CWI 10th World Congress: Asia

"Social, economic and political crises are developing throughout Asia. They underline the vital importance of the CWI’s ideas and programme and the urgent task of developing the cadres for building future mass revolutionary parties."

This document on Asia is one of the resolutions from the CWI’s 10th World Congress. Documents were agreed on World Relations, Europe, Latin America, the Middle East, Asia, Russia and Eastern Europe, and on the situation in Africa.

The Asia-Pacific is a vast area of the world with more than half the world’s population distributed across a number of regions and sub-regions. It includes the ‘emerging’ economies of India and China and also the ’advanced’ capitalist countries of Australia and Japan.

The worst world economic recession downturn for decades has affected the countries in the region differently. Several have been badly hit, at least initially, by shrinking demand in the markets of Europe and the US. Most have so far not seen big drops in GDP but the full impact may yet to be felt. The governments of the region remain fearful of the kind of economic and social crises that followed the Asian financial crash of 1997.

The ’Asian’ crisis of that year entailed major economic and political crises in a number of countries. Huge sums were poured in by the IMF to restore monetary ‘stability’ and safe guard the financial interests of US, Japanese and other creditors in Thailand, South Korea, Indonesia and the Philippines. The IMF intervention was conditioned with attacks against the working class and poor which resulted in widespread hatred and opposition to the IMF by the masses. South Korea had already experienced ’the first-ever general strike against neo-liberalism’ when it announced a programme of deregulation on December 24, 1996. The following year, a mass movement in Indonesia toppled the dictatorship of Suharto. A similar ’reformasi’ movement developed in Malaysia, in spite of the protectionist measures taken by former prime minister, Mahathir Mohammad, much to the chagrin of the international capitalist class.

Trying to avoid the pitfalls that led to the 1997 crisis, many of Asia’s capitalist countries accumulated capital reserves. GDP growth rates have been only slightly punctured in most Asian countries.

Some economies in the region have been more badly hit than others. South Korea, an export-led economy and number 15 in the world, went into ’negative growth’ last year as a direct result of the slow-down in world trade. It has picked up since then but to a growth of just over 2% per annum. The devastating floods in Pakistan have halved the growth rate in its already weak economy – from 4% to approximately 2%.

Singapore, the biggest container port in the world, saw a drop of around 12% in its GDP at the end of 2008, and then began to recover. The 20% drop in the third quarter this year is seen in itself as a sign of an impending double dip world-wide. The economies of Thailand and Taiwan also went into negative figures and rebounded. The feverish ups and downs of some of Asia’s economies are symptomatic of unstable economic situations which can shake governments in the region. Indonesia swung sharply from nearly 4% growth at the end of 2008 to nearly 4% contraction at the beginning of 2009.

Most economies are reporting rapid, even unprecedented growth rates this year, although these are from the low base of 2009. Led by China and India with forecast growth of 10% and 9.4% respectively, according to IMF and World Bank estimates, even politically fractured Thailand and the Philippines are on course for 7%. Singapore’s economy was set to expand at around 13% this year. South Korea, Malaysia and Indonesia are now on course for growth of 5-6%.

An additional factor behind Asia’s current economic expansion is the tsunami of speculative ‘hot money’ fleeing the sinking dollar, as it is driven down by the ‘quantitive easing’and zero interest rate policy of the Obama administration. Speculators – i.e. major banks and financial institutions such as hedge funds – are borrowing at next to no cost in dollars to buy every form of Asian asset including bonds, stocks, commodities and property. This is pushing up regional currencies from the Australian dollar to the Thai baht (both up against the US dollar by 11% this year) thereby exacerbating the worldwide ‘currency war’. At the same time, the inward rush of ‘hot money’ into Asian economies is inflating gigantic financial bubbles that will very likely burst in the period ahead.

China’s economy is heavily geared towards exports to Europe and the US with whom it has massive trade surpluses. It has seen a certain dip in GDP expansion as trade has declined. But the massive stimulus package of 4 trillion renminbi (US$ 586 billion) last year, with its huge infrastructure projects, created some domestic demand. The wave of hugely significant strikes earlier this year also led to some substantial wage rises in parts of the manufacturing sector, although many workers complain that even these increases are rapidly being eroded by inflation.

So far the fundamental imbalance between China’s investment and consumption has not been corrected by the regime’s policy of the past two years. China’s unprecedented stimulus measures and credit expansion, while so far cushioning the economy from the effects of the global crisis, have failed to lay the basis for any lasting economic stability. In fact, these policies have helped to generate a huge bubble in the property sector, surging inflation, and an increasingly serious debt problem for local governments which were the main channel for the regime’s stimulus and infrastructure measures. These problems pose a threat to the continued rapid growth of the economy, while run-away food and house prices can also become a focus for mass discontent.

