Echonomix [Issue 03 | September 2020]

1. ECHONOMIX
ISSUE 03/ SEPTEMBER 2020
INSIDE THIS ISSUE
RELATIONS: NEWS ON THE GLOBAL FRONT ENCOMPASSING JAPAN, LEBANON, NORWAY, AND
PAKISTAN ; PERVASION, PROTECTION, AND PAYBACK: A COMPREHENSIVE DISCUSSION OF THE
INDO-CHINA RELATIONS, FOCUS ON: THE PART STABLE INTERNATIONAL RELATIONS PLAY IN
CONTEMPORARY SOCIETY

2. ABOUT US
03
all the whats, whys, hows and
whens of our journey
POLES OF THE SAME
MAGNET
05, 06
war and peace as understood by
Komal and Pranav Gupta
A PAIR OF KHUSSA
JUTTIS
11, 12, 13
the understated contribution of
Pakistani immigrants to the
Norwegian economy by Ishita Pal
RELATIONS
04
...a penny for your thoughts
RECLAIMING THE SKY
07, 08, 09, 10
Japan's journey from a Chinese
colony to a top-notch economy by
Bhuranyu Mahajan
NON NOBIS SOLUM
NATI SUMUS
14, 15
a report on the Beirut explosion
and its aftermath by Neha Talla

3. AN OBLIVIANT MASS
EXODUS
16, 17
ACKNOWLEDGMENTS
& BIBLIOGRAPHY
20, 21
..cheers!
18, 19
PERVASION, PROTECTION,
AND PAYBACKS
the drawbacks of free trade:
simplified by Aditya Gupta
the Indo-Chinese interdependency by
Aadya Agarwal

4. ABOUT USECHONOMIX started as a student led magazine, which focuses on
empowering student views and perspectives. We aim at exploring possible
solutions to the worlds problems and give a platform to the students who
wish to voice their opinions. After some careful considerations, Echonomix
is not only for young writers, but for anyone irrespective of age, gender,
cast and nationality, who would like to voice their opinions and ideas.
In a nutshell, Echonomix is us, trying to discuss the resounding ripples that
economic policies create on a global level.
Why Echonomix?
-It is a great platform to get collaborative, financial and social
experience
-An experience you would not forget if you want to become a
journalist, economist or even a freelance writer.
-Most importantly, the unforgettable and unique support you would
receive and the influential skills you could develop throughout the
collaborative process
03

5. RELATIONS
04

6. The symbol of peace ☮ and the Greek symbol of
war Ω have long been used worldwide. In this
article, we aim to present to the readers whether
they repel from each other, or attract i.e. whether
war and peace are associated with each other, or
in other words, does war bring peace, or does war
bring war, relying heavily on art and symbols.
Imagine the drawing below as a magnet, it’s
positive end being peace (☮), and negative end
being war (Ω).
POLES OF THE SAME
MAGNET BY KOMAL
AND PRANAV GUPTA
05

7. Well, using some examples from history, the frequency of
war leading to war, and war leading to peace can be
examined. In case of Civil wars, such as the American Civil
War, the war has led to a political and social unrest at first,
but then peace, or a settlement between the ‘black’ and the
‘white’.
World War I led to some decades of peace, but then World
War II followed, so does this mean one war leads to
another?
Well, in our perspective, war and peace in today’s world is
definitely not a magnet, cause diplomatic relations and
peace talks initiated by one side lead to the other side
initiating peace too, therefore peace attracts peace,
whereas war attracts war, as so many wars that are
ongoing currently have been going on for some time, for
example, the Iraqi insurgency, that has been going on since
the 2017, which followed the Iraqi Civil War (2014-17), and
this followed Iraqi insurgency (2011-13). Another example is
the USA, which has been under continuous wars since the
9/11 back in 2001. Leaving it upto the readers to think of
more examples in which war led to war, it will definitely
overcome the number of wars leading to peace.
06

