Wednesday, March 29

Dean Kamen vs World Bank: "Render unto Caesar the things that are Caesar's..."

February 18
Subject: Ephemeralization against the bureaucracy
Dear Pundita,
Welcome back! We've missed you. I just saw this euphoric post by open source advocate Eric Raymond about Dean Kamen's attempt to transform the economics of water and power distribution.

I'm sure much of this is hype (considering the Segway :-), but it is interesting how Eric (libertarian that he is) sees this as part of a larger quest to "dis-empower" government:

> Kamen's (rightly) contemptuous dismissal of conventional development economics, and his plan to end-run governments.
> Kamen is taking the next logical step: downsizing and decentralizing the power and water infrastructure. And look at the way he plans to do it; not by enlisting governments, but by tapping local entrepreneurialism.

To be sure, I think it is silly to imagine we can over do away with government, the way some Libertarians dream. On the other hand, it does seem plausible that technical achievements (or even failures) could dramatically impact some large-scale geopolitical issues you talk about, especially the development community.

Which brings me to my question: do you think it is possible for technology + entrepreneurship to (eventually) do an "end-run" around traditional development organizations (e.g., the World Bank), and demonstrate the viability of a truly grass-roots approach to social uplift?
Dr. Ernie Prabhakar in California"

Dear Dr. Ernie:
Thank you for alerting Pundita to the investment model developed by Dean Kamen and Iqbal Quadir; it's very exciting news so I can see why Eric Raymond is euphoric. Now to play wet blanket:

As the Kamen article notes, those nifty energy generator/water purifier machines have to be mass produced in order to bring their price within the reach of village entrepreneurs. As soon as you talk about mass production, you're talking about factories and distribution, and labor unions, and financing. When talking about financing you're talking about banks, which leads to banking regulations, and -- pretty soon you are entangled in the very red tape that Kamen wants to circumvent.

In 2003, Segway's marketing chief told CBS 60 Minutes that he was targeting military and industrial markets in Europe and Asia, "where there are fewer regulatory hurdles than in the U.S."

There are hurdles of a certain kind in the USA, but just try doing the most routine business in a developing country; the hurdles can be mind boggling. Two illustrations:

> Many illegal Mexicans in the US are here simply because they don't want to wait a decade to get a small business loan approved by a Mexican bank. So they work illegally in the USA just to establish credit so they can borrow from an American bank.

> In the 1990s Ukraine's government appealed to the World Bank for help in handling the massive task of establishing individual ownership of property, which of course was held collectively under the Soviet regime.

The examples are a helpful introduction to David Puglielli's paper The World Bank and Microfinance: An Elephant Trying to Build a Bird Nest, which is the shortest answer to your question. Puglielli observes:
...the World Bank has already found its place in the world of microfinance; structural adjustment programs designed to liberalize the over-regulated and suffocating less-developed economies.
The catch is that unless readers are already steeped in Bankese they will have to plow through the entire paper to fully grasp Puglielli's observation. The effort is worth the trouble; Puglielli's writing seems to be poorly transcribed in parts but the points are well reasoned and clear enough.

The points are also timely -- although for all Pundita knows the paper was published a decade ago. That is another reason to give the paper a read: the general public and businesspeople such as Kamen are at least a decade behind the thinking at the IMF-World Bank (and multilateral development institutions in general).

By the late 1990s the big institutions had come round to the idea that developing the physical infrastructures to support industry in the LDCs isn't much help, if the institutions and methods that support business in an advanced industrial nation are not in place.

In other words, if it takes years for entrepreneurs to get a simple business loan; if owners can't write business contracts because the legal infrastructure isn't in place to enforce the contracts; if the notion of private property has not been legally established, much less codified -- then the country is not exactly developing. It remains dependent on the advanced nations, no matter how many factories are built by multilateral institution development loans.

However, the World Bank and IMF must deal with governments that have any number of excuses for not modernizing their 'soft' infrastructures, shall we call them. Then along came the War on Terror and the Bush Democracy Doctrine; taken together, they provide the practical and theoretical rationale for shifting more emphasis to modernizing business infrastructures in the LDCs.

