On the face of it Pakistan may have bigger things to worry about, but recent weeks have seen it fall out with India over the humble onion:

The pungent vegetable is now at the centre of a mini diplomatic storm that has further soured relations between both countries over the past few days. The Pakistani commerce ministry banned the export of onions across the border by road and rail due to high prices and shortages at home.

Food inflation is running high across South Asia and onion prices are soaring in both Pakistan and India, as the two have had bad harvests of the crop. Reported hoarding and speculation in India have added to the crisis.

Onions are a touchy subject in India and past price hikes have brought down governments. In retaliation, farmers in Indian Punjab have stopped exporting vegetables to Pakistan.

A sideshow, surely, to the really big issues like Kashmir or religious extremism? Maybe not. You can’t spend anytime in Pakistan without noticing the powerful role played by resource scarcity in the country’s politics.

It all goes back to the global food and energy price spike of 2008. According to the IMF, growth had been robust up until that point and government finances were in reasonably good shape.

Conditions deteriorated in mid-2008 with the sharp increase in international food and fuel prices and worsening of the domestic security situation. The fiscal deficit widened, due in large part to rising energy subsidies, financed by credit from the central bank.

As a result, the rupee depreciated and foreign currency reserves fell sharply. Inflation reached 25 percent in mid-2008 [mostly food], causing harm to vulnerable social groups.

The country has never really made it back onto an even keel. The global economic crisis gave Pakistan a little relief, pushing commodity prices sharply lower, but the public finances never recovered.

And as food and energy prices have risen again, Pakistan has been hit by a succession of mini-commodity shocks (the sugar crisis of 2009 and 2010, the flour crisis of 2010). Some estimates suggest that higher food prices have led to a precipitous decline in caloric intake (though robust data is hard to track down).

Gas and electricity are in critically short supply, leading to frequent load shedding, for consumers, business, and industry in winter. Around the major cities, one sees trees being stripped bare by people desperate for heat for their houses and businesses:

Shopkeepers operating in the streets and mohallahs are using pieces of wooden and cardboard crates and other packing material to brace the chill in the air.

Many Lahorites are having ‘bonfires’ even during day time. An empty tin of cooking oil is usually converted into a hearth by making holes in it. Old newspapers, textbooks and copies besides parts of broken furniture are used to make fire as it is hard for many to afford Rs1,200 per 40 kilo fire wood or Rs40-50 per kilo coal.

There are no easy solutions. Pakistan has also been under intense pressure from the IMF and the United States to reduce fuel subsidies, in order to cut its deficit and meet the conditions of its IMF loan.

But its attempts to comply simply fuelled political instability. The PPP-led government came close to falling when it attempted to push up the cost of petrol at the end of 2010. Backing down was the price of getting its junior partner, MQM, back into the coalition late last week.

The result, though, has been unwelcome speculation that Pakistan may on the road to default – a worry that is likely to intensify as oil prices head ever higher.

Inflation is now up to 16%, with food prices expected to rise 20% in December 2010 (year-on-year). In November last year, onions jumped in price by 67% in just one month alone.

As in 2008, many of the drivers of the crisis are regional and global. While the attention of the world is fixated on Pakistan’s struggle with religious extremism. In the background, the struggle for resources seems to be doing as much to push this country towards ruin.

The conflict had several immediate results.

Already fraught relations between Moscow and Tbilisi plunged to new depths and diplomatic relations were severed.

Russia and three other countries recognised the independence of the breakaway Georgian regions of South Ossetia and Abkhazia.

And relations between Russia and the West – the US and the EU – deteriorated to their worst level since the collapse of the USSR – there was even talk of a new Cold War from western politicians.

The Cold War analogies led some commentators to argue Russian foreign policy had taken a decisive anti-western turn and things could and/or should never be the same again

Two years later, the one thing that seems unlikely to ever be the same again is the shape and size of Georgia. If recognition from Russia was not enough, the recent International Court of Justice opinion that Kosovo’s unilateral declaration of independence was not against international law, makes it even less probable Tibilsi could regain control of its lost regions.

