1. 63,000 farm co-ops to be digitised
Computerisation will link all credit societies to a common accounting system
The Cabinet Committee on Economic Affairs (CCEA) on Wednesday approved a proposal to digitise around 63,000 primary agricultural credit societies (PACS).
Union Home and Cooperation Minister Amit Shah said that PACS are the smallest unit in the cooperative sector and their computerisation will prove to be a boon for it.
Mr. Shah said the PACS will be digitised at a cost of ₹2,516 crore, which will benefit about 13 crore small and marginal farmers.
Each PACS will get around ₹4 lakh to upgrade its capacity and even old accounting records will be digitised and linked to a cloud based software.
“In this digital age, the decision of computerisation of PACS will increase their transparency, reliability and efficiency, and will also facilitate the accounting of multipurpose PACS,” Mr. Shah said.
The Minister said the software will be made available in local languages for the convenience of the people.
“Along with this, it will also help primary agricultural credit societies (PACS) to become a nodal centre for providing services such as direct benefit transfer (DBT), Interest subvention scheme (ISS), crop insurance scheme (PMFBY), and inputs like fertilizers and seeds,” he said.
Agricultural insurance refers to an insurance policy availed by a farmer that usually protects him against any losses related to farming incurred following any untoward incident (death, flood, drought etc.). It seeks to minimize the uncertain loss incurred by a farmer due to any unfortunate incident.
As farming involves different types of activities and businesses rather than a single one, agricultural insurances are also of several types that may cover specific aspects of farming. There are the following types of agricultural insurance mainly:
- Crop agricultural insurance
- This type of insurance usually protects farmers or producers against the loss of crops due to natural disasters, such as hail, drought, and floods, or the loss of revenue due to declines in the prices of agricultural commodities.
- It can be generally of two types:
- Crop-yield insurance.
- Crop-revenue insurance.
- Farm equipment and property agricultural insurance
- This type of agricultural insurance involves protection against loss or degeneration of equipment and properties used in agriculture and farming.
- These are usually availed by farmers and agro-allied businesses involved in processing and packaging agricultural produce.
- Animal agricultural insurance
- It is generally availed by farmers who practise animal rearing.
- It protects against the loss of animals such as fish, birds and livestock due to disease outbreaks, accidents and natural disasters, such as hail, drought, and floods.
Need for agricultural insurance
- India is an agro-based country. A large part of the Indian population is engaged in farming and thus, it plays a major role in the Indian economy.
- However, agriculture has always been a risky affair for the people engaged in it. This is due to the following reasons:
- Indian farmers are highly dependent on weather conditions for growing their crops. This leads to variability in production resulting in no stable guaranteed income at the end of the farming season.
- Price fluctuations often lead to income failure.
- As per the Food and Agriculture Organisation (FAO), in India, around 36 mha (million hectares) agricultural area was affected due to hydro-meteorological calamities, including heavy rain and floods since 2016.
- These have led to repeated losses for farmers, especially small and marginal ones who comprise over 85 per cent of the total number of farmers in the country.
- To help the farmers in dealing and rebounding with extreme weather events and protect them from heavy losses, agricultural insurance is a necessity.
- Agricultural insurance will not only ensure a stable cash flow and protect them from bankruptcy but will also help them stay in the business and continue planting for the next season.
- It will also encourage the investors to invest in farming activities.
Major government schemes
- Pradhan Mantri Fasal Bima Yojana (PMFBY)
- It was launched in February 2016.
- It provides a comprehensive insurance cover against failure of the crop thus helping in stabilising the income of the farmers.
- It provides insurance protection for food crops, oilseeds and annual horticultural/commercial crops notified by the state government.
- The scheme is compulsory for loanee farmers availing Crop Loan /KCC (Kisan Credit Card) account for notified crops and voluntary for others.
- The scheme is being administered by the Ministry of Agriculture.
- Restructured Weather Based Crop Insurance Scheme (RWBCIS)
- It was launched in February 2016.
