A Conversation with Prime Minister Dr. Manmohan Singh

Monday, November 23, 2009

Indian Prime Minister Manmohan Singh, speaking at the Washington office of the Council on Foreign Relations on November 23, discussed U.S.-India cooperation, Pakistan's terrorism threat, India's role in Afghanistan, India's economic growth and development, and global challenges to confronting climate change.

Singh, on a four-day trip to the United States as President Obama's first state visitor, listed agriculture, trade, education, defense, and energy as some of the areas for increased bilateral cooperation between Washington and New Delhi. On climate change, though, he reiterated India's long-held stance that it would only support a solution that does not hurt its economic growth.

Singh urged the international community to make long-term commitments to Afghanistan's development. Addressing growing concerns -- especially in Pakistan -- on India's involvement in Afghanistan, Singh said: "We do not see Afghanistan as a theater of influence. Our interest is in building a region of peace and stability."

The prime minister expressed concern regarding the spread of militancy inside Pakistan and its effects on regional security. He said that Pakistan had failed to sever links with militant groups targeting India, and he set Islamabad's break with these groups as a precondition for peace talks, including on issues relating to the disputed region of Kashmir. "Pakistan must make a break with the past, abjure terrorism, and come to the table with good faith and sincerity," he said.

This meeting was co-sponsored with the Woodrow Wilson International Center for Scholars.

RICHARD HAASS: I'm Richard Haass, president of the Council on Foreign Relations, and I'd like to welcome you all to today's event, co-hosted by the Council on Foreign Relations and the Woodrow Wilson International Center for Scholars.

I apologize, one or two pieces of housekeeping. If people would please completely turn off, not just put on vibrate, your cell phones, BlackBerrys and other wireless devices so it does not interfere unduly with our sound system.

Just a friendly warning to the prime minister that today's meeting is on the record.

And in addition to those here seated, there will be Council on Foreign Relations members in New York and around the nation and the world who will be listening and, obviously, we've got some cameras here today.

Let me just say a few things in the way of introduction. I believe it was July 24th, 1991 that the then-Finance Minister Manmohan Singh presented a budget to India's Parliament. And when he concluded his remarks, he quoted Victor Hugo. "No power on earth can stop an idea whose time has come," the then-Finance minister said. And then he went on to say, "I suggest to this august house that the emergence of India as a major economic power in the world happens to be one such idea."

And 18 years later, it's obvious that Manmohan Singh was correct. Thanks, in no small part, to his leadership India is a major power. So we, those of us associated with the Council on Foreign Relations, along with the Woodrow Wilson International Center, could not be more pleased than to welcome him here today to the United States as he visits for, among other things, the first state dinner of the Obama administration.

Now, to be honest, relations between the United States and India have not always been warm. During the Cold War, for example, there were those on the United States who saw India's nonalignment as unfriendly, which, at times, I dare say, it might have been. But the end of the Cold War brought real opportunities to improve ties. But still, there were obstacles that lingered. And then in the last several years, there's been a large increase in bilateral trade and a lifting of sanctions, culminating in the historic civil nuclear accord.

So now there exists the basis for a broader and deeper strategic relationship between the United States and India. Relations began to improve under the Clinton administration, continued under the Bush administration. And a civil nuclear deal, initiated by a Republican president and passed by a Democratic-led Congress, included votes of Senators Obama, Biden and Clinton.

I don't think it's any exaggeration to say that U.S.-India relations are a rare area, something of an oasis, perhaps, of bipartisanship.

And today, India is a member of the G20 and a central international actor on a full range of issues. And the goal for the United States and India should be to fashion a truly comprehensive strategic partnership. There is a need for wide-ranging consultation in order to ingrain habits of consultation and cooperation on many of the most important bilateral, regional and global issues of the day.

I want to thank the prime minister for being here. I want to thank and welcome his entire delegation, including his most-able ambassador. And I want to thank the gentleman standing here, Lee Hamilton, who is president and director of the Woodrow Wilson International Center.

I could not be more pleased to turn to Lee to introduce the prime minister. Lee Hamilton is one of this country's wise men. He represented Indiana's 9th District in the U.S. House of Representatives for more than three decades. And he's a model of what a legislator ought to be and a symbol of an era of bipartisanship in American foreign policy that we would do well to recreate.

Congressman Hamilton. (Applause.)

LEE HAMILTON: Thank you, Richard.

Good evening to you all, and thank you for coming.

I told the prime minister a moment ago that he was appearing before an extraordinary Washington audience. And he is. And we're delighted that you're here.

I'm delighted to work with Richard Haass, the president of the council. I suspect every person in this room is indebted to the excellent work done by the Council on Foreign Relations under Richard Haass' leadership.

May I speak a personal word of welcome to my Hoosier friend Tim Roemer, our ambassador to India from the United States. He served in the Congress with great distinction. And I have not the slightest doubt that he will serve with great distinction in New Delhi.

Just over one year ago, Dr. Manmohan Singh, the 14th prime minister of India, visited Washington and spoke the following words. "These last four and a half years, there has been a massive transformation of India-United States relations. We now have a strategic partnership with the United States," end of quote.

And then President Bush put it, and I quote, "It's a relationship that is based upon our common values, that every person matters, every person belongs, and everybody should be able to worship as freely as they want to, the common values of recognizing the right to people to express themselves in a peaceful way," end of quotation.

The prime minister's presence here today and the state dinner in his honor tomorrow evening reflect the permanence of the transformation both leaders described and the broad support the relationship enjoys, which Richard referred to a moment ago, in the United States and India. We are very honored to have the prime minister here with us this evening.

He was born in a village in Punjab province, completed his matriculation examinations from Punjab University in 1948. He went on to study economics at Cambridge then Oxford University where he received his doctorate of philosophy in 1962.

He spent several years on the faculties of Punjab and the Delhi School of Economics prior to joining the government of India as economic adviser in the Commerce Ministry.

In 1972, he became chief economic adviser in the Ministry of Finance. He became Finance minister in 1991 during a time of crisis and embarked on an unprecedented economic reform program that put India on the path to record growth and unleashed the entrepreneurial and economic potential of the Indian nation.

Today, the United States is the largest investor in India, and the strong economic ties our countries share together would simply be unimaginable without his leadership in the early '90s.

Appointed prime minister in 2004, he became the first prime minister since Nehru to be reelected after serving a complete term when the Indian National Congress triumphed at the polls earlier this year in the single-largest democratic exercise in world history.

He's the recipient of countless awards, among them Padma Vibhushan, India's second-highest civilian honor, the Nehru birth centenary award, the Indian Science Congress, the Asia Money award for Finance Minister of the Year and many, many others.

Dr. Singh and his wife, Mrs. Gursharan Kaur, have three daughters.

It is my distinct pleasure to introduce to you Prime Minister Singh, without doubt one of the world's most accomplished leaders.

Mr. Prime Minister. (Applause.)

PRIME MINISTER MANMOHAN SINGH: Dr. Richard Haass, Congressman Hamilton, distinguished ladies and gentlemen, I am truly honored by the invitation to address such a distinguished gathering and to be among many old friends and well-wishers of India in this season of thanksgiving.

I am very grateful to each one of you for your presence this evening to listen to me.

Many of you have spent long years in the study of India. You have provided intellectual sustenance to the idea of a strong India-U.S. partnership and what it means for our two democracies and the world at large.

Ladies and gentlemen, I see the future of India-U.S. partnership with confidence and optimism. There is a growing convergence in our national interests, both within the bilateral framework and on regional and global issues. The changes in the global economic and political structures and the growing interdependence among nations today offer us a unique opportunity to look beyond our bilateral engagement to establish a strategic partnership of global dimension.

If we are to effectively tackle the multiple challenges that confront the world, India and the United States, as two leading democracies, must work together.

The immediate challenge before us is to bring the world to full recovery from the global economic and financial crisis. I have no doubt that the creative and entrepreneurial genius of the American people will ensure that the U.S. economy emerges from this crisis stronger and well-placed to contribute to global economic growth.