Japan, has failed to get out of its two decades of stagnation despite massive attempts at pump-priming, minimal interest rates etc. Recently, the government ordered the central bank to intervene against speculation which was forcing up the yen. Later, in October, $60 billion was put in to the economy as a further attempt to boost jobs, growth and spending.

As in Europe and the USA, liquidity does not lead automatically to investment if there is uncertainty about returns on capital. Markets are vital. Shrinking export opportunities will impact on even the strongest Asian economies and may yet turn out to be the Achilles heel of the Chinese economy. The international campaign to get China to strengthen the renminbi is being ferociously resisted by the Chinese regime. To avoid a clash they may concede small revaluations. A major contraction in the economy and the growth of unemployment and poverty can spell a new outbreak of revolt…this time political and threatening the very survival of the ’Communist’, one-party dictatorship. Because of the effect of China’s growing economy on keeping other economies in the region moving forward, if it slows down, they will also suffer grave economic and social effects.

The currency clash comparable to a small “war” – that could escalate – is an attempt of the major powers involved to unload the cost of the crisis onto other shoulders. Potentially this could lead to a minor Smoot Hawley – or a ’beg o’ my neighbour’ situation between the US dollar, the yen and the renminbi and affecting all the major economies of the world. China has warned the US it is not prepared to go down the road of Japan in the ’80s when the Plaza Accord led to the revaluation of its currency and more than two ’lost decades’ from which that country has still not recovered. China has warned the US that if they are forced into a significant revaluation, it could halt its massive growth and have world-wide economic repercussions.

The US is faced with a huge trade deficit and pressures from Congress for protectionist action to be taken. This situation could result in further exacerbation of this trade war and reinforce the recessionary-depressionary tendencies in the world that could plunge the Asia-Pacific region into the same kind of recession.

A number of attempts have been made over the years to form a regional block of Asian nations like the European Union. But this process is even more complicated and riven with national rivalries than in Europe. A power struggle is underway between the giants of US imperialism, China, Japan and India for domination within the region. An Asian economic block is the idea of the ruling elites in the region to overcome the limitations of the national markets and create a wider base for their own multi-nationals to compete with US and European capitalists, while at the same time speeding up the ‘race to the bottom’ in relation to workers’ rights, wages and job security. But the developing capitalist crisis will deepen national contradictions, shattering the idea of ‘harmonious’ capitalist integration.

Permanent crisis for workers and poor

Even apparently healthy figures for overall growth in GDP do not tell the whole story. In many of Asia’s countries, the mass of the population has experienced no benefit. In fact they have slid further and further down the global scales of income, employment, health, nutrition and housing. Corruption is rife, press freedom rare. Even the so-called democracies, including India and Malaysia, use anti-terrorist and other repressive laws to suppress opposition and the workers’ movement.

The fact that the economies of many Asian countries have continued to grow belies the fact that within every one of them the gap between rich and poor is widening. This is a world-wide phenomenon, but Asia has nearly 75% of the people in the world who are living below subsistence levels.

The ’natural’ disaster of the floods in Pakistan, brought on by the dam-building and short-sighted irrigation schemes, has left yet more tens of millions struggling for survival. Prices have been jacked up by shortages and speculation. Strikes at a time of national emergency, felt by all, indicate the desperation of organised workers, as well as their determination not to pay for the social or economic crisis in their country.

In India, inflation is the worst in any of the ’Group of 20’ nations. It lies behind the opposition parties’ opposition organised bandh (stoppage) in July of this year and the massive 100 million strong general strike in September – ten times the turn-out on other occasions. The mighty Indian working class moving into action, is the key to the transformation of the lives of over a billion people.

There are more poor in six Indian states than in the whole of Sub-Saharan Africa and only a small layer in society has benefitted from the long-vaunted ’Shining’ in India as a whole. No more than 10% – middle class and qualified workers – have seen their lives improve. They have provided a market for some goods, but at the other end of the scale, subsistence farmers descend into despair. In the past decade 163,000 farmers across India, unable to sustain their families, have committed suicide.

Where the CWI is

Stable growth rates by no means guarantee political stability and a deterioration will see deep-seated resentments expressed in mass revolt across the region. The opportunities for building the CWI in Asia are already great and will grow as the economic and social crises grow greater. We have made important steps forward in, Hong Kong and Taiwan. In South Asia and South East Asia our forces are concentrated in four countries – Sri Lanka, India, Malaysia and Pakistan.

