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22 February 2011, Gateway House

The end of stability in the Arab world

As the Arab world reinvents itself in real time, the rest of the world must begin to understand the region as something more than a source for oil and a market for armaments and consumer goods.

Director, Gateway House

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Succession has always been a problem in the Arab-Islamic world – right from 632 AD when the Shia-Sunni schism began, the outcome of a struggle over the succession to the holy prophet.

In addition to public demands for truncated monarchical powers in Morocco, Bahrain and Jordan, there have been protests against dynastic succession in Egypt and Libya.

(The President of Syria was luckier, having succeeded his father 12 years ago, before the people discovered the power of peaceful protest.) Algeria and Yemen are also beset by daily protests while Kuwait has tried to buy quiescence from its own rebellious minorities by handing out the equivalent of $3,500 per citizen. Will it be enough to save the Al Sabah family when the whole Arab world is seething against their prolonged disempowerment?

While it took more than two weeks for the protesters in Egypt to oust Mubarak, the Libyan dictatorship of 42 years appears to be unraveling in just days. There are contradictory reports that Libyan leader Col. Gaddafi has left Tripoli, though it’s not clear whether it’s for Venezuela, Malta or the Libyan city of Sirte from which he may continue to fight demands for his departure. Although accounts vary, more than 200 people have been killed, most in the Eastern port city of Benghazi which has a history of opposing Gaddafi for tribal reasons. Reports of the use of warplanes and naval guns against unarmed protesters and military installations imply disaffection with, and divisions within, Libya’s armed forces. As in Egypt, the outcome will depend on whether the armed forces stay united and loyal to Gaddafi or as his son said on state television, they will be used against citizens and rivers of their blood will flow.

The contagion of the rebellions in Arab countries may or may not travel all the way to China – where this week security forces have already moved quickly to disperse small gatherings organized through the social media networks with a whiff of the Jasmine Revolution. But it is the impact in the contiguous Gulf region with its substantial Shia populations is a more immediate concern. Defiance of the West in Iran has been bolstered by the installation of a compatible government in Shia-majority Iraq, and a Hezbollah-supported president in Lebanon has already shifted the Shia-Sunni balance in the region. The unrest in Bahrain could impact the Shia population in the oil rich Eastern region of Saudi Arabia, and inspire a minority – although just 5% of the population – that has been treated contemptuously in other Sunni-majority Emirates.

Over time, these tensions are bound to become part of conversations being held in Muslim-majority countries as far away as Indonesia, and minorities in places as close to the region as Pakistan, where Sunni-Shia rivalries have been violent for decades.

These developments pose real challenges for India. Shias comprise about 20 % of India’s 140 million Muslim population, and they are bound to be sensitive to these great historical shifts in the Muslim world. There are somewhere between 4 million and 5 million Indians in the Arab world, who post close to $ 30 billion inward remittances annually. Getting them home will be an impossible challenge for any government. But more importantly, the drying up of remittance inflows combined with rising oil prices would devastate our economy, already reeling from vanishing export markets in the wake of a fragile and declining global economy.  A special desk established in the Ministry of External Affairs in New Delhi is making to evacuate the 18,000 Indian workers currently in Libya. And the several Indian companies invested in the region are watching the crisis nervously.

It is ironic for the United States and Great Britain that this should happen so soon after both countries tidied up their relationship with Libya and returned to extract oil. Having achieved the dismantling of Libya’s rudimentary nuclear programme, extracted billions of dollars for the families of the victims of the Panam flight 103 bombing and crash in Lockerbie, Scotland in 1988 blamed on Libyan agents, and arranged the reinsertion of British Petroleum into the country’s oil exploration industry, they had hoped to resume their highly profitable relationship with Libya, the largest producer of oil in North Africa. Oil companies had been followed by hotel chains, real estate and retail companies – all of which are now scrambling to air-lift their expat employees from Libya.

(The cynicism of earlier UN sanctions against Libya and the bombing of Gaddafi’s compound by the US Air force was matched only by the role alleged to have been played by former British prime minister Tony Blair in the release of the Libyan agent convicted in the Lockerbie crash – all so that British Petroleum and other western oil companies were no longer shut out of a lucrative market in the twelfth largest producer in the world.)

While Libya produces only 2% of world output (and has an estimated 3% of oil and gas reserves), the upheaval in the region has already pushed the price of the Brent crude to over $108 a barrel. The real shock to markets could come from Bahrain, a tiny oil-producer but a country strategically located between Iran and the causeway link with Saudi Arabia. That location is now turning into a nightmare. For years, Bahrain’s Sunni rulers suppressed the 70% majority Shia population, but sought and achieved security by becoming the host to the US Navy’s Fifth Fleet. The Bahraini monarchy is also closely aligned to its counterpart in Saudi Arabia – which is unlikely to countenance the overthrow of an ally from a part of the world which was once part of Iran.

None of the US’ allies in the Middle East pose as complex a challenge as Bahrain because of its proximity to Saudi Arabia and the latter’s importance to the global oil trade, the antagonistic US relationship with Shia Iran and the extreme nervousness now prevalent in Israel. But power equations have already altered – Saudi Arabia failed to persuade the US to remain firm in support to long time ally Mubarak in Egypt.

For now most governments are waiting for the situation in diverse Arab countries to clarify themselves. But people everywhere are transfixed and entranced by the bravery of the young protesters and the extraordinary sight of tens of thousands of non-violent people joining to demand justice and decency in governance.

As the Arab world reinvents itself in real time, the rest of the world must begin to understand the region as something more than a source for oil and a market for armaments and consumer goods. Along with the others, India must draw lessons for integrity and transparency in governance and a greater focus on job creation for the young at home.

Neelam Deo is Co-founder and Director, Gateway House: Indian Council on Global Relations; She has been the Indian Ambassador to Denmark and Ivory Coast; and former Consul General in New York

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