India is playing its own part in the process of global recovery. Despite the slowdown, our economy grew by 6.7 percent last year and is expected to grow by 6.5 percent in the current fiscal year. India and the United States have strong compulsions to work towards an open and liberal regime for transfer of goods, services, investment and technology. This will stimulate recovery in the global economy, create jobs and spur growth in our economies.

Ladies and gentlemen, our generation has an opportunity given to few, to remake a new global equilibrium after the irreversible changes brought about by the rapid geopolitical and economic shifts of the recent past. Nowhere are the changes more visible than in Asia.

India and the United States can work together with other countries in the region to create an open and inclusive regional architecture in the Asia Pacific region.

The India-U.S. partnership can contribute to an orderly transition to the new order and be an important factor for global peace and stability. Both India and the United States draw strength from our common values of respect for cultural diversity, democracy, freedom of expression, rule of law.

Our two nations have been shaped by the thoughts and ideas of two apostles of peace of the 20th century, Mahatma Gandhi and the Reverend Martin Luther King Jr. We should advance these ideas as fundamental rights of all human beings.

We have made some progress in moving towards a more representative mechanism to manage global economic and financial issues. The same cannot be said about governance of the political and security order. There is a need to reform the United Nations and its Security Council.

Ladies and gentlemen, in my interaction with President Obama, I have found shared thinking on the moral imperative of putting the poor at the forefront of the global agenda. In Africa, Asia and elsewhere, they must have access to education and give them bankable skills to nutrition and to health care.

The India-U.S. partnership can promote global cooperation in dealing with issues that the world has to face together, whether it is hunger, global security and terrorism, nuclear disarmament, climate change or the (threat ?) of pandemics.

Ladies and gentlemen, history has taught us that peace, security and prosperity are indivisible. That's why the evolution of Afghanistan as a stable and moderate nation state is so vital for the region and the world at large. The road to peace in Afghanistan will be long and hard. But given the high stakes involved, the commitment of the international community must be sustained by firm resolve and unity of purpose.

India has an enduring civilization of links with Afghanistan. We do not see Afghanistan as a hater of influence. Our interest is in building a region of peace and stability. India will continue to assist Afghanistan in building its institution and its human resources.

Democracy in an ancient land, like Afghanistan, will take time to take root and to come to terms with the country's history and its tribal traditions. It is vitally important that all major regional and international players put their weight behind the government of Afghanistan. This is the only way Afghanistan can meet the daunting challenges it faces.

Ladies and gentlemen, my (country ?) has invested heavily over the past few years in normalizing relations with our neighbor Pakistan. We made considerable progress on the road to a dutiful and permanent settlement of all outstanding issues. I have said that we are ready to pick up the tabs of the dialogue, including on issues relating to (general and national peace ?).

We see a South Asia of peace, friendship and prosperity, where its borders will be energized by the flow of people, goods and ideas. For this to happen, Pakistan must make a break with the past, abhor terrorism and come to the table with good faith and sincerity.

It is my solemn hope that India and Pakistan can together move forward to write a new chapter in the history of our south continent.

We are, ladies and gentlemen, three days away from the first anniversary of the heinous and barbaric terrorist attacks on Mumbai. The trauma of the attack continues to haunt us.

Terrorism poses an existential threat to the civilized world, and it must be defeated. We should not harbor any illusions that a selective approach to terrorism, tackling it in one place while ignoring it in others, will work or pay dividends.

Ladies and gentlemen, we welcome the fact that President Obama has committed the United States to the goal of a world free of nuclear weapons. India has been committed to this goal since our independence. We believe that India's security will be enhanced, not diminished, by the complete elimination of nuclear weapons the world over.

There is much that India and the United States can do together to reduce the global risk of nuclear proliferation, including by building a new global consensus on the way ahead. The negotiation of a verifiable fissile material cut-off treaty in the conference on disarmament will be a significant contribution in this regard. We welcome President Obama's initiative to host the summit on nuclear security in April next year. Our countries can play a vital role in strengthening global resolve to prevent terrorists from gaining access to materials and technologies related to weapons of mass destruction.

Ladies and gentlemen, the negotiations heading towards Copenhagen are proving more difficult than we would have liked. There is disagreement among industrialized countries and between industrialized and developing countries. It is important for all countries to make every effort to contributed to a successful outcome at Copenhagen.

India was a latecomer to industrialization. And as such, we have contributed very little to the accumulation of greenhouse gas emissions that cause global warming. But we are determined to be part of the solution to the problem. We are willing to work towards any solution that does not compromise the right of developing countries to develop and lift their population out of poverty.

We recognize that we have met on climate change in our own interest, since we are among the countries most infected by climate change. It is for this reason that we have adopted an ambitious national action plan on climate change. We are committed to ambitious and time-bound outcomes that will increase the energy efficiency of our economy, the share of clean energy, including nuclear power, in our energy mix and our forest (goal ?).

All this will require considerable resources. We have undertaken to do what we can with our own resources. We will do more if there is global support in terms of financial resources and technology transfer.

Ladies and gentlemen, India's economic transition is gathering pace. It will be faster in the years ahead as we harvest the expanding economic productivity of our young population. The unshackling of our markets, the latent demand, particularly of our rural economy, and the fact that our domestic savings rate is now as high as 35 percent of our GDP all suggest that we can achieve a sustained growth of 9 percent per annum over the next couple of decades.

This will create the resources to make our development process more inclusive as well as more sustainable.

The social agenda has come to dominate the domestic political discourse, both in India and the United States. This was the verdict of our general election held in May 2009, and I believe it was also of yours.

The time is therefore opportune for us to substantially enhance our cooperation in critical areas of education, health, energy, science and technology and agriculture. Collaboration between our software industries has powered the global knowledge economy. We can build and we must on this experience and look at new frontiers of cooperation.

American agricultural science and technology can help India usher in a second (green ?) revolution. India's competitive advantages in the pharmaceutical and medical services industries can support health-care reforms in the United States.

India has embarked on its largest education expansion program since independence. There are plans to set up more than 40 new universities and institutions. We would like to benefit from the great American university system which attracts a large number of Indian students every year.

We can cooperate in the development, production and deployment of green technologies. In this context, we should fully harvest our bilateral civil nuclear cooperation agreement to shape the nuclear -- (inaudible) -- in the energy industry.

Ladies and gentlemen, we deeply appreciate the cooperation that we have received from the United States in the area of counterterrorism in the recent past. I am convinced that we can do much more together on a sustained basis to combat increasingly sophisticated terror networks, transnational criminal groups and cyberterrorism.

Our defense and strategic dialogues have added important dimension to our relationship. Maritime security, including countering piracy and protecting sea lanes of community in the Indian Ocean and beyond, is another important area where we should expand our cooperation.

Ladies and gentlemen, the edifice of the India-U.S. partnership is founded on many pillars. It is a relationship based on pragmatism and principle and strengthened by shared values and common interest. Our ties draw heavily on the strength and vitality of the Indian and American people. The 2.7-million-strong Indian-American community has made good the enormous opportunities provided to them in their adopted home. They are a powerful factor in drawing our two countries together.

President Obama's advocacy often includes an approach to problem solving and (progressing ?) to dialogue as an instrument of policy creates many more opportunities for our two democracies to work together in realizing the vision of a shared destiny for all humankind. Collaboration and cooperation between our two countries will be indispensable for shaping a global society that is responsive to the deeds and aspirations of the 21st century and where countries can pursue their legitimate interests in a secure and just environment.

Ladies and gentlemen, I thank you for listening to me. (Applause.)

HAASS: I want to thank the prime minister for presenting such a comprehensive talk. I'll just ask a few questions and then we'll open it up. I do the easy ones, they do the hard ones. That's the division of labor here.

Several times, sir, you talked about the United States and India, and you used the phrase "strategic partnership," which is a phrase that resonates very well here. But the question I would ask is whether there is sufficient overlap of viewpoints in order to allow one to go forward.

And two of the most pressing questions or issues that are sure to come before us are Iran and Afghanistan, so let me begin with Iran.

The United States believes that it would be unacceptable for Iran to develop or otherwise acquire nuclear weapons. Is that a view shared by India? And would India be prepared to support robust sanctions against Iran in order to discourage it from going down that path?

