Bill approved by the US Senate to jeopardize electric vehicle adoption targets

A group representing General Motors, Toyota Motor, Volkswagen and other major automakers said a US$430 billion bill approved by the US Senate will put achieving US electric-vehicle (EV) adoption targets for 2030 in jeopardy.

"Unfortunately, the EV tax credit requirements will make most vehicles immediately ineligible for the incentive;" said the Alliance for Automotive Innovation's Chief Executive, John Bozzella, adding the bill "will also jeopardize our collective target of 40% to 50% electric vehicle sales by 2030."

The group had warned Friday that most EV models would not qualify for a US$7,500 tax credit for US buyers under the bill.

To be eligible for the credit, vehicles must be assembled in North America, which would make some current EVs ineligible as soon as the bill takes effect.

The Senate bill imposes other restrictions to deter automakers from using Chinese-made materials by phasing in required percentages of North American-sourced battery components.

After 2023, vehicles with batteries that have Chinese components could not receive the credit, while critical minerals also face limitations on sourcing.

Senator Joe Manchin, who pushed for the restrictions, said EVs should not depend on foreign supply chains while Senator Debbie Stabenow of Michigan said the credit is "unworkable”.

The bill creates a US$4,000 tax credit for used EVs. The package provides billions in new funding for EV production as well as US$3 billion for the US Postal Service to buy EVs and battery-charging equipment.

The new EV tax credits, which would expire in 2032, would be limited to trucks, vans and SUVs priced no more than US$80,000 and cars up to US$55,000. Families with adjusted gross incomes of up to US$300,000 would be eligible.

President Joe Biden in 2021 set a target for electric and plug-in electric vehicles to comprise half of new vehicle sales in 2030.

 

Sri Lanka stuck between India and China

Chinese Embassy in Sri Lanka has sought an urgent meeting with senior Sri Lankan authorities after Colombo sought a deferment of the planned docking of a high-tech Chinese research vessel at the strategic Hambantota port over which India had raised concerns.

The Chinese space and satellite tracking research vessel 'Yuan Wang 5' was scheduled to dock at the Hambantota Port from August 11 to 17, weeks after Sri Lanka witnessed a major political turmoil following massive mass protests over the country's worst economic crisis in decades.

A note from Sri Lanka's Foreign Ministry to the Chinese embassy in Colombo dated August 5 says, "The Ministry wishes to request that the arrival of the vessel Yuan Wang 5 in Hambantota to be deferred until further consultations are made on the matter."

Some media reports said that India was worried the vessel would be used to spy on its activities and that it had lodged a complaint with Sri Lanka.

Some Sri Lankan news portals also reported that Sri Lankan President Ranil Wickremesinghe held a closed-door meeting with China's Ambassador Qi Zhenhong after Colombo sought a deferment of the planned docking. But the President's Office denied the media reports over the meeting.

On July 12, amidst the political turmoil in Sri Lanka, the then government approved the Chinese vessel's docking at the Hambantota port.

The Chinese vessel was expected to dock at the Sri Lankan port for "refuelling and 'replenishment' and will conduct satellite control and research tracking in the northwestern part of the Indian Ocean region through August and September.

The southern deep-sea port of Hambantota is considered strategically important for its location. The port, located in the hometown of the Rajapaksa family, has been developed largely with Chinese loans.

According to media reports here, India has informed Sri Lanka that the docking of the high-tech Chinese research vessel could pose a threat to its national security.

Sri Lanka received strong messages of protests from India as the ship was said to have the capability to track satellites and intercontinental ballistic missiles, the report said.

India has said it carefully monitors any development having a bearing on its security and economic interests.

"We are aware of reports of a proposed visit by this vessel to Hambantota in August," External Affairs Ministry Spokesperson Arindam Bagchi said in New Delhi when asked about the reports of a proposed visit by a Chinese vessel.

"The government carefully monitors any development having a bearing on India's security and economic interests and takes all necessary measures to safeguard them," he said last month.

New Delhi is concerned about the possibility of the ship's tracking systems attempting to snoop on Indian installations while being on its way to the Sri Lankan port.

