Presentation on Myanmar in Transition: Implications for Indian Diplomacy

Dr V.S. Seshadri 11 March 2014 at Indian Institute of Technology Guwahati

Myanmar Factsheet
Population Area Demography 60mn 6,76,577 sq. Km (1/5th size of India, 4 times Bangladesh) Ethnic Groups 135 in total-majority Burmans. Others Shan, Kachin, Kayah, Kayin, Chin, Mon and Rakhine. Religion Buddhist; 80%, Christians & Muslims; 4 to 5% each and Hindu; 2% China 2,204 Km. Thailand 2,107 Km. India 1643 Km. Laos 248 Km and Bangladesh 271 Km States (7): Chin, Kachin, Kayah, Kayin, Mon, Rakhine & Shan Regions (7): Ayeyarwaddy, Bago, Magway, Mandalay, Sagaing, Tanintharyi & Yangon - Vast reserves Petroleum & Natural Gas (natural gas 283.2 Bn Cubic Meters), Gold, precious stones - 50% forest cover US$ 760 Presently categorized as LDC
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Borders Administrative Divisions Natural Resources

Per capita GDP

Independence and Military Coup

o Differences between Burman dominated majority and ethnic minorities have long persisted but exacerbated past 1948 in the new Union. Shans, Kachins, Chins, Karens, Karennis, Rakhines, Mons comprising over 30% of population inhabit over 50% of the geographic area which is hilly and rings the Burmans in the plains in the form of an inverted U. Gen Aung San and majority of interim cabinet assassinated prior independence. Resultant ethnic insurgency as well as problems from the uprising by Communist Party of Burma and factionalism led to PM U Nu inviting military to bring order in 1958. Subsequent military coup by Gen Ne Win in 1962 followed by 26 years of Burmese Way to Socialism
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Emergence of ASSK and Gen. Than Shwe

o 1988 1990. Gen Ne Win hands over and Aung San Suu Kyi (ASSK) who returned to the country for tending to her mother joins political arena. ASSKs National League for Democracy (NLD) sweeps 1990 elections. Military refuses to handover power. 21 year military rule with Gen Than Shwe taking over in 1992. ASSK under house arrest for over 15 years. 1988 student leaders and other opposition leaders also under house arrest. Host of ceasefire agreements with different ethnic groups resulting in relative stability. Subsequent hopes for economic reforms or ethnic reconciliation dashed by 1997-98 financial crisis, purge of PM Khin Nyunt in 2004 and saffron Revolution 2007.
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o o o o o o

Transition from Military Rule

o Military regime probably skeptical of sustainability in 21st century. Even Cambodia and Laos were seen developing faster. o Initiates drafting of new Constitution in 2003 as part of a 7 Step roadmap to Discipline flourishing Democracy. o Constitution approved in 2008 referendum despite ongoing cyclone Nargis. o Constitution provides for continued participation of military in governance (25% reservations) o Elections held as per 2008 constitution in November 2010. o New leadership handpicked by General Than Shwe as part of the 6th Step to ensure smooth transition. o President U Thein Sein, earlier PM of SPDC takes over as new Presdient on 30 March 2011 and SPDC disbanded.
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Initiatives announced by New Government

o Path breaking 31 March 2011 speech by President Thein Sein: Good governance and clean govt. Strengthen pillars on Legislative, Executive and Judiciary fronts. Rule of Law. Respect for role of media. Ending corruption.
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On-going Reforms
Political
o Dialogue with Daw Aung San Suu Kyi eventually led to NLD joining political process through bye-election. o Release of political prisoners most released, in phases. o Parliamentary process Ninth sessions held so far has come a long way with more open debate and discussion. o Loosening of media control. Daily private newpapers from 1st April 2013. o Response from international community in the form of removal of most sanctions.
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On-going Reform
Internal Peace and Reconciliation
1.

2.

3. 4.

