Pesek on Asia: Bombs Hit India Campaign
Good morning. Here's my take on some of the stories driving the debate in politics, finance and social issues across Asia today:
Bombings shake India's election cycle
India's 2014 campaign process took a frightening turn Sunday when at least five people died and 50 were injured as seven bombs exploded in the city of Patna hours before Narendra Modi, a prime ministerial candidate, addressed a rally. Prime Minister Manmohan Singh appealed for calm and peace, but Sunday's violence could be a troubling harbinger of things to come as the world's biggest democracy heads to the polls in May. The next seven months could be excruciatingly long ones for investors.
South Korea is on an R&D roll
Perhaps President Park Geun Hye's pledge to build a "creative economy" is gaining some traction. Asia's fourth-biggest economy ranked second among Organization for Economic Cooperation and Development nations in research-and-development spending as a percentage of gross domestic product. At 4.03 percent, Korea was bested by Israel (4.38 percent), but pulled well ahead of Japan (3.39 percent), which came in fourth place after Finland (3.78 percent). These investments will raise Korea's game more than all the fiscal and monetary stimulus officials in Seoul can muster. Park would be wise to build on this early success.
Abe ups pressure on China
A year ago, as Xi Jinping was preparing to take the top job in China, he probably never expected to contend with a resurgent Japan. Even in December, when Shinzo Abe became prime minister again, Xi couldn't have fathomed an economically vibrant Japan emboldened to challenge China for leadership in Asia. Abe's comments over the weekend to Japan's military that "we will show our resolve as a nation, that changes in the status quo by force cannot be tolerated" were clearly aimed at Xi's China. On Sunday, Japan sent up fighter jets for a third day after Chinese aircraft flew between its southern islands. All this is a reminder that anyone who expects peace and tranquility in North Asia is dreaming.
Should the U.S. and Canada merge?
Here's a fascinating idea that's sure to have America's Tea Party enthusiasts reaching for their protest placards: the U.S. and Canada should join forces to take on China. Writing in the New York Post, author Diane Francis argued: "The United States and Canada could merge into one country, or follow a European Union model that eliminates the border without merging the two governments." While this mere suggestion will raise blood pressures in America's red states, not to mention red China, it's something for North American officials to chew over as China's influence soars.
In Thailand, peace between policy makers
Bangkok is gearing up for epic protests as lawmakers mull an amnesty bill that would pave the way for Thaksin Shinawatra, the former prime minister ousted in 2006, to return to a nation now ruled by his sister. As political tensions soar, it's heartening that Thailand's two main economic officials are finding common ground. Finance Minister Kittiratt Na-Ranong told Bloomberg News that he's now ready to accept higher-than-desirable interest rates favored by the central bank as long as the currency remains near current levels. The shift in tone marks a comforting ratcheting down of tensions. Well, at least on the economic front.
(William Pesek is a Bloomberg View columnist. Follow him on Twitter.)