Showing posts with label US. Show all posts
Showing posts with label US. Show all posts

Saturday, April 13, 2013

Cost advantage, knowledge and know-how propel US Silver Mining Juniors


Last Updated : 05 March 2013 at 23:00 IST
As recently as 1997, the US was the world's second largest producer of silver accounting for 14% of silver mined in the entire planet. Blame it on four factors: depletion in mines on a large scale, harder to access ore, regulatory burdens, and a lack of new discovery; the US had to vacate the top spot in a decade.
US' domestic mine production of silver in 1997 was seen at 1600 tons.
“The average price of silver through the first 9 months of 1997 was $4.628 per ounce, which was down from the average $5.19 per ounce through the first 9 months of 1996. The silver price at the end of 1996 was at about $4.73 per ounce. The price began to rise in January 1997, briefly breaking through the $5.00 mark on January 27 before falling back. The highest price of the year occurred on February 27 at $5.26 per ounce. The price remained above $5.00 until April 1, falling back to $4.74 on April 4. During the next 4 months the price of silver fluctuated between $4.30 and $4.95. The price on September 30, 1997, was $5.21 per ounce.” this USGS picture gives a brief overview of the price of silver for the period.
Since 2001, the mine production of silver in US has registered a declining trend and has come down by 40%. Compared to the 1990s, the output declined by 50%. [China, currently the second-largest producer of silver was then not even in the picture in 1990s.]
“It really is amazing that one of the world’s top silver producers could tumble in such epic fashion during one of the most powerful bull markets this metal has ever seen. Factoring into this decline is large-mine depletion, pinched economics for harder-to-access ore, regulatory burdens, and a lack of new discovery.” writes Adam Hamilton & Scott Wright in the bull.com.au
When the bear hugged the silver-mining sector in 1980s and 1990s, several primary silver districts were shut down, and as a result, silver output from US is now a byproduct of copper, gold mining. And needless to say, US' output of copper and gold is also declining.
“But per my recent research looking at the universe of silver juniors, I found there to be a lot of exploration activity in the countries that are the two biggest losers over the course of this bull. Nearly a third of all juniors have a project in the US, with nearly a third also having a project in Canada.” the authors note.
In 2012, the United States produced approximately 1,050 tons of silver with an estimated value of $1.01 billion. Silver was produced as a byproduct from 35 domestic base- and precious-metal mines. Alaska continued as the country’s leading silver-producing State, followed by Nevada.
As one can see from the data, the value surge in silver mined in 2012--$1.01 billion--is not even comparable with the value of silver that it produced in 1996 at $0.23 billion. You may have to adjust it to inflation; still the 2012 value may hold more in firepower.
This ultimately is propelling many junior miners to keep their drills busy. Unlike the past, they also know where the silver is, and great resources beckoning along with advanced technology, the juniors are finding great success in their exploration endeavors.
“I suspect we’ll see a US and Canada silver revival in the coming years that will finally turn around their decade-long downward trends.” Adam and Scott said.

Friday, October 19, 2012

One may not like it; what is bad for US economy is good for Gold


Last Updated : 18 October 2012 at 12:35 IST
AHMEDABAD (Commodity Online): Gold and silver prices are looking positive for the day even as evening awaits a jobless claim report from the US. The figures are expected to boost gold prices.
The weekly data, known as initial jobless claims records the number of people who filed for insurance for the first time as jobs were snatched away from them by a down trend in the economy.
On October 11, the claims stood at 339000 against a forecast of 370000. This time around, the figure is supposed to reach 365000. A higher than expected figure is deemed bullish for gold as the same may prove to be bearish for dollar as both are inversely related.
Invariably, it has to be noted with pain that what is bad for US economy is good for gold. In fact, many job seekers out of classic case of exasperation may refrain from filing for insurance as they even consider putting a full stop to job search; unfortunate, one may say. This, however indicates the proverbial tip-of-the-iceberg situation. The jobless claims data is thus only an indication of the rot in the  economy. 
But given the earnings season signals, one may not completely rule out the possibility of a surprise and sharp fall in jobdata; if not for the week, then at least for the coming weeks as bright earnings may take time to reflect in economy as a restore point of jobs. 
India Gold
“Depreciation in Indian rupee also support higher bullion prices for the day.” said Ankush Kumar Jain, Manager-Research (metals, energy) with Commodity Online.
“Gold is having good support at Rs.31040 and resistance at Rs.31240. Intraday traders may take a long position around Rs.31120 with stop loss of Rs.31040 for the target near Rs.31230.” he added.
“Technically on daily charts, silver is now having good support at Rs 60000 and Resistance at Rs 60800” he further said.
Intra-day traders are advised to take a long position in silver December contract around Rs.60400 with stop loss of Rs.60000 for the target near Rs.60800 and Rs.61200.