March 2012 President announces a three stages roadmap (a) State level ceasefire. (b) Union level dialogue to include no secession, anti drug / economic cooperation, political accommodation, constitutional amendment. (c) Agreement in Parliament. State level ceasefire agreement reached with all major groups except Kachins with whom a 7 point agreement reached but not called a ceasefire agreement. Some clashes still reported. Talks progressing towards a national ceasefire agreement Prospects brightens Rohingaya issue a matter for concern. Some communal clashes have also followed. Inter faith dialogues are taking place. Issue however may need solution.
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On-going Reform
2008 Consitutional Review
1. Joint Committee with 109 Parliament members set up to recommend proposals for constitutional reform. Report submitted on 31st January 2014. inconclusive. A 32 member implementation committee set up. Possible areas of focus. (i) Amendment of Article 59(f) that bars citizens having close relatives who are foreign nationals from being eligible for posts such as President, Vice- President this will depend ASSK eligibility. (ii) 25% reservation of seats for military. (iii) More decentralisation. (iv) More autonomy for ethnic groups demand for federal Union and federal army.
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2.

On-going Reform
Economic Reforms
o Privatisation of several Government owned buildings and some factories. o Unifying exchange rates Kyat now on managed float. o Rationalisation of taxation Incentives for exports. o Enacting of Foreign Investment Law. o Clearing of some external debt has enabled Myanmar to receive ADB / World Bank assistance. o Autonomy for Central Bank. o Moves for Telecom, Port, Airport modernisation. o SEZs at Thillawa, Dawei and Kyaukphyu.
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On-going Reforms
Economic
2011-12 to 2015-16: 5 Year Plan o 7.7% annual increase in GDP. o 1.7 total increase in per capita GDP o Reducing share of agriculture in GDP from 36.4% to 29.2% o Increase manufacturing from 26% to 32% and Services from 37.6% to 38.7%
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On-going Reforms
Constraints
(i) Culture of decision making still remains very centralised without sufficient delegation. (ii) Some friction between Parliament and the Executive constructive tension? (iii) Severe lack of expertise and skills and institutional capacities. (iv) Case for greater decentralisation of powers to regions and states. (v) Absence of adequate infrastructure.
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2015 Elections
o Political parties already strategising. o Ethnic parties have also formed Federal Union party. o Will NLD win a majority? o USDP
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India-Myanmar Bilateral Relations

Key determinants
A 1643 kilometer long and porous border as well as maritime boundary. Strong Historic, Cultural, Religious links. Myanmar gateway to South East Asia, Both are also members of BCIM and BIMSTEC. Strategic location from security perspective. Insurgents from our militant groups tend to take shelter across border. Constructive engagement over last two decades several development cooperation programmes. Sizable people of Indian origin.
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Myanmars External Relations

o New government has reached out to tall countries to make friends. o Many more Foreign embassies in Myanmar. o Many offering technical and financial assistance economic opportunities a draw. o ASEAN Chair this year. o China continues to play significant part although entry of others has diminished preponderance. o Myanmar striving steadily to become part of international mainstream.
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Strengthening of Relations under New Government

High level Visits Increased Frequency
o President U Thein Sein visited India in October 2011 and December 2012. o PM Manmohan Singh visited Myanmar in May 2012 (after 25 years by another PM) and 3-5 March 2014 for BIMSTEC Summit. o Myanmar Lower House peaker Thura U Shwe Mann led a delegation in December 2011, Upper House Speaker in December 2013 and our own Speaker Smt. Meera Kumar in February 2013. o Visits by Foreign Ministers from both sides. o Daw Aung San Suu Kyi visited in November 2012 o Myanmar Human Rights Commission delegation in May 2012. o Myanmar Chief of Armed forces Vice Senior General Min Aung Hlaing visited in August 2012 and all our service chiefs have visited as well. Raksha Mantri in January 2013.
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Development Cooperation Initiatives

