Ambassador Carla Hills,
Dr. Richard Haas,
Ladies and Gentlemen,

Thank you for inviting me to the Council on Foreign Relations. I thought I might share some thoughts with you on India’s foreign policy and the future of India-US relations. Yogi Berra is sometimes credited with having said that it is difficult to make predictions, especially about the future! I am, nevertheless, sufficiently confident that, extrapolating current trends and developments, the future of India-US relations is strong and the graph is on the ascendant.

India’s approach to the world is naturally a function of our values, our history and geography, and of how we define our interests. Our strategic perspectives in the last sixty years have been a product of the historical aberration that was the early twentieth century. Throughout history, India had been a society that was open, pluralistic and intensely engaged with the rest of the world. Yet, in 1947, independent India found herself restricted by the Cold War world and reduced by colonialism to poverty, disease and famine. In the beginning of the 18th century, India accounted for about a quarter of the world’s wealth, roughly equal to that of all of Europe combined. By independence, our share in global output had plummeted to less than 4%. It is thus not surprising that our primary objective, since independence, has been to improve our people’s lives by regaining our position as a major global economy within a pluralist, secular, socially equitable and democratic framework. In making this effort, India has also decisively demonstrated that democracy and development are not only compatible but also necessary for ensuring sustainability.

The primary task of Indian foreign policy since 1947 has naturally been to enable the transformation of India’s society and economy, restoring traditional patterns of dealing with the world, and building strategic autonomy of choice.

Judging by the results, our foreign policy choices have served the nation well. For more than two decades, India has recorded average annual GDP growth of around 6%. In the last four years, this has risen to over 8%, with the result that India is now the fourth largest economy in the world in purchasing power parity terms. Historically unprecedented transformations and improvements in the people’s living standards have taken place in India in the last few decades. Yet, much remains to be done. If we are to abolish mass poverty in India, we need to grow at 8 to 10% every year until 2020. Our record suggests that the goal is achievable, given considerable effort and the right policy responses, as well as a supportive and peaceful international environment.

Among the reasons that give us this confidence in India’s future efforts to develop, one of the major factors must be the democratic nature of our polity. Democracies by their very nature are predictable. This may seem paradoxical, given the fact that democracies tend to be fractious and full of competing political agenda and ideologies. However, because democracies are based on a popular mandate and governments are answerable to the people, there is an underlying continuity in the policies of elected governments.

The predictability of India’s foreign policy can also be ascribed to the fact that it is based on principles and a broad national consensus. Our world-view, reflecting the vision of leaders like Mahatma Gandhi, Jawaharlal Nehru, Indira Gandhi and Rajiv Gandhi, also bears the indelible influence of our civilizational heritage and our historical experience. As a secular polity, India shares the values of fundamental human rights and freedoms with other liberal democracies. Thus, quite apart from its size, population, economy and politics, India’s civilizational values make it a natural bulwark against fundamentalism and terrorism and a factor of peace and stability in Asia.

Other reasons for confidence in India’s future are our demographic trends and human resource base, which are two of our strongest assets. Some 550 million Indians out of our billion plus population are below the age of 25. The middle class of over 300 million people is growing steadily. Our universities produce over 2 million undergraduates each year. India’s comparative advantage in knowledge driven economic activities is a direct result of our demographics and education policies. We seek today to replicate the successes of the IT industry in the fields of biotechnology, pharmaceuticals and other knowledge intensive areas.

Ladies and Gentlemen,

In the evolving geo-political and economic situation in the world, India needs a stable, peaceful, democratic and prosperous periphery for its own and the region’s future. If India is to grow rapidly and transform herself, we need a supportive and peaceful regional environment. This is why the present situation in Myanmar concerns us deeply. We urge a broad-based and inclusive process of national reconciliation and peaceful reform to lead Myanmar’s political evolution. Bloodshed in this situation is unacceptable. India will work with like - minded countries to make a peaceful outcome possible in Myanmar.

Indeed, in its neighbourhood, India today sees difficult transitions to democracy all around: in Pakistan, Afghanistan, Nepal and Bangladesh. We have strongly supported the positive movement towards democracy and development in Afghanistan and Nepal in the last four years. Over 3500 Indians are in Afghanistan, engaged in that country’s peaceful reconstruction. In each of these neighbors, it is for the people themselves to make their choices about the nature and direction of their own governments. India’s interest is in a stable and peaceful periphery, and we will continue to work with our neighbors to achieve this goal.

One of our primary strategic challenges is to restore traditional linkages within our region and between the region and the rest of the world. Connectivity would enable India’s reintegration into the immediate and extended neighborhood, whether in Central Asia or South East Asia or West Asia. This has led us to pursue actively cooperative arrangements such as SAARC, BIMSTEC and our dialogue with ASEAN. The web of preferential and asymmetrical trading arrangements that India has built up or is working on with her neighbors is designed to further a vision of common and indivisible prosperity. This is also what is behind India’s consistent initiatives to improve relations with Pakistan, which have borne some fruit in the last three years, but which need to be pursued to their logical conclusion through dialogue in an atmosphere free of violence.

