50 Japan backs India in border dispute with China

(1) Three opposition parties present united front for Japan election
(2) Japan backs India in border dispute with China
(3) US tests e-mail system to bypass the filters of countries such as Iran and China
(4) Income from Foreign Student fees overstated - not the most valuable export service
(5) China to buy Australian coal mining company - subject to Foreign Investment Review Board
(6) Shell NZ may be sold to Hindustan Petroleum

(1) Three opposition parties present united front for Japan election

http://news.xinhuanet.com/english/2009-08/14/content_11882451.htm

www.chinaview.cn 2009-08-14 16:21:05

    TOKYO, Aug. 14 (Xinhua) -- The Democratic Party of Japan, the People's New Party and the Social Democratic Party have decided on a united policy platform ahead of an election on Aug. 30, according to media reports on Friday.

    The three parties have agreed to make the economy the main focus of their campaign, vowing to improve the livelihoods and increase the disposable income for voters.

    The parties will also promise not to raise consumption tax from its current 5 percent level for at least another four years and will aim to put in place legislation to protect temporary workers, many of whom have lost their jobs during the current recession.

    More benefits will also be promised to young families, and extra protections will be provided to single mothers under the joint platform. The parties also promise to look into ways of revitalizing provincial areas, many of which have suffered severe economic decline since the end of Japan's bubble-era in the early 1990s.

    The Aug. 30 election is expected to bring the DPJ to power, as voters express their discontent for the Liberal Democratic Party, which has been in power for all but a brief period since it was formed in 1955.

(2) Japan backs India in border dispute with China

http://www.wsws.org/articles/2009/aug2009/indi-a15.shtml

China-India border talks highlight rising tensions

By John Chan

15 August 2009

The 13th round of border negotiations between China and India, held in New Delhi from August 7 to 8, became a focus of mounting tensions between the two regional rivals.

China sent its special representative State Councilor Dai Bingguo to meet with an Indian delegation led by National Security Adviser M. K. Narayanan. According to the Hindu newspaper, citing “informed sources”, the immediate aim of the talks was to agree on an outline for a final stage of negotiations, in which “both sides could get down to the actual nuts and bolts of the whole issue—negotiating the demarcation and delineation of the border”.

In other words, nothing concrete has even begun to be discussed since the talks were established in 2003. The only reported achievement of the latest round was an agreement to establish a hotline between the two prime ministers. India has only established such a hotline previously with Russia, so this is regarded as friendly gesture toward China.

China has shared a 4,000-kilometre-long “Line of Actual Control” with India since 1959, stretching from northwest Kashmir to Burma. In 1914, Britain drew the “McMahon Line” between India and Tibet, sowing the seeds of the future conflict between the two countries. China claims about 90,000 square kilometres in northeast India, mainly in the state of Arunachal Pradesh, which Beijing regards as “South Tibet”. India claims 43,180 square kilometres in China’s Aksai Chin region in eastern Kashmir.

Following conflicts over Tibet, the two countries fought a border war in 1962, in which the Indian forces were overrun. However, the Chinese army withdrew and unilaterally declared a ceasefire. The US had threatened to intervene to support India. With growing Sino-Soviet tensions, and Moscow refusing to back China against India, Beijing was in no position for a full-scale war with India.

Since the early 1990s, unresolved border disputes have once again become a potential flashpoint between the two aspiring powers. Although China is now India’s largest trade partner, tensions between the two further intensified with the global financial crisis. India banned imports of a series of Chinese goods.

In April, in an unprecedented move, Beijing attempted to block a $US2.9 billion Asian Development Bank (ADB) loan to India that included $US60 million for a flood control project in Arunachal Pradesh. India’s project rekindled a controversy that erupted in 2006, when the Chinese ambassador to India declared that the “whole state of Arunachal Pradesh is Chinese territory”.

India obtained the ADB funding in June, apparently with the support of the US and Japan, after a vote by the ADB broad. China strongly protested the ADB's approval.