So that's where we are now. Microenterprise is coming into its own in development circles. The catch is that microenterprise, with its emphasis on small-scale entrepreneurs, requires microfinancing and thus, laws that don't mire small business and creative microfinancing in red tape.

The task for the American public in this regard is to lean hard on USAID; Treasury; Congress, the White House and, above all, the US Department of State, so that the multilateral development banks stay the course that the brightest development economists have laid down. (I urge Europeans in the advanced industrial nations to lean on their counterpart organizations as well.) As to why State is key in this regard:

In the manner of the White Rabbit Pundita cautions that you will lose your bearings if you assume that the World Bank's mission is development and reconstruction. The IBRD (now World Bank Group) and its sister organization, the IMF, were conceived as a means to avert another world war; that's their mission, which applies macroeconomic theories to the role of lending to governments that seek development and/or reconstruction assistance from wealthier governments.

The loan mechanism used by the Bank is a carrot and stick; it steers governments toward development/ reconstruction projects that follow economic principles which, in theory, help a poorer government avoid the kind of drastic conditions that traditionally lead to war.

But the development loan is also a powerful tool of foreign policy for the lending governments. So, historically, State (as with all foreign offices in the advanced industrial nations) tends to think in terms of advantage rather than development. Which means State has to be prodded to plug their ears when a government whines that they really can't modernize their business infrastructures if it means riling the party that put them in power. State understands all this; the public just needs to make sure that State's actions support their understanding.

Okay; that is the short answer to your question: In this era the inventor and the entrepeneur still need the World Bank. To be more precise, they need the governments in the advanced industrial nations to lean hard on the IMF and big development banks to keep pushing LDC governments toward modernizing their soft infrastructures.

(The response from many LDC governments will be -- and already is, in some cases -- "We don't need the IMF and World Bank and their stupid rules. We'll just go borrow from commercial banks." Persistence is the best retort.)

In the next post Pundita will tackle the kind of thinking that informs Kamen's push to save the world via cheap energy and clean drinking water. Puglielli's paper is enough homework for now.

Readers who are new to the concept of microfinancing, as applied to small scale development projects in LDCs, might want to visit the Grameen Bank, Grameen Foundation and Aga Khan Network websites before tackling David Puglielli's paper.(1)

Study the history of the Aga Khan's development network if you want to see how relatively small sums of money and lots of ingenuity and good planning can crank out "grassroots" development projects that work well. Also study the history of the Grameen Bank, which led the microinvesting revolution.

Next, I suggest visiting the Microvest Fund website to learn about microinvesting as it's used to help the world's poorest start small businessess.(2) And now that really is enough homework!

Finally, as I noted in the private reply to your February email, Pundita is not exactly back but we'll be posting a little more regularly -- at least once a week -- in April.

Grameen Bank

Aga Khan Development Network

(Pundita has no connection with Microvest Fund and this mention given to the company should not be considered an endorsement.)

Saturday, March 18


"Anna, I can't cope. Look at this!"

It is doctor Anna who is shouting in despair, showing me another of those children. A lump at the back of the throat, eyes glistening with tears at the sight of the badly deformed girl on the cot.

"I'm beginning to hate [the Iraqis]. How can they do this to their children? They know that marriage between cousins..." She stops herself here and has to leave the room; she needs to go and give vent to her anger.

I am familiar with such moments. I glance down at the creature on the cot. I can barely bring myself to look. I can't describe her. My eyes meet hers and it's almost as if she's pleading for help. She understands. She is not going to survive in that body. I wish she didn't understand and she didn't know that there is no hope for her. Her loving father tries to comfort here. Maybe he should have thought earlier. Now it's too late; the damage is done and it's irreversible. Yet even the father, a middle-aged man, is also a victim.

"I have five children," he tells me. "Two of them are fine, but the other three..." I can see in his eyes what he's going to say. He continues. "She is the youngest. Her two brothers are dead."


"This is Allah's will," he tells me.

What if Allah needed to be helped out a little?

"And soon this one is going to die too. And she knows it," he concludes.

I would like to ask him how many more children he wants to bring into this world before he stops. But I don't. He is a victim of a custom that is very much entrenched in Iraq. This is a country where inter-family marriage is quite common, where marrying a relative is perfectly acceptable. The key word is clan. The importance of belonging to one clan rather than another is almost inconceivable for a Western mind. And this man, who will not stop producing children even when faced with such horror, is the best representative.