8. RECLAIMING THE SKY BY
BHURANYU MAHAJAN
Japan, Nihon, The land of the rising sun with the
views of Mount Fiji, that take your breath away,
it’s a country where culture and technology exist
hand in hand. Japan, second to only China and the
US in terms of economic power, surprisingly,
began this path to modernity only 150 years back.
Looking Back
Until the Meiji period (1868-1912), Japan’s
relationship with the rest of the world was
defined by China. In the 16th century, Japan began
trading with the Western countries but soon
became fearful of the spread of Christianity and
its invasion. The government officially limited
foreign trade to that with then Dutch and Chinese
at the port of Nagasaki. In the 19th century, Europe
started aggressively expanding in Asia, China
started weakening, many countries were
colonised. Japan had to bow down and agree to
participate in trade with the West.
On March 31, 1854, the Convention of Kanagawa
became the first treaty between the United States
and the Tokugawa Shogunate. Signed under the
threat of force, it was an end to 220 years of
isolation of Japan. In 1868, under the reform
movement called Meiji Restoration, Japan
abolished the feudal system, the military was
reformed and the country was put on the path to
industrialisation. Subsequently, Japan signed
many treaties with the Western countries.
However, the main forces behind Japan’s
international relations with other countries were
imperialism and colonization. Japan too became a
colonising power and made colonies in Taiwan
and Korea. 07

9. 08
The Beginning Of the End
The beginning of the 20th century saw Japan
emerging as a powerful force after its victory in
the Russo-Japanese war (1904-05) and Japan
became a member of the prestigious League of
Nations. In 1931, Japan created a puppet state in
Manchuria, which no one else recognised. This
isolated Japan and resulted in numerous border
clashes with China finally resulting in the full-
scale Second Sino-Japanese War. The bombing of
Pearl Harbour and Japan’s aggression in Asia led
to war with the United States. The years that
followed saw the occupation of Japan by
American forces. Japan was highly influenced by
the US in the political, economic and cultural
areas.
The devastated Japanese economy rose like a
phoenix from the ashes. By 1956, real per capita
GDP had overtaken the pre-war 1940 level. During
the recovery period, the per capita GDP rose at an
average annual rate of 7.1%. This was followed by
an era of growth propelled by a highly successful
car and consumer electronics industries.
Consequence
Japan's relations with its neighbours are still
heavily influenced by the legacy of Japanese
actions before and during the Second World War.
All this has shaped Japan’s international relations
with various countries and regions across the
world. Its role in the international community is
considerable. It is a major aid donor and a source
of global capital and credit. Here is a summary of
Japan’s relations with a few countries and regions:

10. 09
The United States
The Security Treaty between the United States and Japan was signed on 8
September 1951. The United States in return has to defend Japan and maintains
military bases in Japan. The US has also sponsored Japan’s membership in the
United Nations, The Organization for Economic Cooperation and Development
(OCED) and the General Agreement on Tariffs and Trade (GATT). The US is now
the closest ally of Japan. As two of the world's top three economic powers, both
countries have close economic ties for the creation of wealthJapan is currently
the 4th largest goods trading partner with the US with $218.3 billion in total (two
way) goods trade during 2019. Goods exports totalled $74.7 billion; goods
imports totalled $143.6 billion. The U.S. goods trade deficit with Japan was $69.0
billion in 2019. The top import categories for the US from Japan in 2019 were:
vehicles ($49 billion), machinery ($34 billion), electrical machinery ($17 billion),
optical and medical instruments ($7.0 billion), and pharmaceuticals ($4.3
billion). U.S. total imports of agricultural products from Japan totalled $767
million in 2019. Leading categories include wine and beer, snack foods, tea,
including herbal), other vegetable oils, and processed fruit & vegetables.
China
Japan has had a long history of cultural relations with China. The Japanese writing
system and many artistic, religious and literary traditions originally came from
China. Following WWII, relations have been strained with risks of outbreaks. The
East China Sea has been a long drawn area of conflict between the two countries.
Japan did not establish relations with China due to pressure from the US. This
changed after 1972 and now Japan is majorly involved in helping China develop its
economy. China is now Japan’s largest export market ($139 billion).

