Modi behaviour: will India retaliate against Pakistan?

0:02The Economist

0:10Hello and welcome to The Intelligence from The Economist. I'm Rosie Bloor. And I'm Jason Palmer. Every weekday we provide a fresh perspective on the events shaping your world.

0:24You may have heard that churches tend to be rather rich, and that certainly gives them power, but it doesn't always help to make a flock more devout. Our correspondent explains why even priests and the clergy need the free market to find followers. And history is littered with media formats that died out. Remember cassettes? Eight tracks? Reel to reel? Here's the thing. Those all used magnetic tape. And it's shocking just how many institutions and companies, even high-tech ones, still use it.

1:01But first…

1:10For four consecutive days now, India's troops have exchanged overnight small arms fire with Pakistan forces across the country's disputed border.

1:24Meanwhile, India's navy has been conducting a number of long-range missile drills. The latest was yesterday. These are just a few signs of precarious relations between the two countries after last week's deadly militant attack on tourists in the Indian region of Jammu and Kashmir. Narendra Modi, India's Prime Minister, has promised justice. I say to the whole world, India will identify, defy, drag, and punish every terrorist and their backer. From a man who rarely uses English, that speech was a sign to the world that Modi is serious about retaliation. The question now is how that promise may be fulfilled.

2:14This is a perilous moment for the region. Since the Kashmir attack, tensions between India and Pakistan have escalated dramatically. Jeremy Page is The Economist's Asia diplomatic editor. There's a very high chance of an Indian military response in the next few days or weeks, but that comes with huge risks. Jeremy, before we get on to those rising tensions, just remind us what happened last week. So the attack happened on April 22nd. It was in this area of Kashmir called Pahalgan, which is an incredibly beautiful spot, known as the mini Switzerland of Kashmir. And a small number of gunmen opened fire on tourists there around lunchtime.

2:59They targeted only the men and they seem to have tried to identify the Hindus among them. It's still not clear exactly who the attackers were. The Indian government hasn't presented any clear evidence publicly yet. Pakistan's government has denied any role whatsoever, but the Indian government has publicly alleged that there was cross-border involvement from Pakistan. Former Indian military and security officials are pointing the finger very directly at Pakistan's armed forces, which have very close historical ties with militant groups in Kashmir. And of course, Kashmir has been a flashpoint between India and Pakistan for decades, hasn't it?

3:37Yes, that's right. The history is that Kashmir was a Muslim majority region with a Hindu ruler who couldn't decide whether to join India or Pakistan. They fought three wars over it. Well, two wars in 1948 and 1965, and then a more limited conflict in 1999. And there has been an insurgency against Indian rule since 1989. This was actually the deadliest attack on tourists in Kashmir since that insurgency began. And it was the bloodiest attack on all targets since 2019, when a suicide bombing killed 40 Indian policemen. And how has India responded to the attacks so far? India's response has been mainly on the diplomatic and economic front so far.

4:20It has expelled a number of Pakistan's diplomats, defence attaches and all Pakistani citizens. There weren't that many in India. India's also closed the only land border crossing between the two countries. It has suspended a river sharing treaty that dates back to 1960. Pakistan has responded more or less in kind. It's ejected several Indian diplomats. It's also suspended visas for Indian nationals. It's stopped bilateral trade and closed its airspace to Indian airlines. Pakistan's also threatened to withdraw from an agreement with India in 1972, which defines the disputed border in Kashmir. Most of these moves, a lot of them, are largely symbolic because economic trade and travel links between the two countries have been pretty limited.

5:09since 2019 when the Indian government revoked Jammu and Kashmir's semi-autonomous status. So as you say, most of those responses so far are symbolic and the big threat is military action. How likely is it that India will respond with that? Yeah, so that's the big question at the moment. It's quite likely. Certainly, Prime Minister Narendra Modi is under a lot of public pressure to do something on the military front. And there are two precedents for that. In 2016, there was an attack on Indian military bases and India responded by sending ground forces across that disputed border in Kashmir to hit militant targets.

5:49And then in 2019, after that suicide bombing that killed 40 Indian policemen, India conducted an airstrike again on alleged military sites inside Pakistan. So having sort of set the bar pretty high in those two incidents. There's a lot of public expectation that India will go a step further. But the problem that India faces is that there are not many good options on the military front that wouldn't be extremely escalatory because Pakistan is almost certain to respond in kind. That could trigger a much bigger military conflagration between the two sides, which is not necessarily in India's interests.

