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India & The World

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1. INDIA & NORTH AMERICA

India to Buy C-17 heavy-lift TransportAircraft from U.S.

India decided to purchase 10 C-17 GlobemasterIII heavy-lift transport aircraft from the U.S. for theIndian Air Force. The deal under the Foreign MilitarySales (Government-to-Government) is estimated tocost Rs. 18,000 crore (approximately $4.1 billion).

The contract, when signed would become thehighest single value military contract that New Delhiwould enter into with the U.S. and includes an offsetobligation of around Rs. 4,500 crore ($ 1 billion).Under the clause, the U.S. company would have tosource 30 per cent value of the order from India. Theplane can carry 188 passengers, has reverse thrustengines for short turnaround and equipped withmissile warning system with flares to disengage theincoming attack. The IAF conducted trials last yearincluding one in Himachal Pradesh to check itsefficacy for short take-off and landing with requisitecargo load. At present the Russian IL-76 “Gajraj” andAN-32 are the IAF workhorses for transporting menand material. Earlier this year, the IAF inductedtactical lift C130J Super Hercules aircraft from theLockheed Martin stable.India Averse to Inking Military Pacts with U.S.

As the dust over rejection of two U.S.companies from the Rs. 11,000-crore Indian AirForce tender for fighter aircraft settles, official sourcessaid the United States would also have to reconcilewith India’s unwillingness to sign three militarypacts.

The U.S. was extremely upset after Boeing andLockheed Martin were knocked out of the race forthe Medium Multi-Role Combat Aircraft (MMRCA).

However, India has been unwavering in backingthe evaluation of some 600 qualitative requirementsof the six fighters in contention.

While the U.S. was denied a strategic footholdin the IAF’s offensive capabilities segment, it couldface continued stonewalling with respect to threemilitary pacts — Logistics Sharing Agreement (LSA),Communication Interoperability and SecurityMemorandum of Agreement (CISMOA) and theBasic Exchange and Cooperation Agreement for Geo-spatial Cooperation (BECA).No Hidden Objective

The U.S. argues that there is no hidden aimbehind the LSA. It is an inter-bank type of clearingarrangement — there will be periodical settlementof accounts for the use of each other’s facilities.

For instance, Indian naval ships have had 45refuellings from the U.S. ships in the Gulf of Aden.Under the LSA, payments need not be made eachtime. The expenses could be adjusted against themoney owed to India if U.S. ships came calling here.But the Indian leadership feels that the LSA will givethe impression of a strategic agreement with thePentagon in military operations. India confronts atechnical issue in signing the CISMOA, thoughofficials feel it sounds heavier than it is. They alsofeel that interoperability, as argued by the U.S., neednot be dependent on signing the CISMOA.

The communication will be encrypted and noother algorithm can be used on the system. Duringjoint exercises, U.S. personnel sit on Indian shipswith their own equipment. But on aircraft there isno space for two or three different kinds ofequipment. The Navy and the Air Force have saidthey had no problems either way but politically thisremains a sensitive issue though officials say it is notas heavy as it sounds.

India & The World

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India also has reservations on the third militaryagreement sought by the U.S. — BECA. The U.S. saysthe pact will enable C-130 and C-17 planes to flyclose to the ground.

This entails installation of ground sensors,which none in the security establishment, except theDefence Research & Development Organisation iskeen on.

India-U.S. Focus on Maritime SecurityIndia and the United States welcomed the

progress in bilateral defence cooperation underscoringthe engagement in maritime security withWashington welcoming New Delhi’s decision tochair a plenary of the Contact Group on Piracy offthe Coast of Somalia next year. In her openingremarks, U.S. Secretary of State Hillary Clintonmentioned that maritime security was an area ofmajor concern, as both countries sought to protectsea lanes, combat piracy and defend freedom ofnavigation.

This sector stands codified in the 2006 Indo-U.S. Framework for Maritime Security Cooperationand since then both countries have cooperatedtowards addressing Somalia-based piracy, disasterrelief, illicit trafficking in weapons of massdestruction and enhancing maritime domainawareness.

The Group, which met in Washington earlierthis year, is now scheduled to hold another meetingnext year. At the end of the second round of bilateralstrategic dialogue, both sides noted that India hadprocured defence equipment worth $8 billion (approxRs. 37500 crore) over the last decade.

Earlier, the United States had removed fourIndian organisations, including the Defence ResearchDevelopment Organisation, from the list of entitiesto which sale of high technology items was notpermitted.

U.S. briefs India on Afghan ReconciliationU.S. Special Representative for Afghanistan

and Pakistan (AfPak) Marc Grossman briefed topIndian foreign policy officials on Washington’sopening of dialogue with the Taliban and soughtgreater cooperation from New Delhi in effectingpolitical reconciliation. The briefing was meant toaddress complaints from major regional players that

they were not being kept in the picture on the latestmoves by Washington. While discussions centeredaround the political process, the two sides are alsobelieved to have touched generally on regionalcooperation in the economic field. The two sidescould in future start looking at specific projects. Mr.Grossman also briefed officials about his talks inTurkey, Saudi Arabia and the United Arab Emirates.

Earlier, the State Department provided aninkling of the area U.S. wished India to focus on.“India is very much a player in the New Silk RoadInitiative. These are all part and parcel of the samefight, talk, build strategy,” U.S. State Departmentspokeswoman Victorial Nuland had said at a briefingannouncing Mr. Grossman’s unscheduled visit toNew Delhi. India supports police training inAfghanistan and “other things” in Afghanistan “soit’s important that we keep those lines ofcommunication open,” she added. However the SilkRoad project as such was not discussed but both sidesconsider the proposed Turkmenistan-Afghanistan-Pakistan-India (TAPI) as a major regional project thatwould benefit Afghanistan. India has emerged as akey country in the economic field in Afghanistan bywinning a major contract for iron ore mining and isdeveloping plans for a multi-purpose project.

2. INDIA & CENTRAL AMERICA

India Inks Taxation Treaty with UruguayIndia inked a Double Taxation Avoidance

Agreement (DTAA) with Uruguay for avoidance ofdouble taxation and prevention of fiscal evasion withrespect to taxes on income and capital. The DTAA,signed by Central Board of Direct Taxes (CBDT)Chairman M. C. Joshi and Uruguay’s Ambassadorto India Cesar Ferrer, provides that business profitswill be taxable in the source state if the activities ofan enterprise constitute a permanent establishment(PE) in that state. The DTAA also incorporatesprovisions for effective exchange of informationincluding banking information and assistance incollection of taxes between tax authorities of the twocountries in line with internationally acceptedstandards, including anti-abuse provisions to ensurethat the benefits of agreement are availed of bygenuine residents of the two countries.

“The agreement will provide tax stability to theresidents of India and Uruguay and facilitate mutual



India & The World



economic cooperation as well as stimulate the flowof investment, technology and services between thetwo countries,’’ the statement said.

3. INDIA & SOUTH AMERICA

Argentina Seeks Indian Support inTerritorial Claim

While the South China Sea dispute makesheadlines in the world press, another disagreementin the South Atlantic which pits a former colonialpower against South American and Caribbeancountries has hardly made ripples. Argentina hassought Indian assistance in pressing its claim overMalvinas Islands (Falkland Islands) which wereforcibly occupied by the British in 1833 and saw abrief conflict in 1982.

4. INDIA & AFRICA

Indo-African Gene AdmixtureIndia is a classic example of genetic potpourri.

Though the Ancestral South Indians (ASIs) found inthe four southern States are not related to any groupoutside India, populations in the north Indian Statesknown as Ancestral North Indians (ANIs) exhibit aclose genetic affinity to middle easterners, centralAsians, and west Eurasians. The Nyshi and Ao Nagapopulations from north-east India show geneticaffinity to the Chinese. The small Siddi populationfound in Karnataka, Gujarat and some parts ofAndhra Pradesh shows an African affinity. Thoughthe genetically admixtured tribal Siddi groupexhibiting Indian and typical African features likedark skin, curly hair, and a broad nose has beenaround for a few hundred years, no comprehensivestudy was done to establish its African genetickinship. This lacuna has been finally addressed by astudy published in The American Journal of HumanGenetics (“Indian Siddis: African descendants withIndian admixture,” by Anish M. Shah et al.). Thestudy is robust as the authors have analysed geneticmarkers from non-sex chromosomes (autosomes),and paternally derived Y-chromosomes andmaternally derived mitochondrial DNA (mtDNA).An analysis of both Y-chromosomes and mtDNA,and autosomes in Siddis and the adjoining Indiantribal populations has helped in tracing the direction

of gene flow between the African descendent andIndians. Sixty Siddis and 90 people from the adjoiningtribal populations in Junagarh district of Gujarat, and94 Siddis and 178 people from adjoining tribalpopulations in Uttara Kannada district of Karnatakawere studied.

South Africa Releases Stamps to MarkArrival of Indians

A series of postage stamps in commemorationof the arrival of the first indentured Indian labourersto South Africa 151 years ago have been launched.In partnership with the Department of Arts andCulture, the Department of Communications and theSouth African Post Office, two stamps have beenlaunched, with a further two sets set for launch nextyear. The stamps feature a sketch of the S S Truro,the ship that brought the first indentured labourersfor the sugarcane plantations in Natal province fromIndia in 1860, and photographs of passengers comingashore at the Durban port.

The Truro left Madras and anchored in PortNatal on November 16, 1860 to start off the arrivalof thousands of Indians until the last ship, theUmlazi, in 1911.

5. INDIA & EUROPE

India, Germany Differ on UNSC ExpansionGerman Chancellor Angela Merkel ended her

day-long interaction with the Indian leadership withdivergence of views evident on political issues,especially on the pace of expansion of the UnitedNations Security Council (UNSC) and the bombingof Libya. Of the dozen issues discussed during themeeting between Prime Minister Manmohan Singhand Dr. Merkel, India assured Germany a transparentselection process for a multi-billion dollar tender forfighter aircraft and a stable investment policy.

This was in response to the German pitch forthe Eurofighter Typhoon and higher foreigninvestment limit in sectors such as insurance. Indiaalso promised to look into intellectual property issuesof concern to German companies, including oneinstance of a messy court case. Both Germany andIndia, part of the G-4 grouping along with Japan andBrazil, are pushing for their inclusion in an expandedUNSC, but their divergent views came to the fore.