"But I feel safe like this," a young woman married to her cousin once tried to explain to me. "I know that no one in this family will do me harm."

A debatable opinion.

"Should I marry a stranger instead? Marry someone from work who assures me that I can trust him?"

There are few opportunities in Iraq for women to meet men outside of their own family. There are still fewer opportunities for a woman to date a man and get to know him. Working women have slightly better chances, but only within the working day. Rarely can they meet men outside working hours; that would be considered inappropriate. Consequently, a woman chooses a blood relative who is a regular guest at her family's home. This explains why deformities. . .constitute a gaping wound in the Iraqi people's health."

--From Two Birthdays in Baghdad Finding the heart of Iraq by Anna Prouse

Thursday, March 16

A modern French philosopher displays clarity of thought. Pass the smelling salts.

Marc Schulman at American Future has dug up another gem...

"Thursday, March 16th, 2006 at 9:32 am
Fact vs. Faith
By Marc Schulman
"The new issue of Democratiya is out. The lead article is Separating Truth and Belief by the French philosopher André Glucksmann. Better than anything else I've seen, it puts into words the disorganized thoughts that have been floating around in my mind about the Cartoon Jihad. The article is short, so I'm posting all of it..."

"[4 March-May 2006
Separating Truth and Belief
by André Glucksmann
Le Monde, 2006, 2 pp.

"The anti-caricature campaign started by attacking a newspaper. It then focussed on Denmark as a defender of the freedom of the press, and now it has all of Europe in its sights, which it accuses of having a double standard. The European Union allows the Prophet to be denigrated with impunity, but it forbids and condemns other 'opinions' like Nazism and denial of the Holocaust. Why are jokes about Muhammad permitted, but not those about the genocide of the Jews? This was the rallying call of fundamentalists before they initiated a competition for Auschwitz cartoons. Fair's fair: either everything should be allowed in the name of the freedom of expression, or we should censor that which shocks both parties. Many people who defend the right to caricature feel trapped. Will they publish drawings about the gas chambers in the name of freedom of expression?

Offence for offence? Infringement for infringement? Can the negation of Auschwitz be put on a par with the desecration of Muhammad? This is where two philosophies clash. The one says yes, these are equivalent 'beliefs' which have been equally scorned. There is no difference between factual truth and professed faith; the conviction that the genocide took place and the certitude that Muhammad was illuminated by Archangel Gabriel are on a par. The others say no, the reality of the death camps is a matter of historical fact, whereas the sacredness of the prophets is a matter of personal belief.

This distinction between fact and belief is at the heart of Western thought. Aristotle distinguished between indicative discourse on the one hand, which could be used to reach an affirmation or a negation, and prayer on the other. Prayers are not a matter for discussion, because they do not state: they implore, promise, vow and declare. They do not relate information, they perform an act. When the Islamist fanatic affirms that Europeans practise the 'religion of the Shoah' while he practises that of Muhammad, he abolishes the distinction between fact and belief. For him there are only beliefs, and so it follows that Europe will favour its own.

Civilised discourse analyses and defines scientific truths, historic truths and matters of fact relating to knowledge, not to faith. And it does this irrespective of race or confession. We may believe these facts are profane or undignified, yet they remain distinct from religious truths. Our planet is not in the grips of a clash of civilisations or cultures. It is the battleground of a decisive struggle between two ways of thinking. There are those who declare that there are no facts, but only interpretations – so many acts of faith. These either tend toward fanaticism ('I am the truth') or they fall into nihilism ('nothing is true, nothing is false'). Opposing them are those who advocate free discussion with a view to distinguishing between true and false, those for whom political and scientific matters – or simple judgement – can be settled on the basis of worldly facts, independently of arbitrary pre-established opinions.