The rate of expansion of the Chinese economy is still phenomenal. This is because of the unique development and character of the present regime which combines an important capitalist sector with significant sections of the previous state-dominated economy remaining. What remains of the state and the economic capacity to intervene has been the major factor in China so far escaping the full effects of the world crisis. However, the economic bubbles in property, banking and other sectors could bring this to a juddering halt. This would have devastating repercussions for global capitalism. It would end the ‘special’ situation in Asia, where many economies have been buoyed by the demands of China’s economy. It would have an immediate effect on China’s ability to expand in other continents (South America, Africa) and would have big repercussions on the stability of the already fearful Chinese regime.

Within China, the Chinese ’Communist’ Party continues to ride a tiger. Even with the economy going forward, national and social tensions have intensified. Workers can feel justified in demanding a share of the increased GDP. If the economy slows down, it will become impossible to prevent revolt from below. Harsh sentences and ruthless repression against ’dissidents’, including the liberal Nobel Prize winner, Liu Xiaobo and pan-left wing and trade unionists are carried out by the current regime, although the latter receive almost no international attention from the capitalist governments or media. The denial of media freedom and constant attempts to block internet communication indicate the fear of the regime.

The biggest threat has come from the courageous strike action taken earlier this year in the foreign-owned car and other factories. Attempts to get genuine elected representatives in the workplaces and independent unions will continue and spread to Chinese and state-owned enterprises. Sooner or later, the state will be forced to make concessions or face a mass revolt…or both! The regime was unable to suppress news of the slave-labour conditions at Foxconn which was causing an epidemic of suicides. It will not be able to hide the revolt that develops, at first in sporadic movements and then in a more generalised fashion.

The vengeance of the masses after decades of suppressed aspirations and deprivations in the name of ’socialism’ and ’progress’ will be unforgiving. The political shape it will take is as yet unclear. The regime attempts to manipulate nationalist outrage against Japan and other foreign powers while it fears that ‘patriotic’ demonstrations on the streets can turn against them, as they have done in the past. Beijing is also making political capital from the growing clamour of Taiwan’s ruling class for closer integration. At the same time, Beijing’s courting of the Kuomintang government in Taiwan is a double-edged sword, increasing the party’s stature and popularity inside China, where it could in future become a vehicle for an anti-government sentiment.

The Beijing regime fears the fallout inside China from growing political radicalisation in Hong Kong, and impatience over the lack of progress in abolishing the undemocratic colonial political system. In Taiwan too, Beijing fears the emergence of a genuine alternative or mass challenge to the Kuomintang, which it sees as an ally in ‘managing’ the Taiwan issue. The, in words, pro-independence DDP does not fundamentally challenge the policies of the Kuomintang. Under pressure from the capitalists not even the DPP leaders see any alternative to closer economic ties with China, while they cannot admit this too openjly. The fight for socialist change in China and throughout the region has to be accompanied by a struggle for basic democratic rights as well as a clear programme on the national question.

China has huge investments across most Asian countries. Its relationship with them, unlike with the US and Europe, is as a net importer – sucking in the raw materials and components vital for its still expanding, export-driven economy. Its political and military influence grows in parallel with its economic power.

China is India’s biggest trading partner with $60 billion worth of bilateral trade. But it is also a rival for Foreign Direct Investment, which has been falling in both countries in the recent period. India has a population nearly the size of China but an economy with little over a quarter its weight. Both are nuclear powers vying for political influence in Asia and the rest of the world. They have two of the world’s biggest armies, with almost four million troops between them.

Sri Lanka

As we have noted in our published material, India as well as China, played a decisive role in the bloody ending of the 26-year long civil war in Sri Lanka and consolidating the Rajapakse regime which could consequently manage without either the financial, military or political support of western imperialist powers.

India already owned a large part of Sri Lanka’s tea plantations. It has captured the market for cars, motor-bikes and three-wheelers. It has invested in the Tamil-speaking North where it is re-building the railway, developing an airport, building 50,000 houses and also a 500MW power plant inside a Special Economic Zone. It has imported 30,000 Indian workers to carry out the construction work.

China was Sri Lanka’s biggest source of foreign funding last year with $1.2 billion. To build its mega-port at Hambantota, it has imported its own raw materials and what amounts to a slave labour force of 20,000 Chinese, mostly convicts. While these investments fuel a GDP growth in Sri Lanka of on or around 6% per annum, it also fuels inflation and provides few additional jobs for Sri Lanka’s working class.

After the bloody defeat of the LTTE over a year ago, the Tamil people in the North and East are still living in atrocious conditions. Many are homeless and jobless. The Rajapakse government, leaning on ex-Tiger supporters, and even leaders, and bolstered by Indian involvement in the North, is swamping the Tamil homeland with Sinhala soldiers and settlers. In southern India – Tamil Nadu – there is still a burning resentment about the fate of the Tamil-speaking people in Sri Lanka.

