Nuclear threat hangs over the subcontinent

With the citizens of Bombay still mopping up the blood on their streets and counting the corpses in their hotels, attention has quickly turned to who is behind last week’s terror attacks. India says it has evidence that the gunmen who tore through its richest city were trained in Pakistan, and raised its security status to “war level” as a result.

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Indian air and missile forces on war footing, Pakistani armored units diverted from Afghan border

DEBKAfile’s military sources report that on Sunday, Nov. 30, Asia’s two nuclear powers, India and Pakistan, took their first steps towards a conventional war. India, claiming evidence of Pakistan’s involvement in the Islamist terrorist assault on Mumbai, placed its air and missile units on war preparedness, while Pakistan, disclaiming the charge, diverted its armed divisions from the Afghan border to its frontier with India.

Military experts fear a full-blown war could spill over into combat with tactical nuclear weapons.

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Russia Tightens Europe’s Energy Noose

A leaked intelligence document issued by Spain’s CNI spy agency in October warns that Russia is aggressively pursuing a plan to “monopolize access to energy supplies to Europe.” The report validates what many analysts have been saying for a long time, namely that Moscow is using Russian energy companies to gain geo-strategic control over northern, central and southern Europe.

Now Russia’s largest independent oil company, Lukoil, is negotiating the purchase of a 30 percent stake in Repsol YPF SA, Spain’s largest oil company. The deal, which is valued at 5 billion euros ($6.5 billion), calls for Lukoil to buy a 20 percent stake in Repsol from Sacyr Vallehermoso SA, a debt-laden Spanish construction company, and another 10 percent stake from La Caixa, a Catalan savings bank. Lukoil is now seeking financing in order to close the deal.

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Somalia’s Pirates Flourish in a Lawless Nation

This is the story of Somalia’s booming, not-so-underground pirate economy. The country is in chaos, countless children are starving and people are killing one another in the streets of Mogadishu, the capital, for a handful of grain.

But one particular line of work — piracy — seems to be benefiting quite openly from all this lawlessness and desperation. This year, Somali officials say, pirate profits are on track to reach a record $50 million, all of it tax free.

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Video: The Pirates Of Somalia

Mexico: Borderless drug wars

The drug violence that has left nearly 4,000 people dead this year in Mexico is spreading deep into the United States, leaving a trail of slayings, kidnappings and other crimes in at least 195 cities as far afield as Atlanta, Boston, Seattle and Honolulu, according to federal authorities.

The involvement of the top four Mexican drug-trafficking organizations in distribution and money-laundering on U.S. soil has brought a war once dismissed as a foreign affair to the doorstep of local communities.

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Video: Narco Wars- Mexico

Mexicans are facing a horrifying increase in violence brought about by the governments decision to wage war on the powerful drug cartels. Each day sees more deaths and kidnaps, while corruption is endemic.

The death toll so far this year is 4000, higher than Iraq. Around 4 people a day are kidnapped for ransom. Were assaulted every day, says one man, Mexico as a country can not guarantee our security. In Sinaloa, life is a daily roll call of decapitations, torturing and shootings of gangsters and innocents alike. A hysterical young man just witnessed the shooting of his sister point blank in the head. The next day, assassins on motorbikes executed two men in broad daylight. There are witnesses, but theyre too scared to talk. Its common belief that corrupt police are involved in the drugs trade and the kidnappings: “drug traffickers dont need to buy a minister to carry on his activities. They only have to buy the chief of police”. While this report was in the making, a federal police officer at one point a member of the Anti-Kidnap team was arrested over the kidnapping and murder of a 14-year-old boy. It seems Mexicos president has a hard battle ahead of him. Last year American Congress gave him US$400 million to help fight the drug cartels but this amount is nothing compared to the money laundering from drug activity.

Video: Narco Wars- Mexico

Iceland faces tough times in wake of crisis

The crisis involved the collapse of Iceland’s banks and currency. The banks are slowly being rebuilt, but the crown has effectively ceased trading, creating headaches for importers.

Whether the currency is stabilised quickly or not, a bleak winter looms. Annual consumer price inflation exceeds 17 percent and is at its highest since 1990. Unemployment is set to jump and an economic contraction of 10 percent is forecast for 2009.

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Video: The Sinking Island – Iceland

Iran says it now runs more than 5,000 centrifuges

The P-1 centrifuge is the workhorse of Iran’s enrichment program. It’s run in cascades of 164 machines.

In February, Iranian officials confirmed that they have started using the IR-2 centrifuge, which can churn out enriched uranium at more than double the rate of P-1.

Iran has said it plans to move toward large-scale uranium enrichment that will ultimately involve 54,000 centrifuges.

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New Reports Cite China’s Dangerous Rise

The NIC notes that this transformation of world politics is the result of a massive transfer of wealth from West to East, from Europe and North America to Asia. The United States has transferred $1.2 trillion to China since 2001 by running massive trade deficits. These deficits have not only given Beijing the largest currency reserves in the world, but has supported the growth of Chinese industry and given it a steady influx of new technology. Meanwhile, American factories have been replaced by Chinese workshops. U.S. consumers have been spending themselves deeper into debt to help build China into America’s strongest rival.

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U.S. – China Economic and Security Review

The Commission cites Chinese cyber attacks, authoritarian rule, and trade violations as impedments to U.S. Economic and national security interests, and offers 45 recommendations to Congress.

Russia is a Mess

Russia and the Global Economic Crisis

Any international economic crisis afflicts different countries in different ways, but an unfortunate few experience every painful dimension of it. In the current crisis, Russia is confronting virtually all the negatives at once–sharply declining export earnings from energy and metals, over-leveraged corporate balance sheets and a chorus of bailout appeals, a credit crunch and banking failures, a bursting real-estate bubble and mortgage defaults, accelerating capital flight, and unavoidable pressures for devaluation.

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Is America’s new declinism for real?

The NIC report has made people sit up because it comes from the heart of the US security establishment. But it is part of a broader intellectual trend in America: a “new declinism”. This mood marks a complete break with the aggressive confidence of the Bush years and the “unipolar moment”. Its starting assumption is that America, while still the most powerful country in the world, is in relative decline.

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