- It aims at mitigating the hardship of the insured farmers against the financial loss of farmers incurred due to crop loss resulting from adverse weather conditions such as rainfall, temperature, wind, humidity etc.
- Crops covered under the scheme are food Crops (Cereals, Millets and Pulses), oilseeds and commercial or horticultural crops.
- All farmers including sharecroppers and tenant farmers growing the notified crops in the notified areas are eligible for coverage.
- All farmers availing Seasonal Agricultural Operations (SAO) loans from Financial Institutions (i.e., loanee farmers) for the crop(s) notified are covered on a compulsory basis.
- The Scheme is optional for the non-loanee farmers.
- The scheme is being administered by the Ministry of Agriculture.
- Coconut Palm Insurance Scheme (CPIS)
- The Scheme is initiated by the Government of India and is implemented through insurance companies authorized by the Department of Agriculture and Cooperation (DAC).
- It aims at minimizing the losses occurring to farmers practising Coconut Palm cultivation.
- Farmers can enrol in this scheme at any time of the year.
- Unified Package Insurance Scheme (UPIS)
- It covers people connected with the agricultural sector.
- It seeks to provide financial protection & comprehensive risk coverage of crops, assets, life, and student safety to farmers.
- It includes seven sections such as crop insurance (PMFBY/WBCIS), loss of life (Pradhan Mantri Jeevan Jyoti Bima Yojana PMJJBY), accidental death & disability (Pradhan Mantri Suraksha Bima Yojana-PMSBY), student safety, household, agriculture implements & tractor.
- Crop Insurance will be compulsory. However, farmers can choose at least two sections from the remaining six sections.
- National Agricultural Insurance Scheme (NAIS) or Rashtriya Krishi Bima Yojana (RKBY)
- It was launched in 1999-2000 to protect farmers in case of crop failure.
- It covers food crops (Cereals, Millets & Pulses), oilseeds and, commercial and horticultural crops (Sugarcane, Cotton & Potato).
- The Scheme extends to all States and Union Territories.
- It is an open scheme for those who have not yet availed a loan from a nationalized bank towards their farms and crops.
- However, this scheme is a compulsory scheme for those farmers who have availed of loans as it acts as an insurance policy and covers the farmers’ crops.
- The Scheme is being implemented by the AICI or Agriculture Insurance Company of India.
- With about 25 million farmers insured, it is the largest crop insurance program in the world.
- It helps farmers in regulating cash flows and acts as a financial buffer with which to rehabilitate damaged enterprises.
- It reduces the business risk of farmers thus helping them in having peace of mind.
- It enables farmers to obtain credit and financing for investment in new technologies, tools, and equipment to enhance and sustain their productive capacity.
- It also helps farmers in availing of credit as they can get loans by using the insurance policy as collateral.
- It also protects many marginal farmers from job loss as insurance prevents employers or large farmers or landholders from going out of business.
The agricultural insurance sector in India is beset with structural, design and financial problems. Some of them are:
- Structural issues
- Exclusion from insurance coverage of farmers who grow non-notified crops.
- Mandatory credit-linked insurance where the premium is deducted from a farmer who has taken a loan from any banking institution without their consent
- Lack of documents leads to a lesser number of farmers getting insured.
- Lack of trained professionals to handle the CCEs (crop cutting experiments), etc.
- Financial issues
- Delay in paying subsidy premiums by state governments leads to insurance companies delaying or not making claim payments.
- Huge burden on governments’ exchequer.
- Private companies make huge profits out of farmers’ insurance premiums.
- Other issues
- Lack of transparency.
- High premium.
- Delay in conducting crop cutting experiments (CCEs).
- Non-payment/delayed payment of claims to farmers.
- Asymmetry of information.
- Lack of accessibility.
- Lack of awareness.
2. Editorial-1: The anti-defection law — political facts, legal fiction
The crisis in Maharashtra and even earlier instances are grim reminders of what the Tenth Schedule can and cannot do
In the din of India’s electoral politics, floor crossing by legislators rarely goes out of public discourse. The practice of legislators from changing political parties during their term continues unabated in Indian legislatures despite the Tenth Schedule having been inserted into the Constitution in 1985. Commonly known as the ‘anti-defection law’, it was meant to arrest the practice of legislators from changing political affiliations during their term in office. The political crisis in Maharashtra, and many others before it, are grim reminders of what the Tenth Schedule can and cannot do.
