Editorial Reviews
From Publishers Weekly
As the president of the Council on Foreign Relations, one of the country's most influential nongovernmental organizations and the publisher of the essential policy journal Foreign Affairs, Haass has an unique seat from which to weigh the direction of the U.S.'s relations with the rest of the world. In this book, he covers a lot of familiar territory: the collapse of the bipolar world, the advent of terrorism, the unprecedented possibilities for global political cooperation (that follow on the economic), the lessons to be drawn from the way the war in Iraq has been conducted. Haass ends up arguing not just that the U.S. has terrific opportunities to integrate itself politically with the rest of the world, but that it must do so-in order to preserve its economic integrity if nothing else. The final chapter, titled "The Necessity," argues that if that integration does not happen, "The principal challenges of this era...will come to overwhelm the United States." Coming as they do from a carefully calibrated source, those are sobering words.
Copyright © Reed Business Information, a division of Reed Elsevier Inc. All rights reserved. --This text refers to the Hardcover edition.

From The Washington Post's Book World/washingtonpost.com
Edward Luce, a keenly observant British journalist who headed the Financial Times's bureau in New Delhi at the cusp of the new century, ventures an answer in this insightful and engaging book. His sharp-witted prose brings today's India to life with insight and irreverence. ("If Gandhi had not been cremated," Luce writes, "he would be turning in his grave.") Luce's writing is richly evocative of place and mood, and In Spite of the Gods sparkles with the kind of telling detail that illuminates an anecdote and lifts it above mere reportage. Almost the only thing not worth admiring in this book is its awful title, which suggests a nation struggling against the heavens -- a thesis that has nothing to do with Luce's sophisticated and sympathetic narrative.
Advised early on that in India it is not enough to meet the "right people," Luce travels throughout the country meeting the "wrong people" as well. He explores economic development from the ground up while never losing sight of the big picture (a "modern and booming service sector in a sea of indifferent farmland"); he punctures the myths surrounding India's IT explosion (which he correctly argues will not solve India's fundamental employment problems because it employs only about 1 million of the country's 1.1 billion people); and he depicts the continuing allure of the secure and corruption-laden "government job." Few foreigners have written with as much understanding of the skills and limitations of India's senior government bureaucrats -- of their idealism and inefficiency, of the vested interests that impede growth and progress -- and Luce also captures the extraordinary triumphs of India despite these obstacles.

On my frequent visits home, I discover that India is anything but the unchanging land of cliche. The country is in the grips of dramatic transformations that amount to little short of a revolution -- in politics, economics, society and culture. In politics, the single-party governance of India's early decades has given way to an era of multiparty coalitions. In economics, India has leapt from protectionism to liberalization, albeit with the hesitancy of governments looking over their electoral shoulders. In caste and social relations, India has witnessed convulsive changes. And yet all this change and ferment, which would have rent a lesser country asunder, have been managed through an accommodative and pluralist democracy. Luce tells this story remarkably well.

There is, for instance, a gently sympathetic portrait of Sonia Gandhi, the Italian-born leader of the ruling Congress Party, for whom "the political is very personal." Luce, who is married to an Indian, clearly admires much of India's culture, such as its remarkable novelists, musicians and film-makers: "If world trade were to be conducted purely in cultural products," he writes, "then India would have a thumping annual surplus." He suggests an answer to the famous question of why so few of India's 140 million Muslims, unlike their neighbors in Pakistan, have joined jihadist groups: because of "the political system under which they live," which guarantees them "freedom of speech, expression, worship, and movement."

But Luce is a far from uncritical admirer. He is unsparing on the corruption that infests Indian politics and society, on the ersatz Westernization that has seen sonograms used to facilitate the abortion of female fetuses by parents wanting sons, on the "unimpressive politicians" who run India's "impressive democracy."

Still, no one speaks seriously anymore of the dangers of disintegration that, for years, India was said to be facing. Luce demonstrates that, for all its flaws, India's democratic experiment has worked. The country has seen linguistic clashes, inter-religious riots and sputtering separatism, but democracy has helped to defuse each of these. Even the explosive potential of caste division has been channeled through the ballot box. Most strikingly, the power of electoral numbers has given high office to the lowest of India's low. Who could have imagined that, after 3,000 years of caste discrimination, an "Untouchable" woman would become chief minister of India's most populous state? Yet that has happened twice and looks likely to happen again this year when the northern state of Uttar Pradesh goes to the polls. In 2004, India witnessed an event unprecedented in human history: A nation of more than 1 billion people, after the planet's largest exercise ever in free elections, saw a Catholic political leader (Sonia Gandhi) make way for a Sikh (Manmohan Singh) to be sworn in as prime minister by a Muslim (President Abdul Kalam) -- in a country that is 81 percent Hindu.