But otherwise those predictions and talk of a new Cold War couldn’t appear more misplaced.

Russian relations with Georgia remain hostile. Although the border has reopened in places and some business links survive, ties look set to remain frosty as long as Prime Minister Putin and President Saakashvili remain in office, given their dispute now has a personal animus that goes beyond the geo-political.

But when it comes to relations with the western powers, over the past year things have improved significantly.

One of President Obama’s most successful foreign policy initiatives to date has been the ‘reset’ of relations with Russia that has led to a new nuclear arms control agreement, START 2, but Washington appears to have been pushing at an open door. Though the talks over START took a bit longer than expected and the Russians bargained hard, President Medvedev genuinely seemed to want to do a deal.

When it comes to Europe, the Russians were reaching out to their arch rivals, the Poles, even before the tragic air crash in Russia that killed the Polish President and many of the country’s elite in April. Mr Putin, who has a reputation for playing hardball, handled the consequences of the disaster with a sensitivity that surprised many and Poland has reciprocated.

Russia knows Poland is now an important player in the EU and the overtures to Warsaw show Moscow wants to improve relations with the wider EU, damaged in the past few years by disputes from the disruption of gas supplies via Ukraine, to the killing of the former Russian agent, Alexander Litvinienko, in London.

What lies behind this change of policy in Moscow?

The reasons for the change of approach from Russia were outlined in a leaked Foreign Ministry paper in May  and they appear to be highly pragmatic.

The economic crisis came as huge shock to Russia’s leaders as the economy shrank by up to 10%. The fall in global economic activity led to a big fall in the price of oil on which Russia depends for much of its GDP.

The penny seems to have dropped in Moscow  that the oil and gas industry need to be much more efficient and the country needs to diversify away from reliance on the energy sector. So President Medvedev and Prime Minister Putin want to modernise the Russian economy, and they have decided they need good relations with the western economies to get access to investment and technology.

Last month, Russian Foreign Minister, Sergei Lavrov, wrote a significant essay in Russia in Global Affairs explaining the policy change in more depth

So is Moscow turning  westwards, rather than to its new partners in the BRIC bloc – China, India and Brazil – when it really needs help?.

Well this change could be a sign that the talk of the shifting balance of power in the world is overblown.

Equally, it could well be a sign that the emergence of new powers, alongside the presence of the traditional western powers, has given all states more options in foreign policy – and a country like Russia, which sees national interest through the lens of realpolitik, can pick its horses for courses in the global arena.

The World Tonight is broadcast at 22.00 UK time on BBC Radio 4 and online

- Focusing on Chinese domestic society, the Economist highlights the growing activism and changing dynamics of the country’s vast labour force, with its associated implications for the global economy. Analysis over at VoxEU, meanwhile, assesses evidence of a potential Chinese property bubble.

- Elsewhere, with David Cameron back from his visit to India, Adrian Hamilton and Geoffrey Wheatcroft offer their views on his approach to international affairs. Kim Sengupta meanwhile remarks that the new Prime Minister “has started his foreign policy journey with a series of very deliberate steps”.

- Finally, Sir John Sulston talks to the New Scientist about the implications of global population change for sustainable development – the subject of a new initiative that he’s leading for The Royal Society.  Prospect Magazine‘s blog, meanwhile, highlights favourable demographic trends in the developing world, while figures this week confirm that the EU’s population has now passed the 500 million mark.

- Yevgeny Bazhanov explores the “triangle” of geopolitical relations between Washington, Beijing, and Moscow, while over at Global Europe Shada Islam suggests that the EU must redoubled efforts to improve engagement with Asia.

- In the first of a new column on international affairs, Shashi Tharoor, former Indian Minister of State for External Affairs, explores the importance of internationalism in foreign policy and why it “has always been a vital part of [the Indian] national DNA”. The economist Jagdish Bhagwati, meanwhile, assesses US-Indian tensions at the heart of the Doha Round and the prospects of reinvigorating the trade talks.