Law on defections, ‘mergers’
Instances of floor crossing have long gone unchecked and unpunished. In part, this can be attributed to the exemption given to mergers between political parties which facilitate bulk defections. In 2019, MLAs in the Goa Legislative Assembly from the Indian National Congress (INC) and the Maharashtrawadi Gomantak Party (MGP), crossed over to the Bharatiya Janata Party (BJP). The Speaker of the Assembly as well as the Goa Bench of the Bombay High Court dismissed the pleas seeking disqualification of these MLAs. Both these authorities held that because the MLAs formed two-thirds of their respective legislature parties, disqualification under the Tenth Schedule was not possible. In other words, there was a “deemed merger” of the INC and the MGP with the BJP.
The second paragraph of the Tenth Schedule allows for disqualification of an elected member of a House if such member belonging to any political party has voluntarily given up membership of their party, or if they vote in the House against such party’s whip. Paragraph 4 creates an exception for mergers between political parties by introducing three crucial concepts — that of the “original political party”, the “legislature party”, and “deemed merger”. A “legislature party” means the group consisting of all elected members of a House for the time being belonging to one political party, whereas an “original political party” means the political party to which a member belongs (this can refer to the party generally, outside of the House). Interestingly, Paragraph 4 does not clarify whether the original political party refers to the party at the national level or the regional level, despite the fact that that is how the Election Commission of India recognises political parties.
How does Paragraph 4 then approach mergers? Paragraph 4 is spread across two sub-paragraphs, a conjoint reading of which suggests that a merger can take place only when an original party merges with another political party, and at least two-thirds of the members of the legislature party have agreed to this merger. It is only when these two conditions are satisfied that a group of elected members can claim exemption from disqualification on grounds of merger.
Paragraph 4 , however, is drafted in such a convoluted way that it renders itself open to multiple interpretations. The second sub-paragraph (of Paragraph 4) says that a party shall be “deemed” to have merged with another party if, and only if, not less than two-thirds of the members of the legislature party concerned have agreed to such merger. Given that in most cases there is no factual merger of original political parties at the national (or even regional) level, Paragraph 4 seems to be creating a “legal fiction” so as to indicate that a merger of two-third members of a legislature party can be deemed to be a merger of political parties, even if there is no actual merger of the original political party with another party. At least that is how High Courts in India are interpreting the merger exception.
In statutory interpretation, “deemed” has an established understanding. The word “deemed” may be used in a law to create a legal fiction, and give an artificial construction to a word or a phrase used in a statute. In other cases, it may be used to include what is obvious or what is uncertain. In either of these cases, the intention of the legislature in creating a deeming provision is paramount.
What could Parliament’s intention have been in creating a legal fiction under Paragraph 4? The merger exception was created to save instances of the principled coming together of political groups from disqualification under the anti-defection law, and to strike a compromise between the right of dissent and party discipline. In the absence of mergers of original political parties, the deeming fiction could, presumably, be used as a means to allow mergers of legislature parties. However, reading Paragraph 4 in this manner would empower legislature parties to solely merge with another party, and thus, practically ease defection. Defection gets easier in smaller legislative assemblies, where even a sole member can account for two-thirds of the legislature party’s strength to cross the floor without attracting disqualification.
On the other hand, what happens if both sub-paragraphs of Paragraph 4 are read conjunctively? For a valid merger then, an original political party has to first merge with another political party, and then two-thirds of the legislature party must support that merger. Practically speaking though, this would yield potentially absurd results. Given the politics of current times, stark differences in parties’ respective ideologies, and deep-seated historical rivalries, it is unimaginable how a merger between major national or regional parties would materialise.