As we have always maintained, if the national aspirations of the Tamil-speaking people in Sri Lanka are not fulfilled, the present sullen acceptance of their fate will eventually give way to a new upsurge of resistance, especially amongst the youth. But that is not the immediate perspective. The substantial vote for non-governmental parties in the April elections this year were a small reflection of the resentment that can flare up in the future. Rajapakse’s decision, “to put the consolidation of his family’s power ahead of a sorely needed national reconciliation with an aggrieved Tamil minority, is a decision Sri Lanka will repent at leisure”. (Economist, 11 September 2010).

On a capitalist basis there is no solution to the national question in Sri Lanka. It is a challenge to our small forces, with the assistance of the International, to build points of support in the Tamil North and to rebuild our depleted forces in the South.

The CWI has long described the Rajapakse regime as a ’veiled dictatorship’ or one with a fig-leaf of democracy. The ending of the war has seen not an easing but an intensification of the dictatorship. There are now more armed personnel on the streets of the capital than during the long years of civil war. The main opposition contender in the presidential elections, Fonseka, remains under arrest, facing enough charges to keep him locked away for the rest of his life.

The ’Eighteenth Amendment’ to the country’s constitution was rushed through parliament on September 8 – a ’black day’ for Sri Lankan democracy, marked by demonstrations on the part of all the country’s opposition forces including, separately, the Sinhala-based JVP which was earlier in coalition with the ruling Sri Lanka Freedom Party. The JVP, still claiming to be Marxist but opposed to self-determination for the Tamil-speaking people, has lessened its Sinhala communal propaganda in an attempt to gather Tamil support – arguing that the LTTE did not win anything for them.

The main capitalist opposition United National Party is going through a major internal crisis at present. In the opposition movement which has developed it is offering no hope of a way out. In the vote on the eighteenth amendment in parliament it only abstained. Enough opposition parliamentarians voted with the government, either for money or personal advancement, to get it passed. Even the leaders of the rump left workers’ parties voted for it – against the decisions of their own Central Committees.

The amendment, allowing Mahinda Rajapakse to stand for president as many times as he likes, received the necessary two thirds majority but was not, as previously required by law, put to a referendum. Judges, clearly under the sway of the president, ruled it was not necessary. This amendment gives the president power over no less than 90 institutions and final authority over all appointments to the civil service, the judiciary and the police.

Rajapakse means literally ’the King Party’! With his brothers and other relatives firmly installed in power, Mahinda issued orders to clear more than 60,000 of the poorest people from the capital city, Colombo. They are being dumped in the countryside with no means of subsistence. This is a kind of social cleansing.

Since the Rajapakse government came to power, the biggest protest that has taken place was in Colombo in October against the imprisonment of opposition presidential candidate, former army general Sarath Fonseka. More than 10,000 people demonstrated and walked to Colombo main prison where Fonseka is being held. Fonseka was sentenced not by a normal court in Sri Lanka but by a special court martial appointed by president Rajapakse.

University students have come out in a fearless campaign against the introduction of private universities by the regime. Rajapakse has launched an all out war against the student movement using the police. Students have been arrested and hundreds suspended from the universities. In this situation a joint opposition has been set up – an action front to fight against the Rajapaksa government’s military police dictatorship and defend the democratic rights of workers and students.

With prices still rocketing, with jobs failing to materialise and wages held down, sooner or later, the working class of Sri Lanka will come back onto the offensive. Only a mass movement can now bring down this dictatorship. Our United Socialist Party has been through one of the most difficult periods of its existence – weakened in numbers but as strong as ever in political ideas and combativity and unsullied in its reputation for defending the rights of all workers and poor.


In Pakistan, the worst floods in living memory have exposed all that is rotten in the Zardari government. In a country of 170 million people, 40% are now below the poverty line. Inflation has rocketed to an average 20% but much higher on basic necessities. Eight million people at least are now totally dependent on hand-outs for survival. The economy has gone from 4% to zero growth and overall this year could fall by at least 2%.

Agriculture, in Asia’s third-largest grower of wheat and the fourth biggest producer of cotton, may decline by 20 to 30%. It accounts for over 21% of GDP employing nearly half of the country’s labour force. According to a former finance minister and top official of the World Bank, Shahid Javid Burki, Pakistan today is South Asia’s “sickest” economy and will remain that way unless the policy makers move decisively.

The Financial Times in September wrote that, “Foreboding has intensified over the prospect of an impending military coup, a bloody revolution and parts of the country spinning out of control.” The CWI has long pointed to an increased “Talibanisation” of the country. If the working class does not emerge as the main fighting force in Pakistan, there is a very real prospect of implosion and break-up of the country.