A totalitarian way of thinking loathes to be gainsaid. It affirms dogmatically, and waves the little red, or black, or green book. It is obscurantist, blending politics and religion. Anti-totalitarian thinking, by contrast, takes facts for what they are and acknowledges even the most hideous of them, those one would prefer to keep hidden out of fear or for the sake of utility. Bringing the gulag to light made it possible to criticise and ultimately reject 'actually existing socialism'. Confronting the Nazi abominations and opening the extermination camps converted Europe to democracy after 1945. Refusing to face the cruellest historical facts, on the other hand, heralds the return of cruelty. Whether the Islamists – who are far from representing all Muslims – like it or not, there is no common measure between negating known facts and criticising any one of the beliefs which every European has the right to practice or poke fun at.

For centuries, Jupiter and Christ, Jehovah and Allah have had to put up with many a joke. The Jews are past masters at criticising Yaweh – they've even made it a bit of a speciality. That does not prevent the true believers of any confession from believing, or from respecting those of a different faith. That is the price of religious peace. But joking about gas chambers, raped women and disembowelled babies, sanctifying televised beheadings and human bombs all point to an unbearable future.

It is high time that the democrats regained their spirit, and that the constitutional states remembered their principles. With solemnity and solidarity they must recall that one, two or three religions, four or five ideologies may in no way decide what citizens can do or think. What is at stake here is not only the freedom of the press, but also the permission to call a spade a spade and a gas chamber an abomination, regardless of our beliefs. What is at stake is the basis of all morality: here on earth the respect due to each individual starts with the recognition and rejection of the most flagrant examples of inhumanity."

Tuesday, March 14

Through the Looking Glass

"Pundita, Re your March 12 post on the deleted [UK] Sunday Telegraph article by Dr. Sookhdeo:

A possible reason why removal of the article genuinely might be "for legal reasons." There was a statement in the Telegraph recently (read it in the print edition; unable to find online so far):

"The Sunday Telegraph acknowledges that Dr Sookhdeo's remarks did not refer to The Noble Qur'an, A Rendering of its Meaning in English, but to a completely different translation. The Sunday Telegraph apologises for this mistake and for any offence caused by it."

In other words, there could be a very good legal reason for removing the article.

Free speech, etc. notwithstanding if Sookhdeo, Palmer or the article editors confused titles, the Telegraph could be looking at a very nasty lawsuit if it kept the article up.

BTW I agree with the article argument; it looks like it's an unfortunate victim of the sloppy fact-checking common in newspapers here (which is odd, when you think about; it given how restrictive libel law is in England, you'd think they'd be really scrupulous about verifying facts).
John in UK"

Dear John
Thank you for news about the Telegraph apology. Pundita notes that Dr Sookhdeo very clearly wrote out the title of the book he referenced, which is not the same title that called forth the Telegraph apology. Thus, Pundita suspects that the Telegraph editor had to leap through the Looking Glass in order to scare up an excuse to delete the piece.

This said, British libel laws are beyond restrictive; they are a universe unto themselves, as Rachel Ehrenfeld learned the hard way. So it's possible that a mere similarity of wording in a title might be enough to provoke suit. (Or, as you suggest, this could be one to blame on the fact checkers.)

Of course these observations have nothing to do with Sookhdeo's points, which the British government seems reluctant to discuss, let alone debate, in public. The question is whether the government is reluctant to see the points debated in any public forum under the control of British law. (Or should we say,"British and Sharia" laws?)

Sunday, March 12

Operation Safe Commerce study puts nail in coffin of Bush's defense of Dubai ports deal

..."The study, called "Operation Safe Commerce," undercuts arguments that port security in America is an exclusive province of the Coast Guard and U.S. Customs and Border Protection and is not managed by companies operating shipping terminals.

The theme was an important element in the Bush administration's forceful defense of the deal it originally approved to allow Dubai-owned DP World to handle significant operations at ports in New Jersey, Baltimore, New Orleans, Miami and Philadelphia." ...

Full text:

Study Warns of Lapses by Port Operators
By TED BRIDIS, Associated Press (via AOL news)

"WASHINGTON (March 12) -- Lapses by private port operators, shipping lines or truck drivers could allow terrorists to smuggle weapons of mass destruction into the United States, according to a government review of security at American seaports.

The $75 million, three-year study by the Homeland Security Department included inspections at a New Jersey cargo terminal involved in the dispute over a Dubai company's now-abandoned bid to take over significant operations at six major U.S. ports.