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Germany is inclined to opt for an interimsolution in which some of the countries areaccommodated without veto rights. A finalresolution could take place a decade later. On theother hand, India, along with Brazil, wants to settlethe issue once and for all. It has already receivedendorsements from 80 developing countries and isaiming to add 20 more by the time the U.N. GeneralAssembly convenes in September.

Asked at the joint press conference whetherGermany was departing from the spirit of theconsensus among the G-4 for one lasting solution,Dr. Singh said: “Both Germany and India have beenarguing for a long time that the global system needsto be brought up to date in tune with contemporaryrealities. The new realities of the global scene haveto be taken into account in looking at reform of theglobal structures of governance. India and Germanyhave been partners in this exercise. I sincerely hopethat this partnership will persist, that it will yieldpositive results.” The German Chancellor too did notgive a direct reply: “We are actually aligning ourpolicies as to how we can bring about reform… weshould focus our energies and our capacity forspeeding up this process which after all has alreadystarted a long time ago. Maybe together we can bringsomething about.’’

French Submarine Builder Ties up withIndian firm

The India arm of French naval defencemanufacturer DCNS India signed an agreement withFlash Forge India Pvt. Ltd, for manufacture ofmechanical equipment.

Defence shipyard Mazagon Dock is buildingsix Scorpene submarines under the DCNS transfer oftechnology. Simultaneously, DCNS India is workingat the selection and qualification of Indiancompanies as partners for local production of theScorpenes’ equipment, the French company said ina release. It said, following Indian authoritiessystematic pursue of indigenisation, DCNS is makinga constant endeavour to go beyond the contractualtransfer of technology with Mazagaon Docks so thatvital equipments and systems could be locallymanufactured. The project is running three yearsbehind schedule and the first submarine is due in2015.

Liability Law no Longer an Obstacle toRussian Reactor Deal

The impasse in setting up new nuclear reactorsin India due to the Nuclear Liability Act could endsoon with India and Russia in the final stages offinalising a cost mark-up to cover the additionalinsurance burden that suppliers must bear as a resultof the new law.

The Civil Liability for Nuclear Damages Act2010 makes suppliers liable in case of an accident,both through the section giving operators a right ofrecourse against them (section 17) in the event offaulty equipment or design, and through normal tortlaw (section 46).

American, French and Russian suppliers,assured by New Delhi of lucrative orders for powerreactors, have baulked at these two sections of theliability law. They claim it would be difficult forthem to go ahead with the setting up of nuclearreactors because of the additional financial liabilitydue to the higher insurance premia.

India has identified ‘nuclear parks’ for reactorsoriginating from Russia, France and the U.S. afterthese countries played a pivotal role in ensuring aspecial exemption for India at the Nuclear SuppliersGroup (NSG), which prohibits its members fromselling nuclear equipment to countries that do notallow international inspections over all their nuclearinstallations. Prime Minister Manmohan Singh haddiscussed this issue with Russian President DmitryMedvedev at the BRICS (Brazil, Russia, India, Chinaand South Africa) summit in China in April and theyhad agreed to speed up discussions since bothcountries had no other issues apart from the nuclearliability law hindering progress, unlike France andthe U.S.

The French company, Areva, cannot go aheadwith its plans due to India’s inability to ink a civilnuclear agreement with Japan. Areva, as well as GEfrom the U.S., depend on Japan Steel Works (JSW)for reactors pressure vessels. The US companies toohave Japanese equity in their civil nuclear venturesand cannot go ahead without an Indo-Japan civilnuclear pact, even if the nuclear liability issue issorted out. However, to get around this problem,officials hope that the South Korean Doosan HeavyIndustries and a U.K. based company would be able



India & The World



to step in for Japanese companies if the civil nuclearpact with Japan remains elusive.

But till then, the Russians will remain in thelead. They have sorted out the safety issues andIndia’s largest ever nuclear reactor, Kudankulam-I,based on Russian technology, is likely to go criticalin the next few months. This reactor will be followedby another Russian reactor going critical at anadjoining site. On the other hand, the politicaluncertainty in Tokyo in the wake of the Fukushimanuclear plant accident has dimmed the chances of aquick end to negotiations on a India-Japan civilnuclear agreement.

Russia’s Rosatom to Join Hands with Indianfirms

Russia’s state-owned nuclear corporation plansto set up joint ventures with Indian companies tomanufacture power generation equipment.

Atomenergomash (AEM), an affiliatedcompany of the Atomic Energy Corporation Rosatom,is to launch two JVs in India before the end of thecurrent year, the company head was quoted as saying.

Rosatom is finishing the construction of twonuclear power reactors of the Kudankulam NuclearPower Plant in Tamil Nadu. In March 2010 Russiaand India signed a contract for the construction of athird and forth reactors for the Kudankulam NPP.

With its thrust on developing an indigenousnuclear energy programme, India insists on a 60-per-cent indigenous component in foreign-built nuclearpower plants. AEM also views India as a bridgeheadfor entering other Asian markets where Rosatom plansto build NPPs — Vietnam, Bangladesh, and China.

India-EU Trade Talks to Conclude This YearUnion Commerce and Industry Minister Anand

Sharma said negotiations on the India-EU broad-based Trade and Investment Agreement (BTIA) hadbeen intensified and were in the final stages withthe aim to conclude them. “The India-EU BTIAnegotiations are in their final leg. Thirteen roundsof negotiations have been held so far. A statementissued by the Commerce Ministry said currentnegotiations cover trade in goods, sanitary and phyto-sanitary measures and technical barriers to trade, tradein services, investment, intellectual property rightsand geographical indications (GIs), competition

policy, customs and trade facilitation, trade defence,dispute settlement, government procurement andsustainable development.

India Inks Tax Treaty with LithuaniaIndia inked a protocol and double taxation

avoidance agreement (DTAA) with Lithuania toprevent fiscal evasion with respect to taxes onincome and capital and facilitate exchange of bankinginformation between the two countries. Accordingto a Finance Ministry statement here, the DTAA withLithuania — the first such with a Baltic nation —provides that business profits will be taxable in thesource country if the activities of an enterpriseconstitute a permanent establishment (PE) there.

India, France discuss military, civil nucleardeals

India and France discussed military contractsand civil nuclear safety during an interaction betweenExternal Affairs Minister S.M. Krishna and his visitingcounterpart, Alain Juppe.

France, which has been awarded a multi-billion contract for setting up nuclear power plantsin western India, agreed to step up cooperationbetween the civil nuclear regulatory boards of thetwo countries.

Nuclear safety has been high on the Indianagenda after the Fukushima radiation leak and a firein a French nuclear waste dump. Doubts were alsoexpressed about the reliability of the patentedtechnology France intends to use in setting up theplants.

On the defence side, the two sides discussedthe joint development of a short-range missile thatwill be deployed as a last resort for defending vitalinstallations from air attacks. They also touched onthe induction of French technology for the Kaveriengine, which was being indigenously developed butfacing several hurdles.

The interaction came at a time when the twoarmies are engaged in ‘Shakti’ exercises — for thefirst time. The terrestrial war games add to theregularly held joint naval exercises under the ‘Varuna’and ‘Garuda’ series by the two air forces.

India and France also welcomed the move tomodernise the IAF Mirage 2000 aircraft. TheRs.11,000-crore deal to upgrade was signed recently



Current Affairs



with Dassault Aviation and Thales. The IAF has 51Mirage 2000s in its inventory, procured in the 1980s,and upgrade plans include a multimode dopplerradar, modern glass cockpit, fully integratedelectronic warfare suite and beyond visual rangecapabilities.

In addition, the Defence ResearchDevelopment Organisation (DRDO) is negotiatingwith French engine manufacturer Snecma to co-develop high-end technology for the Kabini, whichforms the core part of Kaveri engine, being developedfor the Light Combat Aircraft ‘Tejas’. The negotiationis at an advanced stage and the DRDO hopes to workwith the French so that the engine provides requiredthrust without affecting the size and weight.

Both Ministers noted the ongoing efforts tofinalise joint defence research and development bothfor Kaveri and Short-Range Surface-to-Air Missile (SR-SAM). The DRDO is seeking to co-developtechnology in order to cater to the requirement ofthe armed forces and build upon the experiencegained from the Trishul missile developed earlier.

India must show Respect: ItalyIndia must show respect for Italy, the country’s

Defence Minister Giampaolo Di Paola said, in anescalating row over two Italian soldiers facing murdercharges for killing two Indian fishermen. “We havea lot of respect for India and for the Indian people,but we are expecting equal respect to be shown forItaly, for legality and for International law by theIndian nation,” Mr. Di Paola told reporters in Rome.The soldiers have been in custody in Kerala since oncharges of shooting dead the fishermen, who weremistaken for pirates trying to attack an oil tanker thatthe Italians were protecting.

Italy wants the men to be prosecuted in Italyand not in India, claiming the incident occurred oninternational waters and on an Italian-flagged ship.India insists the soldiers should be dealt with underthe Indian law.

6. INDIA & CENTRAL ASIA

Expanding Ties with Russia in PharmaSector

India and Russia have agreed to explore waysto expand bilateral cooperation in the pharma

industry, including clinical trials of new drugs. TheIndian Health Minister visited Moscow on April 27-30 to attend the First Global Ministerial Conferenceon healthy lifestyles and non-communicable diseasecontrol, organised by the World Health Organisation.The Russian Minister suggested India and Russia signan agreement on mutual recognition of clinical trialsto reduce the time and cost of market entry for Indianpharmaceuticals in Russia and vice versa. A new lawon drug circulation in Russia that came into forcelast September requires foreign companies to conductclinical trials of new drugs in Russia prior to theirregistration. Clinical trials conducted outside Russiawill be accepted only if they involve participationof Russian patients. At the same time, the newlegislation allows for mutual recognition of drugtrials on the basis of international agreements. India’spharmaceutical exports to Russia have doubled inthe past five years, but still account for less than 6per cent of the $18-billion Russian drugs market.According to the first global status report on non-communicable diseases, heart disease, stroke anddiabetes together cost the Indian economy $9 billionin 2005.