Upto 2011 Kaladan Multimodal Transport project began in December 2010. Various Capacity Building Programmes, including setting up four training institutions in IT, entrepreneurship development, English Language and Industrial Training. 250 fellowship under ITEC / Colombo Plan annually. Extension of concessionary loans for several projects including revamping refinery, truck assembly etc. Tamu-Kalay/Kalewa Friendship Road construction. Restoration of Ananda Temple in Bagan
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Development Cooperation initiatives with New Government

12 MOUs signed during PM Manmohan Singhs visit. Extension of new line of credit for US$500 million. Announcement regarding construction of Kalewa Yargyi (120 km) segment of India Myanmar-ThailandTrilateral highway. Repair of bridges on Tamu/Kalay-Kalewa segment Advanced Centre for Agricultural Research and Education and Rice Bio Park at Yezin. Grant of US$10 million worth of agricultural machinery
(Contd.)
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Development Cooperation initiatives with New Government (Contd.)

Myanmar Institute of Information Technology in Mandalay. Border Region Development Programme Chin State and Naga Self Administered Zone. US$ 5 million each year for 5 years. Increase in the number of ITEC / Colombo Plan fellowships to 500. Establishment of a new Industrial Training Centre at Myingyan. MOU signed for Rhi-Tiddim Road.
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Specific Training Programmes supportive of Myanmars reforms

Orientation programme for 40 MPs and 40 Parliament staff, in batches, of one week duration each, in Indian Bureau of parliamentary studies. Special 2-week training programmes and exposure for three batches of Myanmar journalists of 30 each. A seminar on our experiences in Planning and Poverty Alleviation Shri Montek Singh Ahluwalia and Dr. Isher Ahluwalia. A seminar on Disinvestment and Privatisation of publicly owned companies conducted by CII. A 2 week training programme for 20 MBA students of Mandalay University in the Indian Institute of Management, Bangalore now becoming an annual affair.
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India-Myanmar Trade
(Values in US$ Millions) (source: Ministry of Commerce, New Delhi)

Year

2009-10

2010-11

2011-12

2012-13

2013-14 April-June 121.32

Indias exports to Myanmar

207.97 (6.17%)

320.62 (54.17%)

545.38 (70.1%)

544.66

Indias imports from Myanmar TOTAL TRADE

1,289.80 (38.84%)

1,017.67 (-21.1%)

1,324.82 (30.18%)

1412.69 (6.6%

394.82

1,497.77 (30.17%)

1,338.29 (-10.65%)

1,870.20 (39.75%)

1957.35

516.14

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India-Myanmar Trade and Economic Relations

Factors that can boost trade
1. 2. 3. Direct shipping connectivity. Easier payment arrangements and concessionary financing. Expand trade via land border through conducive facilitation early setting up of the Integrated Customs Post at Moreh. More trade promotional activities. Indian companies to make more investments in Myanmar. India of course extends duty free treatment for LDCs including Myanmar.
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4. 5. 6.

India-Myanmar Economic Relations

1. Some On-going Projects: (a) Implementation by M/s Punj Lloyd of the first phase of oil/gas pipeline from Kyaukphyu-Kunming. (b) Offshore platform development by M/s Larsen and Toubro for Zawtika project. (c) Essar Construction in the Kaladan project. ONGC/Gail investment in A1 A3 gas blocks and investment in China-Myanmar Gas pipelines. Jubilant Energy awarded PSC-I onshore block for exploration. Several Indian companies in fray for onshore/offshore blocks and other major investment opportunities.

2.

3. 4.

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India-Myanmar Relations
Outlook for future
Strong political will present on both sides to strengthen relations. As Myanmar marches towards democratic governance there are several areas for the two countries to work together. Bringing to fruition Projects like Trilateral Connectivity and more people to people ties will make big difference. By 2017-18 connectivity would get a boost. Important to transform these into development corridors
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Thank you

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