The previously undisclosed results from the study found that cargo containers can be opened secretly during shipment to add or remove items without alerting U.S. authorities, according to government documents marked "sensitive security information" and obtained by The Associated Press.
The study found serious lapses by private companies at foreign and American ports, aboard ships, and on trucks and trains "that would enable unmanifested materials or weapons of mass destruction to be introduced into the supply chain."

The study, expected to be completed this fall, used satellites and experimental monitors to trace roughly 20,000 cargo containers out of the millions arriving each year from Europe, Asia and the Middle East. Most containers are sealed with mechanical bolts that can be cut and replaced or have doors that can be removed by dismantling hinges.

The risks from smuggled weapons are especially worrisome because U.S. authorities largely decide which cargo containers to inspect based on shipping records of what is thought to be inside.
Among the study's findings:

-- Safety problems were not limited to overseas ports. A warehouse in Maine was graded less secure than any in Pakistan, Turkey or Brazil. "There is a perception that U.S. facilities benefit from superior security protection measures," the study said. "This mind set may contribute to a misplaced sense of confidence in American business practices."

_No records were kept of "cursory" inspections in Guatemala for containers filled with Starbucks Corp. coffee beans shipped to the West Coast. "Coffee beans were accessible to anyone entering the facility," the study said. It found significant mistakes on manifests and other paperwork. In a statement to the AP, Starbucks said it was reviewing its security procedures.

-- Truck drivers in Brazil were permitted to take cargo containers home overnight and park along public streets. Trains in the U.S. stopped in rail yards that did not have fences and were in high-crime areas. A shipping industry adage reflects unease over such practices: "A container at rest is a container at risk."
-- Practices at Turkey's Port of Izmir were "totally inadequate by U.S. standards." But, the study noted, "It has been done that way for decades in Turkey."

-- Containers could be opened aboard some ships during weekslong voyages to America. "Due to the time involved in transit (and) the fact that most vessel crew members are foreigners with limited credentialing and vetting, the containers are vulnerable to intrusion during the ocean voyage," the study said.
-- Some governments will not help tighten security because they view terrorism as an American problem. The U.S. said "certain countries," which were not identified, would not cooperate in its security study -- "a tangible example of the lack of urgency with which these issues are regarded."

-- Security was good at two terminals in Seattle and nearby Tacoma, Wash. The operator in Seattle, SSA Marine, uses cameras and software to track visitors and workers. "We consider ourselves playing an important role in security," said the company's vice president, Bob Waters.

In theory, some nuclear materials inside cargo containers can be detected with special monitors. But such devices have frustrated port officials in New Jersey because bananas, kitty litter and fire detectors -- which all emit natural radiation -- set off the same alarms more than 100 times every day.

The study applauded efforts to install radiation monitors overseas. "While there is clearly value in nuclear detection at a U.S. port, that is precisely the concern -- it is already on U.S. soil," it said.
Finding biological and chemical weapons inside cargo containers is less likely. The study said tests were "labor intensive, time-consuming and costly to use" and produced too many false alarms. "No silver bullet has emerged to render terrorists incapable of introducing WMD into containers," it said.

Sen. Patty Murray, who advocated the study, said: "There are huge holes in our security system that need to be filled." The Washington Democrat said the study "shows us there are major vulnerabilities over who handles cargo, where it's been and whether cargo is on a manifest."

Part of the study tested new tamper-evident locks on containers and tracking devices.
"It's important to figure out what works and what doesn't," said Elaine Dezenski, Homeland Security's acting assistant secretary for policy development. She said the study "gave us a much better view of vulnerabilities." The U.S. is looking for weaknesses across the shipping system to learn where terrorists might strike, she said.

The study, called "Operation Safe Commerce," undercuts arguments that port security in America is an exclusive province of the Coast Guard and U.S. Customs and Border Protection and is not managed by companies operating shipping terminals.

The theme was an important element in the Bush administration's forceful defense of the deal it originally approved to allow Dubai-owned DP World to handle significant operations at ports in New Jersey, Baltimore, New Orleans, Miami and Philadelphia.