Luce is right to list the many problems the country faces: the poor quality of much of its political leadership, the rampant corruption, the criminalization of politics (more than 100 of the 552 members of Parliament's lower house have charges pending against them). The situation in Kashmir festers, provoking periodic crises with Pakistan and leading to fears (mostly exaggerated) of nuclear war on the subcontinent. Luce summarizes these issues crisply and cogently. But I'd like to have read a little more about the strengths of India's vibrant civil society: nongovernmental organizations actively defending human rights, promoting environmentalism, fighting injustice. The country's press is free, lively, irreverent, disdainful of sacred cows. India is the only country in the English-speaking world where the print media are expanding rather than contracting, even as the country supports the world's largest number of all-news TV channels. Disappointingly, Luce tells us nothing of this.

But these are cavils. Luce clearly loves the country he writes about -- an essential attribute for a book like this -- but he is tough-minded as well, and his judgment is invariably sound. "In India," a colleague once told Luce, "things are never as good or as bad as they seem." If you want to understand how that might be, read his wonderful book

Russia Redefines Itself and Its Relations with the West

By Dmitri Trenin
Washington Quarterly, Spring 2007
Russian foreign policy’s modern-day motives are completely dissimilar to those of the recent Soviet and the more distant czarist past. Where-as the empire was predominantly about Eurasian geopolitics and the Soviet Union promoted a global ideological as well as political project backed up by military power, Russia’s business is Russia itself. Seen from a different angle, Russia’s business is business. In stark contrast to its Soviet past, postimperial Russia stands among the least ideological countries around the world. Ideas hardly matter, whereas interests reign supreme. It is not surprising then that the worldview of Russian elites is focused on financial interests. Their practical deeds in fact declare “In capital we trust.” Values are secondary or tertiary issues, and even traditional military power is hardly appealing. Fluctuating energy prices, not nuclear warheads, are what really matter to Moscow.

Geopolitics is important primarily as it affects economic interests, but not as a guiding theory. Private and corporate interests are behind most of Moscow’s major policy decisions, as Russia is ruled by people who largely own it. Although the unofficial slogan says “What is good for Gazprom is good for Russia,” in reality “Russia” stands for a rather small group of people. These people have not inherited their power and property but fought hard to get where they are today. Not a single one among them is a public politician; practically everyone is a bureaucratic capitalist. Under President Vladimir Putin’s watch, the Russian state has turned into something like Russia Inc., with top Kremlin staffers and senior ministers sitting on the boards of various state-owned corporations and taking an active interest in their progress and profits. In a major conflict of interest, for example, between terminating gas subsidies to former Soviet republics and keeping them in Moscow’s political orbit, material interest wins. Russian leaders want to be and be seen as powerful and wealthy individually, but also as a group, which helps to achieve their individual goals.

Having survived in a ruthless domestic business and political environment, Russian leaders are well adjusted to rough competition and will take that mindset to the world stage. From their perspective, everyone can be a partner, from U.S. president George W. Bush to Hamas leader Khaled Meshal and from the Council of Europe’s rapporteur on Chechnya, Lord Frank Judd, to Iranian president Mahmoud Ahmadinejad. Equally, anyone can become an adversary, even Belarusian president Alexander Lukashenko. It’s nothing personal, it’s business.

This does not mean, however, that Russian leaders do not know the difference between the diverse parties with which they are dealing. Russian tycoons thrive primarily on the business they conduct with Europe and the United States, and they desire fast, personal integration with the West. Although some would take risky shortcuts to riches through China, Iran, or Venezuela, most probably keep their principal assets in the West instead of Asia or Russia. If things went sour at home, they would probably leave Moscow for London or Zurich, not Shanghai or Mumbai.

From Moscow’s perspective, Russian-Western relations are competitive but not antagonistic. Russia does not crave world domination, and its leaders do not dream of restoring the Soviet Union. They plan to rebuild Russia as a great power with a global reach, organized as a supercorporation. They are convinced that the only way to succeed is to get their way, and they are prepared to be ruthless. Virtually for the first time, Russia is turning into a homo economicus, and it is emerging as a major player in the highly sensitive field of energy. This naturally disturbs many Europeans and Americans.

This disturbance extends to political and strategic areas. Although Westerners usually reject moral equality between their countries and Russia, namely the “values gap,” Russians no longer recognize U.S. or European moral authority. Moscow is prepared to deal with its Western partners on the basis of interests or agree to disagree and compete where necessary. The principal underlying issue between Russia and the West at the start of the twenty-first century is the terms of engagement.

The View from Moscow

Ironically, at the beginning of the twentieth century the Soviets were fiercely ideological, and the West was essentially practical and pragmatic. Now, the Russians have transformed themselves into raw-and-ready capitalists, and the West is lecturing them on values. From the Russian perspective, there is no absolute freedom anywhere in the world, no perfect democracy, and no government that does not lie to its people. In essence, all are equal by virtue of sharing the same imperfections. Some are more powerful than others, how-ever, and that is what really counts.

Buoyed by high oil prices, Russian leaders are standing tall for the first time in almost two decades. Their level of self-confidence can only be compared to the early 1970s, when the Soviet Union achieved strategic nuclear parity with the United States and the United States suffered defeat in Vietnam. Once begging for loans, Russia has now paid off its debts. Russia is sovereign at last and fiercely independent, no longer a poor ward of the West, and on the way to becoming a power on par with others. For each concession the Russians are now asked to make, they will quote a price.