Russia for Sharing its Experience in DisasterManagement

Russia has called for stepping up cooperationwith India in high-tech areas, and is willing to shareits experience in disaster management. “Russia is veryanxious that our two countries step up cooperationin high-tech areas such as civilian aircraft andsubmarines,” Union Home Minister P.Chidambaram said about his meeting on Wednesdaywith Russia’s Deputy Prime Minister Sergei Ivanov,whose responsibilities cover industry, defence andspace.Joint Commission

During his meeting with the Russian Emercom(Emergency Situations), the Minister said, both sidesdiscussed the Russian proposal to set up a jointcommission to implement the December 2010intergovernmental agreement on cooperation indealing with natural and man-made disasters.

Mr. Chidambaran suggested that India andRussia share experience in forecasting tsunami andother natural calamities.



India & The World



Antony to visit KyrgyzstanDefence Minister A.K. Antony on a two-day

visit to Kyrgyzstan to promote bilateral ties in a widerange of areas and also inaugurate the India-KyrgyzMountain Biomedical Research Centre. The uniqueinstitution has been established jointly by theDefence Research Development Organisation(DRDO) and the National Centre of Cardiology andInternal Medicine, Kyrgyzstan, to study high altitudeacclimatisation and find measures to provide succourfor maladies at high altitudes.

Counter-terrorism cooperation figures highin India-Turkey talks

India and Turkey agreed that greaterinternational cooperation was needed to counter thescourge of terrorism that is affecting both countriesduring bilateral talks that also reviewed regional andinternational developments including the upcomingIstanbul conference on Afghanistan.Afghanistan Issue

During his meetings with top Turkish leaders,Vice-President Hamid Ansari reiterated New Delhi’sposition that any solution to Afghanistan must beled by its people with Ankara recognising the rolebeing played by New Delhi in assisting Kabul inreconstruction. Mr. Ansari also briefed the hostsabout the recent visit of Afghanistan PresidentHamid Karzai to India during which both countriessigned a strategic cooperation pact.

The Indian vote on Syria in the U.N. SecurityCouncil also figured prominently during themeetings as Turkey shares open borders with thecountry.

The Vice-President conveyed India’s deep griefover recent terror attack in Turkey. Both countries havea Joint Working Group and a strategic dialogue.National Security Adviser Shivshankar Menon isscheduled to visit Turkey early next year.Rousing Reception

While Turkish Parliament that is in sessionaccorded a rousing reception to the delegation ledby Mr. Ansari, on a personal note Mr. Cicekpresented him with a photograph of his greatgranduncle Mukhtar Ansari, who led a medicalmission to Turkey in 1913.

The Turkish side also evinced keen interest inthe electronic voting machines being used in India.

China signs Contract for Indian OceanMining Rights

China signed a long-expected contract, whichhas drawn much attention in Indian strategic circles,under which the China Ocean Mineral ResourcesResearch and Development Association (COMRA)will get exclusive rights to explore 10,000 square-km of seabed in the southwest Indian Ocean in anarea off the coast of Africa, state media reported.Under the deal with the International SeabedAuthority (ISA), COMRA can explore polymetallicsulphide ore deposits in the region over the next 15years.

COMRA will have to give up 75 per cent ofthe region within 10 years, following which it willhave pre-emptive rights to mine the remaining area,according to the state-run Xinhua news agency. Thedeal also requires China to fulfil certainenvironmental obligations and monitoring. In India,the deal has drawn attention on account of a Chinesefirm gaining access to the Indian Ocean, with reportssaying the Directorate of Naval Intelligence hadexpressed concern that COMRA’s access could havestrategic implications for India’s security.

Analysts in India have also seen the deal as areflection of India’s own failure to be more proactivein better utilising mining exploration rights in theIndian Ocean, thereby giving space for othercountries.

India, Russia will Strive to GalvaniseBilateral Trade

India and Russia will strive to “galvanise”bilateral trade after it missed the $10 billion targetset for last year. The Indo-Russian IntergovernmentalCommission (IRIGC) on trade, economic,technological, scientific and cultural cooperation,resolved to give thrust to four vectors of bilateralcooperation, the Indian Embassy said in a release.The 17th annual meeting of the IRIGC was co-chairedby External Affairs Minister S. M. Krishna andRussia’s Deputy Prime Minister Sergei Ivanov. Thetwo sides decided to launch a joint public-privateinvestment fund that will invest in both countries.The two governments will also set up a Joint StudyGroup to prepare a Comprehensive EconomicCooperation Agreement with the Customs Union,



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which unites Russia, Kazakhstan and Belarus.A new Working Group on Modernisation has

been added to the nine WGs already existing withinthe IRIGC. It will deal with integration oftechnological platforms, not only on a bilateral basisbut also in the format of BRICS.

India and Russia will strive to revive the North-South Transport Corridor (NSTC) through Iran thathas failed to take off more than 10 years after thethree countries signed an agreement to set up thetrade route. India and Russia agreed to “enhanceconnectivity” through the NSTC, the Embassy releasesaid.

Ukraine for durable defence relationshipwith India

Having supplied military hardware to Pakistan,Ukraine now wants to enter into a durable defencerelationship with India. Subjected to competingpulls from Russia and the European Union, Ukraineis looking at Asia, especially India, for collaborationin a large number of areas, including civil nuclearenergy. Home to niche technologies and having beensubjected to a nuclear accident in 1986, Ukraine haslessons in nuclear safety for India because this sectorstill caters to 45 per cent to 50 per cent of thecountry’s energy needs. Most reactors are based onthe technology offered by the Russians for theKudankulam plant and a large number of Ukrainianengineers were working there till protestors forced ashut down.

India and Ukraine are understood to beworking on an energy pact that will subsume amemorandum of understanding between the civilnuclear regulators as also cover sectors such as gasand solar energy. But for the immediate future, it isdefence which will attract maximum attention. Kievis already modernising the An-32s, backbone of theIndian Air Force’s transport and troop replenishmentfleet, and wants a more wider-ranging relationship.

TAPI: A Step ForwardIn a breakthrough that will take forward the

ambitious $7.6-billion TAPI (Turkmenistan,Afghanistan, India and Pakistan) pipeline project,India and Pakistan agreed to have a uniform transitfee to ferry natural gas from Turkmenistan. This wasdecided at a meeting between Petroleum and NaturalGas Minister Jaipal Reddy and visiting PakistanEnergy Minister Asim Hussain.

Under the in-principle agreement, India willpay transit fee to Pakistan and Afghanistan to get itsshare of 38 million standard cubic metres a day ofgas through the pipeline, while Islamabad will payferrying charges to Afghanistan.

“Pakistan agreed in principle that whatevertransit fee formula is eventually settled between Indiaand Afghanistan will also be acceptable to it and issubject to the approval of the competent authorities,”a statement issued by India after the meeting said.

The 1,735-km-long pipeline will run fromTurkmenistan’s Yoloten-Osman gas field to Heratand Kandahar province of Afghanistan, beforeentering Pakistan. In Pakistan, it will reach Multanvia Quetta before ending at Fazilka (Punjab) in India.The project envisages a total throughput of 90 millionstandard cubic metres a day (MSCMD) of gas, ofwhich India is expected to receive 38 MSCMD.

7. INDIA & WEST ASIA

Israel Offers farm Tech to IndiaThe Israeli Government has offered its

agricultural technologies for India, Israeli Agricultureand Rural Development Minister Orit Noked said.Talking to media persons after her meeting withHaryana Chief Minister Bhupinder Singh Hooda atthe Centre of Excellence for Vegetables at Gharaundain Karnal district, she described “India as a truefriend”. “The implementation of these technologieswill surely benefit Indian farmers by enhancing theirincome as well as neutralising the escalation in foodprices. The agriculture cooperation with Israel canand will propel India to become a superpower in foodproduction and supply, strengthen this great countryas a whole and will place it at the forefront of worldagriculture,” she added.India’s Engagement with Latin AmericanCountries Increasing

A three-day photo exhibition titled ‘AmazingAmazon’ will be inaugurated by Juan Alfredo PintoSaavedra, Ambassador of Colombia to India, atAmethyst. Mr. Pinto said the exhibition was part ofthe promotion of trade and cultural relationshipsbetween India and Colombia. The exhibition wouldpresent the hidden treasures of tribes, flora and faunaalong the banks of the Amazon from the Pacific



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Ocean to the Andes Mountains. Talking about thebilateral ties between the two countries, Mr. Pintosaid that the Latin American Countries (LAC) wererich in natural resources.Market Potential

The LAC and the Caribbean region comprising43 countries accounted for about 3.67 per cent ofthe total world trade in 2009. Considering the marketpotential in the Latin American region, an integratedprogramme ‘Focus LAC’ was launched in November1997 by the Commerce Ministry. The programmewas revived from time to time and extended up toMarch 2014. So far India had signed two PreferentialTrade Agreements in LAC region, he said. India’s totaltrade with the region increased from 1,732.55million US dollars in 2000-01 to 16,602 million USdollars in 2009-10, registering an increase of about858 per cent in a decade. India’s export to LatinAmerica was 6.21 billion US dollars in 2009-10 andthe imports from the region were 10.39 billion USdollars, he said.

India Seeks out to Abu Dhabi InvestmentIndia invited Abu Dhabi Investment Authority

(ADIA), world’s largest sovereign wealth funds, toinvest in the $90-billion ambitious Delhi MumbaiIndustrial Corridor (DMIC) and other infrastructurefunds. “We have invited ADIA to invest in theDMIC and other infrastructure projects,” Mr. Sharmasaid after the meeting. The ADIA, which is as largeas $1 trillion, has expressed keen interest in investingin India. “The ADIA will come forward to work withIndia in the DMIC project. We have agreed to setup a joint working group to work out the modalities.We will be happy to see ADIA participation inIndia’s infrastructure-building,” he said.

Mr. Sharma also said that the UAE shouldencourage other members of the Gulf CooperationCouncil (GCC) to hold a third round of negotiationson the proposed Free Trade Agreement between Indiaand the GCC at the earliest. The UAE is the biggesttrading partner of India in the entire West Asia andNorth Africa (WANA) region and accounted forabout 63 per cent of India’s total trade with GCCcountries in 2010-11. Bilateral trade between thecountries has registered an over 300 per cent increasein the last five years and stood at $66.56 billion inJanuary-November 2011.

Iran Crucial for India to open up Routes toCentral Asia

Notwithstanding the U.S. pressure to scaledown its engagement with Iran, official sources saidthe country not only remains an important source ofoil for India, but is crucial to opening up routes toCentral Asian and Caucasian countries, where NewDelhi’s quest for hydrocarbons and minerals isgathering critical mass.