- Elsewhere, in The Walrus John Schram has an in-depth account of Ghana’s post-colonial transition and how its democratic experience provides an example to other African countries.

- Finally, Keith Simpson, William Hague’s Parliamentary Private Secretary, presents his annual offering of summer reading in foreign affairs. Iain Dale has the full list here.

My understanding is that BASIC was formed at China’s instigation. China agreed a Memorandum of Understanding with India in October 2009, committing the two countries to working closely together at Copenhagen. It then invited Brazil and South Africa to join the party, at a meeting in Beijing a week before Copenhagen started. Sudan was also invited to represent the G77.

According to Jairam Ramesh, India’s environment minister, the four countries decided that they’d walk out of Copenhagen together if necessary:

We will not exit in isolation. We will co-ordinate our exit if any of our non-negotiable terms is violated. Our entry and exit will be collective.

During Copenhagen, China worked extremely closely with India, with the two delegations meeting up to six times a day. It also engaged intensively with the other members of BASIC. In the final meeting with the Americans, China agreed to accept a limited international monitoring of its targets (India claims to have pushed China on this point).

The decision was also taken to drop language, setting a deadline for turning the Copenhagen Accord into a legally binding agreement. South Africa and Brazil both appear to have been unhappy with this decision.

Since Copenhagen, the BASIC countries have met once and have agreed to continue to get together on a regular basis. They want the Copenhagen Accord to set the stage for a ‘twin track’ agreement – with tough and binding targets for developed countries through Kyoto #2 and voluntary commitments for themselves under a new agreement.

No-one really knows how the US would fit into this picture. It is also increasingly clear that they and the US left Copenhagen with quite different impressions of what will happen next. The US believes that large emerging economies now have “very explicit activities and obligations”. I don’t think they believe they are committed to anything significant, beyond what they agreed at Bali or put on the table on a voluntary basis before Copenhagen started.

Over the past few days, the BASIC countries have lodged their “mitigation actions” with the UNFCCC, meeting a Jan 31^st deadline. Here are the highlights:

China and India have submitted their commitments using exactly the same form of words. They are both prepared to increase decrease their carbon intensity by set amounts – 40-45% for China; 20-25% for India.

These commitments are made reliant on “financial resources and transfer of technology” from the developed countries, in line with the 1992 Convention, though China has elsewhere made it clear that it isn’t expecting to get much money.

China also offers a bit more detail on its plans than India – saying it will “increase the share of non-fossil fuels in primary energy consumption to around 15% by 2020 and increase forest coverage by 40 million hectares and forest stock volume by 1.3 billion cubic meters by 2020 from the 2005 levels.”

Brazil goes quite a bit further, setting out a fairly detailed action plan that it says it expects will reduce its emissions by 36.1%-38.9% against business-as-usual by 2020.

This is a more robust target than China or India’s – as it implies a cap for emissions in 2020 (if that is, the Brazilians publish – or have published – what they expect BAU to be). China and India’s expected emissions can only be calculated if one makes assumptions about their economic growth.

South Africa, meanwhile, underlines that it negotiated both as part of a broader group of countries working for a deal, and within the BASIC coalition, disassociating itself ever so slightly from BASIC’s robust line during Copenhagen’s endgame.

Like Brazil, it sets out a 34% deviation below business-as-usual in 2020, and a 42% deviation by 2025. Its figures are based on this study.

It also, with some hedging, commits itself to a peak year for its emissions:

With financial and capacity building support from the international community, this level of effort will enable South Africa’s greenhouse gas emissions to peak between 2020 and 2025, plateau for approximately a decade and decline in absolute terms thereafter.

Try asking the Chinese governments when it expects the country’s emissions to peak and you’ll be as welcome in Beijing as Larry Page and Sergey Brin. It’s worth noting, though, that South Africa emits much more than China on a per capita basis and has comparable emissions intensity – facts that it admits puts it “in a difficult position” in climate negotiations.