Also in June, New Delhi announced the deployment of an additional 30,000 soldiers, along with tanks and a squadron of advanced SU-30 strike aircraft, to the northeast state of Assam (near Arunachal Pradesh), bringing the total troop numbers in the area to 100,000.

In response, China’s official People’s Daily published an editorial on June 11 warning India “to consider whether or not it can afford the consequences of a potential confrontation with China”. The editorial reminded New Delhi that China had established close relations with Pakistan, Sri Lanka and Nepal and declared: “China won’t make any compromises in its border disputes with India.”

An unnamed Chinese official told the South China Morning Post on August 7 that India had intensified the border row with China by obtaining the ADB funding through the support of the US and Japan. “India has enough money to develop Arunachal Pradesh,” he declared. “But it wanted to test the Chinese. China opposed the loan application tooth and nail but India had its way. We lost face. And we don’t like losing face. We disgrace anyone who disgraces us.”

Indian officials meanwhile complained that Beijing had rejected their proposal for India to retain Arunachal Pradesh in exchange for accepting China’s control over Aksai Chin. An Indian foreign ministry official told the South China Morning Post: “China has developed a big superiority complex. It thinks that any give-and-take vis-à-vis India will dent its self-projected image as the predominant power in Asia.”

China’s ambassador to India, Zhang Yan, urged both sides to resolve their disputes “with the utmost political wisdom”. Brahma Chellaney, a strategic analyst at the New Delhi-based Centre for Policy Research, told the Indian Express: “Mr. Zhang’s syrupy words are designed to salvage the [border] negotiations from the damage inflicted by vituperative attacks on India in China’s state-run media. China’s objective is to keep India engaged in endless and fruitless border talks so that Beijing, in the meantime, can change the Himalayan balance decisively in its favour through development of military power and infrastructure.”

In 2006, China built a major railway into the Tibetan plateau, a project widely regarded by Indian officials and defence analysts as designed for the rapid deployment of troops to attack India, if need be. China has also expanded its influence in a number of South Asian countries, including the construction of a “string of pearls” of ports and other facilities for deploying warships in the Indian Ocean. These developments have raised concerns in New Delhi about China’s intrusion into India’s “backyard”.

The bitter exchanges spilled into the open after the chauvinist China International Strategy Net web site urged the encouragement of communal divisions in India in order to break it up into 20-30 small states. “There cannot be two suns in the sky,” the web site declared, arguing that Asia could have only one dominant power. The Financial Times noted that the web site was run by Kang Lingyi, “who took part in hacking into the US government websites in 1999 following US bombing of the Chinese embassy in Belgrade. Sites such as his are part of the Communist Party’s strategy to allow nationalism to grow to strengthen its political legitimacy.”

An outcry in the Indian media forced the Indian foreign ministry to issue a statement on August 10. It stated that the article “appears to be an expression of individual opinion and does not accord with the officially stated position of China on India-China relations conveyed to us on several occasions,” such as the previous week’s border talks.

India is seeking to become a “world power” by aligning with the US, which is actively seeking to woo New Delhi through a series of nuclear, economic and military agreements. China attempted to block India’s access to the Nuclear Supplies Group after the former Bush administration pursued a civil nuclear deal with India in order to make it a strategic counterweight against Beijing. China has also assisted India’s rival Pakistan to build nuclear reactors and supplied it with arms.

The China-India rivalry has extended well into the Indian Ocean. In the name of fighting piracy, China recently sent warships to Somali waters to escort its merchant fleet, which is vital for the Chinese economy. The deployment is part of Beijing’s development of a blue-water navy. India is even more concerned by China’s growing influence in Sri Lanka. Beijing provided arms and diplomatic support to Colombo, helping its military crush the Liberation Tigers of Tamil Elam (LTTE) in May.

