Bargaining in Crisis

07 Feb, 2002    ·   695

Arpit Rajain juxtaposes the current Indo-Pak stand-off on Game Theory and speculates possible positions and their outcomes
Arpit Rajain
Following the December 13 attack on the Indian Parliament, the Indian Government quickly mobilised its troops and, if reports are to be believed, even deployed its missiles. India placed a charter of demands on Pakistan – prominent being the extraditing of India ’s 20 most wanted terrorists and the closing of terrorist training camps inside Pakistan . Calls then came from the ruling party to cross the LoC. With India driving a bargain that cross border terrorism be stopped, 20 of India’s most wanted criminals be handed over or else the military build-up would continue, an escalation of the crisis was inescapable. 

 

 

Stephen Maxwell and Robert Jervis argue that a refusal to back down in a crisis exposes a government to the risk that the other will also refuse to back down; hence the one willing to accept the greater risk will prevail. Both governments thus have a choice between accepting the demand of the other, which leads to an automatic de-escalation of the crisis and a certainty in its outcome, or accepting an uncertain outcome (back channel diplomacy, international pressure to de-escalate-the crisis, which may or may not work) leading to a military conflict ensuing from the demands not being met. Glenn Snyder has also theoretically gamed the choice of outcomes that a country might decide to accept in bargaining. He contends that the main component of each country’s strength in this type of situation is ‘critical risk’, that is the risk of the other side standing firm, leaving the initiator of the crisis with the choice of either standing firm or accepting the demands of the other side. This is the risk that a government should be willing to accept as the consequence of standing firm. There remains a choice with the bargainer of comparing his critical risk with an estimated probability – the probability that the other side also stands firm whatever the consequences. An escalation at this juncture would leave no room for a face saving solution to the bargainer.

 

 

Based on this framework the following scenarios emerge if one speculates on the possible outcomes of the present Indo-Pak stand-off. 

 

 

·                     Pakistan decides that if it complies with any of India’s demands of stopping cross-border terrorism and handing over India’s 20 most wanted criminals, it stands to lose out with its domestic constituency, and concludes that India is unlikely to attack given (a) international pressure, and (b) India’s established norm of not crossing the LoC; in that case one outcome is certain. The stand-off remains for a time, but international pressure slowly ensures that India withdraws its troops in a phased manner from their battle positions to peacetime locations. 

 

                   

 

·                     Another outcome could be that the stand-off continues for a while, and Pakistan does hand over some of the people named in the 20 most wanted list (perhaps beginning with the Punjab militants), and a process of de-escalation is initiated. 

 

                  

 

·                     A third outcome could be no compliance, no bargaining, no punishment – the US ensures that the stand-off ends peacefully. In either case, Indian demands, even if met, would only be partially met. Pakistan realises that it can get away after testing India ’s patience at a threshold that is substantially higher than before.  Where does this leave India ? After the present stand-off, India would realise that a military build-up and making demands does not work. Since this threshold did not work, India would have to raise the threshold in the next crisis to just short of an armed conflict.

 

                 

 

In the present crisis, it is unlikely that India will either launch an all out military attack or target the terrorist training camps. It is also unlikely that Pakistan will comply with all of Indian demands – at best there could be a limited compliance. The next time around India would have to exercise better judgement about the probability of various pay-offs including Pakistan ’s refusal to comply, and India ’s ability to execute a threatened course of action. 

POPULAR COMMENTARIES