11. South-East Asia
The earlier actions and forced occupations by Japan of many Southeast countries
like Korean and Taiwan have left many nations resentful of Japan. In the present,
the Japanese government has been making consistent efforts to improve these
relations. The developing countries of ASEAN (Brunei, Indonesia, Malaysia, the
Philippines, and Thailand) regard Japan as critical to their development. Japan's
aid to the ASEAN countries totalled US$1.9 billion in Japanese fiscal year (FY) 1988
versus about US$333 million for the United States during the United States FY
1988. Japan was the number one foreign investor in the ASEAN countries, with
cumulative investment as of March 1989 of about US$14.5 billion, more than twice
that of the United States. Japan's share of total foreign investment in ASEAN
countries in the same period ranged from 70 to 80 per cent in Thailand to 20 per
cent in Indonesia. South-East Asia makes up for Japan’s second-largest export
market and provides important food, oil, metal ore, lumber and rubber imports.
Russia
Initially, Japan and Russia had clashed over their interests in Manchuria leading to
the Russo-Japanese War. Towards the end of WWII, Soviet had occupied South
Sakhalin Islands and the Kurile Islands and some islands near Hokkaido, which
Japan claimed were a part of their territory. On 27 April 2018, in Moscow was held
the fourth Russia-Japan forum dubbed The Points of Convergence, where the
sides discussed issues concerning the two countries’ trade and economic
relations. Trade has gradually developed between the two countries.
10

12. A PAIR OF KHUSSA JUTTIS
BY ISHITA PAL
Tears streamed down his face as Aslam Ahsan
saw his worn-out khussa juttis in an orange
briefcase at the Oslo Museum. The shoes
document his three-month journey from Pakistan
to Norway across Afghanistan, Iran and Turkey.
Nearly fifty years after the journey, Ahsan proudly
celebrates the Norwegian national holiday of
‘syttende mai’ by taking his twin grandsons to the
Constitution Day parade.
Today Pakistanis are the third-largest immigrant
nationality in the country, right behind the Poles
and the Swedes. Apart from tandoori and kebab
eateries punctuating street corners, the
contribution of Pakistani immigrants in the late
1960s to the country’s economy is vastly
understated.
SEA-BASED ECONOMY
Before 1963, the Norwegian economy relied
mostly on fishing with its GDP resembling
that of underdeveloped countries today. Its
people were not prosperous and the
socialist Labour Party was not dynamically
reforming any public policy in the near
future.
In 1963, Oslo asserted sovereign rights in a
part of the North Sea off the coast of the
country and her fleet of ships started their
quest to strike liquid gold.
11

13. MAKING A KILLING
Braving 15-metre-high waves and winds
with a speed of up to 110km/h, the Ocean
Viking stumbled upon massive oil and
natural gas reserves in 1969. The reserves
spewed out 1.6 million barrels of oil a day.
With Saudi Arabia threatening to decrease
their daily supply along with the soaring
demand of nouveau-riche nations like the
United States, Japan and Germany, Norway
naturally became the developing world’s
friendly oil supplier.
The Norwegians made a killing in the
international market as its potential value of
real output increased.
An immigration surplus was established as
those seeking improved standards of living
flocked to Europe’s new oil realm. As an
exodus ensued, Norway welcomed these
immigrants who laboured mostly in the low-
paying services sector.
Thus, the nations human and natural capital
peaked, expanding Norwegian horizons.
Change in the potential level of output can
be depicted as an outward shift of the PPC
(Production Possibilities Curve).
12

14. From a macroeconomic perspective, the
same is shown by a rightward shift in AS
curve for Keynesian economists and a
shift in the LRAS for the Monetarists.
FINANCIAL PRUDENCE
Naturally, in a matter of a decade,
Norway’s GDP rose from 12 billion USD to
65 billion USD. Instead of the oil revenues
being owned by private companies like
Shell or BP, all generated profits weighed
down the pockets of the government-
owned corporation, Statoil.
Since the Labour Party had been enjoying
a fairly stable control in the Norwegian
parliament, it made no effort to please
its citizens by regulation of an array of
expansionary fiscal policies involving tax
cuts. Instead, it established a sovereign
wealth fund. This wealth fund was
essentially a mega-hedge fund that
invested in stocks and bonds of
corporations whose legal entities were
not registered in Norway. This ensured
the citizens a steady stream of revenue
despite the booms and busts in the
homeland’s economy. In October of 2019,
Norway’s wealth fund was estimated to
be of a trillion dollars in value!
A CAUTIOUS COMMUNITY
Norwegian culture frowns on the flaunting
of wealth and unusually lavish lifestyles.
Norway is one of the select countries in
the world that has adopted a strict
economic model, now colloquially called a
Nordic model, of free-market capitalism
with universal social benefits like
education and healthcare fuelled by
substantially higher taxes than other OECD
countries. Taxation is redistributive and is
justified in the high government spending
palpable in the country’s infrastructure
and public services.Immigrants have
settled effortlessly into the rather
unfamiliar Scandinavian culture. As the
country’s diversity earns it some well-
deserved brownie points, Norway was
judged as the third happiest country to live
in, in 2019.
Three generations of the Ahsans now live
in Norway and although they have an
enormous mansion in Aslam’s parental
town of Kharian, for his children and
grandchildren the Pakistani palace is
easily tradeable for their three-bedroom in
downtown Oslo.
13