Power and property are inextricably linked in Russia itself, and Russian leaders, though primarily business oriented, are not oblivious to the political influence that comes with ownership or market dominance. They reason that economic dependencies lead to political dependencies, which result in privileges. The oil and gas business, they believe, is essentially political. For decades, Western oil companies were major political players in the Third World countries in which they operated. Since the 1973 oil boycott, decisions by the Organization of the Petroleum Exporting Countries have been essentially political. The Baku-Tbilisi-Ceyhan pipeline was a U.S.-driven political project, with the aim of bypassing Russia. Transit countries, such as Ukraine and Belarus, have used their critical geopolitics to win concessions from their Russian suppliers. The Russians thus make no apologies for being the principal purveyor of oil and gas to the Western markets. They see it as a strength that stands out among so many Russian weaknesses. They enjoy being an energy power.

Ironically, despite the geographical distance, Russia is in some ways more similar to the United States in its outlook and key characteristics than it is to the European Union. The United States is a nation-state, and postimperial Russia is on the way to becoming one. The role of religion is more prominent than it is in most EU states, although, needless to say, very different than it is in the United States. Russia shares a predilection and propensity toward using force in international disputes and certainly has a residual superpower mentality, now manifested in energy power. The role of money is preeminent, and social democracy is not a major force. Russia is becoming markedly individualistic, although in a very crude fashion. Given all of these characteristics, Russia will modernize and will become more Western, but it will not necessarily become European.

This means that Russia’s future foreign policy is likely to be global, assertive, and driven by the national interest as defined by the country’s elite. It will be couched in the universalist language of international law and moral values. It will not be tied to the United States or the EU. The idea will be to develop what many Russians believe is their nation’s unique capacity to understand different cultures and, if need be, mediate between them. Russia will seek to strengthen its relations with the leading countries of Asia as well as Latin America and continue to be at peace with the Muslim world.

Russia and Europe: Seeking Equality and Reciprocity

Russia’s long daydream about uniting with Europe is history. Soviet leader Mikhail Gorbachev’s idea of a “common European home” and other Russians’ more recent concept of a greater Europe are now regarded as conceptual flights of fancy. Old thinking about integration, which even included EU membership in some cases, has been shelved. The new talk is centered on sovereignty, with the United States as the role model and China as an object of admiration and envy. Present-day Russia wants a Europe without dividing lines: a pragmatic business proposition that assumes the essential equality of two partners.

Russia does not seek to dominate Europe, but it will exploit the EU’s various vulnerabilities at a tactical level. To capitalize on the EU’s internal divisions, Moscow prefers to deal with the EU’s members separately, rather than as a group. It will take advantage of its links to Germany, France, and other important countries such as Italy, Spain, Greece, and Portugal. Based primarily on strong business interests, these relationships are relatively stable, being subject to periodic corrections, such as the recent post-Schroeder “readjustment” of German-Russian relations, but are not in any real danger of sharp reversals. Relying on these productive ties, the Kremlin will work to offset the influence of the recent group of EU entrants, which includes some traditional Russia skeptics such as Poland and the Baltic states.

Having consigned central Europe, including the Balkans, to the EU sphere politically, Russia seeks to acquire assets there and in the Baltic states. Rather than a nostalgic move, this is a pragmatic decision to exploit opportunities where competition is still relatively light. At the same time, the Russians want to keep the post-Soviet neighborhood largely to themselves. From their perspective, NATO and EU enlargement should stop at the Commonwealth of Independent States’ doorstep. Gazprom’s sharp increase in gas prices in late 2005, leading to the cessation of supplies to Ukraine on New Year’s Day in 2006, was the ultimate coup de grace for the former Soviet Union. A similar move led to cutting off Belarus one year later. Moscow sent the message to its neighbors that there would be no special relations or subsidies anymore, even for political loyalists such as Armenia or Belarus. This is as much about geoeconomics as it is about geopolitics. Although the former Soviet states are now considered abroad, Russia still sees these neighbors as economic spaces in which it continues to enjoy some comparative advantages over third-party competitors.

Pipelines are essential to Russia’s policy of economic expansion. As Putin mentioned at a meeting with EU leaders in Lahti in October 2006, Europe relies on Russia for 44 percent of the natural gas it consumes, and 67 percent of Russia’s natural gas sales are to Europe. The EU will seek to lower its dependence on Russian gas, but pipeline projects that bypass Russia promise bitter rivalry. The underlying cause of the Kremlin’s ongoing spat with Georgia is Tbilisi’s Westward political orientation, which among other things would allow Western companies to build a pipeline to pump Caspian gas to Europe, bypassing Russia. In Turkmenistan, Russia and the West are already struggling over Turkmenistan’s vast natural-gas inheritance.

This energy interdependence will keep the EU-Russian relationship relatively stable in the medium to long term. In 2010 the North European gas pipeline, traveling under the Baltic Sea, will further link Russia and Germany. The development of the giant Shtokman gas field in the Arctic Sea will re-quire cooperation on an even larger scale, due to the massive requirements of expertise and advanced technology, and much of the gas from that project will be shipped to Europe. Russian leaders want to deepen this relationship through asset swaps. In return for allowing Europeans to acquire some of Russia’s upstream assets, Russians want a piece of the downstream distribution business in the EU. They see this as a fair trade and are prepared to bargain hard.