SINGH: Can I go there?

HAASS: You can go there, or you can sit here, because we're going to have a few. It's up to you. Because you have a microphone here, it might be easier to sit.

SINGH: (Inaudible.) (Laughter.) Well, as far as Iran's nuclear weapon ambitions are concerned, I have stated it unambiguously on several occasions that we do not support the nuclear weapon ambitions of Iran. Iran is a signatory to the NPT. As such, it has all the rights that got with this membership of the NPT, that is use of nuclear energy for peaceful purposes.

At the same time, it has obligations that go with its membership, and this rules out the nuclear weapon part. So there is no ambiguity in our position. They're quite clear in our thinking that Iran should not go the nuclear weapon path. That is inconsistent with its obligation as a member of the NPT.

Now, as regards the sanctions question, let me say that if the Security Council, in its wisdom, passes any resolution, we have, in the past, abided by the decisions of the Security Council. And as I see President Obama's approach has opened up a new pathway of engagement without precondition, our hope is that it will yield results.

A few days before I left New Delhi, I had the privilege of meeting the Iranian foreign minister, who is an old student who studied in our country for many years. He was there. And while talking, he mentioned explicitly to me that Iran is encouraged by the messages it is receiving from the new Obama administration and that he was hopeful that they would lead to constructive, productive results.

I hope that part, if it does yield productive results, that would be for the good of humanity at large.

HAASS: On the question of Afghanistan, I think the phrase you used was that the world should put its weight behind the country and government of Afghanistan. You've obviously arrived in Washington in the midst of a public debate as well as the internal deliberations of the Obama administration which, in some ways, is trying to define what putting its weight or putting our weight into Afghanistan might mean.

Do you believe that a large increase or a significant increase in American troops levels or,more broadly, international troop levels should be an element of the policy?

SINGH: Well, I'm not an expert on military affairs. It would be much too presumptuous on my part to claim that I know what's the right size of troops that ought to be deployed to Afghanistan. But I am quite clear in my mind that Afghanistan requires the sustained support of the global community if it is to return to a path of peace, freedom and an environment in which fundamentalist terrorist elements do not have the sway of the type that they had some years ago before 9/11.

HAASS: Just to follow up, do you believe that what happens in Afghanistan will be decisive for Pakistan's future?

SINGH: There is no doubt in my mind that if the Taliban and the al Qaeda group of people succeed in Afghanistan, that would have catastrophic results for the security and stability, not only of Pakistan, but for the security and stability of all of South Asia. And please don't forget we are talking about nearly 1.8 billion people living in South Asia.

Also, I believe it will also affect the course of evolution in the Middle East as well as in Central Asia and maybe, I think, beyond, I think, these regions as well.

HAASS: To build on what you just said, when you look at your neighbor Pakistan and you look at its difficulties with maintaining order, with governance, economically, do you harbor concerns that Pakistan could fail? And if that were to happen, if Pakistan were to fail in certain ways, could India succeed?

SINGH: Well, we don't want Pakistan to (fail ?). The emergence of democracy in Pakistan is something we welcome. But at the same time, we have to recognize that there are forces at work in Pakistan, the terrorist groups that are active there, until now, they were active only in the federally administered areas along the borders of Afghanistan.

Now they are, I think, have a grip over several parts of mainland Pakistan. If that process is not controlled, I think it has, I think, phenomenal consequences for the security and stability of Pakistan as well as our own security.

HAASS: Speaking of which, you mentioned the anniversary of the terrible events in Mumbai a year ago. India exercised what I believe most observers would say was rather remarkable restraint.

As you look back on that decision not to respond or retaliate militarily, do you believe it was the right decision? And God forbid, if it were to happen that there were future terrorist acts against India, do you think that that restraint may have come at a cost?

SINGH: Well, let me say, there was enormous pressure on me at that time. I resisted that pressure, and I think the decisions that I and my government took was, on balance, the right decision.

As regard to the future, I hate to speculate. I sincerely hope that that sort of eventuality does not arise. And that's why I believe the world community has an obligation to impress upon Pakistan that it must use all its influence to curb the power of the terrorist groups.

Pakistan has done something to control the activities of the Taliban terrorist groups in federally administered areas. But it is our sincere belief that it has not acted as it should have acted in dealing with terrorist elements who are using their energies to target our country, nor has Pakistan used all its machinery to bring to (book ?) all those murderers, gangs who perpetrated the horrible crime in Mumbai in which 2,000 citizens of our country, innocent citizens, lost their lives, several nationals of foreign countries, including six from the United States, two from Canada that lost their lives.

Pakistan, in our view, should be pressurized by the world community to do much more to bring to (book ?) all those people who are responsible for this horrible crime. After all, there is now impeccable evidence that a conspiracy was planned in Pakistan. It was executed with the active -- (inaudible) -- of peoples who are still roaming around freely in Pakistan.

And therefore, I respectfully request the world community to use all its influence on the power that be in Pakistan to desist from that sort of behavior.

HAASS: I just have two last questions and then I'll open it up, and they actually both deal with China.

At the recent meeting between President Obama and President Hu, there was obviously, as everyone in this room knows, a reference to China's role in your part of the world. Is that something that India would welcome?

SINGH: Let me say, what happens between President Obama and President Hu is not our direct concern. We want the world to prepare for the peaceful rise of China as a major power. So engagement is the right strategy, both for India as well as the United States.

We, ourselves, have tried very hard to engage China in the last five years. And today, China is one of our major trading partners.

But we also recognize that we have a long-standing border problem with China. We are trying to resolve it through dialogue. In the meanwhile, both our countries have agreed that, pending the resolution of the border problem, peace and tranquility should be maintained in the border line.

Having said that, I would like to say that I have received these assurances from the Chinese leadership at the highest level. But there is a certain amount of assertiveness on the part of the Chinese. I don't fully understand the reasons for it. That has to be taken not off.

HAASS: Last question about China. There has been a lot of talk in the literature about the comparison of the Indian and the Chinese approaches to development. A question I had is, why do you believe that India's is preferable, assuming you do, given that China has grown at a higher rate for more years?

SINGH: Well, there is no doubt that the Chinese growth performance is superior to Indian performance. But I've always believed that there are other values which are important than the growth of the gross domestic product. I think the respect for fundamental human rights, the respect for the rule of law, the respect for multicultural, multi-ethnic, multi-religious rights, I think those have values also.

There are several dimensions of human freedom, which are not always (caught ?) by the numbers with regard to the gross domestic product. So I do believe that even though the Indian performance with regard to GDP might not be as good as the Chinese, certainly I would not like to choose the Chinese, but I would prefer to stick to the India part.

Also, I believe India may appear as indecisive democracy at times. And it does, because many democracies are short-term maximizers. They're not able to take a long-term view.

But I have also believed that once a democracy decides on the basis of a wide-ranging consensus, any reforms that are undertaken will be far more durable, will be far more effective than reforms introduced by the writ of a ruling group in a non-democratic setup.

HAASS: Ladies and gentlemen, you've just been treated to an economist saying there's more to life than GDP. (Laughter and applause.) This is an important moment. (Laughs.)

That was a wonderful answer, by the way.

Let me open it up to questions. Please, wait for a microphone. Speak directly. Let us know who you are and with whom you are affiliated. The shorter, the better.

Yes, ma'am.

QUESTIONER: Beverly Lindsay, Penn State University. My question in terms of your being a former professor as well as prime minister, you mentioned the idea of partnerships, particularly in higher education. Are there new areas that we should be considering? And do they include areas, like public engagement?

And because you have such diverse populations, like the United States, can we both learn from each other?

SINGH: Well, because of our diversity, I believe there are enormous opportunities for us to enter into dialogue, how to manage diversities. We have many (cause ?). We have great regional disparities. And we certainly can learn a great deal from each of those experience of the type of exchanges that you have mentioned.

HAASS: C. Fred Berkston.

QUESTIONER: Mr. Prime Minister --

SINGH: That's an unfair advantage. I -- (inaudible) -- able to answer your question. (Laughter.)

HAASS: Oh, I think you're okay.