15. NON NOBIS SOLUM NATI SUMUS
BY NEHA TALLA
Not for ourselves alone are we born
5, 4, 3, 2, 1.
You had the benefit of a countdown to prepare yourself for what’s to come. Lebanon
didn’t. Beirut, didn’t.
On the 4th of August 2020, tragedy struck when the improper storage of explosive
ammonium nitrate at a port in Beirut, Lebanon caused a calamitous explosion that
shook the foundations of a country already facing an ongoing economic and political
crisis. It caused the deaths of 170 people, left more than 6,000 injured, and has left an
estimated 10-15 billion USD of damages to the city. Lebanon is the world’s 3rd most
indebted country in the world, with a 152% debt to GDP ratio. It was no wonder that
when the explosion occurred; the country was at more of a loss than it had ever been
before, and needed the support of nations around the world to survive this massive
accident amidst the already challenging COVID-19 pandemic.
"The UK is ready to provide support in any way we can, including to those British
nationalsaffected" - Prime Minister Boris Johnson
Immediately following the explosion, multiple countries offered assistance to
Lebanon by deploying search and rescue specialists, doctors, medical equipment, and
other such relief teams. This list of countries includes but is not limited to India,
Norway, Qatar, France, Turkey, Brazil, Russia, and the USA. India, for instance, swore
58 tonnes of humanitarian aid that was dispatched via C-17 heavy-lift aircrafts.
Norway provided 40 tonnes of medical equipment, and France contributed with 15
tones of aid along with a mobile medical unit and dozens of emergency workers.
“ France is at the side of Lebanon. Always”- President Emmanuel Macron
In more monetary terms, contributions of various sizes have poured in from around
the world.
14

16. To illustrate, The United States, through the U.S. Agency for International
Development (USAID), is providing $18 million in humanitarian assistance, along with
$15 million to support emergency response efforts. This aid is in addition to the $41.6
million the U.S. has already contributed to bolstering Lebanon's efforts to fight the
COVID-19 pandemic . Similarly, the UK is offering around a total of 63 million euros,
and the Qatar authorities have provided 50 million dollars worth of support.
"On behalf of the Syrian Arab people, we extend our sincere condolences to you and
the Lebanese people" - Syrian President Bashar al-Assad
When it comes to the aid of international organizations, the United Nations World
Food Programme has promised to provide 50,000 tonnes of wheat flour. Lebanon
authorities have also been in conversation with the International Monetary Fund to
receive a loan of 10 billion USD. Additionally, 6 million USD was released from the
Central Emergency Relief Fund along with 9 million USD from the UN Lebanon
Humanitarian Fund to address primary health needs and also to provide food
assistance. Last but not least, The WHO is appealing for $15 million to cover
emergency health needs.
“Non nobis solum nati sumus”
Literally translated, this Latin motto means “Not for ourselves alone are we born.”
Looking around the world, it’s heartwarming to see the way economies have
supported Lebanon through an unimaginable crisis, even an economy such as Iran
which has no diplomatic relations with Lebanon given their current official state of
war. That being said, the nation is far from having recovered. Lebanon has long been
criticized for its political structure as it leads many to believe that it is the primary
reason for their deepening economic crisis. The COVID-19 pandemic put a massive
strain on the already sparse natural resources available in Lebanon, so the blast in
the capital city was just the tipping point for citizens of Lebanon, many of whom took
to the streets to protest against the governing body’s inability to feed andsustain
their people. Due to this outcry by civilians, Prime Minister Hassan Diab resigned,
leaving the country in the hands of the President Micheal Aoun. The country has to
now not only pull itself through a traumatic incident but must also re-elect a new
Prime minister with a clear cut financial and economic rescue plan to overcome all
the challenges currently faced by the dismal economy.
“Stay Strong, Lebanon” -Iranian Foreign Minister Mohammad Javad Zarif
15