Neither of these two interpretations complement the ‘mischief’ that the Tenth Schedule was expected to remedy — that of curbing unprincipled defections which endanger the foundations of our democracy. Presently, while individual Members of Legislative Assemblies remain vulnerable to disqualification for crossing the floor, group defections remain exempt. The criticisms levelled against the exemption given to splits in political parties – that it facilitated defection by groups – applies equally to mergers.
Revisit, if not delete
In a situation where either reading of Paragraph 4 in its current form yields undesirable results, its deletion from the Tenth Schedule is a possible way forward. This thought is hardly novel, for the Law Commission in 1999 and the National Commission to Review the Working of the Constitution ((NCRWC) in 2002 made similar recommendations. Till that happens, an academic revisiting of the Tenth Schedule by the Supreme Court, so as to guide future use of the anti-defection law, is timely and should happen soon. That would do a world of good for democracy in India.
Mayuri Gupta is the Milon K. Banerji Fellow at the Vidhi Centre for Legal Policy and works with Charkha, Vidhi’s Constitutional Law Centre.
3. Editorial-2: The Indian challenge in Afghanistan
Intra-Afghan tensions rather than any hostility towards India could impede implementation of projects
India’s record as a ‘first responder’ is improving by the day. Just 24 hours after a massive earthquake hit Afghanistan, the Indian Air Force moved in with tonnes of relief. That is impressive. It is also badly needed, given that the worst earthquake in 20 years hit a region that has been at war for decades. Desperate people are always open to adopting any means to survive. Apart from India, other countries will soon weigh in with aid. This might be the time to either make friends or renew hostility with old enemies.
The massive earthquake was centred around Khost along the Afghanistan- Pakistan border, and measured 5.9 on the Richter Scale. Clearly, the Pakistan side would have suffered as well, though there has been no reportage on this in the Pakistani media. Like other news from the tribal areas, this one also appears to have been damped down. The proximity to the affected area also meant that Pakistan was able to send relief aid quickly. Trucks decked with banners entered Afghanistan declaring that the aid was from “the people of Pakistan”. Iran also sent relief material by air. Both these efforts and the Pakistan Foreign Ministry’s statement expressing condolences were reported by Xinhua There was nothing about India’s effort. There was also nothing on Qatar, which is in negotiations to manage Kabul, Kandahar and Herat airports.
Stressing “historical and civilizational relationship ties” with the Afghan people, Delhi announced the arrival of a technical team to “closely monitor and coordinate the efforts of various stakeholders” for the effective delivery of humanitarian assistance. This followed the arrival of a delegation led by a senior official to Afghanistan. Afghan officials welcomed not only aid, but called for the restarting of small projects across the country. Prior to this, there were reports that Indian aid was being hoarded and diverted back to Pakistan. This meant that only a fraction of some 50,000 MT of wheat and medicines was actually reaching the country. Delhi seems to have asked for aid to flow through the Iranian route, instead of across Pakistan, so that it would reach Afghanistan. Iran is on board, as was evident during Foreign Minister Dr. Hossein Amir Abdollahian’s recent visit to Delhi, where issues discussed included provision of aid to Afghanistan.
Meanwhile, countries are responding to the United Nations’ appeal for aid. That includes Taiwan, which has offered $1 million despite not being a member of the world body due to Beijing’s objections. Japan, South Korea, and the UAE have also responded to the UN’s appeal. The U.S. and its primary agency, the United States Agency for International Development, made brief and similar statements without making any specific commitment. U.S. aid stands at $512,208,314 in the current financial year, after the U.S. Treasury Department broadened the types of activities authorised under U.S. licences, and the UN Security Council allowed sanctions exemption for delivery of humanitarian aid. However, the U.S.’s response indicates the difficulties involved given the broken Afghan banking and financial systems and lack of infrastructure. A range of institutions is involved in actual aid delivery, and U.S. instructions are that all aid should be in cash, since no banks will do business or accept letters of credit to the Afghan central bank (DAB). UN organisations also provide cash, and aid agencies have long had to use reliable local hawala networks for transfers. The main benefit to this is that money is spent within the country, rather than in physical aid sourced from the neighbourhood. The trouble is that a notoriously strait jacketed Finance Ministry will never agree to large-scale Indian aid being spent in this manner. Cash transfers to the DAB are possible, but its own reach to the furthest parts of the country is doubtful.