A week before the China-India talks, the Indian defence ministry’s naval planner, Alok Bhatnagar, announced that it would build 107 warships over the next decade, including aircraft carriers, destroyers, frigates and nuclear submarines, to rival China’s fleet. “China is developing its navy at a great rate. Its ambitions in the Indian Ocean are quite clear,” Bhatnagar declared.

At present, India is a lesser power than China. According to an article written by India’s former chief economic adviser, Shankar Acharya, and published in the Financial Times on July 29, China’s economy is three times the size of India’s, with per capita income 2.5 times that of India. China’s share of the world’s merchandise exports is almost nine times India’s. “Despite the rapid growth of India’s information technology-based service exports since 1995,” Acharya wrote, “in 2007, China’s total service exports exceed India’s by 40 percent”.

India’s chairman of the chiefs of staff, Admiral Sureesh Mehta, admitted on August 10 that India was no match for China militarily. “In military terms, both conventionally and unconventionally, we can neither have the capability nor the intention to match China force for force,” he said. Mehta said India’s annual defence budget of $US30 billion was much smaller than China’s $70 billion. He proposed avoiding conflict with China, “as it would be foolhardy to compare India and China as equals”.

However, the US is tipping the balance, seeking to woo India away from Russia and China. This is bound up with the Obama administration’s strategy to focus on the war in Afghanistan, Pakistan and surrounding Central Asian areas, aiming to control the energy-rich heartland of the Eurasian continent. During US Secretary of State Hillary Clinton’s trip to India in July, she signed a key defence pact, laying the basis to expand the already burgeoning US arms sales to India, including fighters and high-tech weapons.

The Wall Street Journal noted: “With their companies jockeying for market share abroad and their militaries modernising at home, China and India have been regarding each other less as friendly neighbours and more as future rivals.” The newspaper cited Brajesh Mishra, a former Indian national security adviser who headed the previous border talks with China. He urged India to deepen its ties with the US and other countries. “The Chinese must know that if they create something on the border, there would be an instant reaction far beyond what happened in 1962,” he said.

The US nuclear accord with India not only provides New Delhi with advanced nuclear technology but also effectively accepts India as a nuclear weapons power. In July, India unveiled its first nuclear-powered submarine armed with nuclear missiles, making it the sixth country in the world to acquire such weapons systems. This only underscores the dangers presented by the sharpening rivalry between the two regional powers that is being encouraged by Washington.

(3) US tests e-mail system to bypass the filters of countries such as Iran and China

http://www.taipeitimes.com/News/front/archives/2009/08/15/2003451174

US tests system to break down foreign Web censorship

REUTERS AND AFP, BOSTON AND BEIJING
Saturday, Aug 15, 2009, Page 1

The US government is covertly testing technology in China and Iran that lets residents break through screens set up by their governments to limit access to news on the Internet.

The “feed over e-mail” (FOE) system delivers news, podcasts and data via technology that evades Web-screening protocols of restrictive regimes, said Ken Berman, head of IT at the US government’s Broadcasting Board of Governors, which is testing the system.

The news feeds are sent through e-mail accounts, including those operated by Google Inc, Microsoft Corp’s Hotmail and Yahoo Inc.

“We have people testing it in China and Iran,” said Berman, whose agency runs Voice of America.

He provided few details on the new system, which is in the early stages of testing. He said some secrecy was important to avoid detection by the two governments.

The Internet has become a powerful tool for citizens in countries where governments regularly censor news media, enabling them to learn about and react to major social and political events.

Young Iranians used social networking services Facebook and Twitter as well as mobile phones to coordinate protests and report on demonstrations in the wake of the country’s disputed presidential election in June.

In May, ahead of the 20th anniversary of the Tiananmen Square crackdown, the Chinese government blocked access to Twitter and Hotmail.

Sho Ho, who helped develop FOE, said in an e-mail that the system could be tweaked easily to work on most types of mobile phone.

The US government also offers a free service that allows overseas users to access virtually any site on the Internet, including those opposing the US.

“We don’t make any political statement about what people visit,” Berman said. “We are trying to impart the value: ‘The more you know, the better.’ People can look for themselves.”