Saturday, March 31, 2012

India’s role in Sri Lanka’s Dostoyevskian moment: A reading of UNHRC vote after settling down of dust

After Fyodor Mikhaylovich Dostoyevsky was sentenced to death by the Tsar of Russia for alleged royal subversion, some intuitive conviction in the great writer bordering Extra Sensory Perception told him for sure that he will not be hanged.

On the morning of execution, promulgation came out from the palace sparing Dostoevsky and fellow convicts from the rope and deporting them to cold prisons in Siberia. The whole thing was a drama (mock execution) and on the night before the same, it was noted by the author that the hair of his prison inmate, a fellow-convict, turned grey out of excessive anxiety. The palace circle which staged the drama even deliberated at length whether or not to dig graves in advance just to add a realistic punch to the whole episode.

The outcome: Dostoyevsky and his inmates thanked King profusely and remained indebted to the King for the rest of their lives even as they labored hard in Siberia. (Dostoyevsky even wrote a poem in praise of His Highness while he was in prison.)

While India’s vote at the UNHRC was against Sri Lanka, and marked a paradigm shift in its stand pertaining to country-specific resolutions, the vote against Sri Lanka has been interpreted as:

1. Feet-dragging until the last minute by Indian government
2. Buckling to American pressure on the issue
3. Allowing Foreign Policy to be dictated by Tamil Nadu politics
4. Estranging Sri Lanka
5. Pushing Sri Lanka into the strategic embrace of China

Read more on my policy blog

Monday, December 5, 2011

User name: South China Sea, Password: Philippines; How US is accessing the Chinese zone of influence

Sovereignty is a tricky word. On the one hand it stands for all that is patriotic and embodies pride. On the other hand the very patriotism and pride that it invokes guide the respective believers to sink into unrealistic and often delusionary assumptions.

Eventually, as and when this feeling of sovereignty gets hurt by an agent (read China), when this pride is curtailed by harsh realities (read untenable military ambitions), it is an awakening that in terms of geopolitics would take you to the White House.

Ask Philippines!

China is possibly regretting the way it dealt with its immediate neighbors including Philippines in the South China Sea and the resultant citing of American hull—USS Fitzgerald—in its traditional zone of influence.

On the 16th of November on board the USS Fitzgerald in Manila Bay, U.S. Secretary of State Hillary Clinton and Philippine Secretary for Foreign Affairs Albert del Rosario signed the Manila Declaration.

A part of declaration read:

“We (US and Philippines) share a common interest in maintaining freedom of navigation, unimpeded lawful commerce, and transit of people across the seas and subscribe to a rules-based approach in resolving competing claims in maritime areas through peaceful, collaborative, multilateral, and diplomatic processes within the framework of international law.”—emphasis added.

On board the ship, Ms. Clinton said in a speech: “The USS Fitzgerald has patrolled the entire Western Pacific region this year. It traveled to Australia, Russia, Guam, Saipan, the Marshall Islands, before docking here in Manila Bay. As part of Operation Tomodachi, the search, rescue, and recovery mission following the earthquake, the tsunami, and the nuclear reactor meltdown in Japan, the Fitzgerald operated closest to shore. And this summer, it transited the Gregorio del Pilar the flagship of the Filipino Navy on its maiden voyage across the Pacific. The ships cross-decked and held training sessions for 16 days on emergency response and onboard medical procedures. By the end of the exercise, the officers and crews onboard both vessels achieved new levels of proficiency and partnership.”

