'The Firm Broom Of Cold Logic ...'

Full text of the speech at the Council of Foreign Relations, New York, May 07, 2003: 'India, United States and the New World Order: Prospects for Cooperation'

Ladies and Gentlemen,

It is a privilege to be here today with you to exchange views on India-US relations. At the same time, you have put me in a bit of a spot by asking me to talk about the New World Order! Frankly I think it is still very much an evolving process. Are recent events a continuation of the post-Cold War readjustment of the world order, or do they signal a re-ordered "post-9/11" world order? The jury is still out on this, and the verdict will emerge only in the future.

I will, therefore, make some brief remarks on what I see as elements of the emerging world order and then talk about the India-US relationship in that framework.

History tells us that after a great war, the victorious forces seek to redesign the world order. But history also warns us that unexpected events and the interplay of diverse forces can divert or derail this effort.

Just look at the previous world order. At the end of World War II, the victorious Allies sought to guarantee collective security through the United Nations and its specialized agencies.This blueprint for a New World Order did not last for even a decade. The UN Security Council was paralysed by the confrontation between the Eastern and Western blocs. Instead of multilateral cooperation within the UN, the Cold War became the world’s strategic paradigm for four decades after World War II.

With the fall of the Berlin wall came the next quest for a New World Order. Political leaders across the globe spoke about a new window of opportunity for peace and cooperation.

But optimistic hopes for the end of conflict were soon belied. Countries disintegrated under the onslaught of ethnic nationalism and religious extremism. The myth of self-correcting market forces was exploded by the East Asian financial crisis and similar afflictions in parts of Europe and Latin America. Conflicts claimed more casualties during the decade of the 1990’s than during the entire Cold War. Terrorism was beginning to announce itself on the world stage as a non-state actor of worrying proportions.

And then came September 11 2001, demonstrating the reach of global terrorism and its ability to bridge the asymmetry in power and strength between the terrorist and his victims. The coalition, formed to fight this scourge, achieved its immediate purpose of restoring a popular government in Afghanistan, but its composition does not enable it to tackle global terrorism comprehensively since not all its members have a firm commitment to this objective. The military action in Iraq involved another "coalition of the willing", and in the process opened up divisions within the UN Security Council, European Union and NATO.

Today, we hear two prognostications of the evolving new world order. The first is of a unipolar world with the United States taking the principal decisions on international political and economic issues. According to this theory, the dominance of U.S. power would drive the impulse to unilaterally shape the world in its image, brushing aside any dissenting opinion. The other model is one of a world comprising multiple political poles, suggesting that a certain level of tension between the poles will maintain an equilibrium in which the dominant pole can be kept in some checkWhile pondering on the viability of the model of a unipolar world, we need to recognize that the post Cold War order has been profoundly influenced by globalisation. Inspired by – and now itself driving – the technologies of the information age, it affects every aspect of human and group activity – political, economic and social. No country or society has remained immune from this phenomenon. The consequences of globalisation cannot be localised within national boundaries.

Demographic changes and migration patterns; the movement of natural resources – particularly energy and water; and issues like climate change pose challenges transcending national boundaries. Even States with the most advanced technical means are increasingly unable to fully control international flows of disease, illicit drugs, funds and weapons. The international information networks of terrorism and the proliferation of weapons of mass destruction among its state and non-state practitioners can only be countered by close cooperation between democratic societies through regular information exchanges and intelligence sharing.

Today, a regional epidemic like SARS becomes a global problem overnight. The ongoing arguments about whether more real-time information might have halted its spread prove the point of global interdependence.

Such global inter-dependence means that even a unipolar power needs cooperative action in pursuit of its various objectives. The current crisis over North Korea is anexample.

The question is also one of resources. If a terrorist network is smashed in a failed or failing state – as Afghanistan was under the Taliban – there would obviously be costs for the reconstruction of the state. The external assistance for Afghanistan’s reconstruction is now about $250 million a year; it would need to be increased and sustained over many years. The cost of restoration after the last Gulf War was higher, and that of Iraq’s reconstruction is expected to be much, much higher. No single world power, however rich, would want to take on this kind of financial burden, at the expense of its taxpayers.

On the second model, we should realize that in the real world, an arrangement not in conformity with geopolitical realities cannot be sustained. It is an unquestionable fact that USA is the pre-eminent power in the world today. The American commentator, Fareed Zakaria, recently pointed out that USA spends as much on defence as the entire rest of the world put together; and this amount is only 4% of its GDP. The US economy is as large as those of Japan, Germany and Britain puttogether.