In addition to China and Iran, targets for the FOE technology include Myanmar, Tajikistan, Uzbekistan and Vietnam, he said.

Berman, however, said there would be modest filtering of pornography on the system.

“There is a limit to how much [US] taxpayers should have to pay for,” he said.

Meanwhile, a top Beijing official said on Thursday that a controversial Internet filter software was optional for all users after plans to install it on computers sold in China triggered a storm of protest.

“After you install the software, you can use it or you can decide not to use it,” said Li Yizhong (???), minister of industry and information technology.

“When you buy a computer, a floppy disk or CD [with the software] is included, and the right to choose resides with the parent, with society,” he told reporters in Beijing.

(4) Income from Foreign Student fees overstated - not the most valuable export service

http://www.theaustralian.news.com.au/story/0,,25915978-12332,00.html?from=public_rss

Don't count on earnings

Geoff Maslen | August 12, 2009

WESTERN countries that attract hundreds of thousands of foreign students each year often claim they contribute billions to their economies, even if the claims are sometimes quite wrong.

The US, for example, is said to generate the equivalent of $18.5 billion a year from overseas students studying in its colleges and universities while the most often quoted figure for Australia is $15.5bn.

In Britain it is said to be $11bn and in New Zealand, $4.2bn.

But as Monash University sociologist Bob Birrell demonstrated in these pages last week, such claims can be wildly inaccurate unless the calculations take account of a range of factors, including the income students earn while working in the country where they are studying.

Birrell revealed that the true figure was probably half the officially quoted sum and the industry was therefore certainly not the most valuable of the nation's exports of services, as universities -- and the federal government -- have long asserted.

Likewise, the editors of the GlobalHigherEd weblog, Kris Olds at the University of Wisconsin-Madison in the US and Susan Robertson of the University of Bristol in Britain, point to the variations among different countries in the way the economic impact of foreign students is calculated.

"There are clearly debates under way about which analytical models to adopt and about the impacts of this development approach," they say.

"Other countries have made relatively little effort, or progress, in calculating such impacts. The reasons for this are many, ranging from lack of capacity, inadequate data, ideological unease with the idea of thinking about (and especially speaking about, in public at least) education as an industry, and limited inter-governmental engagement about this issue within some countries."

In his analysis, Dr Birrell noted that the $15bn earnings figure for foreign students in Australia derived from a Bureau of Statistics release on international trade in educational services, and pointed to two problems with it.

First, in the accounting convention the bureau uses, it makes no adjustment for student earnings in Australia. Second, the information on which student earnings and expenditure in Australia is based is outdated. As a result, the overseas trade contribution from education services is probably a bit over $7bn rather than the $15bn-plus figure attributed to it.

Yet there are models used by other countries for preparing such estimates. The annual calculations by NAFSA -- the Association of International Educators -- in the US stand out as one model. For 2007-08, NAFSA estimated that the amount the 623,805 international students brought to support their education and stay in the US was $US15.54bn ($18.6bn).

Importantly, though, NAFSA's calculations exclude any US funding or employment the international students may be receiving. This effort to best represent the export dollars flowing into the US economy therefore provides a more accurate figure.

In Britain, a 2007 study by the Higher Education Policy Institute found the total economic contribution of international students was about pound stg. 3.74bn ($7.4bn) in 2004-05 with pound stg. 866million from European Union students and pound stg. 2.87bn from those outside the EU.

If the multiplier effect of international student spending is taken into account, the total impact of direct spending by international students in 2004-05 was pound stg. 5.5bn.

The policy institute said Britain's international student market outstripped the export value of alcoholic drinks (pound stg. 2.8bn in 2005), textiles (pound stg. 2.8bn), clothing (pound stg. 2.5bn), publishing (pound stg. 2.3bn) and cultural and media industries (pound stg. 3.7bn in 2006).

But the institute did not adjust its figures to take account of international student earnings while in Britain so the actual contribution was almost certainly markedly less than that estimated.

