Our connection with the Middle East - which we call West Asia - has historically been intimate. In a geographical and cultural sense, India is very nearly a part of the region. We have a considerable dependence on oil and gas supplies from this region. In addition to this, 3.5 million Indians work in the Gulf and Arab countries. They send back remittances, which are now approaching US $ 10 billion annually. Religion is also an important part of this connection. India has the world's second largest Islamic population of about 150 million - next only to Indonesia - and the regular visits by our Muslims to holy shrines in the region create another cultural and emotional link. India, therefore, has a vital political, economic and strategic interest in peace and stability in the Middle East region.
On the Arab-Israel front, we had hoped that UN Security Council resolutions 1397 and 1403, universally endorsing the goal of two separate States of Palestine and Israel, would move the conflict towards resolution. The evolution of the Quartet Road Map and Arab League Peace Plan should have given a forward thrust to the attainment of this goal. Yet, what we saw during the last year was a continuation of the endless cycle of violence and terror, which set back even the little progress that had been made by September 2000.
I think the developments of the last year have confirmed three important points. First, there is a
widespread fatigue with violence and a deep desire for peace. We can see this from the various unofficial
explorations of ways out of the current impasse. This process deserves wider support from official channels.
Second, the great leverage of the United States with all the parties to the conflict is an important
determinant of the future course and needs to be exercised to maintain the positive momentum. This is not to
belittle in any way the contribution of the European countries in bringing the various parties to the
negotiating table. Third, it is a widespread conviction that President Arafat remains the only credible leader
who can coordinate all streams of Palestinian opinion. Excluding him from the process would not serve the
cause of peace.
On Iraq, debates continue within the international community on the legitimacy of the military action; on unilateralism versus multilateralism, and on doctrines of pre-emption. While this is part of a search for new ground rules in an emerging world order, we must also focus on the immediate requirements of that country.
The ground situation in Iraq has become even more complex after the fall of Baghdad in April last year. The
security environment has prevented any substantive progress in reconstruction. The international community has
to participate meaningfully in the efforts for early transfer of sovereignty to an Iraqi Government. It is
important that this process is accepted by the Iraqi people as transparent and truly representative of the
internal political, economic and social currents. This is why UN participation is so critical. The challenge
is to create a multi-cultural, multi-ethnic secular democracy, while preserving Iraq's territorial integrity.
There have to be secure constitutional guarantees for the political and social rights of minority groups. A
break up of Iraq on ethnic, sectarian or religious grounds would be a catastrophe for the region and for the
I believe that every one of Iraq's neighbours shares these perspectives. All of them can exert a positive influence on Iraq's political revival and economic reconstruction. Our reading is that they are willing to do so, if they are approached. We have to harness their energies and tap their influence.
As we have publicly announced on a number of occasions, India is ready to assist in every possible way in the reconstruction of Iraq's infrastructure and the development of its human resources. We have pledged US $ 20 million bilaterally and US $ 10 million multilaterally through the trust funds set up by the Madrid Donors' Conference. We are willing to respond to any further requests from the Iraqi people.
Adverse security developments in the Middle East region immediately impact on South East Asia and beyond.
We have seen the proliferating influence of linkages between terrorist groups based in the Middle East with
those in South Asia, Central Asia and South East Asia and the Asia Pacific. UN Security Council Resolution
1373, with subsequent resolutions and conventions, reflected a strong international consensus on dealing with
terrorist linkages, including financial transfers. However, we have not developed effective international
mechanisms to translate this consensus into concrete action. The movement of people, arms and ammunition and
funds from terrorist outfits through these regions needs to be firmly curbed through international
cooperation, if we are to decisively win the war against terrorism.
This is very evident in Afghanistan, which was the first theatre of the international war against terrorism. There have been a number of indicators of hope in Afghan developments. The Loya Jirga has successfully drafted a constitution, the Central Government under President Karzai has strengthened its support base, and the reconstruction work is gradually expanding. But at the same time, we cannot ignore the resurgence of Taliban forces in the South and South East, the growth of warlordism and the inability of Provincial Reconstruction Teams to even enter some of the interior provinces. The acid test of returning normalcy in Afghanistan would be the conduct of elections later this year in all parts of the country without fear, intimidation, violence and insecurity. This is a crucial phase, when the international coalition against terrorism cannot afford to turn its attention away from Afghanistan.
If we look at the larger picture of trends in Asia, there are both encouraging signs and major question marks. By and large, however, there are conducive trends for an improved security environment.
The development of close Sino Russian political, economic and military relations has important consequences
for the Asian continent. The Shanghai Cooperation Organisation, linking these countries with Central Asia, is
an important beginning for a cooperative security framework. We believe that this Organisation could be
expanded and strengthened to form a wider front against the forces of terrorism and religious extremism.