India has traditionally taken a stern view of Chinese military vessels in the Indian Ocean and has protested such visits with Sri Lanka in the past.

The ties between India and Sri Lanka had come under strain after Colombo gave permission to a Chinese nuclear-powered submarine to dock in one of its ports in 2014.

China is the main creditor of Sri Lanka with investment in infrastructure. Debt restructuring of Chinese loans would be key to the island's success in the ongoing talks with the International Monetary Fund for a bailout.

India on the other hand has been Sri Lanka's lifeline in the ongoing economic crisis.

India has been at the forefront of extending economic assistance of nearly US$4 billion to Sri Lanka during the year as the island nation is grappling with the worst economic crisis since independence in 1948.

As the new Sri Lankan president looks at pulling the country out of its economic crisis, India has said that it will continue to assist the island nation and support its people in their quest for stability and prosperity.

Prime Minister Dinesh Gunawardena last week said Sri Lanka was looking forward to settle the issue of the vessel's visit with an "approach of friendship".

India's concerns have been focused on Hambantota port in particular. In 2017, Colombo leased the southern port to China Merchant Port Holdings for 99 years, after Sri Lanka was unable to keep its loan repayment commitments, fanning fears over the potential use of the port for military purposes.

One year Rule of Ebrahim Raisi: A comparison between present and past foreign policies

Ebrahim Raisi, President of Iran has been in power for one year. Today, a comparison is done between the foreign policies followed by him and his predecessor Hassan Rouhani. The general perception is that Raisi has been towing the same policy, still let us explore his priorities and key achievements.

Raisi has been relatively cautious and has not changed the overall direction of foreign policy. In Iran’s system, the president can guide foreign policy, but he is only one of several players at the Supreme National Security Council, the most powerful body for setting national security policy.

Raisi has little reason to rock the boat or take major risks because Iran’s position in the region is relatively strong. The west accuse Iran of sponsoring armed proxies and political allies in Iraq, Lebanon, Syria, and Yemen that help project power and influence across the region.

Raisi’s priorities have been easing tensions with Iran’s neighbors and boosting ties with Asian powers, especially China and Russia. Raisi has also focused on expanding Iran’s trade with Central Asian countries. He has been active on the diplomatic front. As of July 2022, he had traveled to Oman, Qatar, Russia, Tajikistan, and Turkmenistan.

Raisi’s first trip was to Tajikistan, where he participated in the Shanghai Cooperation Organization summit in September 2021. The regional economic and security bloc, led by China and Russia, accepted Iran’s bid for membership 15 years after it applied.

Afghanistan

Raisi took office in August 2021 as the Taliban took over wide swaths of Afghanistan, which shares a 572-mile border with Iran. He welcomed the departure of US forces but cautiously engaged with the Taliban. Iran had supported opposition forces against the Taliban when it last ruled the country from 1996 to 2001. He has repeatedly called for an inclusive government that includes all political factions and reflects Afghanistan’s religious and ethnic diversity. Tensions have flared over sporadic altercations at border crossings. 

China

Under Raisi, Iran managed to increase oil exports to China. In January 2022, Iran reportedly exported more than 700,000 barrels per day – more than Iran exported before the reimposition of US sanctions in 2018. China has also continued to invest in a broad range of Iranian industries, including oil and gas, lumber, and light manufacturing. But this pattern had begun years ago.

Iraq

In August 2021, Foreign Minister Amir-Abdollahian participated in a regional conference in Baghdad along with presidents, kings or foreign ministers from Egypt, Jordan, Kuwait, Qatar, Saudi Arabia, Turkey, and the United Arab Emirates. French President Emmanuel Macron also participated. The goal was to ease regional tensions. Iran continues to support an array of Shiite militias and political parties, which may be in a position to form a government more to their liking. 

Israel

Since Raisi took office, Israel has allegedly carried out several operations, including two drone strikes and an assassination, in Iran. But Iran’s responses have been surprisingly muted. In March 2022, Iran fired a dozen ballistic missiles into Iraqi Kurdistan. The IRGC claimed that it targeted Israeli strategic centers in Erbil. The other notable allegation was a plot to assassinate Israeli tourists in Istanbul. But those moves were relatively small compared to the alleged Iranian strike on Saudi Arabian oil facilities in 2019 or sabotage of Gulf shipping that occurred during Rouhani’s presidency.