Russian companies will continue to seek lucrative assets in other industries as well, proceeding with initial public offerings in Europe, opening Russian businesses to Western buyers. In some sectors, such as the aircraft industry, Russian producers may enter into cooperative arrangements with European companies to acquire lucrative industrial assets. In particular, they have been eyeing the French-German aerospace company EADS, with which there has been some industrial cooperation since 2004. In 2006 a Russian state-owned bank bought five percent of EADS’s shares. Russian defense minister Sergei Ivanov, who as vice premier also oversees the defense and technology industries, subsequently singled out EADS as a possible future strategic partner in civilian aircraft production. Russians are angered but not deterred by the stiff competition they meet and will keep trying despite occasional setbacks, such as the recent failed bid by Severstal to merge with European steel manufacturer Arcelor.

Outside of government and business relations, European-Russian personal contacts will gradually increase to include ever more diverse interests of societal groups and individuals. Visa-free travel to the EU for ordinary Russians may be decades away, but Russian diplomatic passport holders, that is, the Russian elite, already have that access. Europe’s general attractiveness to Russians and its geographic proximity will lead to a gradual social rapprochement between the EU and Russia.

This process will hardly be smooth or easy. In the short term, the European media and publics will become even warier of Russia. The transfer of power in the Kremlin in the spring of 2008 or, as the case may be, the extension of Putin’s mandate is likely to be accompanied by events that will drive Russia’s image still further into the ground. Political assassinations, large-scale ethnic violence, and terrorist attacks would serve as a pretext for anyone trying to exploit isolation from the West and stir up turmoil at home to create an emergency situation in Russia that would freeze the existing power and property balance.

New members of the EU, particularly Poland and the Baltic states, will negatively affect the EU’s attitudes toward Russia. The recent signals from the deepening and widening of the EU are not particularly encouraging. In a dispute over its meat exports to Russia, Poland has succeeded in delaying the start of an EU-Russia negotiation, due in 2006, on a new overarching docu-ment to replace the Partnership and Cooperation Agreement. Along with the Baltic states, Poland is wary of the North European gas pipeline and is calling for an EU-wide energy security policy to oppose Russia’s domination. The current acrimony of Russian-Georgian relations and the uncertainties regarding Ukraine’s foreign policy orientation will also complicate the picture. True statesmanship on each side will be required to keep the relationship from hitting the rocks.

Russia and the United States: Damage Control

U.S.-Russian relations do not benefit from the same economic interconnectedness. With their interactions therefore based mostly on geopolitics, the United States and Russia are in unstable territory. The Kremlin has basically written off Washington as a partner in useful diplomatic business for the foreseeable future. Russian decisionmakers see the United States, with its Iraq turmoil, as distracted and disinterested. To the extent that they must deal with the United States, they view it mostly as a problem. The U.S. opinion on Russia is to an extent a mirror image. Most of the meager news about Russia in the United States is negative as well.

The U.S. and Russian foreign policy agendas are very different. Washing-ton’s agenda is currently dominated by Iraq, Islam, terrorism, and the proliferation of weapons of mass destruction. Russia puts the post-Soviet neighborhood front and center. In principle, these plans could complement each other and lead to a measure of productive interaction, but the ideological bent of the Bush administration on democracy promotion and the Kremlin’s domestic heavy-handedness and suspicion about democracy promotion prevent any chance of serious, long-term engagement.

The only positive goal the Russian government is currently pursuing with the United States is accession to the World Trade Organization (WTO), likely to be completed in 2007. Moscow recognizes that keeping the issue unresolved indefinitely would mean more problems later. Now that Georgia has recalled its signature from its bilateral WTO protocol with Russia to protest Moscow’s economic sanctions, Russian wants to avoid Ukraine acceding first and using its membership as a bargaining chip during gas talks. Yet, reaching agreement with the United States has turned out to be exceedingly difficult. Even signing the bilateral protocol in November 2006 is only a prologue to dealing with the Jackson-Vanik Amendment. This piece of U.S. legislation, passed in 1974, originally conditioned normal trading relations with the Soviet Union on Moscow permitting its Jewish citizens to emigrate. Although the original purpose of the amendment is no longer relevant, the legislation continues to block Russia from acquiring normal trading status in the United States.

Washington and Moscow conflict more directly on the issue of U.S. influence in the post-Soviet area. Russia is adamantly opposed to NATO membership for Ukraine, Georgia, and Azerbaijan. Capitalizing on Uzbekistan’s decision to remove the U.S. military presence there, Russia is trying to ease U.S. forces out of Central Asia altogether. Moscow has been somewhat relieved by the August 2006 election of Russia-friendly Ukrainian premier Viktor Yanukovych, who will counterbalance the pro-Western, liberal president Viktor Yushchenko. Obviously, the Russians would like to see President Mikhail Saakashvili’s government in Georgia replaced by some who would take Russian interests more seriously. Saakashvili, to many Russian leaders, is what Venezuelan president Hugo Chavez is to the United States. There is little, however, that the Kremlin can do about the Georgian president.