Chipping away the niceties in the speech and analyzing the substance would produce 4 points:

1. US Navy has unrestricted and unquestioned access to what it calls the high seas or the international waters.

2. US Navy enjoys a pre-eminence in rescue operations (which often leads to concrete relationship in post-crises periods).

3. US Navy enjoys cordial relationship with its previous rival (Russia; please see that ‘Russia’ is pronounced next to ‘Australia’).

4. US Navy cares for its allies and is keen on enhancing interoperability with Philippines.

But there is one critical point that we should not miss in the declaration. “…subscribe to a rules-based approach in resolving competing claims in maritime areas through peaceful, collaborative, multilateral, and diplomatic processes.”

All these years, the US has maintained a neutral stand in South China Sea dispute refusing to side with the claimants. Now it has changed the tack, and is taking active interest in the whole issue. One can argue that by using the world ‘multilateral’, the US is calling for enhanced ASEAN participation in the till-date regional issue.

But the very fact that the words virtually came from the mouth of none other than the US Secretary of State puts across a point: The US will have the role of a patron, if not a mediator. Any inkling of doubt in this regard is obliterated when you look at the venue where the declaration was signed: the battle ship of the most powerful Navy in the world! Unusual and probably unprecedented, in effect, it was as good as signing the declaration on American soil.

What could this be if not a strong message to China?

Origins: South China Sea (SCS) dispute

A few would recall that the SCS island disputes originated with the end of the Second World War.

In the San Francisco conference of 1951, the Allied powers failed to identify who had the title to the South China Sea islands—Spartlys and Paracel-- when they stripped Japan off the possession of the same after the Pacific War in Article 2(f) of the San Francisco Treaty. (Japan occupied the islands in 1939, when the war was on foot.)
This paved way for the littoral states like Philippines and Vietnam to raise the claims.

Had China not fallen to the Communists, the treaty may well have accorded island titles to the Chinese. But as fate would have it, this did not happen. In fact in one way or other, the Chinese had laid claim to the disputed islands during various instances in 1877 (Qing dynasty), 1883 and 1887.

In fact, even before the conference, on August 15, 1951, the Chinese Foreign Minister Zhou Enlai affirmed China’s claim on the islands (see the current map). But these claims went unheeded and Allied powers were in no mood to bequeath the islands to Communist China.

Now, only problem is that historical precedents alone will not help China calcify its claims. “Continuous and effective acts of occupation”; which worked in disputes concerning Island of Palmas, Clipperton and Eastern Greenland at the Permanent Court of Arbitration, would do.

This partly explains the developments manifested as claims, occupations and counter occupations in the South China Sea Islands in the past years by various parties, including China, Vietnam and Philippines.

Source: eia.doe.gov, 2008; UNCLOS=United Nations Convention on the Law of the Sea



What brings the US to the table?

But, the Island disputes though central to the problem of the South China Sea, singularly cannot warrant US intervention in the issue.

It needs to be something more important, lethal to be precise:

In an opinion piece written in the month of August in The Heritage Foundation portal, Renato De Castro and Walter Lohman said:

“On March 2, 2011, in the South China Sea, two Chinese patrol boats confronted a survey ship commissioned by the Philippine Department of Energy to conduct oil exploration in the Reed Bank, just 80 nautical miles west of the Philippine island of Palawan. The survey ship was in the process of identifying sites for possible appraisal wells to be drilled for the next phase of a contract with the Philippine Department of Energy, when it was accosted.

According to Philippine sources, the Chinese boats moved dangerously close to the Philippine vessel twice, as they ordered it to leave the area. Then, the Chinese boats maneuvered straight toward the survey vessel two times, apparently threatening to ram it, but turned away in time. The unarmed survey vessel radioed for assistance to the Armed Forces of the Philippines (AFP) Western Command in Palawan, and the Philippine Air Force (PAF) dispatched two reconnaissance planes to fly over the area. The Chinese patrol boats, however, had left the area before the aircraft arrived.”