It would make poor political or economic sense for a country – or a group of countries – to set itself up as an alternate pole in opposition to USA. Most countries advocating a multi-polar world also affirm that they attach great importance to relations with USA. What they seek is an ethic of plurality and consensus which would ensure that collective decisions give due weightage to their legitimate interests and concerns. It is a non-confrontationist model, not based on outmoded concepts of balance of power, spheres of interest and militaryblocs.

Nearly sixty years ago, after the end of World War II, America was in a similar position of political, military and economic pre-eminence. Then, a mature American communitarian impulse inspired the creation of a multilateral global architecture. The United Nations, the World Trade Organisation, the World Bank and the IMF are all products of this internationalism.

The challenge today is not to demolish these edifices, but to address their shortcomings, some of which are serious. The United Nations system of collective security has not always functioned effectively. It needs reform. The Security Council needs reconfiguration. But we should not throw out the baby with the bathwater. As I pointed out earlier, even a powerful unipolar power requires multilateral agencies, which can maintain political, financial and economic order.  A reform is also required in the current non-proliferation architecture to make it serve the real purpose for which it was created. Restrictive regimes deny access of several countries to dual-purpose goods and technologies, without either rewarding responsible behaviour or punishing irresponsibleproliferators.

Deterrence, prevention and defence are accepted elements of a national security strategy. But today, the international terrorist is often an irrational individual, ready to sacrifice his and innocent lives for an extremist cause, acquiring weapons of mass destruction and using unorthodox techniques to overcome asymmetries of strength. There can be no deterrence against irrational behaviour. Prevention and defence are also almost impossible. In such cases, extraordinary measures have to be taken in the interests of security. This is where a smoothly operating world order with a functioning consultative mechanism can help to provide legitimacy.

It is from these strands that a new world order would be woven. What we need is a constructive and continuing dialogue on the management of global inter-dependence.

In the world order defined by the Cold War, India and US were not really allies though, to be fair, nor were they enemies. India-US relations reflected a lack of engagement, coupled with wariness and a periodically recurring suspicion whenever the shadow of the Cold War fell over ourregion.

In the post-Cold War world (and even in the post-9/11 world order), the situation is dramatically different. We have shared geo-political interests and economic opportunities, which can bind an enduring partnership. This was the perception that led Prime Minister Vajpayee to declare, nearly five years ago, that the two countries could be "natural allies", which have yet to fulfil the promise of their cooperation.

We know that President Bush fully shares this vision for an enduring India-US partnership. The US National Security Strategy released by the President last September states, "The United States has undertaken a transformation in its bilateral relationship with India based on a conviction that US interests require a strong relationship with India. We are the two largest democracies, committed to political freedom protected by representative governments. India is moving towards greater economic freedom as well. We have a common interest in the free flow of commerce, including through the sea-lanes of the Indian Ocean. Finally, we share an interest in fighting terrorism and in creating a strategically stable Asia." This is a succinct statement of our complementarities andconvergences.

It is particularly refreshing that our two countries are now looking at the full scope and breadth of the Indo-US relationship. To speak very frankly, what really stunted the growth of our bilateral relations in past years was the tendency to look at India’s role only within a South Asian canvas and to see South Asia solely as the theatre of an India-Pakistan zero sumgame.

India has broken free of these limiting confines, which the Cold War ideologies sought to impose. It has land borders of well over 3000 km with China and Southeast Asia. It has maritime borders with Indonesia and Thailand. Its exclusive economic zone spans the waters almost from the Persian Gulf to the Straits of Malacca. As your National Security Strategy recognizes, it straddles the commercial sealanes and the oil routes from the West to all of East Asia.

Our cultural and trade connections have historically extended along the Silk Route through Central Asia into Europe; and along what could be termed the Buddhist trail through Myanmar, Indochina, China and Southeast Asia to Japan.

Today, India has a population of over a billion people, upwardly mobile on the economic ladder. In terms of purchasing power parity, it is the world’s fourth largest economy, averaging an annual growth rate of over 5% since 1980 – the highest ever achieved over a comparable period by any democracy in the world. I might also mention that this growth rate was maintained through the turbulent period a few years ago when the so-called "Asian crisis" seized a few Asian economies.

Our economic fundamentals remain strong. Inflation is within the reasonably low single digits. Over the last few years, India has been attracting foreign direct investment at an annual rate of nearly 1.7% of GDP. American companies in India sometimes complain about operating conditions, but statistics show that they all have very healthy balance sheets. The inflow of American investments into India has grown significantly in the last few years. The case of Enron’s Dabhol Project is sui generis. It is not so well known that the financial exposure of Indian entities exceeds the foreign funds deployed in the project. It is more a case of an economically unviable project than a foreign investment venture turnedsour.

