It’s time India creates a national agency of economic intelligence
By Mohan Das Menon
21st October 2012 12:00 AM
Two major telecom companies, Huawei Technologies and ZTE, have recently been put on notice by the US House of Representatives for their alleged connections with Chinese intelligence services and the military. The Indian security establishment, spearheaded by the national security advisor, should be concerned over this development as both these entities have a robust presence in India in certain sensitive segments such as the Indian Railways and Telecom.
Intelligence assessments in the US are often made at multi-levels before drawing any finite conclusions. Lessons are drawn after adhering to a process of intensive processes of scrutiny of events and information and an in-depth analysis of varying and merging perspectives of the target domain. These processes entail ‘problem definition’, cautious information resource selection, putting in place legally admissible search strategies, collection of inputs and analysis of the information gathered prior to reaching final conclusions about the problem. The eventual goal of such a comprehensive analytics is to protect the vulnerable among the US private enterprises, both at home and abroad, and the American state.
Clearly, ZTE and Huawei have undergone a process of scrutiny within the US, possibly on the basis of leads available through intelligence generation. The fact that as a sequel to such a methodology of ‘inquiry and research’, the Intelligence Committee of the House of Representatives has barred the two global Chinese firms from US mergers and acquisitions sends a set of messages to other countries, including India, where they operate.
Compared to the US, the Indian intelligence mechanism is qualitatively different, given the intrinsic preference and prevalent ‘wide open space’ for foreign investment. Once a foreign entity settles in India after all the real and virtual procedures, the enterprise invariably looks forward to a sustained stay. Lacking the sophisticated methods of operational monitoring of enterprises, both domestic and foreign, the degree of institutional oversight in India is quite limited. Additionally, the degree of compliances in respect of Indian enterprises in the UK or US is far more comprehensive than for foreign firms in India. So both these Chinese firms could be in for a long haul, unless otherwise deterred by Indian authorities.
That is exactly where the problem lies. Economic security administration in India remains weak because of the absent range of fine-tuned ‘analytical’ procedures for any focused verification of suspicious foreign operators. The processes of initiating an enquiry are often long-winded and subject to legal and other procedural hurdles, defeating the very rationale of the enquiry. New Delhi has to assume a more assertive tenor for its own national empowerment in the framework of our modern globalised world wherein international capital funds move with far greater speed than the flow of international labour or foreign technologies.
Rather than being mellowed down by Paris, Washington or Moscow — capitals from where India imports multi-billions worth armament and equipment — India should seek proportionate ease for movements of its workforce into these countries, extract easier terms for transfer of technology and ensure proportionate bilateral visa regimes for business, educational and tourism travel for Indian applicants.
In order to grasp these and related dynamics, New Delhi has to comprehend global economic forces more compositely and consider the creation of a national network of economic and commercial intelligence. Disaggregating economic intelligence into multiple parts or reports received from multiple intelligence services has diminished the impact and actionability of precious global and domestic economic intelligence. It may, thus, not be too facile to call for the creation of a coherent National Agency of Economic Intelligence and Analysis, which eventually becomes the epicentre for receiving and assessing global and national economic currents. Its major thrust area ought to be generation of economic intelligence in an integral manner and ensuring economic security within Indian contours. South and North Blocks, wherein the ministries of finance, home affairs, defence, external affairs and the PMO are currently resident, could dimensionally benefit from such a creative enterprise which could in turn advice the Centre and state governments on major economic thrust areas.
A specialised economic intelligence service would be better placed in assessing and informing the highest echelons, both at the Centre and in the states, on major issues of economic security than a clutch of multiple services currently handling the sensitive brief. It can also help in working out answers to unresolved challenges posed by Maoist-style depredations in India’s rural interns. Similarly, the political and economic ramifications of the uncontrolled illegal migration into India, the ever-increasing money reserves could be better assessed by this service. Without such an instrument, India confronts several limits in economic forecasting and in taking diligent action based on such forecasts.
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