My conclusions:

• BASIC is here to stay, but it’s not entirely on the same page as yet. The four countries talked recently about harmonising their commitments on emissions – it’s not clear how that will happen.
• If I had to guess, I’d say that China will be able to keep the alliance together – and probably will also keep the G77 on side. (The latter is probably bad for poor countries, with high climate vulnerability and low emissions.)
• BASIC, the US, and the EU are also some way apart, despite their willingness to sign up to the Copenhagen Accord. BASIC thinks the Bali negotiations are ongoing. The US thinks negotiations have been put onto a new footing. The Europeans are hoping for the best.
• It’s going to be another rocky year for the international climate regime, especially with few governments expecting cap and trade to pass the US Senate.

Weakness on China is especially egregious now that the country is above average global per capita emissions. Campaigners should be demanding that China ties itself to a date when its emissions will peak and then to commits to deep cuts by mid-century. (Armed with such a commitment, of course, China itself could then begin to turn the heat up on America – rather than allowing the US congress to bleat about US competitiveness.)

A failure to ask hard questions of China is bad for lower income countries. Not only will they suffer worst as the climate changes, they are going to wake up in ten years’ time to find that most of the global carbon budget for 2 degrees has been spent. Their interests are being sacrificed on the altar of G77 solidarity, with the global NGO community helping sharpen the knife.

The problem is similar, if less extreme, for the world’s other rising powers. Their per capita emissions may be lower than China’s and NGOs less terrified of offending them. But still, a country like India has 17% of the world’s population – which gives it quite a stake in our collective future. It is also massively vulnerable to a changing climate (especially as a lack of water disrupts food production).

But yet India is notoriously rubbish at international climate talks. So all the more credit to Malini Mehra, from the Center for Social Markets, for her persistent (and unusual) attempts to shine a light on India’s failings.

“In recent months, India has sought to challenge its image overseas, and in growing quarters at home, as recalcitrant and obstructionist on climate change,” she writes in her latest critique.

“[But] in a showdown this week with the old guard, the reformist environment minister, Jairam Ramesh, had to tone down his climate advice to India’s Prime Minister, Dr. Manmohan Singh. Political correctness won, but the loser was India’s climate security.”

Here’s the rest of her analysis:

In a tumultuous week for Indian climate politics that saw Delhi hosting a major UN technology and climate change conference, a regional meeting of South Asian environment ministers, a Sino-India climate change workshop, and MOUs with China, Japan and Norway, the political air is charged. As the week opened, the driver-in-chief of these high-level meetings, Jairam Ramesh, was engulfed in a firestorm over a leaked confidential communication to the Prime Minister.

As the Major Economies Forum got underway in London with Gordon Brown saying there was no ‘Plan B’ for Copenhagen, news broke in Delhi that Jairam Ramesh had allegedly proposed dumping the Kyoto Protocol, ditching the G77 in favour of the G20, and taking on carbon cuts without concomitant financial or technical guarantees. In a country with a well-entrenched political consensus on India’s role in international climate negotiations, the Minister’s alleged remarks were seized on as heresy. Partisan press reporting, well-oiled with anonymous quotes by India’s aggrieved negotiators and threats to resign, added fuel to the fire. Outraged opposition parties railed that the Minister had capitulated to the United States and NGOs charged him with damaging India’s credibility with developing country partners.

In the storm that followed, the papers were full of indignation at Ramesh’s supposed deviation from India’s traditional hard-line climate position, but silent on India’s climate risk.  No words spent on why it might make sense to be ‘flexible’ on climate change. No effort to explain why new approaches were imperative if India wanted to craft a fiendishly difficult global climate compact. Instead, everything was cast as a sell-out to western interests – an unedifying neo-colonial spectacle more focussed on political point scoring than protecting India’s people. Why is it that we are more concerned with doctrinal purity than climate catastrophe?