Lebanon

Iran is often alleged for providing weapons, including missiles and drones, and funding to Hezbollah. The outfit has evolved into the strongest armed group in Lebanon and one of the most influential political players.

Oman

In May 2022, Raisi visited Muscat to sign deals for expanded cooperation on energy, transportation, education, and trade. 

Qatar

Raisi signed agreements on transportation, trade, tourism, energy, and education during a visit to Doha in February 2022. Emir Tamim bin Hamad al Thani visited Tehran to discuss ways to boost bilateral ties in May 2022. They also discussed diplomatic efforts to restore the 2015 nuclear deal. 

Russia

In perhaps the most significant change, Iran has accelerated the expansion of ties to Russia despite the invasion of Ukraine, which has led to extensive Western sanctions on Russia. Raisi met Putin three times in the first seven months of 2022 alone. Russia has also shown interest in purchasing Iranian drones. On energy, the two countries have cooperated as part of OPEC Plus to try to keep oil prices high. But Russia has also started to heavily discount its oil to sell to China, putting it in competition with Iran.

Saudi Arabia 

Iran has continued a series of talks that began in April 2021 to restore diplomatic relations, which were severed in 2016. In July 2022, Iran announced its readiness to move talks to the political level. Iraq mediated the talks.

Syria

Iran continued to bolster the Assad regime, which has regained much territory from rebel and jihadi groups since the civil war broke out in 2011.

United Arab Emirates (UAE)

Foreign Minister Amir-Abdollahian made a rare visit to Abu Dhabi to pay respects following the death of President Sheikh Khalifa in May 2022. He said that the two countries were turning a new page after years of tensions. As of July, the UAE was considering sending an ambassador back to Tehran. The UAE had downgraded its ties with Iran in 2016. 

Yemen

Allegedly, Iran continued to provide weapons to the Houthi rebels. But it also welcomed the UN-brokered ceasefire between the Houthis and Yemeni government that began in April 2022.

 

Can Saudi Arabia-China-Russia-Iran alliance end the US hegemony in the region?

Saudi Arabia-China, Russia and Iran are getting closer to resist the US hegemony and Washington is definitely not happy with this coalition. Over the years Beijing has inked various strategic partnerships with the Arab states to push United States out of the region.

Lately the Biden administration tried to redefine the relationships with Saudi Arabia, having deteriorated in 2018 over the murder of Washington Post columnist Jamal Khashoggi. It may be recalled that Biden, after assuming the charge as the president of the country, had vowed to make Saudi Arabia a "pariah" state over Khashoggi's murder.

Biden is under tremendous pressure after having initiated proxy war in Ukraine. Not only the world but United States is bearing the brunt of higher energy prices, supply disruptions and historic high inflation.

Analysts believe Biden having failed in punishing Saudi Crown Prince Mohammad bin Salman (MBS) changed his policy to mend relationships, but failed in securing more oil from Saudi Arabia and made little headway on Israeli-Palestinian relationship. 

Biden in his recent visit tried to reassure his allies in the Middle East that the U.S. will stay actively engaged amid fears that China and Russia could swiftly fill a leadership vacuum.

Countering China's growing influence in international politics, Russia's war in Ukraine and Iranian influence in the Middle East remain to be seen as the top priority of the Biden administration.

According to some analysts, the New Cold War has already been triggered and the world will see further intensification due to China’s growing economy, military modernization, superiority in Artificial Intelligence, and soft power domain.

China's bilateral trade with Arab world in 2021 crossed the figure of US$330 billion. The China-led Belt and Road Initiative (BRI) has 20 partners in the Middle East and North Africa while Beijing has inked 15 strategic partnerships with the Arab states in the last decade alone, causing enough trouble for Washington.

The region has rapidly been witnessing bloc politics. The US and China are on quest of promoting their ideologies and political clouts. Washington seeks to promote democratic values to reinforce the QUAD and New Quad in the Middle East.