Bush and senior officials sought to assure lawmakers that safety at ports would not decline.
"I can understand people's consternation because the first thing they heard was that a foreign company would be in charge of our port security when in fact, the Coast Guard and Customs are in charge of our port security," Bush said Feb. 28. "Our duty is to protect America, and we will protect America."

DP World promised on Thursday to transfer fully to an American company its U.S. port operations it acquired when it bought London-based Peninsular & Oriental Steam Navigation Co.

It was unclear how such a sale might occur, but the divestiture was expected to involve major operations at the six U.S. ports and affect lesser dockside activities at 16 other ports in this country.

Sen. Robert Menendez, D-N.J., a leading critic of the Dubai deal, said anyone suggesting that port operators and shipping companies were not involved with security was "living in La-La land."

"You can obviously have stuff in containers that doesn't make it onto manifests, either by design or from the actions of bad actors," Menendez said in an AP interview Friday. "A terminal operator is so involved in the overall security equation of ports."

Parts of the U.S. study examined the safety of containers sent to the same cargo terminal in New Jersey that DP World would have managed jointly and operated with its Denmark-based rival, Maersk Sealand.
Hundreds of pages of study documents obtained by the AP do not list specific security lapses at the New Jersey terminal. The final two cargo containers being tracked under the study were expected to arrive there this week from the Middle East.

But the study broadly described problems in warehouses and other storage areas that raised doubts about the safety of containers brought to New Jersey's port. It cited problems with protective fences and gates, surveillance cameras and emergency plans.

The lengthy study has been beset by problems. Japan refused to allow officials to attach tracking devices to containers destined for the United States. Other tracking devices sometimes failed. Many shipping companies refused to disclose information for competitive reasons.

Some containers in the study were aboard a ship the Coast Guard held 11 miles off New Jersey's coast for security reasons in August 2004. An anonymous e-mail had claimed a container filled with tons of lemons was deliberately contaminated with a biological agent. The lemons were fumigated and burned, but no trace of poison was ever found; the containers also were destroyed.

Parts of the study could not be finished at all. U.S. officials went to Pakistan to inspect how workers in Karachi handle cargo containers. But they canceled plans for a return inspection because of an outbreak of terrorist attacks there.

Press censorship in Britain deletes opinion article about British Muslims

". . .in a decade, you will see parts of English cities which are controlled by Muslim clerics and which follow, not the common law, but aspects of Muslim sharia law. It is already starting to happen – and unless the Government changes the way it treats the so-called leaders of the Islamic community, it will continue."

Thanks Marc for alerting me to this situation. Thanks also to Hyscience and VirtueOnline for rescuing the deleted article.

The censorship is bad enough but the observations in the Telegraph suggest that the British government is still having a hard time digesting the concept of a 'nation,' which of course can only be governed by one body of law. Fellow Americans, please take note.

* * * * * * * * *
By Marc Schulman at American Future
"On February 19, The Telegraph published an article by Alasdair Palmer entitled "ENGLAND: The day is coming when British Muslims form a state within a state."

If you click on the link, you won't find the article. Instead, you'll be treated to this message: "This story has been removed for legal reasons." What those legal reasons are isn't said.

Fortunately, Hyscience found the deleted article on another website. Shocking would be an understatement. You owe it to yourself to read all of it. Please help to disseminate it throughout the blogosphere.

ENGLAND: The day is coming when British Muslims form a state within a state

For the past two weeks, Patrick Sookhdeo has been canvassing the opinions of Muslim clerics in Britain on the row over the cartoons featuring images of Mohammed that were first published in Denmark and then reprinted in several other European countries.

"They think they have won the debate," he says with a sigh. "They believe that the British Government has capitulated to them, because it feared the consequences if it did not.

"The cartoons, you see, have not been published in this country, and the Government has been very critical of those countries in which they were published. To many of the Islamic clerics, that's a clear victory.

"It's confirmation of what they believe to be a familiar pattern: if spokesmen for British Muslims threaten what they call 'adverse consequences' – violence to the rest of us – then the British Government will cave in. I think it is a very dangerous precedent."

Dr Sookhdeo adds that he believes that "in a decade, you will see parts of English cities which are controlled by Muslim clerics and which follow, not the common law, but aspects of Muslim sharia law.