QUESTIONER: He's afraid I'm going to revert to the economist mode. (Laughs.) An easy question, Mr. Prime Minister. In your earlier speech today, at the outset of it, you talked about economics being at the foundation of relations between countries. And I wanted to ask you a question in that vein.

Your government has negotiated free trade agreements with a number of your trading partners -- ASEAN, Korea. And you're now talking with the European Union, Japan, Canada and others. My question is, what about the United States? Would you be interested in a free trade negotiation with the United States, particularly since, in the absence thereof, if you do complete trade agreements with all your other major partners, you'll be discriminating against the United States, and it might make it more difficult to carry out the kind of relationship we all want?

SINGH: Well, there is no easy answer to your question. I do recognize the trade diversion effects of (these free trading ?) agreements. And to your question, would we like to have a free trade agreement with the United States? Let me say, my first preference is that the multilateral trading system itself should evolve in a direction where there is a reduced role for trade distortions, represented by tariff and non-tariff barriers. So I sincerely hope that the Doha round can succeed.

We belong to a region where we cannot have tight regional arrangements like the European Union have. In our regions, for various historical reasons, we're not able to have a reasonable tariff union of the type that exists in some other parts of the world.

So our first preference would be that the multilateral trading system should evolve in a direction in which there is a reduced amount of tariff distortions which distort the flow of trade and goods and services.

But I do have to recognize that today that more than 50 percent of world trade takes place behind regional tariff walls and tariff agreements. And if so, I've not studied this question, but the ambassador was telling me this morning that the United States has some hesitancy in talking about a free trade (agreement with India ?). I don't mind exploring the possibilities of a free trade agreement with the United States.

HAASS: Mr. Gadbaw.

QUESTIONER: Prime Minister Singh, it's great to see you again. My name is Michael Gadbaw, I'm with Georgetown University Law School. My question is, in 20 years, almost 20 years, since you introduced some very significant reforms, we've seen a very dramatic change in the relationship between the Indian government and the Indian economy. As you look down the road, do you think, in the next years, we will see as dramatic a set of changes in that relationship?

SINGH: Well, I have no doubt about that. I said in my speech that our ambition is to ensure that the Indian economy grows at the average annual rate of about 9 percent per annum, which was the growth rate preceding the current years and the previous years of the last five years.

And if our economy grows at the rate of 9 percent -- and 72 divided by nine, eight -- in eight years, we will double the national income of our country. And therefore, by 2020, India should join the ranks of middle-income economies if we do succeed in growing at the rate of 9 percent per annum.

And I am confident our growth is, unlike China, not dependent on external stimulants. Our growth is largely fueled by our domestic demand. And our savings rate is as high as 35 percent per annum. Our investment rate in recent years has been as high as 37 percent per annum.

As an economist, I know the rough rule of (thought ?). I think that a capital output ratio of four to one, if you save 35 percent of your GDP, you should be able to reach a growth rate of 9 percent per annum, that that's our vision. And I am confident that the Indian economy will move in that direction in the next two, three decades.

HAASS: What is the biggest impediment? What concerns you most that could get in the way of that?

SINGH: Well, I think that the concern that I have is the quality of our physical infrastructure. We need a lot more investment in infrastructure. We need a lot more investment in human resource development, in education, in skill formation. These are the three critical, I think, constraints which we are trying to address. And I am confident, over a period of time we will be able to address them.

And I invite the United States investors and the members of the academic communities and the university system to work with us so that we overcome these disabilities.

HAASS: Since we started a few minutes late, is it okay if we run a few minutes over? Is that all right? Not too long, I promise.

Yes, sir.

QUESTIONER: Thanks. David Gartner with the Brookings Institution. Thank you, Mr. Prime Minister for your remarks, especially around the partnership between the United States and India, around responding to global poverty and enhancing education for all children.

And my question is, given India's leadership now within the G20 as well as the bilateral relationship, do you see the G20 as a forum that could take on these issues of development?

And might, given the Indian experience might initiatives around something like education and education for all be something that could be a first-development initiative of the G20?

SINGH: Well, the G20 is a very helpful evolution. And I compliment President Obama for having taken the initiative at Pittsburgh to bring it about.

But it is in a state of infancy. It is still grappling with the macroeconomic problems and ensuring that the idea of a peer review of the performance of the macroeconomic performance of the 20 countries takes root. But it could evolve. I doubt that it will evolve.

But (in weak direction ?), I think it is too early to predict at this stage.

HAASS: Since it may be a while before India can get a seat on the U.N. Security Council, would you favor, at least as an interim measure, the idea of the G20 taking on a political as well as an economic role?

SINGH: I'm sorry, I have not thought it through. As of now, the G20 forum is a purely economic forum. And from whatever I have heard other members of the (G20 ?), I don't think they are prepared to give political, I think, muscle.

I was with the Canadian prime minister a few days ago. He was our guest in Delhi. And I raised this issue with him. He said, no, no, no, as far as the G8 is concerned, we want to maintain it, because we want to discuss political issues. As far as G20 is concerned, we will discuss economic issues. (Laughter.)

HAASS: Canada has a special reason to keep the G8 going. (Laughs.) I think it's one-eighth of it.

Sir.

SINGH: (Inaudible) -- is willing. (Laughter.)

QUESTIONER: Mr. Prime Minister, I'm John McCormick with the Energy Policy Center. It's an honor to be addressing this question to you.

Mr. Prime Minister, when I think about the tensions in Pakistan, India, Afghanistan, Bangladesh, I look 20 years out, and I see that the common enemy for all these countries will be water. Now, I have a feeling that the South Asian Association for Regional Cooperation could be a focal point for bringing all the Himalayan nations together to talk about their common enemy, that is, melting glaciers.

And I'm wondering if the SAARC might find a way to expand its portfolio to include some very aggressive adaptation, because South Asian nations are victims, they are not perpetrators of climate change.

SINGH: I entirely agree with you that water is going to be probably the most critical (dynamic ?) of our growth profiles in the 21st century. And therefore, the common Himalayan river system, which provides -- (inaudible) -- the water resources both of India, Bangladesh, Nepal and Afghanistan, I think we have to take a holistic view.

But politics is the art of the possible. The way the SAARC region has evolved, it has not, I think, grown, I think, to the extent to which one can say that we are ready to take on this additional burden of water management. But I sincerely hope that in due course of time I think water will be one area where our nations of South Asia will have to think together, think collectively to find effective, practical, pragmatic solutions to the problems of water management in our region.

HAASS: I'm getting the proverbial signal, so we've got time for one last question. After the prime minister answers it, I ask that people remain seated while the prime minister and his delegation have to depart.

Yes, ma'am, you had a question there. Yes.

And let me apologize for having alienated so many of you who I was unable to call upon.

QUESTIONER: Thank you very much. And it's a privilege to have the last question. Thank you for your remarks.

HAASS: You have to introduce yourself.

QUESTIONER: Sorry. (Name inaudible) -- I work as an independent consultant on gender equality.

It was encouraging indeed to hear your emphasis on factors other than hardcore economy and finance. In this regard, you talked about democratic values, human rights. And one sees India playing a leadership role in that region, on so many fronts. And I just wondered if you could tell us a little bit on the kind of role that you envision for India in terms of promotion of human rights, in particular women's rights, minority rights, and some bold steps for poverty alleviation.

SINGH: Well, human rights are enshrined in the constitution of India. And we're very proud of the fact that our codes are very jealous of protecting the human rights of our citizens.

With regard to women's rights, I think our constitution gives men and women equal right. At the age of 18, all men and women can vote in all elections in our country. And it is our ambition, as a party, to bring about constitutional changes where at least 33 percent of all seats in our Parliament would be reserved for women. We have not been able to evolve a broad-based consensus, but that's a commitment that we made in our election manifesto of the Congress Party. We will make every effort to fulfill that.

But today, we have a situation where the president of our ruling coalition is a woman of extraordinary qualities, Mrs. Sonia Gandhi. The president of India is a woman. The speaker of the lower house of our Parliament is a woman. So women are playing an increasingly important role. But I do agree with you that much more needs to be done, could be done, should be done. And that's our commitment to our people. We owe it to them, we owe it to our women to improve their lots a lot more than we have done in the past.