A 2008 study by Britain's NatWest Bank reported that 42 per cent of British undergraduates were in part-time term employment, earning a combined total of more than pound stg. 2bn.

As in Australia, however, international students in Britain are not permitted to work more than 20 hours a week during term time and are not normally required to pay British National Insurance contributions, so locating data as to their earnings is almost impossible.

In an article discussing the contribution students make to the New Zealand economy and published on the Global Higher Ed site, Adolf Stroomberge, chief economist of New Zealand financial forecaster Infometrics, describes just how difficult it is to calculate export earnings when foreign students are involved.

"Expenditure on tuition fees and living costs gives the direct impact on the country's gross domestic product," Stroomberge writes. "However, the net impact will be less than this as some of the foreign exchange earned by export education leaks out of the country as payment for imports of goods and services.

"Economic impact multipliers are used to estimate the direct and indirect consumption of imports of goods and services. Each dollar spent on the output of one industry leads to output increases in other industries, or to an increase in imports.

"For example, for a university to deliver education services to a foreign student it requires inputs of books, energy, communication services and so on. Part of the tuition fee is used to cover the cost of these items. Another part covers the cost of the buildings and equipment (spread over their useful lives) and there is a large portion for staff wages and salaries."

But, as Stroomberge says, the wider the attempted coverage of indirect and induced effects the greater is the potential for miscalculation and error.

The message then is that claims for massive earnings by selling education to foreigners need to be treated with caution.

Geoff Maslen is editor of the online newspaper University World News

(5) China to buy Australian coal mining company - subject to Foreign Investment Review Board

http://www.reuters.com/article/rbssCoal/idUSSYD36232920090813

UPDATE 2-China's Yanzhou Coal to buy Felix for $2.9bln
Thu Aug 13, 2009 6:55am EDT

Yanzhou agrees to buy Felix for $2.9 bln

By Denny Thomas

SYDNEY, Aug 13 (Reuters) - China's Yanzhou Coal Mining Co (1171.HK) agreed to buy Australian coal miner Felix Resources Ltd (FLX.AX) for $2.9 billion, both firms said on Thursday, further underscoring China's growing appetite for resources assets.

The deal comes amid strained investment ties between the two nations, with China formally arresting four staff from Anglo-Australian miner Rio Tinto (RIO.AX) this week on accusations they stole state secrets. [ID:nSP473911]

China's relentless pursuit of Australian resource companies is also despite the Australian government rejecting China's state-owned Minmetals bid for distressed miner OZ Minerals Ltd (OZL.AX) this year, forcing Minmetals to submit a revised bid.

Yanzhou's proposed takeover of Felix is subject to regulatory approvals in Australia, including from the Foreign Investment Review Board which vets all foreign sovereign investments.

"We recognise that the offer is subject to a range of regulatory and shareholder approvals in Australia and China and fully respect those processes," Yanzhou said in a statement.

"We will work constructively with authorities in both countries at all times, recognising the importance of this transaction and its potential to deliver significant employment and economic benefits," it added.

In June, Anglo-Australian Rio Tinto (RIO.AX) walked away from an agreed $19.5 billion tie-up with China's state-owned Chinalco, a decision that some Chinese critics blamed on Australian hostility to Chinese capital. [ID:nRIO]

Yanzhou's proposed takeover of Felix would be China's largest purchase in Australia.

China's No. 4 coal producer by market value is offering A$18.00 per share cash, including special dividends, a 6.5 percent premium to Felix's last traded price.

Some analysts had expected Yanzhou's bid to exceed A$20.00 per share as Felix is cash rich, unlike some of the distressed mining companies in Australia.

(6) Shell NZ may be sold to Hindustan Petroleum

From: Iskandar Masih <iskandar38@hotmail.com> Date: 15.07.2009 08:25 AM

Shell NZ ops sale to Indians?