“We recognise that Iran is the key to connectingwith Central Asia,” said the sources while referringto a major meeting on a proposed Russia-Iran-Indiapromoted North-South corridor that would originatefrom Bandar Abbas leading to Russia and othercountries via the Caspian Sea. India has “taken thelead” and is “pushing hard” to put the missing raillinks in place so that a seamless route from BandarAbbas port to Russia and Central Asia opens up bynext year by when the customs union of Russia-Kazakhstan-Byelorussia would have expanded toinclude other Eurasian countries.Customs Procedures

Besides the three original signatories, over 15countries have joined the north-south project. Inaddition to putting in place missing railways linksof about 200 km, all the sides will have to harmonisetheir customs procedures to make the endeavourworkable. Currently Indian goods enter Russiathrough the Baltic ports of St. Petersburg and Kotka,the European port of Rotterdam and the Ukrainianports of Illychevsk and Odessa. Iran, said the sources,was also critical to stabilising Afghanistan as part ofthe Shanghai Cooperation Organisation (SCO)grouping after the NATO forces scale down theiroperations in 2014. Nearly all the countriessurrounding Afghanistan are either members orobservers to the SCO and they said, “we take it [theSCO] as an important platform to discuss the post-2014 situation in Afghanistan.”

India is also closely following the developmentof another route into Central Asia via Iran andAfghanistan into Uzbekistan. Currently a portion ofthe route (part of the the Northern DistributionNetwork) — from Termez in Uzbekistan to Mazar-e-Sharif — is used by the NATO to transfer non-lethalsupplies for its forces to Afghanistan.Alternative Route

A western spur from Mazar to Herat would go



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to Delaram, follow an India-built road till the Iranborder and, if the missing rail link is constructed,will connect to the Iranian port of Chabar. India isalso interested in another alternative route that wouldgo from Mazar to Iran’s Sangan and Kerman citiesand ending at Bandar Abbas port.

Both these routes bypass Pakistan and theinsurgency-hit southern Afghanistan, while giving itaccess to Central Asia. In both cases as well as theNorth-South route, India will have to ship its goodsto the Iranian ports and then transport them by landinto Afghanistan and Central Asian countries in thenorth and the east. However, the sources admittedthat the intense U.S. pressure has put the Iran-Pakistan-India gas pipeline on the back burner forthe moment. While not involving Iran, a gas pipelinefrom Turkmenistan’s South Yolotan gas pipeline toAfghanistan, Pakistan and India is making rapidprogress. But Iran remains central in plans to sourcegas and oil from Central Asia, where politicalgoodwill for India has resulted in allocation of theSatpayev oil block in Kazakhstan despite intenseinterest shown by China. India is also discussing thesourcing of gas from Uzbekistan’s Karakalpakstanregion with talks having gathered pace during itsPresident Islam Karimov’s visit last year.

8. INDIA & ITS NEIGHBOURINGCOUNTRIES

India, Pakistan Resume Talks on TulbulProject

After a gap of four years, India and Pakistanwill resume talks in Islamabad on the Tulbulnavigation project, also known as the Wular Lakeproject, in Jammu and Kashmir.

Work was suspended in October 2007 afterIslamabad imposed it as a pre-condition for talks atthe government-level. Before that, the matter wasbeing handled at the level of the Permanent IndusCommission. According to informed sources, Indiawill seek an early resolution so that it can resumework on the project, which is located on the Jhelumriver in Jammu and Kashmir’s Baramullah district.

The Tulbul navigation project is located justbelow the exit of the Wular Lake, a natural lake. Indiaenvisages controlled release of water from the lakeduring the lean-season months of October to

February to facilitate year-round navigation forcommercial trade, employment and tourism.

New Delhi maintains that the regulatingstructure is permitted under the Indus Waters Treatyof 1960 for the non-consumptive use of navigation.Moreover, it holds that the project is beneficial forPakistan as well as to firm up lean-season watersupplies for its proposed projects and the Mangaladam in the PoK region. Pakistan, however, contestsit as a “storage project” and charges India withviolation of the provisions under the Treaty. In 1986,Pakistan threatened to resolve the issue through aneutral expert as was done in the case of the Baglihardam, or through an arbitration court as in theKishanganga project.

China in the Forefront in Building PowerProjects in PoK

Amid a cold war between the federalgovernment of Pakistan (GOP) and the governmentof Pakistan-occupied Kashmir (PoK) over the issueof building hydel power projects, China is taking alead role in their construction in the region.

This increasing presence of Chinese companiesin PoK comes amid the protest lodged by New Delhiagainst the “direct involvement” of China inrebuilding the Karakoram highway in Gilgit-Baltistan, the part of erstwhile Jammu and KashmirState and annexed by Pakistan. The highway wasseverely damaged in the floods last year and the workto rebuild it is going on at fast pace.

With a huge potential to generate power mainlyfrom two rivers — Jhelum and Neelum — flowingfrom Jammu and Kashmir, the GOP has paved theway for the Chinese companies for taking up workfor large-scale power generation. Though there hasbeen stiff resistance from PoK government to GOP’s“unilateral” decision , but it has not hampered thework by the Chinese.Neelum-Jhelum Tunnel

The main attraction is a $2.16-billion powerproject being constructed by the China InternationalWater and Electric Corporation (CIWEC). Sourcessaid around 700 Chinese workers are stationed inChattar Kalas, 20 km ahead of Muzaffarabad on theroad connecting Kashmir with Pakistan. A barbedwire demarcates the site with the local government



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showing the cost of the project on a signboard outsideit. The project envisages constructing a tunnelbetween Neelum and Jhelum rivers (which meet atDomel in Muzaffarabad city) to divert the water fromthe former to the latter. The work on the tunnel ison and the people are expecting a leap forward inpower generation. The project will generate 969 MWof power. Sources maintained that there is substantialinvolvement of Chinese companies in raising theheight of Mangla Dam in Mirpur to increase thecapacity of this 1100 MW project by 12 per cent andovercome the loss of power generation due tosiltation over the years since it was completed in1967. Another project on which they are working isKunaar-Patrind project, which will generate around147 MW of power.

Contracts for two more upcoming projectshave been awarded to China. They are the Kohala-Jhelum project of 1100 MW and Karot-Jhelumproject of 720 MW. The Kohala project has,however, been controversy that it was awardedwithout proper bidding. Media reports suggested thatsetting aside the Pakistan Procurement RegulatoryAuthority rules and without holding InternationalCompetitive Bidding, the contract has been given tothe state-owned China Three Gorges ProjectCorporation (CTGPC).

Members to Meet to Sort out Differenceson Afghan Investment

Sharp differences have cropped up betweencompanies in the 15-member consortium, especiallythe leading PSUs NMDC and Steel Authority of IndiaLimited (SAIL), over bidding for iron ore mininglicences at Hajigak mines in Afghanistan.

SAIL Chairman C. S. Verma has been activelypushing for making investments in iron ore miningin Afghanistan and has even favoured setting up of asteel plant there provided the Government ofAfghanistan provides the necessary infrastructurerequired for such a facility. Recently, differencescropped up between two leading PSUs — NMDCand SAIL — over consortium leadership, with theformer not favouring setting up of a steel plant inAfghanistan.

On its part, SAIL is of the view that a steelplant in the war-torn country would be an importantmilestone in further firming relations between the

two nations and has pitched for setting up a threemillion tonnes per annum plant while drawing ironore from the Hajigak mines. NMDC officialscontinued to be pessimistic about the steel plant butsaid the June 13 meeting would certainly help innarrowing down differences and firming up issues.

Besides SAIL and NMDC, companies like TataSteel, JSW, Jindal Steel and Power, Bhushan Steel,Monnet Ispat, Rashtriya Ispat Nigam are among the15 Indian companies short-listed by the AfghanistanGovernment.

Brahmaputra Waters will not beDiverted, Indicates China

The Chinese government indicated it wouldnot divert the waters of the Brahmaputra river, sayingit would take into “full consideration” the interestsof downstream countries in taking forward anydevelopment projects on the river. Chinesehydropower experts have also ruled out any plan todivert the river’s waters in the near future, describingproposals from some scholars to direct the flow ofthe river to China’s arid northwest as unfeasible.

Recent media reports in India suggested Chinawas considering a plan to divert the river’s waters,citing comments from Wang Guangqian, anacademic at the Chinese Academy of Sciences.

Among the proposed projects is a 38-gigawattdam at the “Great Bend” at Motuo, where the riverbegins its journey towards India. China said the damswould be built only to generate power and neitherdivert the river’s waters nor store them for irrigation.But environmental groups say even large hydropowerprojects could have a negative impact on India,affecting both the flow as well as the river’s fragileecosystem. In November, China began work on itsfirst major hydropower project on the river, a 510-MW project at Zangmu, which will come intooperation in 2014. Mr. Zhang said the Zangmuproject was an exception, and China had not yetapproved a comprehensive plan to take forward otherprojects.

Indian and Chinese officials have held talks onChina’s plans for the Brahmaputra, and also set upa joint working group mechanism to cooperate ontrans-boundary water issues. But experts say theabsence of a water-sharing agreement means Indiahas few means to verify Chinese claims, and has few



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options besides raising the issue in regular bilateraltalks.

Constitutional Amendments in BangladeshThe Bangladesh Parliament has passed a crucial

amendment to the Constitution, scrapping thecaretaker government system for holding polls andrestoring secularism but retaining Islam as the statereligion. Under the caretaker system, introduced in1996, general elections are overseen by non-partisancaretaker governments. The Constitution (15thAmendment) Bill, 2011 also brings in some otherfundamental changes in the context of the liberationwar against Pakistan, bringing back some principleswhich were deleted during military-rule. TheConstitution now also acknowledges the country’sIndependence War hero Sheikh Mujibur Rahman asthe Father of The Nation.

China Ready to Support Indian bid forUNSC

China was ready to back India on UnitedNations Security Council reforms and delink itsrelationship with Pakistan to take forward ties,Chinese officials have said. China was even readyto support India’s move for a permanent seat on theUNSC if India did not associate its bid with Japan,top Chinese diplomats told Sitaram Yechury,Communist Party of India (Marxist) Polit Bureaumember. Mr. Dai also “bent over backwards” toexplain that China was not against India’s bid for aseat in the UNSC — a recent sticking point in thebilateral relationship. China is the only one of fivepermanent members that is yet to back India’s bid.Mr. Dai told Mr. Yechury that China’s reluctance tovoice support was more sourced in India’s decisionto put forward its bid along with Japan, Germanyand Brazil, under the banner of the G4 group ofnations. He said China could never accept Japan’sbid because of “historical baggage”, and was henceopposed to the G4 grouping.