HAASS: A wise comment from any gentleman.

Mr. Prime Minister, on behalf of both the Council on Foreign Relations as well as the Woodrow Wilson International Center for Scholars, we just really want to both thank you for honoring us with your presence. We appreciate both your insights and your candor.

And I know I speak for everyone in wishing you every success, both in this state visit to the United States and, perhaps even more important, in the work that still lies ahead of you when you return to the wonderful country of India.

So thank you very much. And again, all the best. (Applause.)

This meeting was co-sponsored with the Woodrow Wilson International Center for Scholars.

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THIS IS A RUSH TRANSCRIPT.

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RICHARD HAASS: I'm Richard Haass, president of the Council on Foreign Relations, and I'd like to welcome you all to today's event, co-hosted by the Council on Foreign Relations and the Woodrow Wilson International Center for Scholars.

I apologize, one or two pieces of housekeeping. If people would please completely turn off, not just put on vibrate, your cell phones, BlackBerrys and other wireless devices so it does not interfere unduly with our sound system.

Just a friendly warning to the prime minister that today's meeting is on the record.

And in addition to those here seated, there will be Council on Foreign Relations members in New York and around the nation and the world who will be listening and, obviously, we've got some cameras here today.

Let me just say a few things in the way of introduction. I believe it was July 24th, 1991 that the then-Finance Minister Manmohan Singh presented a budget to India's Parliament. And when he concluded his remarks, he quoted Victor Hugo. "No power on earth can stop an idea whose time has come," the then-Finance minister said. And then he went on to say, "I suggest to this august house that the emergence of India as a major economic power in the world happens to be one such idea."

And 18 years later, it's obvious that Manmohan Singh was correct. Thanks, in no small part, to his leadership India is a major power. So we, those of us associated with the Council on Foreign Relations, along with the Woodrow Wilson International Center, could not be more pleased than to welcome him here today to the United States as he visits for, among other things, the first state dinner of the Obama administration.

Now, to be honest, relations between the United States and India have not always been warm. During the Cold War, for example, there were those on the United States who saw India's nonalignment as unfriendly, which, at times, I dare say, it might have been. But the end of the Cold War brought real opportunities to improve ties. But still, there were obstacles that lingered. And then in the last several years, there's been a large increase in bilateral trade and a lifting of sanctions, culminating in the historic civil nuclear accord.

So now there exists the basis for a broader and deeper strategic relationship between the United States and India. Relations began to improve under the Clinton administration, continued under the Bush administration. And a civil nuclear deal, initiated by a Republican president and passed by a Democratic-led Congress, included votes of Senators Obama, Biden and Clinton.

I don't think it's any exaggeration to say that U.S.-India relations are a rare area, something of an oasis, perhaps, of bipartisanship.

And today, India is a member of the G20 and a central international actor on a full range of issues. And the goal for the United States and India should be to fashion a truly comprehensive strategic partnership. There is a need for wide-ranging consultation in order to ingrain habits of consultation and cooperation on many of the most important bilateral, regional and global issues of the day.

I want to thank the prime minister for being here. I want to thank and welcome his entire delegation, including his most-able ambassador. And I want to thank the gentleman standing here, Lee Hamilton, who is president and director of the Woodrow Wilson International Center.

I could not be more pleased to turn to Lee to introduce the prime minister. Lee Hamilton is one of this country's wise men. He represented Indiana's 9th District in the U.S. House of Representatives for more than three decades. And he's a model of what a legislator ought to be and a symbol of an era of bipartisanship in American foreign policy that we would do well to recreate.

Congressman Hamilton. (Applause.)

LEE HAMILTON: Thank you, Richard.

Good evening to you all, and thank you for coming.

I told the prime minister a moment ago that he was appearing before an extraordinary Washington audience. And he is. And we're delighted that you're here.

I'm delighted to work with Richard Haass, the president of the council. I suspect every person in this room is indebted to the excellent work done by the Council on Foreign Relations under Richard Haass' leadership.

May I speak a personal word of welcome to my Hoosier friend Tim Roemer, our ambassador to India from the United States. He served in the Congress with great distinction. And I have not the slightest doubt that he will serve with great distinction in New Delhi.

Just over one year ago, Dr. Manmohan Singh, the 14th prime minister of India, visited Washington and spoke the following words. "These last four and a half years, there has been a massive transformation of India-United States relations. We now have a strategic partnership with the United States," end of quote.

And then President Bush put it, and I quote, "It's a relationship that is based upon our common values, that every person matters, every person belongs, and everybody should be able to worship as freely as they want to, the common values of recognizing the right to people to express themselves in a peaceful way," end of quotation.

The prime minister's presence here today and the state dinner in his honor tomorrow evening reflect the permanence of the transformation both leaders described and the broad support the relationship enjoys, which Richard referred to a moment ago, in the United States and India. We are very honored to have the prime minister here with us this evening.

He was born in a village in Punjab province, completed his matriculation examinations from Punjab University in 1948. He went on to study economics at Cambridge then Oxford University where he received his doctorate of philosophy in 1962.

He spent several years on the faculties of Punjab and the Delhi School of Economics prior to joining the government of India as economic adviser in the Commerce Ministry.

In 1972, he became chief economic adviser in the Ministry of Finance. He became Finance minister in 1991 during a time of crisis and embarked on an unprecedented economic reform program that put India on the path to record growth and unleashed the entrepreneurial and economic potential of the Indian nation.

Today, the United States is the largest investor in India, and the strong economic ties our countries share together would simply be unimaginable without his leadership in the early '90s.

Appointed prime minister in 2004, he became the first prime minister since Nehru to be reelected after serving a complete term when the Indian National Congress triumphed at the polls earlier this year in the single-largest democratic exercise in world history.

He's the recipient of countless awards, among them Padma Vibhushan, India's second-highest civilian honor, the Nehru birth centenary award, the Indian Science Congress, the Asia Money award for Finance Minister of the Year and many, many others.

Dr. Singh and his wife, Mrs. Gursharan Kaur, have three daughters.

It is my distinct pleasure to introduce to you Prime Minister Singh, without doubt one of the world's most accomplished leaders.

Mr. Prime Minister. (Applause.)

PRIME MINISTER MANMOHAN SINGH: Dr. Richard Haass, Congressman Hamilton, distinguished ladies and gentlemen, I am truly honored by the invitation to address such a distinguished gathering and to be among many old friends and well-wishers of India in this season of thanksgiving.

I am very grateful to each one of you for your presence this evening to listen to me.

Many of you have spent long years in the study of India. You have provided intellectual sustenance to the idea of a strong India-U.S. partnership and what it means for our two democracies and the world at large.

Ladies and gentlemen, I see the future of India-U.S. partnership with confidence and optimism. There is a growing convergence in our national interests, both within the bilateral framework and on regional and global issues. The changes in the global economic and political structures and the growing interdependence among nations today offer us a unique opportunity to look beyond our bilateral engagement to establish a strategic partnership of global dimension.

If we are to effectively tackle the multiple challenges that confront the world, India and the United States, as two leading democracies, must work together.

The immediate challenge before us is to bring the world to full recovery from the global economic and financial crisis. I have no doubt that the creative and entrepreneurial genius of the American people will ensure that the U.S. economy emerges from this crisis stronger and well-placed to contribute to global economic growth.

India is playing its own part in the process of global recovery. Despite the slowdown, our economy grew by 6.7 percent last year and is expected to grow by 6.5 percent in the current fiscal year. India and the United States have strong compulsions to work towards an open and liberal regime for transfer of goods, services, investment and technology. This will stimulate recovery in the global economy, create jobs and spur growth in our economies.

Ladies and gentlemen, our generation has an opportunity given to few, to remake a new global equilibrium after the irreversible changes brought about by the rapid geopolitical and economic shifts of the recent past. Nowhere are the changes more visible than in Asia.

India and the United States can work together with other countries in the region to create an open and inclusive regional architecture in the Asia Pacific region.

