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AllAfrica
36 minutes ago
- AllAfrica
What India can teach the US about digital finance
The new US administration has made digital finance an early priority, championing three pieces of legislation governing digital assets—the GENIUS Act, the CLARITY Act, and the CBDC Anti-Surveillance State Act. The first bill was signed into law by President Donald Trump on July 18, while the latter two recently advanced to the Senate. The laws have given a boost to advocates of digital assets, but face harsh criticism from consumer advocacy groups and experts over safety and stability concerns. As US policymakers continue to consider the promise and perils of digital finance, they should look toward the experience of India, a global leader in digital payments and digital public infrastructure, for critical lessons on the centralization and adoption of consumer-facing digital finance. Although the bills collectively clarify the federal regulation of many digital assets for the first time, they broadly sideline the federal government from the developing ecosystem of digital finance. The clearest manifestation of this trend is the ban on Federal Reserve digital currencies in the CBDC Anti-Surveillance State Act, a policy that—if enacted—would make the United States an international outlier. For its part, the CLARITY Act would effectively reduce federal scrutiny of digital assets like cryptocurrencies. These aspects of the new legislation represent components of a broader agenda of deregulation, but they carry particular risks for the development of secure and successful digital finance in the United States. India offers a useful lesson in productive state-led digital finance, demonstrating a healthy balance between public-led initiatives and private sector partnerships that ultimately deliver quality options to consumers. India's central government has proactively developed 'digital public infrastructure' (DPI) under the India Stack framework and positioned the state as a provider of digital public goods. In India's digital payments ecosystem, for instance, the National Payments Corporation of India (NPCI) oversees the Unified Payments Interface (UPI) and serves as the central hub for real-time transactions between banks, payment service providers, and consumers. However, because of UPI's openness and interoperability, private sector platforms are among the biggest winners of India's digital finance revolution, including US firms—Google Pay and PhonePe (owned by Walmart) process nearly 90% of transactions. Moreover, government involvement through the centralized hub unlocks improved consumer data protection and record-keeping to combat fraud and financial crime. India's experience also demonstrates the key role of adoption in the transition to digital finance. Certainly, many of the initial applications of stablecoin technology will be for back-end transactions in financial markets, but US companies will eventually look to harness consumer-facing stablecoins to ease retail payment costs and enable new offers or discounts. As consumers adapt to novel technologies and navigate a potential proliferation of digital asset offerings, adoption will be a major roadblock—especially given the sluggish US shift to digital payments. India's digital finance adoption has been remarkable. With difficult initial conditions, the Asian country has emerged as the global leader in real-time digital payments, processing 18 billion transactions each month. The Indian government achieved this rapid adoption through forward-looking initiatives that laid the groundwork for the digital finance ecosystem, including the aggressive implementation of the 'JAM trinity' of banking, identification, and mobile access. Then, in designing the ecosystem, NPCI prioritized simplicity, convenience, and cross-platform integration—all boons for otherwise reluctant or unaccustomed consumers. Lastly, political initiatives played a major role in pitching digital finance to the wider population, exemplified by the public-facing Digital India program. Due to variations in economy and demography, the Indian experience does not map directly onto the United States, but policymakers should heed the universalizable lessons on the importance of complementary digital infrastructure, consumer-friendly principles, and awareness-building. How can US officials integrate these insights into the policy agenda for digital assets? First, the US government should embrace centralization, either through proactive public development or—more likely—through pointed regulation of private sector players. For back-end stablecoin applications, the development of a central hub akin to NPCI would lend stability to the emerging digital financial system, as well as improved documentation and cybersecurity. For consumer-facing applications, although the US government is unlikely to develop or require a unified digital assets platform, regulations aimed at ensuring openness and interoperability will help stem the growth of a complicated landscape of siloed proprietary stablecoins. Second, if the administration intends on making the United States the 'undisputed leader in digital assets,' it must take adoption seriously. To build up complementary infrastructure, India proliferated bank accounts and mobile phones—the US government could focus on augmenting connectivity or spreading access to new financial technologies like digital wallets. Moreover, adoption relies on trust. If regulators continue to underdeliver on consumer protection, the United States will struggle to maintain leadership on digital assets for retail applications. But if the US government follows the Indian example, companies and consumers alike will benefit from the new era of digital assets. Andrew Gordan is a Motwani Jadeja US-India fellow at the Pacific Forum, where he researches Indian tech diplomacy. He also serves as a junior fellow in the South Asia Program at The Stimson Center think tank. He received his BA in Government from Harvard and is a recipient of the Boren and Fulbright-Nehru scholarships. He has previously worked at The Council on Foreign Relations, Wilson Center and Harvard's Davis Center.