While ‘buy local’ may work with food and immediate aid, the requirements for reconstruction, particularly in the present case, will have to be sourced from Pakistan. Pakistan cement companies such as Lucky Cement made their fortunes out of U.S. construction in Afghanistan, of everything from airfields to culverts, when operations were ongoing. A 2004 study reported not just the huge amounts of money being made by all those concerned, but also revealed that Afghan companies were being sidelined in favour of Turkish or Chinese ones in the country.
Also, most UN activity for Afghanistan is slotted through Pakistan. U.S. listings show that major UN agencies and the International Organization for Migration are present in Pakistan, where they are funded to source supplies. This includes smaller NGOs such as Red Crescent or the hundreds of others operating on the ground. Any Indian attempt at reconstruction has to take this reality on board. India also needs to encourage Afghan cement plants and related industries, and ensure optimal use of coal, which is now being exported to Pakistan at cheap prices.
The security issue
Then there exists the ever-present issue of security, which was apparent from the recent attack on a gurdwara in Kabul, apparently by the Islamic State Khorasan (IS-K). The IS-K is a group of many parts, with a presence in the north, along the Pakistan border, and in Kabul. In the north, the Russians accuse the Americans of assisting the group, while in Kabul, the IS-K’s worst attack was against withdrawing U.S. troops in August 2021. In recent times, IS-K has become strongly anti-India, along with al- Qaeda, which put out a video where chief Ayman Al Zawahari was seen praising a Karnataka girl for defending the hijab. Even more vicious language was used in the threat made against Nupur Sharma, former BJP spokesperson, for her controversial remarks against the Prophet. A recent UN report notes that both groups are operational, and may see increased recruitment of young men with no alternatives.
India has around 400 projects in all the 34 provinces of Afghanistan. With the Taliban offering protection to foreign embassies, and acting quickly in the recent gurdwara bombing, it is possible that the Indian effort will continue unimpeded. It is also important to remember that the Taliban have never actively been anti-India. Difficulties in implementation are more likely to arise from intra-Afghan tensions rather than any hostility to India.
4. Editorial-3: A direct approach to conservation
The mobilisation of private and public finance for Payments for Ecosystem Services lacks lustre
Incentives for biodiversity protection and sustainable use include biodiversity-relevant taxes, fees, levies, tradeable permits, and Payments for Ecosystem Services (PES). Through these economic instruments, governments can affect both public and private financing flows for biodiversity. Mobilisation of biodiversity finance through pesticide levies, admission fees to natural parks, hunting and fishing permit fees, and the trade-in energy-saving certificates has gained governmental support and political will, but the mobilisation of private and public finance for PES has lacked lustre.
Lack of academic research, governmental support, and political will have vexed environmental economists. Despite a solid theoretical foundation and the ability to tether investments more directly to outcomes, the debate revolves around the same issues from two decades: monetisation of environmental benefits, lack of additionality (how much environmental service would have been provided without conditional payments), and so on. In this article, I answer whether this is a missed or a lurking opportunity for biodiversity financing in India.
Increasing ecosystem services
PES is one way to conserve and increase ecosystem services. It works through the establishment of performance contracts. People who can help provide the desired ecosystem service are rewarded based on their actions, or the quantity and quality of the services themselves. PES presents a unique scope for incentivising local land stewards to manage threatened ecosystems. It has the potential to achieve the dual goals of conservation and poverty alleviation towards the achievement of Sustainable Development Goals. This places PES as one of the pivotal economic instruments for conservation.
However, PES has not achieved much attention either in the research or policy mandate in the Indian subcontinent. This is in sharp contrast to the successful implementation of PES in Latin American and African countries. In the Western Cape, South Africa, the CapeNature Stewardship Programme protects biodiversity on private lands. Kitengela, Kenya’s Wildlife Conservation Lease Programme, maintains open areas for wildlife and grazing on personal grounds. In terms of raising money, PES programmes such as Costa Rica’s Pago Por Servicios and Ecuador’s Socio Bosque were among the few to mobilise significant finances.