India and Pakistan to Increase Number ofCross-LoC Trading Days

While expressing their intention to normalisetrade between India and Pakistan, Foreign MinistersS.M. Krishna and Hina Rabbani Khar announcedenhancement of CBMs for trade and travel across the

Line of Control (LoC) that divides most of the twoKashmirs. Key among them are enhancing the numberof trading days from two to four a week, six-monthentry permits and encouraging travel for both tourismand religious purposes. While deciding to “respect”the list of 21 products of permissible items for cross-LoC trade, the Foreign Ministers agreed to furtherspecify permissible items.

On expanding cross-LoC travel to covertourism and pilgrimage also, both sides would workout the modalities, again in due course.

The six-month multiple-entry cross-LoC travelpermits would be allowed after completion of therequired formalities “at an early date.”

On trade proper between India and Pakistan,promises were held out on “early establishment” ofa non-discriminatory trade regime.

‘Composite Dialogue should Lead to furtherAgreements

Parliamentarians from India and Pakistanjointly called for consolidating the outcome of theComposite Dialogue, which has been going on forthe last 14 years, into further agreements.

They identified people-to-people contacts asthe most important confidence building measure(CBM) at the end of their second interaction this year.They decided to take up the issue of energy securityand, in particular, that of the Iran-Pakistan-India gaspipeline, whose fate is uncertain because of India’sreluctance to join the project. Urging theirgovernments to follow suit in deliberating on thepipeline, the parliamentarians said that economic tiesshould be boosted by removing the restrictions andconsidering a preferential duty regime. Theparliamentarians, who included influential as wellas emerging leaders from a wide political spectrum,asked their governments to resolve outstanding issuesthat were being discussed for well over a decade.

India, China seek to Remove LAC WrinklesEven as the media focus on last month’s

alleged confrontation between Chinese and Indiannaval ships, dismissed by diplomats here as a non-event, both governments are quietly working onremoving the occasional wrinkles that affect thelargely tranquil Line of Actual Control (LAC), whichserves as the boundary. China and India have an



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agreement ensuring that heavy military equipmentstay away from the border. Also in place in a pactprohibiting military exercises very close to the LACto avoid misinterpretation of the actual intentionsin case a large body of troops suddenly descends therefor war games. India and China will soon open talkson a mechanism that would solve issues arising outof military patrols coming face to face on the LAC.The negotiating brief will be taken up by the CabinetCommittee on Security (CCS) before the two sidesget down to hammering out an agreement on a“Working Mechanism for Consultation andCoordination on Border Affairs.” This will be oneof the few occasions when the draft of the negotiatingtext is first sent to the CCS for approval, say officialsources.

Krishna: India for Strong Ties withBangladesh

External Affairs Minister S.M. Krishna said Indiawas committed to building a strong partnership withBangladesh, including assistance in developmentalefforts and enhanced bilateral cooperation to mutualbenefit. Making a suo motu statement in the LokSabha on Prime Minister Manmohan Singh’sSeptember 6-7 visit to Bangladesh, he said the tripachieved a concrete progress in New Delhi’s effortsto develop and strengthen close and friendly relationswith Dhaka.

On the signing of border managementagreements, he said: “We hope that problems arisingfrom illegal border crossings and related difficultieswill be better addressed by both sides.” India’s effortsto resolve the border issues with Bangladesh reflectedits desire to make the country’s borders with theneighbours “borders of peace, stability and amity.”

On water treaties, he said: “we are keen toarrive at fair and equitable arrangements for sharingof our common rivers. We have experience of thisbefore, as in the Ganga Water Treaty of 1996. We,however, recognise that water is a sensitive issue inboth the countries. The government will worktowards arriving at solutions that are acceptable toall concerned.”

India would encourage people-to-peoplecontacts, greater cultural interactions and moreexchanges among persons, youth and scholars. Thetwo countries would remain engaged in the joint

effort to commemorate the 150th birth anniversaryof Rabindranath Tagore in an appropriate manner upto May 2012.

India, Sri Lanka Conduct Naval ExercisesThe Indian Navy gained from the Sri Lankan

experience with low intensity conflict, while the SriLankan Navy learnt to operate more effectively in amulti-force environment on the conclusion of thebiggest-ever exercise between the two Navies.

The exercises, “SLINEX II,” which commencedwere aimed at enhancing interoperability.

Involving 6 Indian state-of-the-art vessels of theEastern Command, and over 1,200 Indian navalpersonnel, and 11 Sri Lankan vessels and an almostequal complement of personnel, the exercises werekeenly watched by the international community andthe diplomatic corps stationed in Colombo.

India to train Afghan forcesIn a major development, India has agreed to

mentor the Afghan security forces as they gear up todeal with the drawdown of foreign forces by 2014.

The proposal has been on the drawing boardfor six years since Afghanistan President HamidKarzai first suggested it, but was not implementedas Pakistan was uncomfortable with the idea of India-trained forces on both its flanks. The proposal to trainthe Afghan National Security Forces was includedin the first-ever Strategic Partnership Agreement(SPA) signed by Mr. Karzai and Prime MinisterManmohan Singh during their third extensive meetingthis year. India has started stepping up its exposureto the security scenario in Afghanistan byoperationalising an airbase in Tajikistan, which hassince been used to strike at the top leadership of theIslamic Movement of Uzbekistan. It has also soughtpermission to reopen a hospital at Farkhor on theAfghan border. The two sides would also cooperatemore closely at the United Nations, one of theobjectives being to help India gain a permanent seaton the Security Council.

In addition to dealing with political andsecurity cooperation aspects, the SPA spells out tradeand economic cooperation in much greater detail,covering aspects ranging from assisting Afghanistanin developing trading routes to exploring forhydrocarbons and mineral ores the country is



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abundantly endowed with. This means both countrieswill try to operationalise their trilateral MoU signedwith Iran to end Afghanistan’s landlocked isolationand dependence on Pakistan to reach the sea. Itbrightens India’s chances of bagging a lucrativemining contract for Hajigak, said to be the region’slargest untapped reserve of iron ore, and provides anopportunity to hunt for oil in northern Afghanistan.Two MoUs — one in the field of mineral explorationand the other for the development of hydrocarbons— reflected the interest of both sides in these areas.

India and Bangladesh launch joint exerciseIndian and Bangladeshi forces launched a joint

exercise in the northeastern Sylhet as part of effortsto deepen military ties and cooperation in counter-terrorism and counter-insurgency operations.

An Indian Air Force plane, carrying 25members of an army team led by Major S.Y.Mahadik, reached Osmani International Airport inSylhet from Jorhat, a defence ministry statement said.

“This is the second phase of ‘Op Sampriti’which is aimed at developing professional expertiseof both the armies and strengthening military tomilitary relationship,” an army spokesman said. Thefirst phase of ‘Op Sampriti’ was held at Jorhat inAssam from November 1 to 4 last year. Indian Armysources earlier said the two sides would “practicecounter-terrorism and counter-insurgency operationsunder U.N. mandate.”

India, Myanmar agree to resolve borderissues

India sought to consolidate its ties withMyanmar by offering an additional $500-million lineof credit, agreeing to resolve border issues and stepup energy and trade links.

During a meeting between President ofMyanmar U Thein Sein, a former Prime Minister andnow head of an elected civilian government, andPrime Minister Manmohan Singh, both sides agreedto examine the feasibility of establishing railwaylinks, accelerate work on two hydel projects inMyanmar and reviewed progress on a route into theNorth-East which would supplement India’s sole linkto that part of the country via the Chicken’s Neck(Siliguri Corridor). Officials said the approach wassimilar to the one that New Delhi has followed with

its neighbours such as Sri Lanka, Bangladesh andNepal — addressing each other’s security concernsand building linkages in power, telecom andinterconnectivity by road, air, railways and sea.

Dr. Singh and Mr. Sein also touched upon theMoreh-Mae Sot road that would connect India andThailand via Myanmar. This would open up a directroad link between India and Association of SouthEast Asian Nations (Asean) besides accelerating the10-nation grouping’s plans for the Mekong-Gangacorridor, one of the three identified to enhanceconnectivity and industrial activity.

India, Nepal ink economic pactsBreaking the stagnation that marked bilateral

relations over the past two years, India and Nepalsigned major economic agreements, aimed atenhancing Indian investment and developmental aid.

In a meeting, Prime Minister Manmohan Singhand his Nepali counterpart Baburam Bhattarai arrivedat a broad political understanding, whereby Indiaexpressed its firm support to the peace andconstitutional process underway in Nepal.

The two sides formalised the long pendingBilateral Investment Promotion and ProtectionAgreement (BIPPA), which commits one State toproviding compensation to commercial entities,whose country of origin is the other. This appliesparticularly in cases of wars, national emergency, andarmed conflict. Investments from either country inthe territory of the other country are to be accorded‘National Treatment’ and ‘Most Favoured Nation’treatment. It also provides for elaborate disputeresolution mechanisms between investors and thegovernment concerned, and between governments,including international arbitration. Finance MinisterPranab Mukherjee and Nepal’s Industries MinisterAnil Jha, signed the pact in the presence of the twoPMs. The agreement’s overall objective is to promoteinvestment flows between the two countries.

Pakistan Military Exercises not Directed atIndia: China

China’s Ministry of National Defence saidannual joint military exercises with Pakistan, were“not targeted at any third nation” and were drillsfocused on combating terrorism, rejecting Indianmedia reports which said the exercises were aimed



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at India. The exercises, the Ministry said in astatement, were part of an annual exchange betweenthe two militaries, and would take place nearIslamabad. “This is the first joint drill of the twoarmies this year and is not targeted at any thirdnation,” the Ministry said in a statement issued tothe official China Daily newspaper.

A statement issued by the Pakistan Army’sInter-Services Public Relations in October said theexercises, named Youyi-IV (or “Friendship”), wereaimed at “mutual exchange of experience andinformation” and would “encompass techniques andprocedures involved in Low Intensity ConflictOperations environment.”

The exercises were started in 2004, withPakistan becoming the first foreign army to conductan exercise on Chinese soil, the statement said,adding that three exercises had been held since.