The India-U.S. partnership can contribute to an orderly transition to the new order and be an important factor for global peace and stability. Both India and the United States draw strength from our common values of respect for cultural diversity, democracy, freedom of expression, rule of law.

Our two nations have been shaped by the thoughts and ideas of two apostles of peace of the 20th century, Mahatma Gandhi and the Reverend Martin Luther King Jr. We should advance these ideas as fundamental rights of all human beings.

We have made some progress in moving towards a more representative mechanism to manage global economic and financial issues. The same cannot be said about governance of the political and security order. There is a need to reform the United Nations and its Security Council.

Ladies and gentlemen, in my interaction with President Obama, I have found shared thinking on the moral imperative of putting the poor at the forefront of the global agenda. In Africa, Asia and elsewhere, they must have access to education and give them bankable skills to nutrition and to health care.

The India-U.S. partnership can promote global cooperation in dealing with issues that the world has to face together, whether it is hunger, global security and terrorism, nuclear disarmament, climate change or the (threat ?) of pandemics.

Ladies and gentlemen, history has taught us that peace, security and prosperity are indivisible. That's why the evolution of Afghanistan as a stable and moderate nation state is so vital for the region and the world at large. The road to peace in Afghanistan will be long and hard. But given the high stakes involved, the commitment of the international community must be sustained by firm resolve and unity of purpose.

India has an enduring civilization of links with Afghanistan. We do not see Afghanistan as a hater of influence. Our interest is in building a region of peace and stability. India will continue to assist Afghanistan in building its institution and its human resources.

Democracy in an ancient land, like Afghanistan, will take time to take root and to come to terms with the country's history and its tribal traditions. It is vitally important that all major regional and international players put their weight behind the government of Afghanistan. This is the only way Afghanistan can meet the daunting challenges it faces.

Ladies and gentlemen, my (country ?) has invested heavily over the past few years in normalizing relations with our neighbor Pakistan. We made considerable progress on the road to a dutiful and permanent settlement of all outstanding issues. I have said that we are ready to pick up the tabs of the dialogue, including on issues relating to (general and national peace ?).

We see a South Asia of peace, friendship and prosperity, where its borders will be energized by the flow of people, goods and ideas. For this to happen, Pakistan must make a break with the past, abhor terrorism and come to the table with good faith and sincerity.

It is my solemn hope that India and Pakistan can together move forward to write a new chapter in the history of our south continent.

We are, ladies and gentlemen, three days away from the first anniversary of the heinous and barbaric terrorist attacks on Mumbai. The trauma of the attack continues to haunt us.

Terrorism poses an existential threat to the civilized world, and it must be defeated. We should not harbor any illusions that a selective approach to terrorism, tackling it in one place while ignoring it in others, will work or pay dividends.

Ladies and gentlemen, we welcome the fact that President Obama has committed the United States to the goal of a world free of nuclear weapons. India has been committed to this goal since our independence. We believe that India's security will be enhanced, not diminished, by the complete elimination of nuclear weapons the world over.

There is much that India and the United States can do together to reduce the global risk of nuclear proliferation, including by building a new global consensus on the way ahead. The negotiation of a verifiable fissile material cut-off treaty in the conference on disarmament will be a significant contribution in this regard. We welcome President Obama's initiative to host the summit on nuclear security in April next year. Our countries can play a vital role in strengthening global resolve to prevent terrorists from gaining access to materials and technologies related to weapons of mass destruction.

Ladies and gentlemen, the negotiations heading towards Copenhagen are proving more difficult than we would have liked. There is disagreement among industrialized countries and between industrialized and developing countries. It is important for all countries to make every effort to contributed to a successful outcome at Copenhagen.

India was a latecomer to industrialization. And as such, we have contributed very little to the accumulation of greenhouse gas emissions that cause global warming. But we are determined to be part of the solution to the problem. We are willing to work towards any solution that does not compromise the right of developing countries to develop and lift their population out of poverty.

We recognize that we have met on climate change in our own interest, since we are among the countries most infected by climate change. It is for this reason that we have adopted an ambitious national action plan on climate change. We are committed to ambitious and time-bound outcomes that will increase the energy efficiency of our economy, the share of clean energy, including nuclear power, in our energy mix and our forest (goal ?).

All this will require considerable resources. We have undertaken to do what we can with our own resources. We will do more if there is global support in terms of financial resources and technology transfer.

Ladies and gentlemen, India's economic transition is gathering pace. It will be faster in the years ahead as we harvest the expanding economic productivity of our young population. The unshackling of our markets, the latent demand, particularly of our rural economy, and the fact that our domestic savings rate is now as high as 35 percent of our GDP all suggest that we can achieve a sustained growth of 9 percent per annum over the next couple of decades.

This will create the resources to make our development process more inclusive as well as more sustainable.

The social agenda has come to dominate the domestic political discourse, both in India and the United States. This was the verdict of our general election held in May 2009, and I believe it was also of yours.

The time is therefore opportune for us to substantially enhance our cooperation in critical areas of education, health, energy, science and technology and agriculture. Collaboration between our software industries has powered the global knowledge economy. We can build and we must on this experience and look at new frontiers of cooperation.

American agricultural science and technology can help India usher in a second (green ?) revolution. India's competitive advantages in the pharmaceutical and medical services industries can support health-care reforms in the United States.

India has embarked on its largest education expansion program since independence. There are plans to set up more than 40 new universities and institutions. We would like to benefit from the great American university system which attracts a large number of Indian students every year.

We can cooperate in the development, production and deployment of green technologies. In this context, we should fully harvest our bilateral civil nuclear cooperation agreement to shape the nuclear -- (inaudible) -- in the energy industry.

Ladies and gentlemen, we deeply appreciate the cooperation that we have received from the United States in the area of counterterrorism in the recent past. I am convinced that we can do much more together on a sustained basis to combat increasingly sophisticated terror networks, transnational criminal groups and cyberterrorism.

Our defense and strategic dialogues have added important dimension to our relationship. Maritime security, including countering piracy and protecting sea lanes of community in the Indian Ocean and beyond, is another important area where we should expand our cooperation.

Ladies and gentlemen, the edifice of the India-U.S. partnership is founded on many pillars. It is a relationship based on pragmatism and principle and strengthened by shared values and common interest. Our ties draw heavily on the strength and vitality of the Indian and American people. The 2.7-million-strong Indian-American community has made good the enormous opportunities provided to them in their adopted home. They are a powerful factor in drawing our two countries together.

President Obama's advocacy often includes an approach to problem solving and (progressing ?) to dialogue as an instrument of policy creates many more opportunities for our two democracies to work together in realizing the vision of a shared destiny for all humankind. Collaboration and cooperation between our two countries will be indispensable for shaping a global society that is responsive to the deeds and aspirations of the 21st century and where countries can pursue their legitimate interests in a secure and just environment.

Ladies and gentlemen, I thank you for listening to me. (Applause.)

HAASS: I want to thank the prime minister for presenting such a comprehensive talk. I'll just ask a few questions and then we'll open it up. I do the easy ones, they do the hard ones. That's the division of labor here.

Several times, sir, you talked about the United States and India, and you used the phrase "strategic partnership," which is a phrase that resonates very well here. But the question I would ask is whether there is sufficient overlap of viewpoints in order to allow one to go forward.

And two of the most pressing questions or issues that are sure to come before us are Iran and Afghanistan, so let me begin with Iran.

The United States believes that it would be unacceptable for Iran to develop or otherwise acquire nuclear weapons. Is that a view shared by India? And would India be prepared to support robust sanctions against Iran in order to discourage it from going down that path?

SINGH: Can I go there?

HAASS: You can go there, or you can sit here, because we're going to have a few. It's up to you. Because you have a microphone here, it might be easier to sit.

SINGH: (Inaudible.) (Laughter.) Well, as far as Iran's nuclear weapon ambitions are concerned, I have stated it unambiguously on several occasions that we do not support the nuclear weapon ambitions of Iran. Iran is a signatory to the NPT. As such, it has all the rights that got with this membership of the NPT, that is use of nuclear energy for peaceful purposes.