As a permanent member of the UN Security Council, Russia is an important factor in several areas of major significance to the United States. Moscow’s cooperation is a necessary part of any solution to the Iranian nuclear issue that is negotiated in the UN context. It is similarly vital to the North Korean problem, even though China is playing a leading role there. A common position of the five countries negotiating with Pyongyang, including Russia, is a sine qua non for North Korea taking the six-party talks seriously. Across the greater Middle East, with U.S. policies in Iraq, Afghanistan, and Lebanon and toward the Israeli-Palestinian dispute in crisis, Russia could be a useful partner. It keeps a presence in Central Asia and maintains contacts with the elements of the former Northern Alliance in Afghanistan, which opposed the Taliban for years and joined with the United States to end the Taliban’s rule in 2001. It has a long-standing relationship with Syria, having supplied arms to Damascus for two generations. It has useful contacts among the Palestinians and the Lebanese factions and a very vibrant relationship with Israel, approximately one-fifth of whose population is Russian-speaking. Despite the very different lenses through which the White House and the Kremlin view the war on terrorism, the core interests of each call for collaboration against Islamist extremists.

Russia could move somewhat on these top U.S. priorities, but it will not budge without a serious quid pro quo. Essentially, the Kremlin wants the United States to stop being a spoiler in the Russian neighborhood. Yet, even if the United States was willing to make certain concessions, Russian flexibility has its limits. Russian leaders will not subscribe to anything at the UN Security Council that would sanction the use of force against Iran. From the Russian perspective, a preventive war over Iran is worse than a nuclear Iran. They believe that a war would only delay Iran’s nuclear program, but at the price of a major regional crisis, political radicalization, and Muslim-Western confrontation. Looking at Iraq and Afghanistan, Russians are skeptical about U.S. staying power and its effectiveness. They suspect that the United States might try to disarm Iran, fail, and have to withdraw, leaving others in the neighborhood, including Russia, to inherit the mess. As Russian foreign minister Sergei Lavrov put it, Russia will not make the mistake it made in 1914 when it became involved in other peoples’ war (World War I) and lost everything.

With the U.S.-Russian economic anchor being essentially absent, political relations can and probably will become substantially worse. A crisis could arise over some provocation or miscalculation in Georgia or Ukraine, should the main Ukrainian factions resume their bitter internecine fight. A resumption of hostilities in Abkhazia or South Ossetia would draw Russia in, resulting in a Russian-Georgian military confrontation, with Tbilisi appealing to the United States and Europe for protection and support. A major political split within Ukraine could also put the territorial unity of the country in question, encouraging Russian irredentists to propose holding a referendum in overwhelmingly Russian-speaking Crimea. Russia is turning nationalist, with clear anti-U.S. overtones, while the U.S. public sees Russia in an increasingly negative light. The rhetoric of both countries’ 2008 presidential elections is likely to strain relations even further. During the U.S. campaign, Russia’s membership in the Group of Eight may become an issue; and in Russia, the United States can be cast as the one country that seeks to prevent the recovery and rise of Russia. If the legitimacy of the new Russian president is questioned, the dam-age could be truly severe.

Russian business, of course, is intensely interested in gaining access to the U.S. market and acquiring little bits of the United States. Future energy deals, including nuclear energy, and other business agreements could give the U.S.-Russian relationship context and stability. Gazprom, Rosatom, Russian Aluminium, Lukoil, and Rosneft all want to enter or to expand their U.S. presence, but the going is difficult. The Russians are impatient and often lack specific knowledge about the workings of the U.S. business and political environments, so they make mistakes and suffer setbacks. Gazprom’s 2006 decision to use Shtokman to supply piped gas to Europe rather than liquid natural gas to North America is in part a result of Russia’s disappointment over the de-sired acquisition of gas networks along the U.S. East Coast.

Russia’s Future with the West

Russian-Western relations are likely to be rocky for the foreseeable future, as they are separated by a value gap over several decades. Russia is very old Europe. It could be reminiscent of Germany in the 1920s, with its vibrancy and intense feeling of unfair treatment by others; France in the 1940s, when it was trying to heal its traumas; or Italy in the 1960s, as far as the nexus of power, money, and crime is concerned. Russia is not a democracy—not even a failed one—but it is a rough, capitalist reality powered by private interest, which sometimes poses as the state interest.

The future of Russia itself is key to any discussion of its future foreign relations. Will it actually be able to modernize, or will it fail again, collapsing once and for all? Will property and globalization, the two forces unleashed in the 20 years since the start of perestroika, be enough to put Russia on track? Will Russia succeed in using two decades of stability to build capitalism? The last time it tried, the Bolshevik Revolution cut the effort short in 1917, before even the first decade was out. It may or may not become a democracy, but this outcome will not be known until the mid–twenty-first century.