"It is already starting to happen – and unless the Government changes the way it treats the so-called leaders of the Islamic community, it will continue."

For someone with such strong and uncompromising views, Dr Sookhdeo is a surprisingly gentle and easy-going man. He speaks with authority on Islam, as it was his first faith: he was brought up as a Muslim in Guyana, the only English colony in South America, and attended a madrassa there.

"But Islamic instruction was very different in the 1950s, when I was at school," he says. "There was no talk of suicide bombing or indeed of violence of any kind. Islam was very peaceful."

Dr Sookhdeo's family emigrated to England when he was 10. In his early twenties, when he was at university, he converted to Christianity. "I had simply seen it as the white man's religion, the religion of the colonialists and the oppressors – in a very similar way, in fact, to the way that many Muslims see Christianity today.

" Leaving Islam was not easy. According to the literal interpretation of the Koran, the punishment for apostasy is death – and it actually is punished by death in some Middle Eastern states. "It wasn't quite like that here," he says, "although it was traumatic in some ways."

Dr Sookhdeo continued to study Islam, doing a PhD at London University on the religion. He is currently director of the Institute for the Study of Islam and Christianity. He also advises the Army on security issues related to Islam.

Several years ago, Dr Sookhdeo insisted that the next wave of radical Islam in Britain would involve suicide bombings in this country. His prediction was depressingly confirmed on 7/7 last year.

So his claim that, in the next decade, the Muslim community in Britain will not be integrated into mainstream British society, but will isolate itself to a much greater extent, carries weight behind it. Dr Sookhdeo has proved his prescience.

"The Government, and Tony Blair, the Prime Minister, are fundamentally deluded about the nature of Islam," he insists. "Tony Blair unintentionally revealed his ignorance when he said, in an effort to conciliate Muslims, that he had 'read through the Koran twice' and that he kept it by his bedside.

"He thought he was saying something which showed how seriously he took Islam. But most Muslims thought it was a joke, if not an insult. Because, of course, every Muslim knows that you cannot read the Koran through from cover to cover and understand it.

The chapters are not written to be read in that way. Indeed, after the first chapter, the chapters of the Koran are ordered according to their length, not according to their content or chronology: the longest chapters are first, the shorter ones are at the end.

"You need to know which passage was revealed at what period and in what time in order to be able to understand it – you cannot simply read it from beginning to end and expect to learn anything at all.

"That is one reason why it takes so long to be able to read and understand the Koran: the meaning of any part of it depends on a knowledge of its context – a context that is not in the Koran itself."

The Prime Minister's ignorance of Islam, Dr Sookhdeo contends, is of a piece with his unsuccessful attempts to conciliate it. And it does indeed seem as if the Government's policy towards radical Islam is based on the hope that if it makes concessions to its leaders, they will reciprocate and relations between fundamentalist Muslims and Tony Blair's Government will then turn into something resembling an ecumenical prayer meeting.

Dr Sookhdeo nods in vigorous agreement with that. "Yes – and it is a very big mistake. Look at what happened in the 1990s. The security services knew about Abu Hamza and the preachers like him. They knew that London was becoming the centre for Islamic terrorists. The police knew. The Government knew. Yet nothing was done.

"The whole approach towards Muslim militants was based on appeasement. 7/7 proved that that approach does not work – yet it is still being followed. For example, there is a book, The Noble Koran: a New Rendering of its Meaning in English, which is openly available in Muslim bookshops.

"It calls for the killing of Jews and Christians, and it sets out a strategy for killing the infidels and for warfare against them. The Government has done nothing whatever to interfere with the sale of that book.

"Why not? Government ministers have promised to punish religious hatred, to criminalise the glorification of terrorism, yet they do nothing about this book, which blatantly does both."

Perhaps the explanation is just that they do not take it seriously. "I fear that is exactly the problem," says Dr Sookhdeo. "The trouble is that Tony Blair and other ministers see Islam through the prism of their own secular outlook.

They simply do not realise how seriously Muslims take their religion. Islamic clerics regard themselves as locked in mortal combat with secularism.