At the same time, it has obligations that go with its membership, and this rules out the nuclear weapon part. So there is no ambiguity in our position. They're quite clear in our thinking that Iran should not go the nuclear weapon path. That is inconsistent with its obligation as a member of the NPT.

Now, as regards the sanctions question, let me say that if the Security Council, in its wisdom, passes any resolution, we have, in the past, abided by the decisions of the Security Council. And as I see President Obama's approach has opened up a new pathway of engagement without precondition, our hope is that it will yield results.

A few days before I left New Delhi, I had the privilege of meeting the Iranian foreign minister, who is an old student who studied in our country for many years. He was there. And while talking, he mentioned explicitly to me that Iran is encouraged by the messages it is receiving from the new Obama administration and that he was hopeful that they would lead to constructive, productive results.

I hope that part, if it does yield productive results, that would be for the good of humanity at large.

HAASS: On the question of Afghanistan, I think the phrase you used was that the world should put its weight behind the country and government of Afghanistan. You've obviously arrived in Washington in the midst of a public debate as well as the internal deliberations of the Obama administration which, in some ways, is trying to define what putting its weight or putting our weight into Afghanistan might mean.

Do you believe that a large increase or a significant increase in American troops levels or,more broadly, international troop levels should be an element of the policy?

SINGH: Well, I'm not an expert on military affairs. It would be much too presumptuous on my part to claim that I know what's the right size of troops that ought to be deployed to Afghanistan. But I am quite clear in my mind that Afghanistan requires the sustained support of the global community if it is to return to a path of peace, freedom and an environment in which fundamentalist terrorist elements do not have the sway of the type that they had some years ago before 9/11.

HAASS: Just to follow up, do you believe that what happens in Afghanistan will be decisive for Pakistan's future?

SINGH: There is no doubt in my mind that if the Taliban and the al Qaeda group of people succeed in Afghanistan, that would have catastrophic results for the security and stability, not only of Pakistan, but for the security and stability of all of South Asia. And please don't forget we are talking about nearly 1.8 billion people living in South Asia.

Also, I believe it will also affect the course of evolution in the Middle East as well as in Central Asia and maybe, I think, beyond, I think, these regions as well.

HAASS: To build on what you just said, when you look at your neighbor Pakistan and you look at its difficulties with maintaining order, with governance, economically, do you harbor concerns that Pakistan could fail? And if that were to happen, if Pakistan were to fail in certain ways, could India succeed?

SINGH: Well, we don't want Pakistan to (fail ?). The emergence of democracy in Pakistan is something we welcome. But at the same time, we have to recognize that there are forces at work in Pakistan, the terrorist groups that are active there, until now, they were active only in the federally administered areas along the borders of Afghanistan.

Now they are, I think, have a grip over several parts of mainland Pakistan. If that process is not controlled, I think it has, I think, phenomenal consequences for the security and stability of Pakistan as well as our own security.

HAASS: Speaking of which, you mentioned the anniversary of the terrible events in Mumbai a year ago. India exercised what I believe most observers would say was rather remarkable restraint.

As you look back on that decision not to respond or retaliate militarily, do you believe it was the right decision? And God forbid, if it were to happen that there were future terrorist acts against India, do you think that that restraint may have come at a cost?

SINGH: Well, let me say, there was enormous pressure on me at that time. I resisted that pressure, and I think the decisions that I and my government took was, on balance, the right decision.

As regard to the future, I hate to speculate. I sincerely hope that that sort of eventuality does not arise. And that's why I believe the world community has an obligation to impress upon Pakistan that it must use all its influence to curb the power of the terrorist groups.

Pakistan has done something to control the activities of the Taliban terrorist groups in federally administered areas. But it is our sincere belief that it has not acted as it should have acted in dealing with terrorist elements who are using their energies to target our country, nor has Pakistan used all its machinery to bring to (book ?) all those murderers, gangs who perpetrated the horrible crime in Mumbai in which 2,000 citizens of our country, innocent citizens, lost their lives, several nationals of foreign countries, including six from the United States, two from Canada that lost their lives.

Pakistan, in our view, should be pressurized by the world community to do much more to bring to (book ?) all those people who are responsible for this horrible crime. After all, there is now impeccable evidence that a conspiracy was planned in Pakistan. It was executed with the active -- (inaudible) -- of peoples who are still roaming around freely in Pakistan.

And therefore, I respectfully request the world community to use all its influence on the power that be in Pakistan to desist from that sort of behavior.

HAASS: I just have two last questions and then I'll open it up, and they actually both deal with China.

At the recent meeting between President Obama and President Hu, there was obviously, as everyone in this room knows, a reference to China's role in your part of the world. Is that something that India would welcome?

SINGH: Let me say, what happens between President Obama and President Hu is not our direct concern. We want the world to prepare for the peaceful rise of China as a major power. So engagement is the right strategy, both for India as well as the United States.

We, ourselves, have tried very hard to engage China in the last five years. And today, China is one of our major trading partners.

But we also recognize that we have a long-standing border problem with China. We are trying to resolve it through dialogue. In the meanwhile, both our countries have agreed that, pending the resolution of the border problem, peace and tranquility should be maintained in the border line.

Having said that, I would like to say that I have received these assurances from the Chinese leadership at the highest level. But there is a certain amount of assertiveness on the part of the Chinese. I don't fully understand the reasons for it. That has to be taken not off.

HAASS: Last question about China. There has been a lot of talk in the literature about the comparison of the Indian and the Chinese approaches to development. A question I had is, why do you believe that India's is preferable, assuming you do, given that China has grown at a higher rate for more years?

SINGH: Well, there is no doubt that the Chinese growth performance is superior to Indian performance. But I've always believed that there are other values which are important than the growth of the gross domestic product. I think the respect for fundamental human rights, the respect for the rule of law, the respect for multicultural, multi-ethnic, multi-religious rights, I think those have values also.

There are several dimensions of human freedom, which are not always (caught ?) by the numbers with regard to the gross domestic product. So I do believe that even though the Indian performance with regard to GDP might not be as good as the Chinese, certainly I would not like to choose the Chinese, but I would prefer to stick to the India part.

Also, I believe India may appear as indecisive democracy at times. And it does, because many democracies are short-term maximizers. They're not able to take a long-term view.

But I have also believed that once a democracy decides on the basis of a wide-ranging consensus, any reforms that are undertaken will be far more durable, will be far more effective than reforms introduced by the writ of a ruling group in a non-democratic setup.

HAASS: Ladies and gentlemen, you've just been treated to an economist saying there's more to life than GDP. (Laughter and applause.) This is an important moment. (Laughs.)

That was a wonderful answer, by the way.

Let me open it up to questions. Please, wait for a microphone. Speak directly. Let us know who you are and with whom you are affiliated. The shorter, the better.

Yes, ma'am.

QUESTIONER: Beverly Lindsay, Penn State University. My question in terms of your being a former professor as well as prime minister, you mentioned the idea of partnerships, particularly in higher education. Are there new areas that we should be considering? And do they include areas, like public engagement?

And because you have such diverse populations, like the United States, can we both learn from each other?

SINGH: Well, because of our diversity, I believe there are enormous opportunities for us to enter into dialogue, how to manage diversities. We have many (cause ?). We have great regional disparities. And we certainly can learn a great deal from each of those experience of the type of exchanges that you have mentioned.

HAASS: C. Fred Berkston.

QUESTIONER: Mr. Prime Minister --

SINGH: That's an unfair advantage. I -- (inaudible) -- able to answer your question. (Laughter.)

HAASS: Oh, I think you're okay.

QUESTIONER: He's afraid I'm going to revert to the economist mode. (Laughs.) An easy question, Mr. Prime Minister. In your earlier speech today, at the outset of it, you talked about economics being at the foundation of relations between countries. And I wanted to ask you a question in that vein.

Your government has negotiated free trade agreements with a number of your trading partners -- ASEAN, Korea. And you're now talking with the European Union, Japan, Canada and others. My question is, what about the United States? Would you be interested in a free trade negotiation with the United States, particularly since, in the absence thereof, if you do complete trade agreements with all your other major partners, you'll be discriminating against the United States, and it might make it more difficult to carry out the kind of relationship we all want?