6:27And some people in India feel it might actually play into the hands of those in Pakistan who want to draw attention to Kashmir and want to sort of rally support around the Pakistani military. And what else might Modi do? What other options does he have? So there are a few things that are being discussed here in India. Military action is still very much on the table, but that could perhaps be limited military strikes on militant targets, perhaps still within Pakistan-controlled Kashmir, but not enough to trigger a much bigger conflagration. And then you could combine that with a much more concerted effort to isolate Pakistan internationally, to put pressure on it economically, using India's international relationships, which have strengthened quite a bit since 2019, particularly the relationship with the United States.

7:16And Pakistan has become a lot less important for the US since 2019, principally because of the withdrawal of American forces from Afghanistan in 2021. There's also been a suggestion that India could step up covert action within Pakistan. And there's some evidence to suggest that already since 2021, there's been some Indian involvement in targeted killings of militant leaders there. Jeremy, you started by saying this was the most dangerous moment for years. Just how dangerous is it? One of the reasons I said I think it's more dangerous than 2019 is that America does have less influence in Pakistan.

7:52and in 2019 it played a very important role in restraining both sides. Another one is that some of these agreements which have helped to stabilize relations between India and Pakistan seem to be at risk of unraveling. I mentioned the water-sharing treaty that India has suspended. Control of those waters is one of the main reasons that India and Pakistan both wanted control of Kashmir at independence and that agreement has survived many of their previous conflicts and confrontations over Kashmir. The agreement the Pakistanis are threatening to withdraw from, as I said earlier, that defines the disputed border in Kashmir.

8:29So if that unravels, then you could see fresh fighting over the position of that disputed frontier. So I think there is a real risk that things won't be resolved as quickly as they were in 2019. Jeremy, thank you very much for talking to me. Thank you.

9:00Henry Ward Beecher's church was spectacularly rich. Kerry-Ann Richmond-Jones is our international economics correspondent. Every Sunday in the 1850s and the 1860s, crowds would flock across New York's East River on Beecher's boats to see the charismatic preacher who had arrived in Brooklyn from rural Indiana the previous year. Mr Beecher was tasked with growing a tiny Brooklyn church. He sold sermons, bringing in so much cash that he could sponsor and arm a regiment in the American Civil War. Mr Beecher became a celebrity, and by 1875, when a scandalous adultery trial brought him down, his Brooklyn congregation had swollen from 20 souls to thousands.

9:46He was proof that religion can lead to riches, and that riches can also lead more people to religion. Today, Christianity is struggling across the developed world. 45 % of Americans attend church. That's down from 70 % in 1999. In Italy, the home of Catholicism, the number of churchgoers has shrunk by almost half over the past decade. What can the clergy do to draw people back? This is not a new problem. Priests, clergymen, all sorts of religious leaders have spent centuries thinking up ways to attract new people. The authors of the Gospels thought that miracles would draw people in. Medieval crusading popes resorted to violence.

10:33British Quakers in the 19th century in the Midlands in Britain thought that providing for the material needs of their flock through housing, social welfare provision and cash would enhance their religion. But now help might be at hand from a really unlikely source, economists. Growing numbers of economists are now studying religion as an example of how people behave, so much so that the microeconomics of religion is a newly flourishing branch of economics. So far, it's yielded some lessons. The first is that experimentation may be required. For hundreds of years, the assumption has been amongst clergymen that knowledge will lead to further godliness.

11:13According to new research by the University of Oxford, however, this theory may be misguided.

11:21The researchers look at very religious countries, where most of the population go to church or some other place of worship regularly. They find that in such societies, the more years of religious education a person receives, the less likely they actually are to vote for a religious candidate in an election. One theory about that is that religion is primarily a public performance. So people in societies where there's a lot of religion, where people tend to have very, very high amounts of faith, feel the need to perform in order to fit in and show that they have the same amount of faith. It's something we call a signal in economics.

11:59And so actually, the more hours they put into their religious education, the less often they display religion in other areas of their public life.

12:13When the Cadbury family started making chocolate in Victorian England, they also provided low-cost housing and healthcare to the area's factory workers. The Cadbury family made chocolate, but they were also deeply religious Quakers. And this did probably improve workers' well-being, but it's unlikely to have made them any more pious as Quakers. Recent research is showing that people do not feel the most religious when they get the most charity from their church. They feel more religious when they are most poor. Evangelical megachurches preach that religion and faith in God is the route out of poverty.