"For example, one of the fundamental notions of a secular society is the moral importance of freedom, of individual choice. But in Islam, choice is not allowable: there cannot be free choice about whether to choose or reject any of the fundamental aspects of the religion, because they are all divinely ordained. God has laid down the law, and man must obey.

'Islamic clerics do not believe in a society in which Islam is one religion among others in a society ruled by basically non-religious laws. They believe it must be the dominant religion – and it is their aim to achieve this.

"That is why they do not believe in integration. In 1980, the Islamic Council of Europe laid out their strategy for the future – and the fundamental rule was never dilute your presence. That is to say, do not integrate.

"Rather, concentrate Muslim presence in a particular area until you are a majority in that area, so that the institutions of the local community come to reflect Islamic structures. The education system will be Islamic, the shops will serve only halal food, there will be no advertisements showing naked or semi-naked women, and so on."

That plan, says Dr Sookhdeo, is being followed in Britain. "That is why you are seeing areas which are now almost totally Muslim. The next step will be pushing the Government to recognise sharia law for Muslim communities – which will be backed up by the claim that it is "racist" or "Islamophobic" or "violating the rights of Muslims" to deny them sharia law.

"There's already a Sharia Law Council for the UK. The Government has already started making concessions: it has changed the law so that there are sharia-compliant mortgages and sharia pensions.

"Some Muslims are now pressing to be allowed four wives: they say it is part of their religion. They claim that not being allowed four wives is a denial of their religious liberty. There are Muslim men in Britain who marry and divorce three women, then marry a fourth time – and stay married, in sharia law, to all four.

"The more fundamentalist clerics think that it is only a matter of time before they will persuade the Government to concede on the issue of sharia law. Given the Government's record of capitulating, you can see why they believe that."

Dr Sookhdeo's vision of a relentless battle between secular and Islamic Britain seems hard to reconcile with the co-operation that seems to mark the vast majority of the interactions between the two communities.

"Well, it isn't me who says Islam is at war with secularisation," he says. "That's how Islamic clerics describe the situation."

But isn't it true that most Muslims who live in theocratic states want to get out of them as quickly as possible and live in a secular country such as Britain or America? And that most Muslims who come to Britain adopt the values of a liberal, democratic, tolerant society, rather than insisting on the inflexible rules of their religion?

"You have to distinguish between ordinary Muslims and their self-appointed leaders," explains Dr Sookhdeo. "I agree that the best hope for our collective future is that the majority of Muslims who have grown up here have accepted the secular nature of the British state and society, the division between religion and politics, and the importance of allowing people to choose freely how they will live.

"But that is not how most of the clerics talk. And, more significantly, it is not how the 'community leaders' whom the Government has decided represent the Muslim community think either.

"Take, for example, Tariq Ramadan, whom the Government has appointed as an adviser because ministers think he is a 'community leader'. Ramadan sounds, in public, very moderate. But in reality, he has some very extreme views. He attacks liberal Muslims as 'Muslims without Islam'. He is affiliated to the violent and uncompromising Muslim Brotherhood.

"He calls the education in the state schools of the West 'aggression against the Islamic personality of the child'. He has said that 'the Muslim respects the laws of the country only if they do not contradict any Islamic principle'. He has added that 'compromising on principles is a sign of fear and weakness'."

So what's the answer? What should the Government be doing? "First, it should try to engage with the real Muslim majority, not with the self-appointed 'community leaders' who don't actually represent anyone: they have not been elected, and the vast majority of ordinary Muslims have nothing to do with them.

"Second, the Government should say no to faith-based schools, because they are a block to integration. There should be no compromise over education, or over English as the language of education. The policy of political multiculturalism should be reversed.

"The hope was that it would to ensure separate communities would soften at the edges and integrate. But the opposite has in fact happened: Islamic communities have hardened. There is much less integration than there was for the generation that arrived when I did. There will be much less in the future if the present trend continues.

"Finally, the Government should make it absolutely clear: we welcome diversity, we welcome different religions – but all of them have to accept the secular basis of British law and society. That is a non-negotiable condition of being here.

"If the Government does not do all of those things then I fear for the future, because Islamic communities within Britain will form a state within a state. Religion will occupy an ever-larger place in our collective political life. And, speaking as a religious man myself, I fear that outcome."