SINGH: Well, there is no easy answer to your question. I do recognize the trade diversion effects of (these free trading ?) agreements. And to your question, would we like to have a free trade agreement with the United States? Let me say, my first preference is that the multilateral trading system itself should evolve in a direction where there is a reduced role for trade distortions, represented by tariff and non-tariff barriers. So I sincerely hope that the Doha round can succeed.

We belong to a region where we cannot have tight regional arrangements like the European Union have. In our regions, for various historical reasons, we're not able to have a reasonable tariff union of the type that exists in some other parts of the world.

So our first preference would be that the multilateral trading system should evolve in a direction in which there is a reduced amount of tariff distortions which distort the flow of trade and goods and services.

But I do have to recognize that today that more than 50 percent of world trade takes place behind regional tariff walls and tariff agreements. And if so, I've not studied this question, but the ambassador was telling me this morning that the United States has some hesitancy in talking about a free trade (agreement with India ?). I don't mind exploring the possibilities of a free trade agreement with the United States.

HAASS: Mr. Gadbaw.

QUESTIONER: Prime Minister Singh, it's great to see you again. My name is Michael Gadbaw, I'm with Georgetown University Law School. My question is, in 20 years, almost 20 years, since you introduced some very significant reforms, we've seen a very dramatic change in the relationship between the Indian government and the Indian economy. As you look down the road, do you think, in the next years, we will see as dramatic a set of changes in that relationship?

SINGH: Well, I have no doubt about that. I said in my speech that our ambition is to ensure that the Indian economy grows at the average annual rate of about 9 percent per annum, which was the growth rate preceding the current years and the previous years of the last five years.

And if our economy grows at the rate of 9 percent -- and 72 divided by nine, eight -- in eight years, we will double the national income of our country. And therefore, by 2020, India should join the ranks of middle-income economies if we do succeed in growing at the rate of 9 percent per annum.

And I am confident our growth is, unlike China, not dependent on external stimulants. Our growth is largely fueled by our domestic demand. And our savings rate is as high as 35 percent per annum. Our investment rate in recent years has been as high as 37 percent per annum.

As an economist, I know the rough rule of (thought ?). I think that a capital output ratio of four to one, if you save 35 percent of your GDP, you should be able to reach a growth rate of 9 percent per annum, that that's our vision. And I am confident that the Indian economy will move in that direction in the next two, three decades.

HAASS: What is the biggest impediment? What concerns you most that could get in the way of that?

SINGH: Well, I think that the concern that I have is the quality of our physical infrastructure. We need a lot more investment in infrastructure. We need a lot more investment in human resource development, in education, in skill formation. These are the three critical, I think, constraints which we are trying to address. And I am confident, over a period of time we will be able to address them.

And I invite the United States investors and the members of the academic communities and the university system to work with us so that we overcome these disabilities.

HAASS: Since we started a few minutes late, is it okay if we run a few minutes over? Is that all right? Not too long, I promise.

Yes, sir.

QUESTIONER: Thanks. David Gartner with the Brookings Institution. Thank you, Mr. Prime Minister for your remarks, especially around the partnership between the United States and India, around responding to global poverty and enhancing education for all children.

And my question is, given India's leadership now within the G20 as well as the bilateral relationship, do you see the G20 as a forum that could take on these issues of development?

And might, given the Indian experience might initiatives around something like education and education for all be something that could be a first-development initiative of the G20?

SINGH: Well, the G20 is a very helpful evolution. And I compliment President Obama for having taken the initiative at Pittsburgh to bring it about.

But it is in a state of infancy. It is still grappling with the macroeconomic problems and ensuring that the idea of a peer review of the performance of the macroeconomic performance of the 20 countries takes root. But it could evolve. I doubt that it will evolve.

But (in weak direction ?), I think it is too early to predict at this stage.

HAASS: Since it may be a while before India can get a seat on the U.N. Security Council, would you favor, at least as an interim measure, the idea of the G20 taking on a political as well as an economic role?

SINGH: I'm sorry, I have not thought it through. As of now, the G20 forum is a purely economic forum. And from whatever I have heard other members of the (G20 ?), I don't think they are prepared to give political, I think, muscle.

I was with the Canadian prime minister a few days ago. He was our guest in Delhi. And I raised this issue with him. He said, no, no, no, as far as the G8 is concerned, we want to maintain it, because we want to discuss political issues. As far as G20 is concerned, we will discuss economic issues. (Laughter.)

HAASS: Canada has a special reason to keep the G8 going. (Laughs.) I think it's one-eighth of it.

Sir.

SINGH: (Inaudible) -- is willing. (Laughter.)

QUESTIONER: Mr. Prime Minister, I'm John McCormick with the Energy Policy Center. It's an honor to be addressing this question to you.

Mr. Prime Minister, when I think about the tensions in Pakistan, India, Afghanistan, Bangladesh, I look 20 years out, and I see that the common enemy for all these countries will be water. Now, I have a feeling that the South Asian Association for Regional Cooperation could be a focal point for bringing all the Himalayan nations together to talk about their common enemy, that is, melting glaciers.

And I'm wondering if the SAARC might find a way to expand its portfolio to include some very aggressive adaptation, because South Asian nations are victims, they are not perpetrators of climate change.

SINGH: I entirely agree with you that water is going to be probably the most critical (dynamic ?) of our growth profiles in the 21st century. And therefore, the common Himalayan river system, which provides -- (inaudible) -- the water resources both of India, Bangladesh, Nepal and Afghanistan, I think we have to take a holistic view.

But politics is the art of the possible. The way the SAARC region has evolved, it has not, I think, grown, I think, to the extent to which one can say that we are ready to take on this additional burden of water management. But I sincerely hope that in due course of time I think water will be one area where our nations of South Asia will have to think together, think collectively to find effective, practical, pragmatic solutions to the problems of water management in our region.

HAASS: I'm getting the proverbial signal, so we've got time for one last question. After the prime minister answers it, I ask that people remain seated while the prime minister and his delegation have to depart.

Yes, ma'am, you had a question there. Yes.

And let me apologize for having alienated so many of you who I was unable to call upon.

QUESTIONER: Thank you very much. And it's a privilege to have the last question. Thank you for your remarks.

HAASS: You have to introduce yourself.

QUESTIONER: Sorry. (Name inaudible) -- I work as an independent consultant on gender equality.

It was encouraging indeed to hear your emphasis on factors other than hardcore economy and finance. In this regard, you talked about democratic values, human rights. And one sees India playing a leadership role in that region, on so many fronts. And I just wondered if you could tell us a little bit on the kind of role that you envision for India in terms of promotion of human rights, in particular women's rights, minority rights, and some bold steps for poverty alleviation.

SINGH: Well, human rights are enshrined in the constitution of India. And we're very proud of the fact that our codes are very jealous of protecting the human rights of our citizens.

With regard to women's rights, I think our constitution gives men and women equal right. At the age of 18, all men and women can vote in all elections in our country. And it is our ambition, as a party, to bring about constitutional changes where at least 33 percent of all seats in our Parliament would be reserved for women. We have not been able to evolve a broad-based consensus, but that's a commitment that we made in our election manifesto of the Congress Party. We will make every effort to fulfill that.

But today, we have a situation where the president of our ruling coalition is a woman of extraordinary qualities, Mrs. Sonia Gandhi. The president of India is a woman. The speaker of the lower house of our Parliament is a woman. So women are playing an increasingly important role. But I do agree with you that much more needs to be done, could be done, should be done. And that's our commitment to our people. We owe it to them, we owe it to our women to improve their lots a lot more than we have done in the past.

HAASS: A wise comment from any gentleman.

Mr. Prime Minister, on behalf of both the Council on Foreign Relations as well as the Woodrow Wilson International Center for Scholars, we just really want to both thank you for honoring us with your presence. We appreciate both your insights and your candor.

And I know I speak for everyone in wishing you every success, both in this state visit to the United States and, perhaps even more important, in the work that still lies ahead of you when you return to the wonderful country of India.

So thank you very much. And again, all the best. (Applause.)

This meeting was co-sponsored with the Woodrow Wilson International Center for Scholars.

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