12:50It's an incredibly popular message in modern-day America. Ingrid Storm, one researcher, looks at 31 European countries and she found that people were more religious right when they were at their poorest rather than when the church had helped them for a number of years. Divine intervention is also not really filling pews. People who report having witnessed a miracle are actually more likely to consider themselves religious but less likely to attend church than their more rational counterparts.

13:22Thankfully, there's something even more powerful than generosity, divine intervention and education. Economic incentives. In a forthcoming paper, two economists from Brazil look at the impact that tax breaks have had on church membership in the country over the years. Incentives like this are common all around the world. American churches, for instance, are exempt from taxes on revenue and property. The results of the research are striking. Federal tax breaks from 1992 to 2018, which amounted to about a third of total religious profits, led to a third more churches being open than would otherwise have been the case.

14:03This also ripples through to politics. Tax breaks are associated with 8 % more votes for evangelical politicians, who are much better and thriftier at managing churches than their Catholic counterparts. One question is, why does this happen? Tax breaks benefit churches and not worshippers. They're not going to directly persuade people into pews. Larger congregations reflect performance related pay. It's not uncommon for Brazilian evangelical preachers, exactly the most successful pastors, to become millionaires, provided that they're able to triple, quadruple and really multiply their congregations.

14:41Lower taxes increase their profit and the extent to which they really want to preach to their fullest ability. It might be easier as well for a parishioner to believe that a well-resourced man and a well-known man is ordained by God. And we come back to the question posed by Henry Ward Beecher. Is it people believing and driving the profits of their priests, or is it the profits of priests driving people to believe?

15:37Thank you.

15:55I once thought that I was just about the last person who was determined to hang on to my music on cassette tapes. It was all the way until 2007 when I gave a friend the last of my collection, a wooden rack full of a hundred of them. The thing is, they worked. They lasted. I relied on them to store a cherished archive. And you know what? I was far from the last person to put that faith in tape. Magnetic tape still has a surprisingly large place in the American government. Daniel Knowles is our Midwest correspondent. Recently, the Department of Government Efficiency, which is Elon Musk's cost-cutting outfit, has discovered this.

16:40And they boasted about how they had transferred loads and loads of data from the General Services Administration off tape onto what they called a more modern type of storage. But there's some reasons why you might want to carry on using magnetic tape. So talk me through, in what way is a lot of tape used by the government? Tape has been used by America's government for as long as it's existed.

17:11Richard Nixon was, of course, famously brought down by the tape recordings that the White House then made of all the meetings that he had.

17:23Nowadays, it tends to be used for things like data storage. NASA store vast amounts of data from their satellites they put on it. The IRS still has some of its master files of taxpayer on data, and the National Archives has got an awful lot of it. So as for the Department of Government Efficiency, then, what's their beef? Why do they want to get rid of it? So earlier this month, Doge tweeted that they had saved a million dollars by converting a load of records at the General Services Administration from tape to what they call permanent modern digital records. And they complained that tape was this 70-year-old technology.

17:58They are right. It's pretty old fashioned. It has to be read sequentially, which means that you can't search it as quickly as you would a hard drive. It requires a whole bunch of specialist equipment. You can't really just plug it into your laptop in the same way. So I can kind of see why the Doge kids might have been like, yeah, let's move along with this. On the surface, they're creating an efficiency gain. And beneath the surface, the outcry of the government technologists who say, hang on a minute. Well, so of course, Doge haven't actually revealed what specifically they moved, but there's a whole bunch of reasons, it turns out, why you would use tape.

18:33One of the reasons is that it's kept offline, so it's very hard to hack. It also doesn't require any power. You can back up loads of stuff. And most of all, it's just a very cheap form of storing data. So, in fact, private companies, Google is one of the world's biggest users of modern tape libraries. So when they say it's the 70-year-old technology, actually a lot of companies are using a very modern form of tape to store vast amounts of data that is just cheaper to store that way than any other way. So as with so many other things, Doge is barking up the wrong tree. You reckon tape is here to stay?

19:11Yeah. Funny thing that's actually happening at the moment is there's a giant boom in tape storage, some of which has been set off by the artificial intelligence boom. In 2023, manufacturers of magnetic tape libraries shipped 153 exabytes of tape. That's 153 billion gigabytes. And you can kind of see the federal government is an organization which has to store an awful lot of data for a very long time. So without knowing exactly what Doge was transferring, you can't say for sure that they are getting it wrong. But it does feel awfully like they might be pulling on the wrong bit of tape.

19:52Thanks very much for your time, Daniel. Always a pleasure, Jason. Thank you.

20:10That's all for this episode of The Intelligence. We'll see you back here tomorrow.

20:20Thank you.