To the extent that Russian capitalism embraces the rule of law, constitutionalism, and eventually some form of democracy built on civic responsibility, this gap with the West will likely narrow, but the process will be very slow. Aside from a general preference for economic expansion over integration, Moscow is pursuing few long-term strategies. Tactics prevail, medium-term thinking is just emerging, and no national interest worth the name has surfaced. In Russia’s contemporary bureaucratic capital-ism, the state itself has been informally but effectively privatized and will take some time to coalesce.

Despite its transitional character, Russia is too important to be ignored, neglected, or stereotyped. The West will not only miss opportunities but may run real risks if it misjudges Russia’s movements, overreacting or reacting inappropriately to them as a result. Russia could be a party to a future U.S.-initiated exercise in global governance, or it could become isolationist and anti-American. The West would do best by dealing with Russia on Russia’s own terms, reaching for an acceptable balance of reciprocity, and not on the basis of normative principles such as democratic reform. Ideology is not a good guide in a valueless yet vibrant Russian environment. Public preaching only shows the powerlessness of EU and U.S. politicians to change realities within Russia and allows Russian officials to portray these protests, even meaningful ones, as meant for Western political consumption.

New realities and evolving interests may make Russia correct its trajectory in the long term. If some future Russian leadership were to decide in favor of economic and political integration with a body that is larger than Russia, it would have only one candidate: the EU. The EU must therefore consider its relations with Russia from a long-term perspective. For the EU, Russia is the immediate neighborhood and the ultimate frontier. In principle, Russia alone, not Africa or the Middle East, could give Europe strategic depth. Culturally, geographically, and historically European, Russia would project the EU all the way to the Pacific, strengthen the Europeans’ global outlook, and provide the EU with a range of resources and materially add to its power. This would enhance Europe’s overall competitiveness vis-?-vis other major players. Eventually, a pan-European energy system could emerge, or Russian companies could join the EU’s aerospace consortium as a substantial minority shareholder. Russians could even visit Paris and Berlin without visas. The resultant whole would be larger than the sum of its parts. This vision, however, has a caveat. A poor and failing Russia would never be a suitable party for the EU, but a rich and successful one would not find joining the EU particularly attractive.

The potential of U.S.-Russian relations can be realized if and when the United States makes a strategic decision to prioritize world leadership and integration, reaching out to the major players, including Russia, in an effort to consolidate the system over which it presides. By that time, the present Russian foreign policy philosophy would probably have had to change, toward more community-conscious behavior. This is not impossible, if the analogy with rough robber barons turning, usually in the next generation, into socially responsible capitalists holds true for nation-states. For those with a long view, a positive partnership is possible, even if difficult to see for quite some time.

Of course, Western countries should diversify their energy supplies, but they must be realistic about the extent to which this is possible. Turning energy into an area of power relations, such as by adding an energy dimension to NATO, is not a well-considered proposition. Outside of the energy sector, building defenses against the invasion of Russian capital is bad business and bad politics. Russia will not take over the EU or the United States, of course, but it could eventually become a responsible shareholder in the system, allowing Westerners to own pieces of Russia in an inevitable quid pro quo.

The main hope for both sets of relationships is more business ties. Essentially, this would mean more of the United States and Europe in Russia and more of Russia in the EU and the United States. This would create a more solid foundation for political relations, especially between the United States and Russia, a far better understanding of each party’s goals, and a convergence of interests. As capitalism in Russia continues to evolve and as the country, on the threshold of WTO membership, integrates further into the global web of economic, political, and social relationships, Russian standards can be expected to grow more modern and closer to the sets of values now espoused by Americans and western Europeans.

Dmitri Trenin is a senior associate at the Carnegie Endowment and director of studies at the Carnegie Moscow Center. This article originally appeared in the Washington Quarterly.

By Roula Khalaf in Dubai
Published: November 18 2007 14:17 | Last updated: November 18 2007 14:17
As the Islamic banking industry moves from a niche sector to the mainstream of global finance, the dearth of religious scholars with sufficient expertise to sign off on “Islamic” products and the lack of standard opinions are emerging as key bottlenecks.

The range of Islamic scholars who have expert knowledge of finance ranges from 50 to 260, depending on estimates. But most experts agree that a few dozen scholars essentially control the industry, sitting on many of the so-called Shariah boards, the bodies that banks and other institutions either employ internally or hire to judge whether products are interest-free and therefore comply with Islamic law.

“A number of institutions are being set up and transactions are raising multi billions of dollars but they are all chasing Shariah fatwas [religious edicts],” says Humayon Dar, chief executive officer of London-based BMB Islamic, an advisory firm.

A group of about 12 scholars are favoured by international banks that have rushed into the industry, and these religious experts are raking in millions of dollars in yearly income, say industry analysts.

“To sell products into the market, to give them credibility, you go to the tried and true guys whom everybody knows,” says Sheikh Yusuf Talal DeLorenzo, chief Shariah officer at DIFC-based Shariah Capital, and a leading expert on Islamic finance.

“There are 50 top Sharia scholars and hundreds of billions of dollars are decided by them,” says another industry expert who asked to remain anonymous. “It’s like having a whole industry with one regulator that has a staff of 50.”