Why have such economic incentives for ecological restoration not received academic, research, and policy prioritisation? A research paper published in Science by Ferraro and Kiss in 2002 argues that any successful PES programme is one that overcomes the impediments to implementation. Such limitations include a solid institutional mechanism capable of simultaneous transfer of funds from buyers to suppliers, monitoring through investment in local capacity building, cost efficiency, the scope for development benefits, and maintaining the sustainability of funds. A local monitoring mechanism is the key to successfully implementing a PES programme. A study (Sardana 2019) conducted in the Kodagu district of Karnataka to restore native trees that grow in the understory of coffee plantations shows a successfully designed local institutional mechanism for PES implementation. However, the PES mechanism is yet to be implemented or even tested for efficacy. The results of such studies offer support for potential research funding in restoration financing. Impact evaluation studies that evaluate financial instruments’ performance in attaining biodiversity are also important. The OECD (2019) Biodiversity: Finance and the Economic and Business Case for Action highlighted the importance of evaluating financial instruments’ performance in attaining biodiversity goals. According to recent OECD research, few thorough impact evaluation studies have been done for terrestrial biodiversity and fewer for ocean/marine biodiversity. The OECD advocates comprehensive impact evaluations and the formulation of strategic criteria to help determine which policies or initiatives warrant more scrutiny.
Additionally, a strong policy thrust, such as the TEEB India Initiative highlighting the economic consequences of the loss of biological diversity, would help prioritise ecosystem restoration financing through a direct approach. A global initiative such as the United Nations Environment Programme Finance Initiative to mobilise private sector finance to benefit people and the environment would help maintain the funds. The cheapest way to receive anything you desire is to pay for it directly. This would allow the country to effectuate the nation’s commitments to achieving the 2030 agenda for sustainable development and the Paris Agreement on climate change.
5. How Turkey made peace with Sweden and Finland joining NATO
Why was Ankara initially against Helsinki and Stockholm joining the North Atlantic Treaty Organization? What changed?
On June 28, NATO Secretary-General Jens Stoltenberg announced the signing of a MoU between Turkey, Finland and Sweden which has led to Turkey vocalising its support for the inclusion of both the nations in NATO.
Turkey was initially against Finland and Sweden joining NATO. Though there were no direct issues between Turkey with Sweden and Finland, the former was against the latter for their position on the Kurdish issue.
On June 28, Deputy Secretary of the Russian Security Council Dmitry Medvedev cautioned Finland and Sweden on continuing with their decision to join NATO. He referred to the relations with these countries as being respectful and mutually friendly.
The story so far: On June 28, the North Atlantic Treaty Organization (NATO) Secretary-General Jens Stoltenberg announced the signing of a memorandum of understanding (MoU) between Turkey, Finland and Sweden in a trilateral meeting held in Madrid, Spain. The MoU was signed once the Finland President Niinistö and Sweden Prime Minister Andersson agreed to address the national security concerns of Turkey. Following this assurance, President Erdoğan agreed to support Finland and Sweden in their bid to join NATO.
What does the MoU say?
The key provisions of the MoU include the following three points: a joint commitment between Turkey, Finland, and Sweden to counter terrorism; addressing the pending extradition of terror suspects through a bilateral legal framework, and investigating and interdicting “any financing and recruitment activities of the PKK and all other terrorist organisations.”
Besides the above, Finland and Sweden assured that “their respective national regulatory frameworks for arms exports enable new commitments to Allies”. Both countries also promised to stand against disinformation and to fully commit to EU’s CSDP (Common Security and Defence Policy) and Turkey’s participation in the PESCO (Permanent Structured Co-operation) Project on Military Mobility.
Why did Turkey withdraw its opposition?
Turkey was initially against Finland and Sweden joining NATO. Though there were no direct bilateral issues between Turkey with Sweden and Finland, the former was against the latter for their position on the Kurdish issue and extradition of activists.