After due diplomatic consultations between both sides, Philippine President Benigno Aquino III said that he wanted to defuse the tension between the two countries and announced that an unarmed Philippine Coast Guard patrol craft would be deployed to protect the survey ship conducting oil exploration at the Reed Bank.
In other words, it was all he could do; despite his country’s sovereignty getting violated in the Exclusive Economic Zone that stretched 200 kilometers into the ocean in blatant terms, that was all he could do.

Meanwhile, Chinese embassy officials in Manila insisted that China had indisputable sovereignty over the “Nansha Islands” (Spratlys) and their adjacent maritime territory. China was blind to the fact that the claims are disputed and the UNCLOS (United Nations Convention on the Law of the Sea) stipulates 200nm EEZ rights to the Philippines.

China has ratified the convention but with riders attached that gives it exclusive sovereignty on the disputed islands which means exclusive EEZ rights (though that may overlap with EEZ claims made by others under the provisions of the same convention!) and has reaffirmed that, “the provisions of the United Nations Convention on the Law of the Sea concerning innocent passage through the territorial sea shall not prejudice the right of a coastal State to request, in accordance with its laws and regulations, a foreign State to obtain advance approval from or give prior notification to the coastal State for the passage of its warships through the territorial sea of the coastal State.”

In other words, the Freedom of the Seas as enjoyed by traditional maritime powers like US would require Chinese approval or at least notifying China, if the US Navy or some other forces ever has to pass through the SCS.

Clearly US is vehemently against this.

Writes Walter Lohman in another opinion piece in The Heritage Foundation portal:
“(Freedom of the Seas) is a bedrock, non-negotiable interest of the United States. The U.S. is the world’s preeminent seafaring nation. When it comes to the South China Sea—through which half of global shipping and most of Northeast Asia’s energy supplies transit—its position is consistent: All nations enjoy navigational rights and freedoms there that are qualitatively and quantitatively the same as those applicable on the high seas.”

The caveat is here: SCS is a vital shipping lane and by far the shortest route from the North Pacific Ocean to the Indian Ocean. The world’s second busiest international sea-lane, with over half of the world’s petroleum-bearing traffic passing through, the region boasts of rich fishery resources, and is widely said to hold enormous potential as a source of oil and natural gas.

Clearly, it is a region that the US cannot ignore as long as it cares about its multi-faceted national interests. If the US, by far thousands of kilometers away from the region, is finding the region to be important, one can only sigh at the enormous interest China has in the Sea; China’s vulnerable backyard.

It also tells us why China is reluctant to involve third parties in the issue; especially the US.

The United States was among the nations that participated in the third United
Nations Conference on the Law of the Sea, which took place from 1973 through 1982
and resulted in the international treaty known as the United Nations Convention on
the Law of the Sea (UNCLOS). The United States also participated in the subsequent
negotiations of modifications to the treaty from 1990 to 1994. The UNCLOS came into
force in 1994. Although the United States now recognizes the UNCLOS as a
codification of customary international law, it has not ratified it.From nationalsovereignty to taxation to economics, a variety of arguments is doing rounds for the non-ratification of treaty by the United States.

Writes David A. Ridenour in an article: “…there are serious flaws in the treaty that -if U.S. ratified the treaty - could place U.S. sovereignty, security and political
independence in doubt.” “The "right of innocent passage" is the right of any
nation's ships to traverse continuously and expeditiously through the territorial
waters of a coastal nation, subject to certain conditions. Under the Law of the Sea
Treaty, such passage is conditioned on passing in a manner that isn't threatening to
"sovereignty, territorial integrity or political independence" or the "good order and
security" of that nation.

By this definition, if the Law of the Sea Treaty was a ship, it would fail to qualify.”—he elaborates. So clearly there are tussles: While states like Philippines and China interpret the UNCLOS in their own terms that foments episodes of uncalled-for provocations, pre-eminent sea faring powers like the US are reluctant to cede the
‘traditional rights’ that they have enjoyed for decades. Both these tussles are shaping the nature of future conflicts in the South China Sea.