The problem, he adds, is that “they are a bottleneck to the growth of the market. You can’t have enough discussions on products because they [the scholars] are spread very thin.”

Nasser al-Shaali, chief executive officer of the Dubai International Financial Centre Authority, says graduating Shariah scholars, who reach their status through religious rather than financial education, remains a challenge. The DIFC’s focus has been instead on graduating Shariah technicians, who work as analysts with the scholars.

Sheikh DeLorenzo, meanwhile, cites language and culture as barriers. “The English language is as important as Arabic, to read documentation and there’s also a cultural qualification,” he says. “Scholars often come from relatively closed environment so they need to be able to work in an environment with which they are not comfortable and to work to a deadline.”

The Islamic finance industry has always suffered from another basic dilemma - that a product or practice that may be acceptable to one scholar could be considered un-Islamic by another, sometimes within the same jurisdiction.

But as the industry expands – the market is now estimated at $750bn – the need for standardisation of fatwas is intensifying. Questions of conflict of interest have also been raised since scholars hired by banks to accredit new products give the institutions an edge vis-à-vis its competitors.

Malaysia is one of the few countries that has established a standard, government backed Shariah board. The Bahrain-based Accounting and Auditing Organisation for Islamic Financial Institutions has created its own group of religious experts to issue fatwas. But it remains a voluntary body, with some banks following its standards, and many others ignoring them.

Mr Dar argues that a centralised Shariah advisory board is an essential ingredient for the industry, and it should focus on issuing opinions, rather than signing off on every transactions conducted by banks.

Financial institutions, he says, should hire Shariah technicians who translate opinions into practice, acting in the same way as lawyers or accountants. Insisting that there is too much hype about remuneration of scholars and that most are, in fact, poorly paid, he says the scholars on advisory boards should receive a share of what the Shariah technicians make.

Copyright The Financial Times Limited 2007

November 23, 2007
Careers Give India’s Women New Independence

By SOMINI SENGUPTA
BANGALORE, India — Not long ago, an Indian woman, even a working Indian woman, would almost always have moved from her parents’ house to her husband’s. Perhaps her only freedom would be during college, when she might live on campus or take a room for a year or two at what is known here as the working women’s hostel.

That trajectory has begun to loosen, as a surging economy creates new jobs, prompts young professionals to leave home and live on their own and slowly, perhaps unwittingly, nudges a traditional society to accept new freedoms for women.

The new opening has hardly rubbed away old restrictions. As they wrestle with new uncertainties and new choices, many young Indian women are embracing the changes tentatively, tinkering for the time being with the customs of the past.

The changes are sharpest in the lives of women who have found a footing in the new economy and who are for the most part middle-class, college-educated professionals exploring jobs that simply did not exist a generation ago.

High-technology workers and fashion designers, aerobics instructors and radio D.J.’s, these women in their 20s are living independently for the first time, far from their families. Many are deferring marriage for a year or two, maybe more, while they make money and live lives that most of their mothers could not have dreamed of.

Bangalore, also known as Bengaluru, the capital of India’s technology and back-office business, is the epicenter of these changes. Once a quiet, leafy city favored by retirees, it now crawls with young people, with more than half of its 4.3 million residents under the age of 30, according to the 2001 census.

Posters advertise rooms for men and women living solo. Coffee bars are packed in the evenings. Vegetable vendors ply their wares late into the night.

So when Shubha Khaddar, 23, trudges home from work and stops to pick up something for dinner, she rarely finds herself alone. “You’ll find 10 other girls like you coming back with sabji,” Ms. Khaddar said, sabji being Hindi for vegetables.

As she left one recent morning for the public relations firm where she works, her parting words to Pallavi Maddala, 23, her roommate and a software engineer, were to bring back some idlis, or steamed rice cakes, for dinner. She would be home late. Besides, idlis would be a low-fat option.

Ms. Khaddar had been on a diet, partly egged on by her mother, who is trying to improve her marriage prospects from across the country, in Delhi. On the refrigerator, she had pasted a snarky yellow note to herself: “Lose Weight, You Fat Pig.”

In November, Ms. Khaddar gave notice at work, because she could no longer stand the job. She said she was stressed out at the prospect of finding nothing in Bangalore and having to return to life with her parents in Delhi. “I don’t think I’m prepared to go home,” she said.

Both women were trying to stave off their mothers’ intervention in the marriage department, though not entirely. Ms. Khaddar had been seeing someone but had yet to tell her parents, nor completely closed the door on her mother’s plans.

Ms. Maddala, for her part, welcomed the prospect of having a husband chosen for her but not now, and not the overseas Indians for whom her mother has an affinity.

Not long ago, Ms. Maddala showed Ms. Khaddar a photograph of one such prospect, a young man living in the United States. “The picture just freaked me out,” Ms. Khaddar recalled this morning, while getting herself ready for work. “I said, ‘Dude, you’re not getting married to that.’”

Ms. Maddala laughed at the memory. She agreed that he was too big and tall for her tastes. A couple of months later, another marriage prospect fell through because the young man’s family demanded a hefty dowry that gave Ms. Maddala pause.