Manmohan’s Return Gift for Pakistan’sMFN Gesture

India Thursday asked Pakistan to put “all cardson the table” during the next round of comprehensivetalks so that both countries could actually movetowards resolving some of the issues bedevilling theirties. At an hour-long meeting between Prime MinisterManmohan Singh and his Pakistani counterpart SyedYusuf Raza Gilani, India announced a trade-relatedconfidence-building measure to match Pakistanaccording the most favoured nation (MFN) status toIndia. “We have wasted a lot of time in acrimoniousdebate in the past. The time has come to write a newchapter in relations,” Dr. Singh said after meetingMr. Gilani at a picturesque island resort on Villingili,just before the opening of the South AsianAssociation for Regional Cooperation (SAARC)summit.

Calling Mr. Gilani a “man of peace,” the PrimeMinister wanted both countries to join hands incombating terrorism so that this “perennial concern”did not affect relations again.

Full Normalisation of India-Pakistan tradeby 2012

With unequivocal political backing to theirendeavour, the Commerce Secretaries of India andPakistan, Rahul Khullar and Zafar Mehmood,decided to ensure full normalisation of trade in aphased manner by the end of next year. Followingtwo days of Commerce Secretary-level talks here, the

two sides agreed on a sequenced approach. In thefirst stage, Pakistan will move from the currentPositive List approach to a Negative List. Theconsultation process is almost complete and thesmall Negative List should be ready and ratified.Thereafter, all items other than those on the NegativeList can be freely exportable from India to Pakistan.

In the second stage, the Negative List will bephased out. The timing for this phasing out will alsobe announced. It is expected that complete phasingout will be completed before the end of 2012.

India tells China its Interest in Disputed sea‘Purely Commercial’

Amid negative vibes on border managementand exploration of South China Sea resources inrecent weeks, India and China reiterated theircommitment to developing the “best of relations.”Meeting on the sidelines of the Association of SouthEast Asian Nations (Asean) and East Asia Summit,Prime Minister Manmohan Singh and his Chinesecounterpart Wen Jiabao spoke the language ofcamaraderie as “large growing economies of Asia”and agreed on the need to work together as there was“enough space” and areas for them to work togetherfor mutual benefit.

The exploration of oil and gas resources in theSouth China Sea and border management came upduring the 55-minute meeting. Dr. Singh maintainedthat Indian exploration of oil and gas in the SouthChina Sea was “purely commercial.” He did conveyto Mr. Wen that the issue of sovereignty over the Seawaters should be resolved according to internationallaw and practice.

The Indian activity in the South China Sea wasraised by Dr. Singh in the context of China’smisgivings over a recent pact between India andVietnam on oil exploration. Jurisdiction over theterritorial waters of the Sea is a bone of contentionbetween China and several south-east Asian nations,including Vietnam. Maintaining that the issue needsto be resolved in accordance with the internationallaw and practice, India is stressing the freedom ofnavigation and right to passage in these waters givenits importance as a trade route.

China signs Contract for Indian OceanMining Rights

China signed a long-expected contract, whichhas drawn much attention in Indian strategic circles,



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under which the China Ocean Mineral ResourcesResearch and Development Association (COMRA)will get exclusive rights to explore 10,000 square-km of seabed in the southwest Indian Ocean in anarea off the coast of Africa, state media reported.Under the deal with the International SeabedAuthority (ISA), COMRA can explore polymetallicsulphide ore deposits in the region over the next 15years. COMRA will have to give up 75 per cent ofthe region within 10 years, following which it willhave pre-emptive rights to mine the remaining area,according to the state-run Xinhua news agency. Thedeal also requires China to fulfil certainenvironmental obligations and monitoring. In India,the deal has drawn attention on account of a Chinesefirm gaining access to the Indian Ocean, with reportssaying the Directorate of Naval Intelligence hadexpressed concern that COMRA’s access could havestrategic implications for India’s security.

Analysts in India have also seen the deal as areflection of India’s own failure to be more proactivein better utilising mining exploration rights in theIndian Ocean, thereby giving space for othercountries.

In Bangladesh, Tipaimukh Dam Pact SparksFresh Row

Though the Ministry of External Affairs haspromised to provide Bangladesh with details of theagreement on the construction of the TipaimukhDam in Manipur, the very signing of the deal hassparked a fresh controversy. Following media reportsand criticism, the Bangladesh Foreign Ministry issueda statement, disclosing that India had promised togive details of the deal signed recently by NationalHydro Power Company, Sutlej Jal Vidyut Nigam Ltd.and the Manipur government to build the 1,500-MWproject. Environmentalists and agriculture expertshave warned that the twin dams, at Tipaimukh andPhulertal, across the cross-border Barak river woulddry up rivers and waterbodies downstream, renderingvast farmland arid, hitting agriculture and threateningfood security in the north-eastern districts ofBangladesh.

India, Nepal sign Revised Taxation PactIndia and Nepal signed a revised Double

Taxation Avoidance Agreement (DTAA), with the aimof encouraging Indian investment in Nepal,preventing fiscal evasion, and easing procedures for

stakeholders with commercial interests in bothcountries. The treaty, based on modern taxationprinciples and in line with the current internationalenvironment, will replace the agreement on doubletaxation avoidance signed in 1987. Mr. Mukherjeetold journalists, “The revised DTAA will provide taxstability to the residents of India and Nepal andfacilitate mutual economic cooperation as well asstimulate the flow of investment, technology andservices between India and Nepal.”

Opposition to India’s Hydel Projects inBhutan

The winds of democracy are making it harderfor India to negotiate the construction of mega hydelprojects in Bhutan. Fixing terms and conditions forbringing power from Bhutan was a cakewalk withthe first three hydel projects five years ago. Withnewspapers other than the Kuensel , a tiny but vocalOpposition in Bhutanese Parliament and exiledleaders raising issues relating to sovereignty, Indianofficials are now having to work harder during talksto bring about the closure of agreed upon hydelprojects with a capacity to produce 10,000 MW ofpower. Is Bhutan then heading for a Nepal-typesituation where Pancheshwar and Sapta Kosi projectshave not taken off after 15 years or more ofnegotiations? The situation in Bhutan does not evenremotely resemble that of the Indian hydel projectsin Nepal where decades of street-level activism hasmade a large number of them non-starters, explainthe officials. But as eastern Bhutan allegesdiscrimination and voices in Parliament and on theNet demand that Thimphu adhere to the policies ithas framed, both governments are trying to meet theirlegitimate aspirations.

Krishna Pitches for a Marshall Plan-likeInitiative for Afghanistan

Warning against the dangers of abandoningAfghanistan, India exhorted the internationalcommunity to stay engaged for the long term toeliminate “sanctuaries of terror” and pitched for aMarshall Plan-like initiative to help rebuild theviolence-torn country.

External Affairs Minister S.M. Krishna, who isrepresenting India at the Bonn conference on thefuture of Afghanistan, also underlined New Delhi’senduring commitment to the rebuilding of thatcountry for which it has already pledged $2 billion.



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“The international community needs to stayengaged in Afghanistan for the long term, for bothits security and development,” said Mr. Krishna atthe conference that is aimed at firming up a roadmapfor Afghanistan’s future beyond 2014 wheninternational combat troops are expected to leave thatcountry. Alluding to the rationale of the internationalinvolvement in Afghanistan, Mr. Krishna stressed thatthe root causes of intervention — the dangers ofterrorism and radicalism — remain as potent as ever.The Marshall Plan was devised by the U.S. to providemonetary support to Europe to help rebuild itseconomies after the end of World War II and tocombat the spread of Soviet Communism.

Alluding to key initiatives by India, whichinclude the setting up of an agricultural universityand training Afghan students, he reiterated that Indiancompanies are “willing to invest up to $10 billionin mining, setting up a steel plant and relatedinfrastructure in Afghanistan”. An Indian consortiumof seven companies led by Steel Authority of Indiahas won the right to develop three iron ore blocks inthe Hajigak deposits in central Afghanistan. “We needto offer a narrative of opportunity to counter theanxiety of withdrawal, uncertainty, instability andforeign interference,” said Mr. Krishna.

China begins Joint Patrol of the MekongChina began deploying a more-than-200-strong

police force to patrol the Mekong river as part of anew joint initiative with Thailand, Myanmar andLaos to boost regional security following recentattacks on ships. The launching of the patrol markedthe resumption of international shipping on theMekong. Trading activities were suspended after anOctober attack on two cargo ships that left 13Chinese sailors dead.

The Mekong river, which has its source inChina and flows through the three other countriesas well as Cambodia and Vietnam, is a transportartery in the region. Shipping has suffered followingthe October attack, which underscored persistingsecurity fears amid a rise in regional smugglingnetworks and the drug trade.

No Indian Ocean Military base: ChinaChina said its naval fleet would only seek

supplies or recuperate in the Seychelles during anti-piracy operations, denying reports that Beijing mightbreak with its long-standing policy on overseas

military bases with a presence in the Indian Oceanarchipelago. The Defence Ministry reaffirmed thatpolicy, saying its ships would only resupply in theSeychelles, as they were already doing in othercountries such as Oman and Yemen, whileparticipating in anti-piracy escort missions.

Seychelles Foreign Affairs Minister Jean-PaulAdam said his government had invited China “to setup a military presence” on the archipelago to helpfight the regular attacks by pirates, Agence France-Presse (AFP) reported. The Seychelles has soughtgreater assistance from a number of countries to boostits capabilities to combat piracy, including India andthe U.S. While the U.S. already had a drone basethere to help anti-piracy operations, India agreed lastyear, following the visit of Defence Minister A.K.Antony to Mahe, to provide a new Dornier aircraftand two Chetak helicopters for maritime surveillance.

India Asks Pakistan to join FMCT talksWhile emphasising restraint and responsibility

in the management of nuclear weapons, India hasexpressed the hope that Pakistan would begin talkson joining the Fissile Material Cut-off Treaty (FMCT)at the next Conference on Disarmament (CD).

Pakistan is the only hold out at the CD among65 countries in substantial talks on the FMCT, aproposed pact that will ban the production of nuclearbomb making material. The FMCT is considered bymany to be a key step towards effective nucleardisarmament and even if Pakistan agrees, manydifferences remain to be sorted out among the majornuclear weapons states on issues of scope,verification and permissible activities.

