Aneela Nike Post: June 2021

Why does Pakistan need Kashmir?

The Kashmir bogey is Pakistan’s favorite pass time. Why does Pakistan need Kashmir? They very well know Kashmir doesn’t belong to them. Then why do they rake up the Kashmir issue over the years. It’s almost over seventy years now. A senior Indian diplomat said – Kashmir and hate India is a must not only for their existence but also for their survival. If not the country will collapse as it was founded mainly on religious ground.

Pakistan was created on the basis of religion, a Muslim state. The irony is India has more Muslims than Pakistan. And they try to project themselves as the leader of the Muslim world when no one really bothers about them. The country is already facing problems in different fronts. They are already facing an economic crisis. Instead of solving their internal problems, they talk of international issues affecting Muslims around the world.

Before I touch on the subject, let me narrate an interesting incident that happened a few years after Indian independence. I happened to come across this story some years ago. During a debate in the United Nations on Kashmir, the Indian delegate rose to speak. He said – Before I talk on the specific issue, let me tell you a story which has some bearing on the issue.

He spoke – As many of you must not be aware, Kashmir was named after a revered sage Kashyap. Many years ago, one day the sage was walking through the dense forest. He saw a pond with pristine water. The sage decided to swim and bath before performing the day’s rituals and meditation. He removed his robes, placed them on the ground near the pond and entered the pool. No sooner had he entered the pond, a person briskly walked towards the ground, picked up the robes and ran away. He was a Pakistani. Immediately the Pakistan delegate stood and blurted out – He can’t be a Pakistani. There was no Pakistan then. The Indian delegate smiled and responded – Exactly, there was no Pakistan then. There was India and Kashmir. There was laughter all around. Pakistan was already on the back foot.

But even though they know very well that they have nothing to prove that Kashmir belongs to them, somehow they come out with statements and make a fool of themselves on the international platforms.

Why Pakistan still likes to play the Kashmir card and why Pakistan is insistent to keep the Kashmir issue on the boil? It suits them. It plays a major role in Pakistan’s survival. They have an issue and have created an enemy, India. Pakistani masses are told Kashmiri Muslims are being tortured, raped and massacred by the Indian forces. And India will attack Pakistan anytime as they have still not accepted the existence of Pakistan. The Pakistan people are constantly fooled by this propaganda. The government plays on their emotions. The masses believe them.

The Kashmir issue and enmity with India helps the army and politicians in Pakistan. It suits the politicians for their survival by playing on the emotions of the people. By invoking the Kashmir cause and creating a fear in the minds of people that India will attack Pakistan, the army tries to convince the people, the army is their only hope and a savior. They play the victim card and try to cash in. And get funds from some foreign and Muslim countries. But now they stand exposed and the country is in a bad shape economically and politically.

During one of my trips to UAE, I happened to meet and talk to a few Pakistanis. In one of my interaction with a straight-forward and educated Pakistani, he stated, unlike India a large part of the population is illiterate. They get carried away by the speeches of the politicians, mullahs and the army. They just believe in what is spoken by them, without thinking or analyzing the facts. See in the last seventy years, harping on Kashmir, where has it has taken Pakistan, almost on the brink of collapse. And India has marched ahead in every field. The country is respected and Indians are in top positions worldwide, while we are known for terrorists. We feel very bad for our country and wonder what will happen to our children.

One may wonder why is Pakistan in a state of war with India just for Kashmir? What is the big deal about Kashmir? Actually Kashmir is an excuse. The Pakistan state and army will never want a solution to this issue. They need to keep this emotional pot boiling as it plays a major role in its existence. Any political leader, who tries to mend ties with India, is eased out.

Pak army is Punjabi dominated and they have the control. They feel they are big and powerful and can fight India though they have been defeated all the time. They oppose anything India does. Trying to bleed India with a thousand cuts is the central theme of Pakistan’s doctrine as a revenge for India breaking up Pakistan in 1971 and capturing 93,000 Pak Prisoners of War. Pakistan just can’t forget this defeat and insult. By doing so they don’t realize the repercussions internally and externally. Pakistan stands exposed for all the wrong doing.

Secondly, the only way Pakistanis can be kept together is not just by religion, but Kashmir. Nothing else matters. Health, education, poverty alleviation, infrastructure development, energy etc takes a back seat. It’s Kashmir. The Pak population has been brainwashed into believing Kashmir is pivotal without which Pakistan is incomplete. It has been drilled into the minds of Pakistanis that Kashmir belongs to Pakistan, is important for Pakistan’s very existence.