In a 1998 Pacific Forum CSIS paper titled, ‘Security Implications of Conflict in the South China Sea: Exploring Potential Triggers of Conflict’, prepared by Ralph A. Cossa it is said, “the proximity of the Spratlys to South China Sea shipping lanes adds an important strategic element to the dispute. A threat to freedom of passage through the South China Seas would severely disrupt regional economies. If, during any military action in the Spratlys--or, for that matter, in the course of defining its claim over the currently occupied or coveted territory--any nation threatened to inhibit the free flow of maritime traffic along these critical SLOCs (Sea lines of communication), the U.S. would almost certainly become involved since America's economic growth and security depend upon continued freedom of navigation for both merchant and military shipping. Other nations heavily dependent on maritime commerce could be expected to at least endorse, if not actively participate in, any U.S.-led enforcement of freedom of navigation along the South China Sea's heavily-traveled sea lanes.”

Profound and prophetic!

Meanwhile, The Wall Street Journal has reported that “Chinese Premier Wen Jiabao reluctantly discussed the issue with 17 other leaders at the East Asia Summit in Bali, Indonesia, on Saturday (November 20, 2011) while restating China's position that it was an inappropriate forum to address the matter, according to U.S. and Chinese official accounts of the meeting.”

The reported noted that Five Asean members—Singapore, Philippines, Vietnam, Malaysia and Thailand—as well as Australia and India raised the South China Sea issue directly at the Chinese Premier.

(Meanwhile, a U.S. official denied that he had lobbied other attendees to put the South China Sea on the agenda.)

China's state-run Xinhua news agency quoted Mr. Wen saying: "I don't want to discuss this issue at the summit. However, leaders of some countries mentioned China on the issue. It's impolite not to make a return for what one receives. So, I am willing to reiterate China's stance.” The Wall Street Journal said.

Axial shift in the stand of small littoral states

To involve US in the issue is an axial shift in the stand of all the littoral states that has cemented their grouping under the ASEAN umbrella.

This is because the Declaration on the Conduct of Parties in the South China Sea proved to be an ineffectual angel. As per the crux of the declaration signed by ASEAN and China in 2002:

• The Parties concerned undertake to resolve their territorial and jurisdictional disputes by peaceful means, without resorting to the threat or use of force, through friendly consultations and negotiations by sovereign states directly concerned, in accordance with universally recognized principles of international law, including the 1982 UN Convention on the Law of the Sea;

• The Parties undertake to exercise self-restraint in the conduct of activities that would complicate or escalate disputes and affect peace and stability including, among others, refraining from action of inhabiting on the presently uninhabited islands, reefs, shoals, cays, and other features and to handle their differences in a constructive manner.

This has sporadically been violated by China many times. No wonder ASEAN sent the SOS to US.

Password: Philippines

“This incident (Reed Bank incident)—and at least eight others since February 25—underscores the sensitivity of the territorial dispute in the bilateral Philippines–China relationship; highlights broader tensions in the South China Sea, which is claimed in whole or part by China, the Philippines, Vietnam, Malaysia, Brunei, and Taiwan; and starkly points to the continued relevance of the obligations embodied in the 1951 U.S.–Philippines Mutual Defense Treaty.” Renato De Castro and Walter Lohman added.

It has to be noted that, U.S.-Philippine relations are based on shared history and commitment to democratic principles, as well as on economic ties.
The historical and cultural links between the Philippines and the United States remain strong. The Philippines modeled its governmental institutions on those of the United States and continues to share a commitment to democracy and human rights. At the most fundamental level of bilateral relations, human links continue to form a strong bridge between the two countries. (There are an estimated four million Americans of Philippine ancestry in the United States, and more than 300,000 American citizens in the Philippines.)