Turkey, after negotiations, agreed to withdraw its opposition for the following reasons. First, Finland and Sweden should promise to address counter-terrorism provisions within their countries. Finland has committed to modify its criminal code, and Sweden has assured to implement the new “Terrorist Offenses Act” from July 1. Second, Turkey had raised concerns about Finland and Sweden being home to Kurdish activists and militant organisations. Finland and Sweden have now agreed to execute the pending “deportations or extraditions” of listed ‘terror’ suspects made by Turkey. Third, lifting the arms embargo. There has been no clear definition about the category of weapons, but Finland and Sweden will remove the arms embargo against Turkey. Since Finland and Sweden have addressed all the above primary concerns of Turkey, Ankara has decided to withdraw its opposition to Helsinki and Stockholm.
Why have Finland and Sweden agreed to address the concerns raised by Turkey?
Finland and Sweden have considered Mr. Erdogan as an authoritarian ruler against democratic norms and rights. The earlier positions of both countries on Turkey were based more on their principles relating to democracy, ‘separatism’, the rule of law etc. Their support to Kurdish activists from Turkey was based on their larger principles than any specific bilateral problem with Turkey.
Both Helsinki and Stockholm have agreed to revisit their position on Turkey, primarily due to the threat from Kremlin. The security threat from Russia looms large in the national capitals of Finland and Sweden today as Russia’s military aggression on Ukraine continues. The fear of their own national security has pushed both nations to join NATO which in turn has made them agree to Turkey’s conditions.
What does this mean for Russia?
Russia shares a 1,340 kilometre long border with Finland. Sweden, though it does not share a land border, shares the Baltic Sea with Russia. The land/sea borders with Russia place both countries under direct threat from the Kremlin.
On June 28, Deputy Secretary of the Russian Security Council Dmitry Medvedev cautioned Finland and Sweden on continuing with their decision to join NATO. He referred to the relations with these countries as being respectful and mutually friendly. He underlined that there are no territorial disputes with these two countries; hence they should not worry about any security threat from Russia.
Since 1948, Finland, Sweden and Russia have maintained economic cooperation, but the relations always remained strained due to the Cold War and Finland’s neutrality principle. If Sweden and Finland join NATO, it means an enlarged presence of the latter around the west and north of Russia. This would go against the very objective of Moscow interfering in Ukraine — maintaining Russian influence in its immediate neighbourhood. Also, whether the two countries joining NATO will undermine Russia’s interests in the Arctic remains to be seen. Both Sweden and Finland are part of the Arctic States; Russia currently holds the Arctic Council chair and will remain the chair until 2023.
For Russia, Finland and Sweden joining NATO not only means an increased NATO presence in its neighbourhood but also questions its Arctic interests.
What does this mean for NATO?
First, strengthening the alliance. Both Finland and Sweden which have followed the non-alignment principle have broken from their natural rule and decided to join NATO. This does not only mean guarantee of security against Russia but it also gives NATO the power to engage.
Second, NATO will gain strategic ground to counter Russia. The addition of more allies means a steady expansion of the NATO towards the East, through which it will now be able to exercise its military operations both on land and in the Baltic Sea, where Russia holds a strategic position. NATO will now also be able to position its weapon systems — further its combat formation and plan its attack techniques to power up deterrence and defence.
In 1997, NATO initiated the rapprochement in order to build bridges with Russia. However, with Russia annexing the Crimean Peninsula in 2014 and launching a war in Ukraine, NATO’s rapprochement efforts came to an end. So currently, this might seem an impossible act for both parties. However, with NATO encircling Russia from the West, Russia might consider the option to meet at the table at a later stage.
Third, a secured Euro-Atlantic. NATO presence in the region will securitise and safeguard the Baltic states, Estonia, Latvia and Lithuania, which were earlier at risk due to their close proximity to Russia and Russian attacks. This will not only help Ukraine win the war but will also enable NATO to bring in advanced weapons such as fifth-generation aircraft, technological weapon systems and strong political institutions across the allied countries.