17. AN OBLIVIANT MASS EXODUS BY
ADITYA GUPTA
Once touted as the next America- a land of opportunity and prosperity, China
is today in a position strikingly different from its hay days of a rising
superpower. Facing rising diplomatic scrutiny from nations worldwide while
also having lost the support of many of its Asian neighbours, the country is
battling sanctions, allegations and bans from the rest of the world. COVID-19,
sadly, dealt the nation a multi-faceted blow as it not only affected the socio-
economic aspects but also helped catalyze the anti-China sentiment to an
extent wherein China is facing the prospects of losing essential ties with
nations worldwide.
What started as an agenda for international domination has turned out to be
a mission of self-suicide. China’s strategy to annihilate the power salvo of the
US has ended up going worse than ever imagined. China’s controversial
hijacking of Hong Kong did not do it any good either and instead furthered an
anti-China sentiment. China’s involvement in Africa has also come under
scrutiny with many counting the days until China takes over the many African
economies under its illegitimate control. Everything that China did under its
agenda for ultimate supremacy has become thorns in its sides with the
international fallout in many being too big to control.
This agenda has played Russian Roulette with not only international politics
but rather with the Chinese businesses too. Chinese companies herewith are
never going to be sure of the market conditions as owing to Beijing’s policies,
they can any day come under scrutiny, can any day lose out on major
international opportunities and can any day be sanctioned or deemed a
national threat internationally. The anti-China sentiment is costing Chinese
companies billions of dollars in future and present earnings. They are losing
out on ambitious forays into developing and upcoming markets which are ripe
for capitalistic exploitation.
In what seems to be a mass exodus Hong Kong too is facing future prospects
akin to that of China after its hostile takeover. Having been one of the financial
doyens of Asia, the territory considered one of the 4 Asian tigers, after
Singapore, Taiwan and South Korea, is today facing the prospects of losing its
coveted super-economy status after coming under Chinese control.
16

18. The territory is on the verge of a catastrophic downfall which will see its
financial markets lose a lot of banks, firms and investors to rotten Chinese
controls and Communist policies. After having lost the coveted trade status in
an annulment on the US’s part, the territory will surely not be able to maintain
its position in the shipping industry too.
In a hostile display, India too has been reported to be working with its Asian
neighbours like Australia and Japan on a trade pact which eliminates the
reliance on Chinese supply chains by, among other things, increasing cross-
border collaboration within the participating countries. This seems only right
and rather predictable after China’s disruptive actions on the LAC lines in
North India. With reports stating the pact to be ready by November due to
increased interest from India and other participating nations, this agreement
will certainly create large-scale chaos and trouble for China. This could
certainly be the death knell for Chinese export houses and will cause great
suffering to the ones looking across the border for future growth
opportunities.
Globalization oversaw widespread integration, collaboration and trade
between countries and while we enjoyed its fruits for many decades we are
only today becoming aware of its few but large disadvantages. An
international diplomatic incident between two countries has turned out to be
the course-setter for many countries and for some even a matter of life and
death. Both are countries which command and yield huge powers amongst
each other to the extent that each dominates and harnesses strengths unique
to either. To choose between the two is a case study ripe for the concept of
opportunity cost as by choosing either you essentially severe ties with the
other. The two countries I am talking about are the United States of America
and the People’s Republic of China who are currently at each other’s throats in
a state of utter disillusionment and oblivion to the harm being done to other
nations in the world by them.
17