Until November 1992, pursuant to the 1947 Military Bases Agreement, the United States maintained and operated major facilities at Clark Air Base, Subic Bay Naval Complex, and several small subsidiary installations in the Philippines. In August 1991, negotiators from the two countries reached agreement on a draft treaty providing for use of Subic Bay Naval Base by U.S. forces for 10 years…

The post-U.S. bases era has seen U.S.-Philippine relations improved and broadened, with a prominent focus on economic and commercial ties while maintaining the importance of the security dimension. U.S. investment continues to play an important role in the Philippine economy, while a strong security relationship rests on the 1952 U.S.-Philippines Mutual Defense Treaty (MDT). In February 1998, U.S. and Philippine negotiators concluded the Visiting Forces Agreement (VFA), paving the way for increased military cooperation under the MDT. The agreement was approved by the Philippine Senate in May 1999 and entered into force on June 1, 1999. Under the VFA, the United States has conducted ship visits to Philippine ports and resumed large combined military exercises with Philippine forces.

In October 2003, the United States designated the Philippines as a Major Non-NATO Ally. That same month, the Philippines joined the select group of countries to have ratified all 12 UN counterterrorism conventions.

The military relation between both states has been gaining traction and China may backtrack if not launch another round of charm offensive for a while to pacify the situation in SCS. Estranging its neighbors may not prove good for China and Beijing knows this well. In the same breath, estranging China is not good for other littoral states.
“While the core problem is a regional one, global issues and concerns are raised that could have far-reaching consequences. Today, all parties have a vested interest in a peaceful resolution of the dispute. As a result, the prospects for conflict seem low in the near term. However, the potential for conflict remains and could grow, especially if potential triggers of conflict are not clearly understood and avoided.” the paper ‘Security Implications of Conflict in the South China Sea: Exploring Potential Triggers of Conflict’, prepared by Ralph A. Cossa cautioned.

“While the prospects of military confrontation over the Spratlys remains low, it would be naive to completely rule out the possibility of the use of force. This is especially so if major oil discoveries are made or if energy shortages add to the perceived (even if unproven) importance of the Spratlys.” It said, and added. “If it were positively determined tomorrow that there was no exploitable oil in the Spratlys, the dispute would not go away; no claimant would, as a result of such news, abandon its claim—the bottom line issue is still sovereignty.”

With the US declaring the Pacific Century in a big way, it is not going to be deluded by the charm offensive that China may launch. With Canberra in tight embrace and Manila joining the stable, the US will continue to make its presence felt in the traditional Chinese zone of influence.

The question is whether other ASEAN members would start talking Filipino? Well, that depends a lot on China.

As I said in the beginning, sovereignty is a tricky word!

As published in the think-tank portal Center for Asia Studies, Chennai

Tuesday, October 12, 2010

The revised US plan to intercept potential Iranian missile attacks OR Iraqing Iran

Introduction
The United States Intelligence Community (IC), comprising of sixteen intelligence agencies has finally reached a billion-dollar consensus: Iran may not develop ICBMs (Intercontinental Ballistic Missiles) at least for the next six to eleven years! Previously, it was believed that Iran had plans to develop ICBMs in a lesser time-frame.
The United States’ NMD (National Missile Defence) program was conceived to take care of the scenario, where Iran or North Korea comes up with the ICBM to attack America.
However in a move which drew appreciation and flak alike, Mr. Obama has decided to scrap the BMDS (Ballistic Missile Defence System) - a program of NMD- to be deployed at Eastern Europe. Russian premier Mr. Vladmir Putin, has welcomed the initiative and even termed it “correct and brave”. BMDS, which had aimed to address the threat from Iran, was perceived as a threat to Russia in the garb of a missile defence system.
In the world of defence and strategy, every high-profile move has their own implicit intentions. Though critics are pummelling the US President, telling that the initiative will be interpreted as a sign of “ weakness” rather than “ goodwill”, the US is sure to have many trumps up their sleeves.
What is BMD?
BMD is a missile defence system intended to protect the US, its deployed forces, allies and friends from ballistic missiles of all ranges and in all phases of flight.
Ballistic missiles are grouped into four, based on their range:
1. Short-range (less than 1,000 kilometers)
2. Medium-range (1,000 to 3,000 kilometers)
3. Intermediate-range (3,000 to 5,500 kilometers)
4. Long-range (greater than 5,500 kilometers)

These missiles could be intercepted in three stages:
1. The boost phase, wherein the launch vehicle has been launched and its boosters have burned out.
2. Mid-course phase which means the flight through space.
3. Terminal phase where the missile is nearing its target.