The issue came up at the sixth round of talkson nuclear and conventional confidence-buildingmeasures (CBMs) held in Islamabad which saw bothsides expressing satisfaction with the existing set oftwo nuclear related CBMs – advanced notificationabout ballistic missile launches and nuclearaccidents. India feels the FMCT could serve as astepping stone for a more serious global push towardsdisarmament. “India has been prepared for a whileand Pakistan was informed that it was also ready tojoin the talks if Islamabad agreed,’’ said sources privyto the talks.

India, Pakistan Exchange Nuclear ListsIndia and Pakistan exchanged their lists of

nuclear installations and facilities, a practice being



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followed for the last two decades under a pactprohibiting attack on each other’s nuclear assets. The“Agreement on the Prohibition of Attack againstNuclear Installations between India and Pakistan,”was signed on December 31, 1988 and it came intoforce on January 27, 1991. It provides that the twocountries inform each other of the installations andfacilities to be covered under the agreement onJanuary 1 every year. This is the21{+s}{+t}consecutive exchange of such lists, thefirst one having taken place on January 1, 1992.

Connectivity will Generate EconomicVibrancy: Hasina

Bangladesh Prime Minister Sheikh Hasina saidthe connectivity between India and Bangladesh,particularly with the northeastern States, includingTripura, would generate tremendous economicvibrancy, leading to peoples’ empowerment andoverall development of the region. Ms. Hasina, whowas on a two-day visit to Tripura, urged India, Nepaland Bhutan to make the best use of the Chittagongand Mongla ports, which Bangladesh had alreadyopened for these neighbouring countries, to accessthe sea route for their trade and commercial activities.

She expressed confidence that the initiativewith Tripura, including the Akhaura-Agartala rail link;operation of Ashuganj as a multimodal trans-shipment point under the Protocol on Inland WaterTransit and Trade for transportation of Indian goodsto Agartala; transportation of Over DimensionalCargo for the Palatana power project; the bridge overthe Feni river; use of the Chittagong and Mongla Portsby India, Nepal and Bhutan; operation of theRamgarh-Sabroom Land Custom Station; and fournew border haats (markets); when implementedwould enhance Tripura’s development.

India, Nepal to share Terror InformationReal-time

India and Nepal discussed cooperation incountering cross-border crimes and terrorist activities,and decided to join hands in sharing terror-relatedinformation on a real-time basis.

Being held after a gap of two years, the high-level meeting took stock of security cooperation anddecided that henceforth the Home Secretary of eithercountry telephonically hold discussions with hiscounterpart or seek cooperation on any terror-relatedissue on a real-time basis.

India, China to set up Working Mechanismon Border Management

A day after beginning talks on the boundaryquestion, India and China agreed to set up a workingmechanism on border management to deal withimportant affairs related to maintaining peace andtranquillity in the border areas.

The working mechanism, mooted by ChinesePremier Wen Jiabao, was finalised at the conclusionof the 15th meeting of the Special Representatives(SR) on the boundary question — National SecurityAdviser Shiv Shankar Menon and Chinese StateCouncillor Dai Bingguo.

The agreement to establish the “WorkingMechanism for Consultation and Coordination onIndia-China Border Affairs’’ was signed by India’sAmbassador to China S. Jaishankar and China’sAssistant Foreign Minister Liu Zhenmin.

The working mechanism will “study ways andmeans to conduct and strengthen exchanges andcooperation between military personnel andestablishments of the two sides in the border areas.’’

“The Working Mechanism will address issuesand situations that may arise in the border areas thataffect the maintenance of peace and tranquillity andwill work actively towards maintaining the friendlyatmosphere between the two countries,’’ accordingto the text of the agreement, released by the ExternalAffairs Ministry. The working mechanism will holdconsultations once or twice every year, alternatelyin India and China. Emergency consultations, ifrequired, may be convened after mutual agreement.

China’s Rail Network to Touch India’sBorder

China has announced it will accelerate plansto expand a railway network in Tibet to reach twotowns near the border with India and will alsoconsider building a railway line to Nepal. Newrailway lines from Lhasa to Xigaze (Shigatse inTibetan) and the town of Nyingchi, which lies in aprefecture bordering Arunachal Pradesh, will be builtas key projects under a five-year development plan(2011-15) for the Tibet Autonomous Region (TAR).Separately, the State-run Xinhua news agency carrieda report indicating that the construction of a railwayline from Tibet to Nepal was discussed during PremierWen Jiabao’s visit last week to Kathmandu. “Therailway which will join Nepal and the Tibet



India & The World



Autonomous Region of China will further strengthenties between the two countries,” Xinhua quotedNepal President Ram Baran Yadav as saying.

Chile for Partnership with India inRenewable Energy Sector

President of the Senate of Chile Guido Girardicalled for partnership between his country and Indiain the renewable energy sector, saying that his countryhad decided to achieve 20 per cent of its energy needsthrough renewable energy sources by 2020. He saidChile, one of the world’s largest copper producers,needed more energy resources, to double investmentsin copper industry.

He said India and Chile could also explorecooperation in areas of biotechnology, agriculturesciences, food processing, ocean water desalinationand transportation. Mr. Girardi said his countrypossessed rich lithium and suggested India could uselithium-based batteries to power electric vehicles.

India, Bangladesh to Resume talks on TeestaTreaty

India and Bangladesh will take the first steptowards revisiting the proposed Teesta river treatywhen officials exchange river flow data at a technicalmeeting of the inter-governmental Joint RiversCommission in Kolkata.

India had put the treaty on hold after WestBengal Chief Minister Mamata Banerjee, unhappyover the treaty’s provisions, pulled out of PrimeMinister Manmohan Singh delegation to Dhaka lastyear. While agreeing to put off the signing of theTeesta Treaty, Dhaka had asked New Delhi to ensurethat the agreement would be examined after sometime. An agreement is expected to pave the way forthe signing of a similar agreement on the Feni riverand five minor ones — Dudh Kumar, Manu, Khowai,Gomti and Muhuri.

The sources said West Bengal or any of theother State through which over 50 rivers flow intoBangladesh will be kept in the loop while signingwater sharing agreements. The States were briefed andtheir advice taken during negotiations on a protocolon land boundary that was signed during Dr. Singh’sSeptember 2011 visit to Dhaka.

Month after Border Talks, Chinese Papersays Aksai Chin is a Closed Chapter

A month after India and China held the

fifteenth round of border talks, a commentary in aChinese newspaper has questioned India’s claims onKashmir and asserted that the only dispute was overthe status of Arunachal Pradesh.

The commentary said: “The Indian sidebelieves that the border dispute between China andIndia covers not only the eastern region of 90,000sq km but also the western region of 30,000 sq kmand the western region is India’s too. This wrongargument, which totally disregards the history, stillhas supporters in India.”

In New Delhi last month, National SecurityAdviser Shivshankar Menon and Chinese StateCouncillor Dai Bingguo, the two SpecialRepresentatives, discussed a framework for thesettlement of disputes in all three sectors — western,middle and eastern. This was in keeping with the2005 agreement on Political Parameters and GuidingPrinciples, which marked the ending of the first ofthree stages of negotiations.

According to Article III of the agreement, theboundary settlement would be “final, covering allsectors of the India-China boundary.”

While this continues to remain the officialposition, both sides have repeatedly stressed theirclaims on the territories under their effective control— Arunachal Pradesh in the east and Aksai Chin inthe west — ruling out any concessions, resulting ina stalemate. There were two different disputes in thewestern sector — Aksai Chin and the territory froma 1963 Chinese-Pakistani agreement, said M. TaylorFravel, Associate Professor of Political Science at theMassachusetts Institute of Technology, who haswritten extensively on the border dispute.

Under the 1963 Sino-Pakistan treaty, which,he said, “contrary to the conventional wisdom inIndia” favoured Pakistan, China kept around 5,300sq km of land that Pakistan claimed, but transferredto Pakistan 1,942 sq km of land in the Oprang Valleyand dropped claims to an additional 1,554 sq km ofland.

Bangladesh, Nepal, India Discuss WaterSharing

Bangladesh, Nepal and India are discussingcollaboration in river water sharing, an emotive issuein all three countries, highly placed sources said.“There could be a tri-nation meeting very soon. Weare working on it.” Bangladesh has been the mostenthusiastic about a sub-regional water sharing



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arrangement and India, lukewarm. The move isaimed at keeping in step with the other linkagesdeveloping among these countries in the form of rail,road and maritime connectivity as also in the powersector. The sources said the tri-nation initiative on acommon basin management of rivers could in futurebe expanded to include other countries, especiallyChina, which is the source to the Brahmaputra, themightiest river in the eastern part of the Indiansubcontinent.

While this tri-nation initiative will take timeto take shape, India for now is focussing on the actualdeliverables — with Bangladesh it is activelynegotiating the Teesta treaty, which should give wayfor one on River Feni, and with Nepal the ambitious,multipurpose project approach to shared rivers hasbeen tempered by misgivings in political circles inKathmandu.

China Denies River DiversionChina rejected reports in India suggesting that

the dam it is building upstream on the Brahmaputrariver was causing its lower reaches to dry up, andreiterated its commitment to Indian officials that ithad neither embarked on any diversion projects norbuilt any large dams in Tibet.

Foreign Ministry spokesperson Hong Lei toldreporters that China had not developed any newprojects, besides the Zangmu dam on the river’smiddle reaches, work on which began in 2010 andwhich is a run-of-the-river project that would haveminimal impact downstream.

“Our projects have not affected the lowerstream regions,” he said. “Overall, the utilisation ofChinese side of the Tsangpo River is very low.”

Mr. Hong also pointed to statements made byExternal Affairs Minister S.M. Krishna and otherofficials in New Delhi rejecting suggestions fromofficials in Arunachal Pradesh that the drying up ofthe Siang river, as it is known in the State, was theresult of a Chinese diversion project. He said theZangmu dam was the only project that China hadbuilt on the Yarlung Tsangpo, as the Brahmaputra isknown in Tibet.

Chinese officials and engineers haverepeatedly ruled out diversion projects, citing thedifficult terrain of the Tibetan plateau. A number ofhydropower lobby groups have, however, pressuredthe Central government to give the green light forlong-pending proposals on a number of other dam

projects. As many as 28 dams have been proposedon the Tsangpo, including a 38-gigawatt plant atMotuo where the Brahmaputra begins its coursetowards India. Work has not started on any of theprojects, officials have said.