19. PERVASION, PROTECTION AND
PAYBACKS BY AADYA AGARWAL
With a rising chorus to boycott Chinese products,
border tensions between India and China have
elevated to new dimension. If the government acts
per public demand, it could undoubtedly strain
political and trade relations between the two
states. Just last year, in 2019, India had more than
500 million smartphone users, an increase of 18%
from the year before. Chinese-made, most visibly Mi
Phones, were in high demand particularly
concerning their low prices and therefore appeal to
lower income or middle class consumers.
Considering the dominance of these classes in the
Indian economy, the catering of these companies
towards these markets was a colossal undertaking,
and massive business opportunity.
So far, in 2020, India imported $65 billion worth of
goods from China, which made up around 14% of our
total imports. Manufactured goods, at 96 per cent,
constituted the highest share of India's imports from
China and within those manufactured goods,
electronic goods constituted the highest share, at 33
per cent, followed by engineering goods at 32 per
cent and chemicals and related products at 20 per
cent.
Due to such high demand, we could say it won’t be
feasible for India to completely stop the imports from
China. Even if the government increases import duties
and doesn't stop trade, more likely than not, its these
Indian consumers who would literally pay the price,
as their goods only become more expensive.
Reasonably, Chinese industries would see a downturn
as well, contracting business operations. However,
considering circumstances, that is the scale of
industrial production in China, it could also be argued
that there would be minimal impacts despite
protectionist measures.
18

20. 19
There’s not much we can really expect as the
pandemic continues the blur the lines that define
the future and our predictions. All we can see is
that the global war against Chinese dominance,
pervasion, and infiltration seems to have spread
outside of the United States. We don’t know the
exact specifics of how it would affect each state,
but we can at least make general conclusions like
the above..
Not only finished goods, like smartphones, but
around 24% of the automobile industry is also
dependent on China for its spare parts, such as
tyres and tubes. Similarly, around 68% of the
market share of the domestic pharmaceutical
companies is held by China for imports of total bulk
drugs. Such large consistencies of Indian imports
would insinuate that in the short run, it would
undoubtedly be difficult to find amicable
substitutes for these goods. Specifically considering
imported materials and resources, domestic
producers would also face roadblocks in retail, and
production. This impact would be magnified more
so, considering the aforementioned dependency. In
the long run of course, substitutes would become
more available and possible negate its impacts. But
during this pandemic, would it be possible to move
into the Long run in the first place?

21. T H E E C H O N O M I X T E A M
Thank you all for
contributing to our second
edition by reading, writing,
sharing, or even skimming!
ACKNOWLEDGEMENTS
20

22. BIBLIOGRAPHYOur writers have referred to several sources including
Times Of India, Economic Times, and other such online
newspapers and websites. We acknowledge the
contribution of their facts to our magazine and condemn
plagiarism.
Sources and suggested reading:
https://www.jstor.org/stable/23608043
https://www.warsintheworld.com/page=static1258254223
https://www.khanacademy.org/humanities/whp-origins/era-7-the-great-
convergence-and-divergence-1880-ce-to-the-future/73-world-war-2-
betaa/a/read-thirty-years-of-continuous-war-beta
https://www.youtube.com/watch?v=_fOYJ3_ZppM&feature=emb_title
https://www.reuters.com/article/us-norway-swf-record/norway-wealth-fund-
grows-to-record-10-trillion-crowns-idUSKBN1X41AO
https://timesofindia.indiatimes.com/india/Pak-3rd-largest-immigrant-group-in-
Norway/articleshow/9511373.cms
https://www.forbes.com/sites/duncanmadden/2019/03/28/ranked-the-10-
happiest-countries-in-the-world-in-2019/#7ec3f9ee48a5
https://apnews.com/12ea65fee7606260167af25156a7cacc
https://currentaffairs.gktoday.in/india-sends-humanitarian-aid-to-lebanon-to-
assist-beirut-explosion-victims-082020332709.html
https://currentaffairs.gktoday.in/united-nations-releases-6-million-usd-in-
response-to-beirut-explosion-082020332366.html
https://www.usaid.gov/news-information/press-releases/aug-7-2020-united-
states-provides-humanitarian-assistance-response-explosions-lebanon
https://www.bbc.com/news/world-middle-east-53710556
21

24. Mukesh Dharanibalan
Joon Gu Kim
Ishita Pal
Riya Gupta
Riya Mantri
Devarya Singhania
Aditya Gupta
ECHONOMIX
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