Weaponry, including missiles, guided by sensors plays the role of the interceptor. A command and control system facilitates interception.

Disadvantages of the current BMD

The BMD had envisioned deploying (only)ten Ground Based Interceptors in Poland as weaponry and building a huge radar site in Czech Republic to sniff out the trajectory of the threat. The intelligence reports in 2006, furnishing the pace of the development of ICBMs by Iran, promoted the BMD program.

But the new reports tell a different story:

Iran, in its efforts to boost its capabilities is in the course of developing, short and medium- range ballistic missiles. The pace of their innovation has made the Americans to sit-up and take notice. The BMD project, in its current form, is simply incapable of addressing the short- to medium-range ballistic missiles that could be fired by Iran. It would leave the Americans lurking in darkness as Iran fine-tunes its technological prowess.

Moreover, the proposed interceptors in Poland would have facilitated nil coverage to some of the allies in NATO like Bulgaria, Greece, Romania and Turkey.

Above all, Russia perceived it as a new step in the arms race with American missiles right in its yard.

Obama’s Plan

In the new plan, missile defence components will be deployed across Europe in a span of ten years in four phases, beginning from 2011- the main-stay of the program being a combination of fixed and re-locatable Standard Missile-3 (SM-3) and radars.

The plan in phases:

Phase one: In the timeframe of 2011, deploy the tried and tested missile defence systems available. The whole process may take the subsequent two years and includes the sea based Aegis weapon system, the SM-3 interceptor (Block 1A), and sensors such as the forward-based Army Navy / Transportable Radar Surveillance system (AN/ TPY-2). The advantage is obvious: regional ballistic missile threats to Europe and the deployed US troops and their families will be taken care of.

Phase two: In the timeframe of 2015, deploy a more capable version of the SM-3 interceptor (Block IB) in both sea and land-based configurations succeeding appropriate testing. Advanced sensors will help in expanding the defended area against threats arising out of short- and medium-range missiles.

Phase three: In the time-frame of 2018, deploy the more advanced SM-3 Block IIA variant (which is currently under development). It will work against short-, medium- and intermediate-range missile threats.

Phase four: In the time-frame of 2020, deploy the SM-3 Block IIB after its development and testing are complete. It would help US to cope with medium - and intermediate-range missiles and the potential ICBM threat of the future.

The US will also be improving the sensors for missile defence throughout the four phases. And the
new plan doesn’t warrant the installation of huge radar in Czech Republic. A different and better interceptor technology means ease of deployment and use.

The new system of missile defence will be augmented with the existing ground-based interceptors deployed at Alaska and California to protect the home-land, in the fourth phase. Moreover, the new plan is six to seven years ahead of the shelved plan, in implementation. In addition to extending the protective umbrella over all NATO members and allies, in concert with their individual defence capabilities, the plan provides flexibility to up-grade and adjust the architecture of interceptor system in a cost-effective manner.

Unlike the previous plan, the new missile defence plan incorporates the allies in Europe as well as NATO. It promotes a multi-lateral approach and not a trilateral approach involving Poland and Czech Republic only. In short, the new system is more “realistic” in its perception of threat scenarios.

The revised system will ensure that European countries and Unites States work more closely on strategic fronts. This will eventually give rise to a fortification of relationship between the participants, ensuring a stronger deterrent in place of which missile defence system is only a part of.

In a scenario where Iran launches a missile at a NATO ally, it will incur the wrath of all NATO members.

A call to Russia?

There seems to be a plan to invite Russia with its wealth of strategic knowledge, to join the new plan. NATO Secretary General Anders Fogh Rasmussen, in his first major speech as the Secretary General, referred to this aspect. He emphasized on exploring the potential of linking the US, NATO and Russian missile defence systems “ at an appropriate time” to combine their collective wealth of experience aimed at “mutual benefit “. He was of the hope that a revival of NATO-Russia council where both parties could discuss common security concerns enhances cooperation. Iran, after all, is a concern for Russia too.