I have set out these facts in some detail, illustrating India’s wider political, economic, security and strategic interests, to reiterate that to view India solely through a South Asian prism would be an analytical error. In our view, the world made this mistake in May 1998, in its reactions to India’s nuclear tests. Our security concerns, which prompted that decision, are better understood today.

We must acknowledge that USA was among the first countries to temper its reservations about our nuclear tests with an understanding of the larger picture of India’s political concerns and economic potential. The visit of President Clinton to India in March 2000 – less than two years after the tests – was in that sense a landmark event. After this opening, President Bush has personally led the effort for a complete transformation in relations.

Given its past history, the Indo-US relationship needs to liberate itself from a number of misconceptions and prejudices of past years. I think we have made considerable headway on this path with good impact on our relations. Our leaders are in regular touch with each other on the phone and through letters. Regular exchanges of visits at the political and senior official levels have resulted in a harmonisation of our position on a number ofissues.

Nowhere is this engagement more visible than in defence and security. Indian naval vessels took on the responsibility of escorting US vessels through the Malacca Straits last year. Joint exercises involving US Special forces and Indian paratroopers in India and Alaska, largest ever combined naval exercise in the Malabar series, institutional linkages between civilian, military and defence institutions of our Ministries of Defence, discussions on missile defence, purchase of defence equipment etc are some new developments. Working groups have been set up on counter-terrorism, the Defence Policy Group has been revived and a joint forum on cyber-terrorism established to pursue defence and infrastructure protection projects.

India was one of the first countries to declare support to the USA in its global war against terrorism after the horrendous events of September 11, 2001. We extended unwavering support to operation ‘Enduring Freedom’. We worked closely with our American and other colleagues in the Bonn process for restoration of representative government in Afghanistan and continue to participate in Afghan reconstruction efforts. On a diverse range of other subjects, India’s interactions with USA and its reactions to US statements or actions have been governed by a pragmatic understanding of realities, rather than doctrinaire ideologies. I might mention our prompt and positive reaction to the New Strategic Framework unveiled by President Bush in May 2001, our support to the many welcome elements in the energy and climate change policies enunciated by the President and our convergent positions on the International Criminal Court. There are a number of other areas where we have been able to find common ground for jointaction.

This does not imply that there are no longer any differences between our two countries, but there is certainly a realisation that there is far more that unites us than divides us. We have had differences including over issues like our nuclear programmes, but a sustained bilateral dialogue with a frank exchange of concerns has led to a far better mutual understanding on theseissues.

I have been saying very candidly that a trinity of issues – high technology commerce, civilian nuclear energy cooperation and collaboration in space can take the Indo-US relationship to a qualitatively new level of partnership. India has consistently followed responsible policies on non-proliferation of nuclear and missile technologies and has strict export control regimes for dual-use technologies. The sharp contrast with others in our near and extended neighbourhood is evident for all to see. We believe that our discussions with our American partners on this subject are on the right path and hope that the road to free high technology commerce will soon be cleared of the hurdles ofmisconceptions.

We have to cover the same path for civilian nuclear cooperation and collaboration in space. Here again, I have to say that the obstacles come from remnants of cold war thinking and are not in consonance with our mutual interests. India has repeatedly asserted – and this is acknowledged internationally – that its nuclear and missile development programmes are entirely indigenous. We have not violated any of our bilateral commitments or international obligations. We will continue to restrict the development of these programmes to the minimum levels required for our nationalsecurity.

When the world has recognized this reality, it defies logic to place obstacles on civilian applications of our nuclear programme and developmental projects of our space programme. These are areas where there are huge commercial possibilities for American companies (and companies from othercountries).

We have, of course, undertaken that we would put all nuclear power projects of foreign collaboration under safeguards. I am aware that some US regulations and laws are constraining factors, but rules and legislation can be amended to respond to changed situations.

Let me also put the nuclear energy issue in an environmental perspective. If the huge additional power required for India’s ambitious development plans is to be generated from fossil fuels, the consequent drastic increase in carbon dioxide emissions could have disastrous effects on the global environment. This is, in fact, the logic for our decision to increase the percentage of nuclear power in our energy output.

In sum, therefore, the political leadership in both countries sees value in building upon the natural links between our two democracies in a globalising world. The India-U.S. relationship is not a single-issue relationship. Our friendship is based on a broad range of shared values, beliefs and interests. Societies of this size and complexity, by their very nature, cannot agree on all issues. Our disagreements are now increasingly discussed with the candour and confidence injected by the recent transformation of our bilateral relationship. Both combating terrorism and forging a new world order demand close and solid partnerships among democratic societies, which value freedom, pluralism and entrepreneurship.