More than anything, Ms. Maddala said, she wanted to savor her independence a bit longer. She moved here from Hyderabad, about 300 miles away, earlier this year. She described the lessons of freedom this way: “What is me? What is myself? How can I manage? We come here, we realize we are strong.”

“Confidence,” she went on. “As a woman nowadays, really it is a must.”

In this deeply traditional society, accustomed to absorbing influences of all kinds over the centuries, change comes slowly, if at all. And so the new economy, and the new lifestyle it has engendered, has hardly wiped away the old values, particularly with respect to marriage.

Public opinion polls in recent years routinely have revealed that young people, men and women both, still cling to ideas of virginity before marriage, and fairly large numbers say they prefer to marry within their own caste and community. The great big Indian wedding is bigger than ever. Dowry — and deaths at the hands of women’s in-laws who consider their dowries to be inadequate — prevails.

Yet, for women like these, freedom has brought new choices, new problems and as Ms. Khaddar puts it, new guilt.

Should she stay here and enjoy her independence for as long as she can? she sometimes asks herself. Or should she return home to Delhi, find a job, and allow her parents to fix a match with a young man from a north Indian Brahmin family like her own?

She is in transition, she said, between being “completely independent” and “a homely chick,” meaning, in Indian English, a life of domesticity.

Ms. Khaddar knows what her parents know, and it makes her nervous: that finding a match will be difficult for a woman like her, a student of philosophy, who thinks for herself, lives apart from her parents and likes classic rock.

A bigger fear, she confesses, is not being married at all.

“I’m torn about this whole independence thing,” Ms. Khaddar said.

Indian women are marrying later, though still relatively young compared with the West. The mean age of marriage inched to 18.3 in 2001 from 17.7 years in 1991, according to the census, and as late as 22.6 years for the college-educated.

Nearly a third of the work force is female, with rural women employed mostly in agriculture and urban women in services. Although their ranks are minuscule at the top rungs of corporate India, it is common to see women in jobs that either did not exist a generation ago, or in jobs that would rarely be filled by women, whether gas station attendants or cafe baristas, magazine editors or software programmers.

Every now and then, a high-profile crime against a woman prompts new hand-wringing and outcry over women working at night. But the young working woman living on her own is now firmly part of the urban mainstream.

Apartments are easier to rent, unlike when accommodations were limited to a room in the home of a nosy landlord who would cluck her teeth if a boyfriend spent the night, and radio talk shows feature callers talking about the pros and cons of a live-in boyfriend.

“I think it’s a very significant shift,” said Urvashi Butalia, publisher of Zubaan Books, based in New Delhi, which promotes women’s writing. “It signals a kind of change and acceptability. It testifies to women’s desire and wish to be economically independent, to be able to interact in public space and be in the same world as men.”

Equally important, she said, is the attitude adjustment among elders. “For families to accept that women will remain single, that they will live on their own, that they will work and defer marriage, is a very, very significant shift,” she said. “Even if it’s very small, it’s beginning to happen in a society where before, if you wanted to do that you’d be out on a limb.”

Ms. Butalia, 55, went out on that limb herself. Thirty years ago, she joined a New Delhi publishing house where she recalls being told that women were not welcome in executive positions because they inevitably married and quit. As it happened, she remained single, becoming one of the best known figures in Indian publishing.

Women in the younger generation, like Cauvery Cariappa, find themselves still bucking their elders on the subject of living alone. She broke the news to her parents after graduating from a Bangalore college in 2000 that she would not be returning home to Ooty, about 180 miles away. Instead, she would work and rent a place here.

“People will talk,” was her parents’ first reaction. They coaxed her to come home. Then they threw what she called “emotional tantrums.” Then they asked her to meet prospective husbands. She refused.

“The trend is once you’re 21, once you graduate, if you’re not doing something productive, you get married,” she said. “‘Productive’ according to your parents is very different from your own terms. For them, back then, it was a doctor or some other known job.”

Ms. Cariappa, now 28, went through a gamut of jobs, all of them fruits of the new economy: first at an advertising agency, then a call center, a bank, and finally she decided she would try her hand at designing clothes.

The apartment she shares now with two roommates is mostly bare, with a shelf loaded with shoes in one corner, cushions on the floor, and empty liquor bottles lined up smartly on a ledge, which made her mother gasp on her first visit. Ms. Cariappa said she assured her they had not all been consumed in one go.

Here, her boyfriend can come and go without anyone asking questions. She can go out with friends. For safety, she carries mouth spray as a substitute for mace. One of her roommates carries a long dog chain, which she once had to use to repel a man.

“I get to live how I want,” she said. “There’s nobody telling me I can’t.”

But after fighting so hard for her independence, even she could not resist the pull of tradition. In November, Ms. Cariappa announced that her freewheeling days were coming to an end.

She and her boyfriend of seven years had decided to marry. That, too, was a break with her family’s tradition, because he is from another community, from another part of the country.

She would soon move out of the apartment. “Yeah, eventually most of us get there!” she said in a text message. “The same thing’s happened 2 my roomie, hence the msg. R u or any of your friends looking 4 a place 2 stay?”