RTHK
2 hours ago
- RTHK
Hang Seng Index joins region in profit-taking
Hang Seng Index joins region in profit-taking The Hang Seng Index lost 135 points to open at 25,531.59 on Friday. File photo: RTHK Regional shares eased from highs on Friday, with Japanese markets retreating from a record peak, as investors locked in profits ahead of a crucial week that includes US President Donald Trump's tariff deadline and a host of central bank meetings. In Hong Kong, the benchmark Hang Seng Index lost 135 points, or 0.53 percent, to open at 25,531. Across the border, mainland blue chips declined 0.2 percent. Japan's broad Topix index, which had jumped more than 5 percent over the previous two sessions to reach an all-time high, pulled back 0.7 percent. The Nikkei slipped 0.5 percent from Thursday's one-year high. Australian shares were headed for their worst week in months, dragged down by losses in gold stocks and miners, while markets awaited progress in US trade talks. The S&P/ASX 200 index lost 0.5 percent to 8,935 by midday local time, taking its decline to more than 1 percent so far this week and putting it on track for its steepest weekly drop since April 4. Next week, in the United States alone, investors need to contend with Trump's August 1 deadline for trade deals, a Federal Reserve policy meeting, the closely watched monthly payrolls report, and earnings from the likes of Amazon, Apple, Meta and Microsoft. The Bank of Japan has its own policy announcement on Thursday, and Prime Minister Ishiba's Liberal Democratic Party holds a meeting the same day. That's after the European Central Bank held rates steady on Thursday, pausing its easing campaign as it waits to assess any impact from US tariffs. (Reuters/Xinhua)
AllAfrica
4 hours ago
- AllAfrica
US and its allies unprepared to repel saturation missile attacks
Between June 13 and 24 Iran launched 574 missiles attacking Israel. Some of them got through, despite Israeli and US efforts to stop them. Until now we have lacked convincing data allowing some cogent analysis of the results of missile defenses. That information is partly supplied by a new study by the Jewish Institute for National Security Affairs, a Washington-based think tank that is pro-US defense and pro-Israel. There are some surprises. The biggest one is the role of THAAD operated by US personnel in Israel and in the Gulf. THAAD is the Terminal High Altitude Area Defense system. It is designed to intercept short-, medium- and long-range ballistic missiles. THAAD interceptors cost $12.7 million each, making them expensive, but not nearly as costly as the AEGIS SM-3 Block 2A interceptor that is priced at just under $28 million per shot. THAAD is a hit-to-kill, or kinetic kill, interceptor that does not use explosives. It has an operational ceiling of around 92 miles, so it is not capable of exoatmospheric intercepts (310 to 620 miles). Israel's high altitude interceptor, Arrow 3, is said to be capable of intercepts in the exoatmosphere. According to the JINSA report, in the June conflict THAAD intercepted 47.7 percent of all the missiles fired at Israel, an unexpectedly high proportion. In doing so, the US expended at least 14% of its total THAAD interceptor stockpile. JINSA says it will take Lockheed, which manufactures the THAAD interceptors, around eight years to replenish the US stockpile, assuming the rate of production is not significantly increased. Take Note: We only know the number of Iranian missiles shot down by THAAD (92). We do not know how many THAAD interceptors were launched to shoot down the Iranian missiles. The 14% figure represents the claimed kills, not the actual number fired. Thus the remaining inventory of THAAD interceptors may be smaller than stated in the report. There are a couple of important caveats. The first is that the US is supplying other countries with THAAD systems. Saudi Arabia has a THAAD system delivered from the United States and 50 interceptors. However, it has ordered 360 interceptors, which will take years to manufacture. Saudi THAAD personnel. Photo: Kingdom's Ministry of Defense The UAE reportedly has 192 THAAD interceptors, although it is not clear all have been delivered. The US also has THAAD systems in South Korea (where there are now reports North Korea is boosting its missile production) and in Hawaii, Guam and Wake Island. Given the Chinese missile threat and regional volatility, the US may have to beef up supplies for the Pacific. The alternative is to reply on AEGIS, a very expensive system that operates at sea and therefore is not capable of fully protecting US and allied bases in the region. The second problem is intercepting hypersonic missiles. Iran reportedly used some of these attacking Israel. China and Russia already have them (e.g., DF-17 with DF-2F hypersonic glide vehicles and Russia's Avangard and Oreshnik ballistic missiles, plus Kinzhal and Zircon). THAAD probably needs to have longer range and speed to counter hypersonic missiles, something that has been proposed (THAAD-ER) but not yet approved. Israel