Thirdly, the Pak army doesn’t want this issue to be resolved. If it ever is, this will directly affect the fate of the Pak army and ISI. They owe their very existence to their enmity with India without which they would lose their exalted status in Pakistani society and the enormous power they wield in government, and be relegated to the background. Defence budgets would be slashed and new gizmos would be hard to come by. The Pak Generals would no longer be able to laugh all the way to the bank. Would they then like to lose the immense power they wield in Pak society and the government? Not in a million years!

So, this proxy war against India by Pakistan in Kashmir will continue. The Pak Army/ISI will keep trying to infiltrate their terrorists who are their low cost, strategic assets into Kashmir. Maximum they might be killed by the Indian forces, no one bothers. The Pak Army doesn’t have the wherewithal and guts to face the Indian Army directly and thus have outsourced this conflict to their proxies like the LeT and JeM who they have trained and armed since the past three decades to wage this proxy war against India on their behalf. They call it jihad.

These terrorists are trained and brainwashed to do the Pak Army’s bidding. This tactic hurts not the Pak Army but the poor, illiterate mercenary being sent across the borders as cannon fodder, while Hafiz Saeed, (a globally designated terrorist by the UN), leader of this pack of mercenary jihadi goons called the LeT, rants and raves against the Kafirs with the tacit understanding of the Pak Government. Apart from all this, another main reason could be water, which flows to the fertile fields of Pakistan’s Punjab. It is their life line. No wonder Pakistan has signed an Indus treaty with India.

Pakistan does not want Kashmir because they care for Kashmiri Muslims, they want Kashmir to secure their water supply. Pakistan's economy is hugely reliant on Indus river and its tributaries Jhelum, Setlej and Chenab. The cities and the population centres dependent upon this system are Islamabad, Hyderabad, Tatta, Quetta, Multan, etc. And to Pakistan's misfortune all these rivers originate in Kashmir which is in India, and India has initiated a number of hydroelectric projects on these rivers. Any normal person can guess, they serve more than just one purpose. And Pakistan is foxed by this development. Pakistan wants Kashmir's water, not Kashmir.

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Does RBI transfer surplus to the govt?
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The RBI had transferred Rs 57,128 crore to the government for the accounting year 2019-20. The year before, the RBI had, based on the Jalan Committee formula, transferred a record Rs 1.76 trillion, which included Rs 1.23 trillion as dividend and Rs 52,637 crore of excess provisions.

The Reserve Bank of India (RBI) planned to transfer 99,122 crore as surplus to the Centre for nine months ended March 31, 2021. The surplus is considerably higher than what the RBI has put forth in the last two years. According to the chief economist at ICRA, the funds will allow the Indian government to absorb the losses that it is likely to face due to the second wave of COVID-19.

In 2019, RBI transferred Rs 1,23,414 crore surplus to the government. As the manager of its finances, every year the RBI pays a dividend to the government to help with the finances from its surplus or profit.

The Reserve Bank of India (RBI) has approved a Rs 99,122-crore dividend payout to the government for an accounting period of nine months ended March 31, 2021 (July 2020-March 2021).

Short-Term Borrowing – RBI lends money for a short period of time, maximum being an overnight post which the banks buy back their securities deposited at a predetermined price. Collaterals & Securities RBI accepts collateral in the form of gold, bonds etc. The Reserve Bank acts as adviser to Government, whenever called upon to do so, on monetary and banking related matters. The Central Government and State Governments may make rules for the receipt, custody and disbursement of money from the consolidated fund, contingency fund, and public account.

Recently RBI approved Rs 99,122 crore as surplus to the Central government for a nine-month period from June 2020 to March 2021. But RBI isn’t a company that announces a dividend. Then how does it earn this surplus or profit? And how does it transfer surplus fund to the Central government?

Reserve Bank of India makes a profit by carrying out a number of operations and services. Its income also comes from the returns it earns on its foreign currency assets, deposits with other central banks, as well as its holdings of local rupee-denominate Government Bonds and Securities. Its expenditures are limited, is mainly incurred on the printing of currency notes, on staff salaries and on commissions to other banks.

RBI transfers this surplus, ie the excess of income over expenditure, to the government in accordance with section 47 of the Reserve Bank of India act, 1934. Reserve Bank of India is also exempted from paying income tax or any other tax, including wealth tax on these profits.

In February, Finance Minister Nirmala Sitharaman had projected Rs 53,511 crore as surplus from RBI. The actual amount is over 85% higher than the budget estimate. By and large, with a few exceptions, the quantum of surplus transfer averages around 0.5% of the GDP.

Earlier, the RBI transferred part of the surplus to the Contingency Fund and the Asset Development Fund. After the Malegam Committee’s recommendation in 2013-14, RBI’s transfer of surplus to the government as a percentage of gross income shot up to 99.9% from 53.40% in 2012-13.

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