We have been down this road before. In July just after the G8 meeting in L’Aquila when Dr. Manmohan Singh acceded to language agreeing a 2 degree Celsius limit to warming, a similar political firestorm erupted. His actions were also interpreted as a capitulation to western interests and a restraint on India’s right to development.

Confusing degrees with percentages, some politicians screamed about agreeing to “two per cent” under U.S. pressure.  That the Maldives and Bangladesh were asking for a 1.5 degrees limit with much deeper emissions cuts by all nations, went unreported. As President Nasheed of the Maldives, the world’s lowest-lying island nation, said in Delhi last week: “with so much damage being caused by less than one degree of warming, why on earth would we aim for two degrees?” At present trends, we are heading towards a 6 to 7 degree world by 2100. As the world’s fourth largest emitter and potentially the worst victim of climate change, India cannot afford the complacency its political class is fostering. Our water and food security lie wounded, our coastal aquifers are turning saline, our glaciers are melting.

Ramesh’s suggested shift in India’s hard stance has created momentum in climate talks, forcing developed countries to contemplate much deeper cuts than they wanted. A new set of possibilities has thus opened up that might just manage to dispel mutual fears of inaction and mistrust. The Minister no doubt had to publicly step back towards the party-line on India’s climate negotiating position, but he opened a deadlocked debate and let fresh air in.

Interestingly, China, Brazil, Mexico, South Africa and even Indonesia are all considering variations of domestic emissions peaking, national and sectoral caps – not in response to western arm-twisting but in response to increasingly unequivocal climate impact projections, energy security, development and economic competitiveness concerns. Though the uproar over his reformist advice has momentarily slowed his pace, a new political consensus on climate is forming. It has hidden, powerful supporters both within government and the opposition who are poised to occupy the climate spotlight and will have to respond to India’s 670 million farmers and 100 million fisherfolk who are sure to ask: “If you knew about this climate threat, why did you keep it from us and why did you not act in time?”

Meanwhile the science races on. Climate change is occurring faster and deeper than previously thought – while India’s politics remains stuck. Ramesh has let the reform genie out of the bottle. New constituencies are clamouring for change. Hopefully the world will finally get the debate it deserves and India the politicians we deserve.

- Looking to Copenhagen, Bruce Bueno de Mesquita propounds the predictive capacity of game theory and rational choice theory to explore what the climate negotiations might hold. Der Spiegel, meanwhile, has a report about the Danish island of Samso – at the forefront of the country’s green revolution.

- Elsewhere, Robert Skidelsky assesses the current debate raging between New Keynesian and New Classical economists over the financial crisis. Fully grasping the “implications of irreducible uncertainty for economic theory”, he suggests, would lead to a better understanding.

- Finally, Mihir Bose explores the contemporary state of Anglo-Indian relations, suggesting that fragility, rooted in history, is still very apparent. And with Indian and Chinese officials set to meet, Kapil Komireddi argues that rivalry between the two rising superpowers will come increasingly to define the 21st century.

- Writing in the New Yorker, Malcolm Gladwell explains how “the roots of Wall Street’s crisis were not structural or cognitive so much as they were psychological”. Overconfidence among bankers, he suggests, in addition to the more familiar arguments about poor regulation and simple incompetence, played a significant role in the financial crisis.

- The Prospect blog, meanwhile, discusses how “the Indian Ocean is emerging as a focus for Chinese logistical and naval expansion” – something being felt acutely in Washington and New Delhi. Staying with the US and India, WPR takes an interesting look at Hillary Clinton’s recent trip to South Asia.

- Elsewhere, the Channel 4 News blog has more details about the UK’s upcoming Iraq War Inquiry – suggesting that it is due to hear “mountains of evidence” and, given the expansive nature of its remit, is unlikely to have lawyers present.

- Finally, Adam Roberts has an interesting piece in The World Today assessing the current state of the Geneva Conventions. Sixty years later, he ponders, are the laws of war still relevant to the changing nature of conflict?