has Arrow 2 and Arrow 3, the latter able to operate in the exoatmosphere. In the recent conflict, Israel says it intercepted more than 200 Iranian missiles, Another 258 missiles were not intercepted because Israel determined they were not going to hit populated areas or critical infrastructure. THAAD intercepted 92 Iranian missiles. According to Israeli reports, that left 57 Iranian missiles that got through and did damage. What the information tells us is that more than half of Iran's missiles were inaccurate (for one reason or another). It tells us that Israel does not have an adequate missile intercept inventory or launcher capability. Apparently Israel recognizes this shortcoming, but it depends on US manufacturing to help fill the gaps. It also tells us that Israel cannot defend its territory without the United States. The great importance of THAAD for defending Israel is critical. The JINSA report does not take into account Iranian and other drones fired at Israel. However, that threat will also multiply in future. (Israel has Iron Dome and Iron Beam, and can also use its air force to shoot down drones,) Patriot also played a role in the conflict, mainly to defend al Udeid air base in Qatar. The Iranians fired 14 short and medium range missiles at the air base on the last day of the conflict, and the US was warned about the attack ahead of time by Iran. In response the US launched 30 Patriots and intercepted 13 out of 14 Iran's missiles. One missile got through and damaged a communications dome on the base. Before and after photos of damage at Al Udeid Air Base last month. Photo: Planet Labs In practice this means it takes at least two Patriot interceptors for every enemy missile fired. As is well known, the US is in short supply of Patriot, which the US, its allies and friends rely on for air defense. This has caused significant controversy in connection with supplies of Patriots for Ukraine. The Pentagon has made clear that stockpiles are at a critical level and it does not want to deplete them further in support of Ukraine. Instead, at President Donald Trump's initiative, Germany has agreed to supply Patriot interceptors (model unclear, as there are different Patriot interceptors, the most important PAC-3), but Germany does not have enough. The German Defense Minister, Boris Pistorius, is negotiating with his European counterparts, to 'find' the missiles Ukraine needs. Allegedly, Germany will pick up the bill for replacing them later., but the Germans now want US guarantees. The JINSA paper also points out that Israel destroyed some 250 Iranian missile launchers (only after they fired their missiles). This is a luxury that Ukraine, for example, does not have and it is a challenge for the US and its Pacific allies, because finding and destroying adversary launchers (e.g., potentially China's or Russia's) is a far bigger challenge than Iran. The US and Israeli ability to manufacture air defense missiles is inadequate against Russian, Chinese, Iranian and maybe North Korean factories' ability to produce ballistic missiles. What is true for the defense of Israel, supplementation of Israel's local air defenses with US assets, also is true for Europe and Asia. NATO has very limited air defenses, well below what Israel has but a need to protect a massively bigger territory. The United States' Asian allies Japan and South Korea also have limited air defenses, mainly relying on their own Patriot systems or on Patriot plus AEGIS in the case of Japan. Taiwan has Patriot PAC-3, but not enough systems or missiles. The US, at present, would find it extremely difficult to backstop NATO against a massive attack by Russia, or to support Japan and South Korea, let alone Taiwan, with de minimis stockpiles and too few systems. There is THAAD in Korea, but not in Japan or Taiwan. Japan even rejected AEGIS Ashore to protect its territory, although it does have four AEGIS-equipped ships. Taiwan publicly rejected THAAD, an incredibly foolish move. To make a long story short, the US and its allies are not well prepared against saturation missile attacks and don't have enough coverage to protect military installations, command and control centers, airfields, naval ports or even logistic centers and factories (putting aside attacks focused on critical infrastructure, as we see on a daily basis in Ukraine). It should be obvious that the US industrial base is not ready for the challenge, that there are not enough factories and that efficiency (understood in terms of output) is low. The Pentagon is still relying on ordering missile production from existing factories rather than really trying to reform the manufacturing infrastructure so we can match the output of Russia, China or even Iran. Stephen Bryen, a special correspondent to Asia Times and a former US deputy undersecretary of defense for policy, also previously served as executive director of the JINSA think tank. This article, which originally appeared in his Substack newsletter Weapons and Strategy, is republished with permission.