In a poll taken just before the Indus overflowed its banks, 95% of Pakistanis said that feudalism should be smashed. Seeing the way these super-rich landowners and politicians behaved during the flood crisis, very angry, revolutionary moods can and will develop again. Revolt can be further inflamed by the actions of the US military in relation to Afghanistan and of the Indian Army in attempting to crush the revolt in Kashmir.

Recent developments in Pakistan have shown that the weak capitalist regime is incapable of getting rid of feudal and pre-feudal relations there. The abject failure of the PPP government to organise effective relief for the 20 million people affected by the devastating floods has stored up new resentments and anger against it. It blatantly came to the aid of major land-owners while its leader, president Zardari, was relaxing at his Chateau in France.

The main opposition Pakistan Muslim League (N) of Nawaz Sharif has so far failed to offer any alternative or mobilise discontent against Zardari and the PPP during this crisis. Where religious charities step in with aid, they can win support amongst a population not generally attracted by their reactionary philosophies.

The Army, under Ashfaq Kayani, standing aside from politics since the departure of the Musharraf dictatorship more than two years ago, has also stepped in to give relatively efficient disaster relief. No one on the ground or abroad trusts the government to distribute aid given from within or outside the country.

The demand for non-payment of the $10bn IMF loan forms part of the massive propaganda campaign conducted by our section in Pakistan along with the demand for the debts of all small farmers and poor people to be annulled. It has been relayed in Europe through the parliamentary interventions of Joe Higgins, MEP. The CWI comrades of the SMP have carried out heroic work in the battle to give practical assistance to trade unionists and activists hit by the disaster. They have also organised support for a number of important strikes continuing in this desperate situation and put forward a fighting programme to bring down the Zardari government.

The army has been the real ultimate power in Pakistan throughout the 63 years since independence and directly ruling for half of that time. This is because of the basic unviability of the state since its construction. Although the present situation in Pakistan is desperate, the assumption of power by a military regime would not find favour with imperialism in the current international situation in which it would have difficulty justifying to world and domestic opinion support for dictatorial and semi-dictatorial regimes. The continuing crisis in Pakistan means that an attempt at military intervention, while probably not an immediate prospect, cannot be precluded. If it happens, however, imperialism would, of course, reluctantly acquiesce.

The devastation wrought by the floods will take years, if not decades, to overcome on the basis of the rotten feudal-capitalist system in Pakistan. Public ownership and socialist planning are put squarely on the agenda to take society forward. A further Talibanisation of the country, more bombs and bullets, a collapse of central authority, barbarism and a break up of the country are the grim alternative.

The CWI comrades in Pakistan have earned the greatest respect of the workers’ movement in the country and of the International in the heroic work it has carried out. They have reached hundreds of activists and trade unionists whose lives have been ruined in the floods. They have also continued with great energy and determination to build the forces of the Socialist Movement Pakistan and the Progressive Workers’ Federation.


In Bangladesh, important developments have recently taken place and there are opportunities for building the CWI. Half the population lives in absolute poverty, on less than $40 a month. The ferocity of the recent clashes between striking garment-workers and the police is explained by the constant threat to their jobs from other, even lower-waged, economies in the region. (But in Laos and Cambodia, workers struck for higher wages following the example of workers in China’s foreign-owned firms).

Bangladesh is under pressure from US imperialism to play its part in the “war on terror” by sending troops to Afghanistan. The government has recently removed all Islamic articles from the constitution and banned Islamic fundamentalist books from libraries. The Supreme Court has also banned the “enforced” wearing of the veil. The role of women workers in the strike of 800,000 textile workers in 700 factories was particularly significant. At the same time the government has deployed the army to repress the port workers who were on strike in October 2010. For the first time since the new government came to power the right-wing opposition has been able to organise a “shutter down strike” (business stoppage). These significant developments reveal the explosive situation opening up in Bangladesh.

At the top, there is constant rivalry between two parties, whose differences on policy are hardly discernible and they have no solutions to the urgent problems facing workers and their families. Their frustration can quickly turn to anger and unrest that can begin to take on a revolutionary character.


Economic growth in India, has fallen back slightly, but remains at 8.5 – 9%. Certain layers of skilled workers have benefitted and seen their living standards rise…especially those in IT and back-room services for companies based in the US and Europe. This has had an effect on their consciousness, but the effects of the world recession are already being felt by these layers.

After the abandonment of the decades-long policy of self-sufficiency in the late 1990s, national and state politicians (of all hues) have looked to multi-national companies to develop the Indian economy, not without personal benefit to themselves. Bribery and corruption is rife, not least in the Communist Party of India (Marxist) – in power in West Bengal, Kerala and tiny Tripura – at least until the next round of voting!