If the above said plan gets materialized, Iran gets the signal that US is not alone in its endeavour to curtail the strategic ambitions of the so called rogue sates.

Russia, though has welcomed the US plan to scrap the BMD, seems to be fully aware of the consequences of the new plan ( as explained in the ensuing paragraphs). Beyond diplomatic niceties as exhibited by the Russian premier, Russian Ambassador to NATO, Dmitry Rogozin said that Russia cannot be “childishly euphoric” about the US initiative to suspend the BMD deployment. Russians are reluctant to perceive it as a “concession” from the US.

Why Iran has changed course to a different degree of defence?

Before explaining in detail, the implications of the new missile defence system, it is worthwhile to think why Iran has changed its plans, in a strategic somersault. Why is it keen on developing short and medium range ballistic missiles instead of ICBMs?

It is because Iran has shuffled its priority hit list sensing change of strategic realities.

Intercontinental Ballistic Missiles are essentially long range missiles which Iran planned to include in its arsenal to mount a strike on America, of course after fitting it with an indigenous nuclear war head. Iran foresaw the possibility of a US strike and found that an effective deterrent can be nuclear weapons and a couple of delivery vehicles.

But soon enough, Iran realized that the actual threat lay somewhere close to it, in its neighbour hood- Israel. The Islamic Republic had been at loggerheads with the Zionist state since the Iranian revolution. The verbal wars between both countries continued into decades. Threats from US and satiation of Israel’s nuclear arsenal triggered the Iranian hunger for nukes. And that lead to its development of covert nuclear installations retailed out by notorious A.Q. Khan.

But one cannot depend on a postman to deliver these warheads! Hence, the short and medium range ballistic missiles, tailored for Israel.

The latest news is that Iran is shopping around to have advanced surface-to-air missiles (S-300) and Russia can be a source. Read this is in the context of Iran revealing its secret nuclear installation at Qom.

Iran now knows that it is impossible for it to develop nuclear weapons, at least when the Americans are on prowl. The only solution is to protect these facilities which it has painstakingly built after several years of sweating it out, braving sanctions. But Israel is someone who can upset the applecart. Russia too may back-off from selling missiles due to international pressure. The only way out is to foster the indigenous missile development program and protect itself from possible Israeli air-attacks.

Sneak a peek at Israel’s hand

As usual, Israel has played its trump-United States of America. Engaging all of its sixteen intelligence agencies for some serious data-mining in Iran shows the gravity of the situation as perceived by the Americans. If the previous plan was to install a BMDS to protect American longevity, the new plan takes into account the United States’ brother-like love for Israel. In the garb of protecting partners and allies and inviting Russia to join forces with America, US is stepping up the pressure on Iran that could break the barometer, eventually. Add to this, the fresh call for additional sanctions and the Iranians living a life in the ventilator, may soon be doomed. The internal unrest in Iran would be fomented, as peace and stability turn into rubble.

Advantage USA

So, what piece of pie will the U.S. get out of this? “Really big”, is the answer.

The US will get a back-door entry into the neighbour- hood of Russia as Iran turns into a cauldron of chaos. The authorities there can be dethroned. Iran has nuclear capability which is a good pretext for the US to ‘intervene’ or in other words, “Iraqing Iran”. Millions of barrels of oil and gas are an incentive enough! To achieve this, the US just has to relocate a part of its troops in the military bases of Afghanistan to Iran. Any wonder, the US is “considering” an increase of troops in Afghanistan?

Implications on Russia
Though the new plan is intended to curtail Iran’s strategic game plans, the ultimate aim could be Russia! A pro-US bulwark, which the plan eventually hopes to build in Europe and Asia by the year 2020, is definitely not in the interests of Russia- and Russia knows it well.

How Russia is going to tackle the emerging situation can be an interesting study in strategic affairs.