Last updated 07:53 15/07/2009
 
Fairfax Media

http://www.stuff.co.nz/southland-times/business/national-business/2594901/Shell-NZ-ops-sale-to-Indians

The Shell oil company is looking at selling all of its petrol stations in New Zealand - and a stake in the Marsden Point refinery - and news reports say the buyer could be an Indian oil company.

"Hindustan Petroleum Corp (HPCL) appointed PricewaterhouseCoopers as its consultant for the (potential) deal last week," a senior HPCL executive told the Dow Jones newsagency, on condition that he was not named.

The executive said the plan is in initial stages: "It is too premature at this stage to talk about the issue," but the company's chairman, Arun Balakrishnan, rejected the report, which was carried in the Wall Street Journal.

Shell New Zealand Ltd appointed UBS AG in May to find a buyer for its entire downstream assets, apart from its 36 percent stake in construction and roadwork firm Fulton Hogan.

The assets on sale include Shell's 230 retail fuel stations, a marine business, commercial fuel and aviation operations as well as a 25 percent stake in Loyalty NZ. Shell's distribution network includes terminal facilities throughout New Zealand. They also include a 17 percent stake in New Zealand Refining Co's refinery at Marsden Point, which Shell shares with the local units of Chevron Corp., Exxon Mobil Corp. and BP Plc to provide about 70 percent of the nation's oil products.

Shell is also carrying out separate portfolio reviews of its refineries in Quebec - where it is considering closing its Montreal-East refinery - and in Germany.

Mehul Thanawala, vice president in charge of research at JM Financial Institutional Securities Pvt. Ltd in Mumbai, told Dow Jones that free-market pricing in countries outside India offered better returns on investment than than assets in India.

India deregulated gasoline and diesel pricing in 2002, but the government intervened again when international crude oil prices began rising, to keep down local fuel prices.

The state-run oil-marketing companies - Indian Oil Corp., Bharat Petroleum Corp. and HPCL - lose profits on sale of fuel products at government-mandated prices.

Another analyst, who asked not to be named, said HPCL could consider the acquisition as it could export oil products to New Zealand from its Vishakapatnam refinery in southern India. The company has already announced plans to double output at the 150,000-barrel-a-day facility.

"Both New Zealand and Fiji are geographically easier to approach from south India and HPCL may just consider exporting its products" to these countries, he added.

HPCL, which has more than 8300 retail outlets in India, has an agreement to manage the fuel-marketing business Fijian Holdings it acquired from BP in the southwest Pacific countries of Fiji, Tonga, American Samoa, Vanuatu, Tuvalu and Cook Islands, the newsagency said.

- NZPA ==

http://royaldutchshellplc.com/2009/07/14/hindustan-petroleum-mulls-plan-to-buy-shell-nz-assets-source/

Hindustan Petroleum Mulls Plan To Buy Shell NZ Assets-Source

Jul 14th, 2009

by John Donovan.

THE WALL STREET JOURNAL

July 14, 2009

By Sunil Raghu

Of DOW JONES NEWSWIRES

MUMBAI (Dow Jones)–Hindustan Petroleum Corp. Ltd. (500104.BY) is considering a plan to acquire most of the downstream assets of Royal Dutch Shell Group (RD) in New Zealand, said a person with direct knowledge of the matter.

"HPCL appointed PricewaterhouseCoopers as its consultant for the deal last week," the person, who didn't wish to be named, told Dow Jones Newswires recently.

A senior executive of HPCL, on condition of not being named, said also that the acquisition plan is in the initial stages.

"It is too premature at this stage to talk about the issue," he said.

HPCL Chairman Arun Balakrishnan, however, denied that the company is planning to acquire Shell's downstream assets in New Zealand.

Shell New Zealand Ltd., a unit of Royal Dutch Shell, had in May this year appointed UBS AG (UBS) to sell the bulk of its downstream assets.

-By Sunil Raghu, Dow Jones Newswires: +91-11-4356-3305; santanu.choudhury@dowjones.com