Further afield, India’s political and economic ties with the Asia-Pacific region are also growing through institutional mechanisms such as the East Asia Summit. We are also pursuing high-level dialogue with major powers through the India, China and Russia trilateral forum and the India-Brazil-South Africa group, and also developing closer linkages with major powers like the United States, Japan, the European Union and Russia.

In today’s world, as interdependence among the major powers grows, each of us is engaging the other. Today, India enjoys strategic partnerships of one kind or another with as many as eleven countries and the EU. Our strategic partnership with the US has strengthened our relationship bilaterally, in the region and in the world. It is also clear that the development of closer relations between India and any one strategic partner will not be at the expense of relations with any third country.

Ladies and Gentlemen,

The Indian Ocean littoral today has greater economic and strategic value to the world economy than ever before. India has a natural and abiding stake in the safety and security of the sea-lanes of communication from the Malacca Straits to the Gulf. We have endeavoured to promote greater cooperation between Indian Ocean littoral states. Existing or emerging threats of piracy, drug trafficking, proliferation of weapons of mass destruction, closure of choke points, environmental hazards, regional conflicts and other developments are of equally vital concern to us.

As we look around the world, the defining characteristics of the Cold War era, namely, conflicting ideologies and opposing military blocs, are being transformed by the imperatives of globalization, interdependence and connectivity. When I look at the issues of the future, namely, energy security, the environment, food security, and the possible spread of WMD, it is clear to me that each issue will require all states, and particularly countries like India and the USA, to work together. The new challenges that are emerging, including protecting the electronically connected and inter-dependent world from terror and organized crime, are immensely complex. Handling this complexity requires much closer international cooperation than has been the case till now. It is also naive to expect the international system to deal with such complex and significant issues without democratizing international decision-making. Globalization and integration require that the UN and its Security Council be changed dramatically to reflect present day realities.

On a number of these emerging issues, such as disaster relief, HIV/AIDS and other pandemics, new initiatives have been taken for closer India-US collaboration. A telling example of the possible cooperation in these areas is the seamless coordination by our two countries to assist our neighboring states affected by the tsunami disaster of 2004.

If India is to realize its economic potential, it will also need alternative sources of clean energy. Foremost among them is nuclear energy. The bilateral civil nuclear cooperation agreement that India and the USA have finalized indicates the way forward, which should lead to the lifting of technology restrictions and the opening up of cooperation in this field with several countries.

Ladies and Gentlemen,

The future trajectory of India-US ties should be clear from what I have described as India’s foreign policy preoccupations and priorities. Today, India and the USA have an objective convergence in several areas: in values and interests, in areas ranging from economic development to the dangers of proliferation of WMD, and in terrorism. There is much that India and the USA need to do individually and together. Each of us brings to the relationship complementary skills and attributes. We are aware of the challenges that continue to confront our own country. But these challenges also translate into opportunities. In infrastructure or energy, telecommunications or manufacturing, they create opportunities for economic partnership between India and the United States.

I anticipate that there will be underlying predictability and transparency in India US bilateral ties, because this relationship answers to the aspirations and interests of the people of both countries. The links between our two countries are multi-layered. The large and vibrant Indian-American community constitutes a vitally important bridge closely connecting many millions of citizens of both our countries. Parallels of such significant and broad-based popular stake holding in bilateral relations are rare.

Ladies and Gentlemen,

Another important aspect of our relationship with the United States is that it is of mutual benefit. India’s rapid economic growth is propelled not primarily by exports, but much more by growing domestic consumer demand and increasing investments. Our growth will thus not be at the cost of other countries. It will, in fact, be a major stabilizing force in the global economy. This is reflected in recent trends in India-US trade, where US exports to India are growing much faster than US imports from India. Investments are now also flowing in both directions. In terms of the global economy, India and the United States have shared concerns on critical issues, such as energy security. Both our countries are, for instance, interested in the stabilization of oil and gas prices at reasonable levels and in reduced dependence on fossil fuels.

In advanced areas like nuclear energy and space exploration, a sound indigenous base has been built that enables India not only to absorb high technology but also to collaborate with the United States in new fields. We remember US contributions in building centers of excellence in India in science and technology and agricultural research. This collaboration led, amongst other things, to the Green Revolution and self-sufficiency in food. India believes that advanced technologies must be used and managed with care and a sense of responsibility. Our systems of protecting advanced technology show an increasingly apparent convergence.

Ladies and Gentlemen,

I have touched briefly on some of our foreign policy concerns and priorities and on trends in India-US ties. In sum, our relationship has never been better than it is today. I am confident about its future.

I would be happy to answer any questions and to hear your comments.

Thank you.

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