China–Iran 25-year economic cooperation deal of US$400 billion enhances Beijing's influence in the Middle East and the Indian Ocean.

Biden, unlike his predecessor Trump, is trying to unite the US allies in the Middle East, cementing NATO, the New Asia-Pacific Economic Bloc, and reviving the Joint Comprehensive Plan of Action (JCPOA) to obtain relative political gains.

When Trump became the president of the country, he instead of visiting Canada (Ottawa is the first capital to be visited by the US presidents due to economic diplomacy) visited Saudi Arabia and inked an agreement, worth US$350 billion including a US$110 billion weapons deal. Many US analysts believe that Saudi Arabia is a lucrative market as far as the US military-industrial complex and foreign direct investments are concerned. Saudi Arabia can also be instrumental in eroding Iranian sway in the region.

The Middle East (West Asia) is unlikely to remain immune to the great powers’ competition. Legitimation of MBS remains to be seen as the tip of the iceberg. The only game in the town for Washington is China and Iran in the region.

People can still recall that Modi was the only person ever denied a US visa because of deliberately allowed anti-Muslim riots in Gujarat state in 2002 when he was the Chief Minister of the state resulted in the killing of more than 1,000. However, Modi turned out to be an apple's eye of the US as soon as he became prime minister of India. It appears the US is more concerned about its national interest and is least bothered with morality. According to Machiavelli school of thought “politics have no relation to morals”.  

China, Russia, and Iran are clearly in one bloc opposing the US hegemony. The Ukraine crisis has further been bolstering ties between Beijing, Moscow, and Iran. Biden’s statement clearly illustrates that aforementioned countries are predicated to be described as the new evil axis to the US in a bid to unite the allies to protect the democratic values and the prevailing international world order. 

One year Rule of Ebrahim Raisi: Comparing present and past Foreign Ministers

Ebrahim Raisi, President of Iran, often termed a hardliner by the west has now been in power for one year. Let us explore what are the major differences from his predecessor Hassan Rouhani. Today, a comparison is done between the two foreign ministers. 

Raisi has long expressed hardline views on both domestic and foreign policy. The United States sanctioned him in 2019, citing his role in domestic repression. Raisi is best known for serving on the so-called “death commission” that ordered the extrajudicial executions of thousands of political prisoners in 1988. Raisi was critical of Rouhani in both his failed 2017 presidential campaign and his successful 2021 campaign.

Raisi, like all presidents, replaced the ministers of his predecessor. Rouhani’s cabinet included several ministers who were educated in the West or were open to engagement with the West. In contrast, Raisi team was largely educated in Iran and has favored boosting ties with Asian powers. Five of his ministers were designated under US sanctions.

The change in foreign ministers was a microcosm for the transition. Rouhani’s Foreign Minister, Mohammad Javad Zarif, spoke fluent English after receiving a BA and an MA from San Francisco State University, and an MA and PhD in international relations from the University of Denver. Zarif also served in New York as Iran’s ambassador to the United Nations from 2002 to 2007. As foreign minister (2013-2021), he played a key role in negotiating the 2015 nuclear deal and developed a working relationship with Secretary of State John Kerry.

By contrast, Raisi’s Foreign Minister, Hossein Amir-Abdollahian, speaks fluent Arabic and stilted English. He received a PhD in international relations from the University of Tehran. During his career at the Foreign Ministry, he was posted to Iraq and Bahrain and had portfolios largely focused on the region. As Foreign Minister, his priorities are to improve relations with Iran’s neighbors as well as Asian countries. Amir-Abdollahian reportedly has close ties to the Islamic Revolutionary Guard Corps (IRGC). 

In my next blog I will compare the foreign policies followed by the two ministers. Please allow me to say that the change in president and ministers has not translated into much of a shift. Raisi has generally continued down the same path as Rouhani on domestic and foreign policy.

Iran to continue constructive cooperation with OPEC

Iranian Oil Minister, Javad Oji said his country will continue constructive interactions with Organization of Petroleum Exporting Countries (OPEC) and will support the organization’s new Director General, Shana reported.