The multi dimensional character of the strategic partnership between India and Russia makes a positive contribution to the matrix of Asian stability.
Recent advances in India-China relations hold the promise of far reaching geo-strategic consequences. Over the past decade and more, India and China have maintained peace and tranquility on their borders and have developed all round cooperation, even while continuing a dialogue on our differences over the border. During Prime Minister Vajpayee's China visit last year, we took an important step forward by agreeing to discuss the resolution of our boundary, from the political perspective of our bilateral relationship. Our Prime Minister has publicly stated that India is willing to take pragmatic decisions to fulfil the strategic objective of a comprehensive boundary settlement with China.
There have been some winds of change in South Asia, following a series of initiatives taken by our Prime
Minister since April last year and positive responses from Pakistan. At Islamabad last month, our Prime
Minister and Pakistan's President Musharraf agreed to recommence the process of India-Pakistan dialogue in an
atmosphere free from terrorism. As with any such initiative, which follows a long period of mistrust and
suspicion, we must proceed with hope, tempered with caution. But there is no denying that improved
India-Pakistan relations can transform the political and security landscape of South Asia. I must emphasize
that the dialogue can be taken forward and sustained only if violence, hostility and terrorism are prevented.
The Maoist insurgency in Nepal has seriously disrupted the political equilibrium between constitutional Monarchy and multi party democracy in that country. In Sri Lanka, the peace process is in extreme danger of being derailed by political opportunism and extreme positions. In both these countries, India has been trying to encourage the emergence of corrective impulses within these countries, so that political solutions are found, which accord with long-term national interests.
One of the positive trends in Asia is that regional economic cooperation is gaining an increasing foothold. ASEAN is already a success story. It is now expanding economic and trade links with major economies like those of Japan, China, Korea and India. As the Indian Prime Minister said at the India-ASEAN Summit in Bali,
"If the 14 of us combine into a broader Asian Economic Community, it can promote our overall economic competitiveness and create a new engine of growth for the entire region. There has been extensive examination of this idea by intellectuals and economists in our countries. It is an idea for the future, when all of us feel more comfortable about closer economic integration."
Similarly, SAARC, after being in limbo for many years, is showing healthy signs of revival. At the Islamabad summit last month, SAARC leaders agreed on the framework of a SAARC Free Trade Area (SAFTA). As the Prime Minister of India said on that occasion, and again I quote,
"Any joint endeavour needs mutual trust and confidence. For many decades, South Asian countries - which have a complex and troubled colonial legacy - have been unable to forge an integrated economic understanding, circumventing political differences.
"Mutual suspicions and petty rivalries have continued to haunt us. As a result, the peace dividend has bypassed our region.
"History can remind us, guide us, teach us or warn us; it should not shackle us. We have to look forward now, with a collective approach in mind."
Along with a realization of the stabilizing influence of regional economic cooperation, is a growing recognition that Asia's energy resources and its fast growing demands for these fuels can create a new cementing factor in Asian relations. Energy transfers and establishment of new routes of transportation can create mutual linkages and economic benefits, which can help to sink political differences, dispel historical suspicions and soften ethnic confrontations. This is an area of promise - as yet untapped - in intra-Asian relations.
The strengthening economic linkages between the Asian countries, US and EU today also have a beneficial
influence on political and economic stability in Asia. In fact, trade and economic exchanges with Asia fund an
increasing proportion of the US budget deficit each year.
There is a wider question of multilateral approaches to the security issues of today. Approaches to security based on conventional alliances, arms competition, deterrence and diplomacy have been less than effective in coping with the challenges posed by terrorism, suicide attacks, WMD proliferation and failing states. Asia, both as source and destination, has witnessed proliferation of WMD.
Extraordinary measures are being contemplated to guarantee security from these challenges. A multilateral consultative machinery with international credibility can provide legitimacy to such measures. But for it to be effective, it has to be evolved with wide and representative consultations. I would also add that clubbing partners against proliferation with countries of true proliferation concern is a self-defeating approach, which can only weaken the cause of genuine non-proliferation.
So, outside of the Middle East, there has been some progress in a gradual phasing out of distrust and suspicion among Asian states. The powerful forces of globalization are being augmented by the productive potential of regional integration. Preserving the inherent pluralism, and respect for heterogeneity are essentials for a stable security equilibrium in Asia. The security forums in Asia are making headway in evolving CBMs and in tackling terrorism, piracy, maritime security and transnational crimes.
India will, of course, contribute to this process in every possible way. We are committed to reshaping our regional environment through sustained dialogue and engagement.