is "resistance" to the Chinese presence. Psychologically, there is "a subterranean anger" at what China is doing in Myanmar, he observed. However, the fact remains that China is today one of Myanmar’s largest trading and investment partners, he noted.

According to Dr. Bhushan, China’s interests in Myanmar were four-fold. First, China wanted to get access to the seaports of the Indian Ocean and the Bay of Bengal from Kunming. To this end, China has built roads and ports so that they could take goods up to Yunnan. Second, China wanted to control the financial sector. Third, to invest in infrastructure and hydro-electric projects in Myanmar so that infrastructure projects would facilitate trade and hydro-electricity projects would supply electricity to China’s growing energy needs; and fourth, China wanted to get access to Myanmar’s natural resources of copper, zinc, oil, gas, timber, and other mineral resources. In other words, convert Myanmar into China’s own "hinterland" for resources, he pointed out.

In September 2011, the Myanmar government suspended the China-funded 6000 MW Myitsone dam in the upper reaches of the Irrawaddy in Kachin State under public pressure. This was a signal to China not to take Myanmar for granted, Dr. Bhushan argued. Today, no Burmese expects this dam to be restarted and nor are any other big projects likely to go to China, he pointed out.

Chinese immigration and their control over trade have pushed the Burmese to the periphery in cities like Mandalay and Yangon, he pointed out. At the personal level, people may not like the Chinese, but there is no escaping them. Local Burmese citizens are resentful about Chinese property development and the tendency to quickly monopolise local businesses. However, the government continued to favour China because when nobody was doing business with them, the Chinese came forward, he noted. Therefore, whatever else happens, China will be a "special" country for Myanmar, he asserted. Chinese influence in Myanmar will not disappear, it is a large neighbour and it may be incorrect to "underestimate" that influence, he added.

The ethnic question

The basic problem of Myanmar since independence has been how to integrate the ethnic nationalities (who consist of about 40 per cent of the country’s population) into a union through a federal system that is acceptable to all. There is a "perceptible change" in the way Myanmar used to deal with ethnic minorities, argued Dr. Bhushan. It used to be through military might, but now it is more of political dialogue, he added.

Today, the ethnic nationalities have their legislatures and parliaments in seven states. Furthermore, the cabinet provides for the presence of ministers from the ethnic minorities in all states and regions, he pointed. After the 2010 elections, the government has signed ceasefire agreements with 10 out of the 11 major ethnic militant groups, the 11th being the Kachin Independence Organization.

Dr. Bhushan pointed out that the Myanmar government has adopted a four-pronged strategy to deal with ethnic insurgents. First, the military strategy, that is, enter into ceasefire agreements; second, a political strategy, that is, to have a dialogue; third, an economic strategy that focuses on regional economic development of the ethnic areas; and fourth, a social strategy that focuses on health and education needs of the ethnic minorities.

The government has also worked out three phases to find peace and political settlement with the ethnic minorities, he pointed out. The first phase focuses on ceasefire and confidence-building measures. In the second phase, the government will initiate political dialogue and negotiations. In fact, two negotiating teams have already been established and they have been negotiating with the ethnic insurgents, he added. The third phase is to incorporate ethnic demands in to the constitution. Dr. Bhushan pointed out that the ruling party was open to modify the constitution.

The Myanmar government wants four assurances from the ethnic militant groups in return, he observed. One, it wants the ethnic minorities to accept the sovereignty of the state; two, give up the demand for secession; three, to promote national identity, and fourth, to refrain from narcotics trade. There are major problems that the government anticipates in disarming, decommissioning and rehabilitating the ethnic insurgents. On the other hand, many of the insurgent leaders have got into informal businesses -- timber, mining, drugs -- and they may not want a quick settlement because this would lead to loss of income, he observed.

The government has plans to come up with special package for ethnic areas by setting up special economic zones and giving special incentives for setting up industry, etc to bring back the ethnic refugees in Thailand and other neighbouring countries, Dr. Bhushan noted.

What India needs to do?

Views on India in Myanmar differ, Dr. Bhushan noted. People in the army think India did not do enough and the democrats feel that India has not done anything to help them. However, ordinary Burmese wants India to come forward to help as they feel the Indian way of life is similar to the Burmese, connected through Buddhism, he observed. There is a sizable Indian population (Tamils, Biharis, Oriyas, Marwaris, Punjabis, etc.) in Myanmar which is not leveraged by India to its benefit, he asserted.

As Myanmar moves forward, there is an opportunity for India to strengthen its traditional links, create new links and increase its presence in a country with which it has had strong historical and cultural ties. But to do this, India should "change its mindset" about Myanmar, suggested Dr. Bhushan. India should see Myanmar as an important neighbour and "give it the respect it deserves" in diplomacy as well as business, he added.

Dr. Bhushan has suggested six policy recommendations for India: First, to expose more Indian businessmen, diplomats, bureaucrats to Myanmar by sending them in a series of delegations. Second, to improve transportation connectivity through more roads, flights and direct shipping arrangements. Today, there is only a bi-weekly flight to Yangon from Kolkata which operate through Bodh Gaya. The lack of transportation links between the two countries reflects the sad reality of Indian engagement with Myanmar, Dr. Bhushan asserted.

Third, big business houses need to be encouraged to invest in Myanmar. With prospects for new licenses to be opened up in the oil and gas sector as well as telecom sector, Indian companies should position themselves to grab this opportunities, Dr. Bhushan pointed out. Fourth, Myanmar lacks good health services and Indian hospitals need to open hospitals in Myanmar and have joint-ventures with Burmese. About 70 per cent of the drug market in Myanmar is captured by Indian pharmaceutical companies and these companies should set up drug manufacturing units in Myanmar, which is bound to open up, he observed.

Fifth, Indian banks should facilitate trade documents. Banks should also be encouraged to set up joint-venture banks in Myanmar. Myanmar should be removed from the negative list and make it at least neutral to encourage more businessmen to go to Myanmar. Sixth, border trade between the two countries should be increased by opening more trading posts.

The talk and the discussion was attended by former diplomats, scholars, journalists, Burmese nationals based in Delhi, among others.

(This report was prepared by Dr. K. Yhome, Research Fellow, Observer Research foundation)

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