“As a founding member of OPEC, Iran will definitely continue its constructive interaction with OPEC and would effectively support the new Secretary General as well as the OPEC secretariat,” Oji said at the 31st OPEC and Non-OPEC Ministerial Meeting held via video conference.

Honoring the memory of former OPEC Secretary General Mohammad Sanusi Barkindo and welcoming his replacement Haitham Al Ghais, the minister said, “I received the very sad news of the passing away of His Excellency Mohammad Sanusi Barkindo, Distinguished Secretary General OPEC. On behalf of the Government and people of the Islamic Republic of Iran, I would like to express my heartfelt condolences to Your Excellencies, particularly His Excellency Timipre Sylva, Minister of State for Petroleum Resources, Distinguished Government and Great People of Nigeria and the esteemed Staff of the OPEC Secretariat.”

“Undoubtedly, His Excellency’s round-the-clock efforts as the OPEC Secretary General to promote solidarity and unity among Member Countries, along with his trust in collective wisdom and efforts for creating understanding have always helped the Organization and its Members,” he added.

He also congratulated Haitham Al Ghais for assuming the position of the OPEC Secretary General, saying, “I am confident that your appointment will be a critical step in advancing the Organization, achieving the collective goals of the OPEC and its Members and the fair and forward-looking leadership of the OPEC Secretariat.”

“I am confident that the OPEC’s successes in recent years will continue in the future under the leadership of Al Ghais. I wish him every success in his new position during this challenging time for fossil fuels,” he added.

Chinese Foreign Minister scheduled to arrive in Dhaka today

Chinese Foreign Minister, Wang Yi is scheduled to arrive in Dhaka today (Saturday) afternoon to discuss bilateral, regional and global issues with Bangladesh leadership. Agriculture Minister Muhammad Abdur Razzaque will receive the Chinese Foreign Minister.

According to reports, neither the Ministry of Foreign Affairs nor the Chinese Embassy in Dhaka shared his program schedule in detail till the time till late evening.

Minister Wang is scheduled to meet Prime Minister Sheikh Hasina on Sunday morning apart from holding a bilateral meeting with his Bangladesh counterpart AK Abdul Momen the same day.

“This is going to be different from other bilateral visits. I can’t tell you in details at this moment as many things are still under last minute discussion,” another official familiar with the development told, speaking on condition of anonymity.

Awami League General Secretary and Road Transport and Bridges Minister Obaidul Quader will host a dinner in honour of the Chinese Foreign Minister on Satuarday, said State Minister for Foreign Affairs Md Shahriar Alam.

Foreign Minister Momen is expected to return home Saturday night from Cambodia after attending the ASEAN Regional Forum meeting.

Talking to reporters at the Ministry of Foreign Affairs, Shahriar Alam said Bangladesh and China are likely to sign multiple MoUs and agreements during Wang’s visit.

He said the list is not finalized yet and it can be five-seven – new and renewal including cooperation on the disaster management and cultural exchange fronts.

Shahriar assured that the planned MoUs and agreements will be aligned with Bangladesh’s cultural, social and economic policy though the list is not finalized yet.

The state minister said the relationship between Bangladesh and China is “deep and wide” and the two countries will discuss areas of future cooperation.

Responding to a question, the state minister said Bangladesh will seek a stronger role from the Chinese government for early repatriation of the Rohingyas.

In January 2017, Wang had an hour-long stopover in Dhaka. This time, he is coming for a longer period.

The visit is taking place amid growing geopolitical tensions with impact on developing countries in the region while experts suggest Bangladesh to ensure a strategic balance amid these tensions.

Earlier, Foreign Secretary Masud Bin Momen said taking a new loan from China will not be a part of their agenda during the Chinese foreign minister’s Bangladesh visit.

“This time, the issue of taking loan afresh isn’t there at least,” he said on Wednesday when a reporter wanted to know whether Bangladesh is going to take a loan from China again.

Asked what message this visit carries amid the crisis in various parts of the world, the foreign secretary said it will be known once the Chinese foreign minister comes. “We are working on the visit. Things are yet to be finalized.”

He reiterated that the visit is part of the Chinese side’s routine visit to the region and also it is an opportunity to review the existing engagements between the two countries.