They have given the green light to vast companies like the Korean-based steel company, POSCO, the bauxite-mining giant Vedanta and Indonesia’s biggest conglomerate, the Salim Group in West Bengal to move in and destroy the homes and livelihoods of tens of thousands of poor farmers and Adivasis (indigenous peoples). They have destroyed forests and even mountains in the scramble for raw materials.

In many cases, the Maoists (or ’Naxalites’) step in to try and get support. They have made important inroads into 200 of India’s 626 districts compared with 56 in 2001. They attack rich landlords and the police but when they de-rail passenger trains and ordinary working and poor people are killed, they inevitably alienate the people whose rights they claim to champion. Such tactics also give the state an excuse to introduce special powers to deal with the ’insurgency’. In Chattisgarh, Jharkand, Orissa and West Bengal, thousands of police have been involved in an offensive against the ’insurgents’ – ‘Operation Green Hunt’ – which often sees ordinary civilians killed and injured.

A conscious linking of the struggle in the country-side to that of the working-class of India’s massive cities could provide an unstoppable force capable of transforming society, but that is not the approach of the Naxalites. In Orissa, where Vedanta’s plans have actually met a reversal through mass action and a court decision, it has been mostly NGOs and activists, including supporters of ours, that have organised the resistance, trying to involve the local people to some extent.

In West Bengal, ruled for decades by the CPI(M), the recent deployment of state forces and thugs to bloodily disperse small farmers from the land they tilled has resulted in a dramatic fall in support for the CPI(M) in local elections and succoured the right-wing populist Trinamul. This year in the June municipal elections, the CPI(M) lost almost half the wards they had held and lost control of Kolkata. Next year they could well lose most of their seats in the State assembly. In Kerala, too, the CPI(M) has been drastically losing support.

The Stalinist two-stage theory is behind the policies of the Communist Party of India (Marxist) CPI(M) in the states where they hold power, especially West Bengal. Even if this not any longer formally included in the programme of the party it remains an important idea we still need to answer. They justify their attacks on the rights of workers and poor farmers – setting up union-free Special Enterprise Zones and using armed thugs to clear land etc. – on the basis of the need for ’industrialisation’/’modernisation’. They have courted not simply with ’good’ capitalists, to use the Stalinist phraseology, but with very ruthless capitalists – conglomerates of the home-grown and foreign variety.

Central government in India is weak – a conglomeration of parties – the biggest being Congress under Sonia Gandhi. Manmahon Singh as prime minister is not popular. (‘India Today’ found just 1% of Indians would give him as their first choice for the job!). The weakness of the central government is reflected in the conglomeration of parties which make up the government and reflects the undermining of the main political parties which has taken place. Singh and his finance minister, Pranab Mukherjee, have carried out only half-measures – failing to satisfy the big bourgeois and imperialism but leaving the overwhelming majority of the population in penury.

The main Hindu nationalist opposition, the BJP, has gone through a prolonged internal crisis after losing the last election. It has not been able, so far, to capitalise on anti-Muslim sentiments after the bombings in Mumbai and other cities by Pakistani-backed Islamic extremists, nor from the attacks in Kashmir and elsewhere against the Indian Army.

In Indian-occupied Kashmir, the ’intifida’ has no leaders – Maoist or Islamist. 700,000 Indian troops face mass stone-throwing protests, organised by SMS and Twitter. (Even the IOK Chief Minister, Omar Abdullah, has recognised that neither he nor the octogenarian separatist leader, Geelani, is in touch with the fighting mood of the youth.) The AFSPA (Armed Forces Special Powers Act) is used to protect the troops from prosecution over their many gross violations of human rights. This angers the Azadi (’Freedom’) fighters who have lost more than 100 of their number in two months of street battles after the upsurge in struggle from July 11. Developments in IOK were bound to increase tensions between the Indian and Pakistani troops either side of the Line of Control and can ignite political and social unrest on the Pakistani side.

The campaign in India expressing solidarity with the youth and workers in Kashmir was initiated by comrades of the CWI in Chennai with a leaf-letting campaign. Our comrades who have links with some of the youth in IOK have raised the vital need to struggle for a Constituent Assembly to brush away all the false friends of the workers and poor in the Kashmir Valley.

India is a country encompassing numerous nationalities and ethnic groups. It is made up of 28 states, in some of which a large part of the population is in favour of breaking away from Delhi-based rule. Much of the country is said to be already beyond the control of central government. A clear programme of socialist democracy that champions the right of all nationalities to self-determination is needed, while also stressing the importance of a united workers’ struggle against ethnic and communal divisions. Only such an approach could, as did that of Lenin and the Bolsheviks after October, cut across the fissiparous tendencies in Indian society.

