Financial Times 27Feb2020

Thursday 27 February 2020 ★ FINANCIAL TIMES 3

I N T E R N AT I O N A L

A M Y K A Z M I N A N D ST E P H A N I E F I N D L AY
NEW DELHI

Thousands of paramilitary police were
deployed to restore order on the streets
ofNewDelhiyesterdayafterdaysofreli-
gious violence in the Indian capital that
has left at least 20 people dead and 189
injured.
In his first public acknowledgment of
the rioting, Prime Minister Narendra
ModitooktoTwittertocallforcalm.
“I appeal to my sisters and brothers of
Delhi to maintain peace and brother-
hood at all times,” Mr Modi wrote, as
police stepped up their presence in the
working-class districts where mobs had
roameduncheckedsinceSundaynight.
At the Guru Tej Bahadur Hospital,
doctors said they had struggled to cope
with the flow of critically injured people
— many shot and others severely beaten
in the worst sectarian clashes in New
Delhiindecades.
“There were so many people brought
dead on the spot in ambulances, cars
and bikes,” said a young physician, who
requested anonymity. “There were so
many injuries. They were beaten up
with sticks, iron rods... There were so
many doctors, yet we fell short of man-
power because there were so many
wounded.”
Arvind Kejriwal, Delhi’s chief minis-
ter, said the police had been unable to
control the situation and urged Mr
Modi’s government — which controls
Delhi’s police force and its security — to
summon the army to restore order and
public confidence, as some Muslim resi-
dentssaidtheywereleavingthecity.
“The army should be called in and
curfew imposed in rest of affected areas
immediately,” Mr Kejriwal wrote on
Twitter.
Religious tensions have been rising in

India since Mr Modi’s government

introduced a new law that incorporates

religious criteria into the country’s citi-

zenshippoliciesforthefirsttime.

Public threats to deport Muslims who

cannot prove their eligibility for Indian

citizenship have emboldened rightwing

Hinduextremists.

On Monday and Tuesday, marauding

mobs — including Hindu youths affili-

ated with an organisation called Hindu

Sena, or “Hindu Army” — attacked peo-

ple in Muslim-dominated areas of

north-east New Delhi, while arsonists

set fire to shops, a mosque, cars, buses

andmakeshiftdwellings.

As authorities yesterday moved to

clamp down on the violence, a curfew

was imposed in the affected areas. The

streets, empty save for a heavy police

presence, were littered with bullets,

smashed glass and burnt motorbikes.

Manyshopsdisplayedbulletholes.

During the campaign for this month’s

bitterly fought local elections in Delhi,

Mr Modi’s Hindu nationalist Bharatiya

Janata party stoked communal tension,

describing the contest — ultimately won

by Mr Kejriwal’s centrist Aam Aadmi

party — as a battle between “India” and

[Muslim]“Pakistan”.

“This communalisation and tension

has been building up over quite a while,

and it was very much part of the Delhi

elections,” said Pratap Bhanu Mehta, a

professor of political science at Ashoka

University,nearNewDelhi.

“The confident claim that the poison

theBJPleaderswereinjecting[intopub-

lic discourse] would disappear after the

electionswasnottrue.”

Notebookpage 10

JO S E P H C OT T E R I L L

SOUTHERN AFRICA CORRESPONDENT

South Africa has announced plans to

slash its public sector wage bill, setting

President Cyril Ramaphosa on a colli-

sion course with powerful trade unions

asheseekstofixthebiggestfiscaldeficit

in the post-apartheid era and avoid

anotherratingsdowngrade.

Tito Mboweni, finance minister, said

in a budget speech yesterday that the

state planned to cut 160bn rand

($10.5bn) from civil service pay in the

next three years to halt a rapid rise in

publicdebtbetween2020and2021.

Cutbacks to pay rises and promotion

increases were part of “a major step

towards fiscal sustainability”, he said, as

stagnant growth, falling tax revenues

and repeated bailouts for broken state-

owned enterprises threaten to sweep

away South Africa’s last investment

gradecreditrating.

Moody’s could downgrade Africa’s

most industrialised economy to junk

status as soon as next month as govern-

ment debts look set to surge to two-

thirdsofGDPbetween2020and2021.

This fiscal year’s budget deficit will

reach 6.8 per cent of GDP, the widest

since the end of apartheid, Mr Mboweni

said. The economy is likely to grow less

than 1 per cent in 2020, according to

official forecasts. “The numbers show

that we have work to do,” the finance

ministertoldmembersofparliament.

The treasury is having to squeeze

state spending to find funds to avert

defaults atEskom, the blackout-prone

electricity monopoly, and the national

airline,SouthAfricanAirways.

South African stocks and government

bonds rallied and the rand gained 0.

per cent against the US dollar after Mr

Mboweni’sbudget.

The treasury said the target for wage

cuts could be achieved “through a com-

bination of modifications to cost-of-liv-

ing adjustments, pay progression and

otherbenefits”.

But Cosatu, the country’s biggest

labour federation and member of the

AfricanNationalCongressparty’sruling

alliance, has already called any move to

review public wages “a declaration of

war”, setting the stage for a bruising bat-

tlebetweenunionsandtherulingparty.

The politically unaligned Public Serv-

ants Association immediately criticised

Mr Mboweni’s plan. Members’ salaries

were “not for sale to address a deepen-

ing crisis that was brought about by

widespread inefficiencies and a lack of

urgency to deal with corruption and

recoversuchfunds”,itsaid.

More than one-third of South Africa’s

state spending is devoted to wages, rep-

resenting about one-tenth of its GDP,

almost as high as levels in Sweden and

Norway, according to Capital Econom-

ics, an independent economic research

consultancy.Afterinflation,theaverage

South African government wage rose

two-thirds in the decade to 2019, Mr

Mbowenihassaid.

Historically, unions have been impor-

tant supporters for Mr Ramaphosa. In

2018 the former union leader relied on

Cosatu’s backing to win the battle to

replace the discredited Jacob Zuma as

headoftheANC.

Despite the mounting fiscal deficit

andloomingjunkcreditstatus,MrMbo-

weni also announced the formation of a

sovereign wealth fund, with plans to

raiseabout$2bnforinvestments.

The long-discussed plans for such a

fund have baffled analysts, given the

poor state of the government’s finances,

but have become a key goal for the

ANC’sleft.

“There are a variety of possible fund-

ing sources, such as the proceeds of

spectrum allocation, petroleum, gas or

minerals rights royalties, the sale of

non-core state assets, future fiscal sur-

pluses and money we set aside,” Mr

Mbowenisaid.

Additional reporting by Anna Gross

Budget

South Africa to squeeze

public sector wages

The economy is likely to

grow less than 1 per cent

in 2020, according to

official forecasts

Civil unrest

India sends in paramilitary police

in bid to quell sectarian violence

Modi calls for calm after

New Delhi clashes leave

20 dead and scores hurt

On fire:

shops burn in

New Delhi

yesterday

following days

of unrest

in the Indian

capital

Dinesh Joshi/AP

‘The army

should be

called in

and curfew

imposed’

Arvind

Kejriwal, Delhi

chief minister

FEBRUARY 27 2020 Section:World Time: 26/2/2020 - 18: 35 User: andy.puttnam Page Name: WORLD2 USA, Part,Page,Edition: USA, 3, 1