The struggle for a new political voice for the working class and oppressed people of India is more urgent than ever. A more favourable period has already opened up for the CWI, which has now got a foothold in a number of cities and is beginning to become a national organisation.


In Malaysia the CWI has developed a capacity to publicise our ideas and has started to build amongst layers of workers and youth from different ethnic and national backgrounds. The PSM, meanwhile, claims to have grown but has failed to mark itself out clearly from its allies in the Pakatan Rakyat (PR or People’s Coalition) as a workers’ socialist organisation. The PR forms the main opposition at national and local level and is made up of the PKR (People’s Justice Party), PAS (Malaysian Islamic Party) and the predominantly Chinese DAP (Democratic Action Party).

After suffering heavy set-backs at the last general election, the government is not now too seriously challenged by this ’official’ opposition. GDP growth is around 5 to 6%, mainly assisted by domestic economy activities encouraged by stimulus measures as well as the increased trade with China and other regional economies that has taken the place of the decline in trade with US. Now the PR coalition says that the prime minister, Najib Razak, and the ruling BN coalition (with UMNO still the dominant force) have stolen its policies.

This does not, of course, include the indirect renewal of favouritism for Malays – a policy which sparked the Indian-based Hindraf movement at the end of 2007. The government has also given tacit support for ultra-right groups like PERKASA (empowerment) to champion Malay hegemony. This will further undermine the support of non-Malays for the BN, despite the government propaganda of ‘One Malaysia’ and could be used to instigate racial clashes in the midst of worsening economic and political conflicts. The government’s New Economic Model also involves privatisation, deregulation – i.e. wholesale ‘liberalisation’ of the economy – policies which the opposition coalition does not oppose. Their main emphasis is on government practices not being ‘transparent’ and endemic corruption in government dealings.

The PKR leader – Anwar Ibrahim – is facing renewed court proceedings which could result in his imprisonment, as before. But, more likely is that the threat will be kept hanging over him to deter him from too bold an opposition when it comes to elections. The government also fears a repetition of the ’reformasi’ movement which Anwar led during the late 1990s when thousands came onto the streets demanding an end to corruption and one-party domination in politics.

Najib has adopted a large stimulus package and could even adopt Mahathir-style protectionist measures when the world crisis takes greater effect in Malaysia. Even less likely to do so is the ardent US trained neo-liberal, Anwar Ibrahim. As finance minister in 1997, he supported the International Monetary Fund (IMF) plan for recovery. He also instituted an austerity package that cut government spending by 18%. In the face of a slow-down in the economy, however, protectionist measures cannot be ruled out. Nor can the development of a new reformasi-type movement.

Najib could well decide to go for an early election ‘while the going is good’. The possibility is never far away of corruption and other scandals blowing up in the face of his apparently stable government that anyway involves considerably weakened coalition partners. The failure of the world economy to pick up will begin to have a major effect on the Malaysian economy. 60% of its exports to China are destined for the G3 – America, Europe and Japan.

Foreign Direct Investment has not achieved the level it was before the 2008 global economic crisis and the competition for FDI among regional countries has become intense. The tendency for foreign investors to seek even lower-wage economies in the region will continue, in spite of the recent spate of wage increases won through strikes in Laos, Cambodia and Vietnam.

The region

Across Asia in the past, countries have experienced very different developments – both under colonial occupation and since. Some, for special reasons that we have explained, have seen periods of very rapid development. Japan, on a capitalist basis, but without military spending and with huge assistance from the US, had a very high growth rate from the ’50s to the ’70s. China, on the basis of state ownership and the plan, is estimated to have reached more than 20% annual growth in a number of years during that same period.

In the later ’70s and the ’80s, when capitalism in Europe and the US hit its first post-war crises, South Korea and the other ’Tigers’ experienced phenomenal growth. China’s economy has powered ahead in the ’90s and throughout the last decade.

Now, Japan, with its stagnating economy and struggling government, is no longer the second largest economy in the world. It has been overtaken by China. Heightened tensions between Japan and China over disputed waters and islands as well as over Taiwan, are potential flashpoints. Fortunately fear of the consequences of open clashes holds back both sides. A collapse of the regime in the North of the Korean peninsula presents a potential nightmare for China but especially for South Korea.

This year, China became the biggest trading partner of Australia. Its continuing growth, partly due to stimulus measures, has so far cushioned the Australian economy against the worst effects of the world recession. This ’advantage’ will not last for ever. The unstable hung parliament of Julia Gillard will arouse the anger of the electorate as it imposes its austerity measures, as in Europe and elsewhere. 400 Australian companies operate in Indonesia and mineral and energy companies extract big profits from there as well as from the Philippines and other neighbouring countries. This investment and trade will determine Australia’s foreign policy in the event of any new phase of economic and social turmoil hits that country.

The stale-mate that has developed in Nepal clearly demonstrates that a revolution which stops half-way will not succeed in changing the conditions of the mass of the population. The Maoists, after gaining control of most of the countryside and the towns through mass struggle, with a correct programme and methods, could have taken power by linking up with the mass movement in the cities which erupted. The monarchy was removed and the ’classical’ conditions existed for carrying through the socialist revolution. But the leaders saw the struggle for socialism as a later stage of the struggle.

Having allowed pro-capitalist and pro-Indian government politicians to recover, the Maoists are now in limbo. They opposed the proposals for the disbandment of their guerrilla forces, but posed no alternative which would take the struggle onto a socialist and internationalist plane. There is a need to organise democratically-elected committees in town and country for the running of society and appeal to the workers and poor of India and elsewhere in the region to support them, to organise and to follow suit.

A form of civil war broke out in Thailand earlier this year, with some similarities to developments in Nepal. Although not fighting for years as guerrilla forces, like the Maoists, when the ’reds’ came from the countryside and occupied the commercial centre of Bangkok for weeks, they held a continual parliament of the streets, and attracted layers of workers to their side. Thaksin Shinawat, the man for whom the reds were literally risking their lives, is a billionaire tycoon. His support stems mainly from the reforms he put through as president which benefited the poor farmers. He has combined a programme of reform in the countryside while at the same time supporting neo-liberal policies and racism and the repression of the Muslim minority. But his supporters brought the capital city to a halt and drew certain layers of the state forces to its side.

Behind the barricades there were long discussions on how to defeat the ’yellows’, seen as representing the rich and privileged in society. Conscious revolutionaries would have encouraged a linking up of the struggles in the countryside with those of the working class in the cities to demand a workers’ and poor farmers’ government. The yellow-shirts, or Peoples Alliance for Democracy (PAD), themselves came to power on the basis of street demonstrations and airport blockades in 2008 and have no programme for taking Thai society forward.

The generals’ junta in neighbouring Burma is backed by China, in trade and aid terms. Beijing’s support for the dictatorship there is a major element in its survival. But a new generation of fighters is undoubtedly in the making. As in other parts of the region, the apparently all-powerful regime, that hides away in its specially constructed administrative capital, Naypyitaw, could find itself facing not only new street demonstrations but strikes by workers. A revolutionary upheaval in Burma, with a leadership that has drawn lessons from the experience of 1988, could shake the whole region.

In Indonesia, the Yudhoyono government is setting as its main policy aims the eradication of drug crime and terrorism, but is losing the battle. The economy drags cautiously along, supported by both western and Australian imperialism. Accumulating foreign debt, Indonesia could fall quite rapidly into an economic downturn, breeding discontent and a new wave of mass protest in Jakarta, Surabaya and Jogjakarta as in the late ’90s. Over half Indonesia’s population is under 25.

The trade union and political organisations in Indonesia, struggling to unite against foreign-owned and indigenous capitalists, and to build a workers’ party, deserve the support of workers and socialists everywhere. But the best assistance the CWI can give is to warn against the dangers of unity for its own sake, and to help develop an independent class analysis and socialist programme.

Likewise in the Philippines. The new president, Benigno Aquino, played on the memory of his mother, Cory Aquino, who was propelled into the presidency in 1986 by the ‘People Power Revolution’ that overthrew the Marcos dictatorship. ’Noynoy’ presented himself as a ‘clean pair of hands’after the corrupt and ineffective ’reign’ of Gloria Macapagel Arroyo (GMA), but his family is from the same elite in Philippine society. He is already exhausting any hopes and illusions in him as a successor to the hated GMA. He is wedded to capitalism and landlordism and offers no solutions to the scourge of corruption, terrorism and mass poverty. Under his presidency, summary repression and extra-judicial killings of left activists by the military continue.

The Philippines is one the Asian economies most affected by the collapse in ’remittances’ from abroad. Poor families depended on the earnings of at least one of their number being able to get employment abroad. Now their jobs have disappeared as the recession has hit Europe, the US and the Middle East. Socialists and trade unionists in the Philippines, with their potentially powerful organisations, need to advocate decisive action against capitalism and landlordism – no united front with the less corrupt layers of the ruling class but a clear socialist fight that can attract the radical young layers in the army who are repelled by elitism and exploitation.

Social, economic and political crises are developing throughout Asia. They underline the vital importance of the CWI’s ideas and programme and the urgent task of developing the cadres for building future mass revolutionary parties. One major success for the socialist revolution in this highly combustible region, with the conscious intervention of our forces, can spread like the proverbial prairie fire. Our task is to prepare and work unstintingly for this goal.

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