India Prefers International Arbitration forTulbul Row

India has indicated to Pakistan that it is nolonger willing to indefinitely discuss the Tulbulnavigation/Wullar lake project in Kashmir and mayseek international arbitration to resolve the twodecades-old dispute. This message was conveyed atthe two-day Water Resources Secretary-level. WaterResources Secretary Dhruv Vijay Singh led the Indiandelegation, while the Pakistan team was headed byImtiaz Kazi, Secretary, Water and Power. The twosides are already in arbitration over the Kishengangaproject in Jammu and Kashmir. Earlier, Pakistansought arbitration by a neutral expert on India’sBaglihar hydel project in the State. Keen to resolvethe long-pending Tulbul dispute, India has agreedto provide Pakistan additional technical data. Theproject, planned on the Jhelum, has been suspendedsince 1986 after Pakistan raised objections. The issuenow forms part of the Composite Dialogue betweenthe two countries. India said if no solution wasforthcoming, would prefer to go in for arbitration.New Delhi maintains that the Tulbul navigationproject, located just before the exit of the Wullar lakeon the Jhelum, is within its rights under the IndusWater Treaty of 1960.

9. INDIA & NORTH EAST ASIA

India-Korea Civil Nuclear Cooperation onAgenda of President’s visit

Discussions on a civil nuclear cooperationagreement between India and the Republic of Koreaare on the agenda of President Pratibha Patil’s seven-day visit to Korea and Mongolia.

Although on the sidelines of the Asean-IndiaSummit in Hanoi last year, an agreement wasannounced in principle, it has not yet beenformalised. In October 2010 in Hanoi, NationalSecurity Adviser Shivshankar Menon had announcedafter a meeting between Prime Minister ManmohanSingh and Korea’s President Lee Myungbak that thetwo countries “have finalised an agreement on



India & The World



cooperation in civil use of nuclear energy” and this“now awaits signature.” India could be looking atthe possibility of using Mongolia’s coking coal, itwas said, even as government officials admittedtransportation cost of coal from Mongolia to Indiawould be prohibitive. The high profile visit is partof India’s “Look East” policy formulated in 1992.

With Korea, there have been regular high-levelvisits and strengthening of bilateral relations againstthe backdrop of a booming trade that grew by 40 percent to $ 21 billion in 2010 with a target of $ 30billion for 2014. Over 300 Korean companies arepresent in India.Vishnu Prakash, spokesperson for theMinistry of External Affairs, said a number ofagreements will be signed in Seoul and inUlaanbaatar, but he declined to spell out the details.However, it is confirmed that a strong Indian businessdelegation will be present in the capitals during thevisit with a view to taking forward economicrelations.

India will participate in Nuclear SecuritySummit in Korea: Pratibha

President Pratibha Patil has expressedconfidence that the India-South Korea Agreement onCooperation in the Peaceful Uses of Nuclear Energy,signed during her just-concluded state visit to Korea,would enable the two countries to cooperate in thisarea. The initiative aims at supporting all measuresessential for the global security architecture,especially those that help prevent nuclear materialsfrom reaching the hands of terrorists. Last year in April,U.S. President Barack Obama hosted the NuclearSecurity Summit attended by 47 nations.

In Korea, she told President Lee Myung-bak thatIndia looked forward to launching Korean satellites.She also expressed the desire to upgrade the existingbilateral Comprehensive Economic Partnership,while seeking greater market access for Indian goods,especially pharmaceuticals and IT-enabled servicesas well as enhanced Korean investment in India. TheKorean Minister of Foreign Affairs and Trade will visitIndia later this year, she told journalists.

In Mongolia, President Tsakhiagiin Elbegdorjand she signalled a wish for deepening economicrelations and enhanced trade, while a defence pactsigned by the two countries during her visit wouldadd “depth and substance to India-Mongolia ties.”

In response to a question, she said womenpoliticians, including parliamentarians in Mongolia,who called on her, showed interest in the proceduresin India for legislating on reservation for women inParliament and State Assemblies. As India was tryingto build a consensus on 33 per cent reservation, theMongolian women in politics said they coulddemand an increase from their current 25 per centreservation if India were to legislate on this.

India to Cut Duties on Diesel Engines,Gearboxes from Japan

India is all set to drastically reduce duty on anumber of items including diesel engines and gearboxes imported from Japan as the newComprehensive Economic Partnership Agreement(CEPA) between the two countries comes into force

The first meeting of the Joint Committee willbe co-chaired by Commerce Secretary Rahul Khullarand Ambassador of Japan to India Akitaka Saiki hereon Monday. The committee is the main body thatmonitors the implementation of the Agreement.

Under the CEPA, signed in February, the twocountries will eliminate import duties on 94 per centof their trade items in 10 years. The agreement coversgoods, services such as telecom and finance,movement of professionals, customs procedures andcooperation in other areas.

The agreement will boost bilateral trade, whichmay touch $25 billion by 2015 from the present$12.35 billion. India and the 27-nation EuropeanUnion (EU) have been negotiating hard over a similarpact since June 2007, which is likely to be concludedby the end of 2011.

Japan has put 87 per cent of their tariff linesunder immediate tariff liberalisation. A large numberof these items are of India’s export interest andinclude seafood, agricultural products such asmangoes, citrus fruits, spices, instant tea, most spiritssuch as rum, whiskies, vodka etc, textile productssuch as woven fabrics, yarns, synthetic yarn,readymade garments, petro chemical and chemicalsproducts and cement jewellery.

Japan will give equal treatment to applicationsof Indian companies. This will greatly helppharmaceutical firms. Indian professionals will beable to provide their services and contribute to furtherdevelopment of Japan’s IT sector. Indian exporters



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of sea foods, spices and textile products will benefitas a result of immediate removal of tariff.

India, Japan to firm up Strategic TiesDespite Nuclear Stalemate

Despite stalemated talks on a civil nuclearagreement and political uncertainty surrounding thecontinuation of Japanese Prime Minister Naoto Kan,New Delhi and Tokyo have chalked up a series ofhigh-level engagements to firm up their strategic ties,especially in the security and economic spheres. Inwhat could be a disappointment for South Block,India’s quest for a nuclear pact with Japan found nomention in a detailed Japanese government responseon Friday to a question by the Opposition LiberalDemocratic Party In a statement, the Japanesegovernment requested the Diet to approve civilnuclear accords with Jordan, Russia, South Korea andVietnam, according to diplomatic sources. Eventhough its name found no mention, India, whosecivil nuclear talks with Japan have not resumed sinceNovember last year, could find some cheer in Tokyo’saffirmation to continue exporting nuclear powerplants despite the crisis at the tsunami-hit Fukushimanuclear plant. But away from the headline-grabbingcivil nuclear sector, both countries have lined upseveral high-level engagements aimed at extendingmaritime cooperation beyond India’s immediatevicinity. The two sides are also closing the gaps in amega project that will build futuristic townshipsfrom Delhi to the western coast — the Delhi MumbaiIndustrial Corridor (DMIC) — along a high speedrailway track called the Dedicated Freight Corridor(DFC).Trilateral Meeting

On top of the diplomatic agenda is the firstU.S.-Japan-India trilateral meeting which could betimed around the East Asia Summit (ten ASEANmembers along with observers) in November. Withthe U.S. getting into the framework of the EAS, thereis “good reason for us to start the trilateral dialoguein time for the EAS,’’ said the sources. “All of usthink maritime security is very important and Indiashould be involved, not only on its side of the IndianOcean.’’ The second Japan-India 2 + 2, a rare formatfor India simultaneously involving the Foreign andDefence Secretaries, would also be held around the

same time. The meetings are likely to see Japan beingincluded in the Malabar series of India-U.S. navalexercises in a big way. The last Malabar seriesexercise, held in April off Okinawa, had a similarintention of involving a strong Japan Self DefenceForces (SDF) complement. But the tsunami whichoccurred a month earlier led to SDF diverting shipsfor rescue and rehabilitation.

India to Reopen CEPA with South KoreaDays after having inked a civil nuclear

agreement with South Korea, India will reopen theComprehensive Economic Partnership Agreement(CEPA) to make it more contemporary and furtherstrengthen trade ties with the East Asian tiger.

The first round of talks on “upgrading” theCEPA will begin, with an Indian team due to visitSeoul. Since 2009, when the India-South Korea CEPAwas sealed, both countries have shed theircautiousness and offered better terms to othernations. India has offered lower tariffs to othercountries with which it has made similar agreements,while South Korea too has been more liberal inoffering access to other countries. “We finalised theIndia-South Korea CEPA in 2009. Since then, theground realities have changed. They have made offersto other countries that go way beyond what wasoffered to us. This will help increase trade muchfaster,” said government sources. Trade with SouthKorea stood at $7.1 billion in 2006. The CEPApropelled it to $17.5 billion in 2010 — an increaseof 46 per cent over the previous year, with growthrates of exports being the same for both countries.The expectation from bilateral trade this year is $21billion — very much on course to touch the targetof $30 billion set for 2014. “Thanks to the CEPA,exports by both countries have risen. We arebeginning to see Indian IT companies getting afoothold in South Korea because of CEPA,” said thesources.Civil Nuclear Agreement

Even as the government reopens the CEPA, itis keeping its eyes fixed firmly on the civil nuclearagreement signed during President Pratibha Patil’srecent visit to Seoul. The text of the civil nuclearagreement was frozen at next February and offers Indiaanother option for setting up civil nuclear plants



India & The World



besides the three big boys of this sector — the U.S.-Japan, France and Russia. A high-level visit fromSeoul later this year will help bring more depth tothe agreement, said the sources.

“This agreement adds another dimension to thepossibilities for India to access civil nucleartechnology from another country,” said the sources.South Korea stunned the civil nuclear community bypipping the French giant Areva in a limited tenderto bag $20 billion worth of orders from the UnitedArab Emirates for building four nuclear plants. KoreaElectric Power Corporation has already signed aMemorandum of Understanding with the NuclearPower Corporation of India Limited.

Traditional mindsets and cultural sanctionsprevent fulfilment of U.N. obligations:India

Traditional mindsets and culturally sanctionedpractices continue to affect the degree of fulfilmentof obligations under the Optional Protocol to theConventions on the Rights of the Child, the Sale ofChildren, Child Prostitution and Child Pornography,2011, India has told the United Nations. It hasadmitted to lack of awareness and the inadequacyof shelter homes and rehabilitation.

India has said this in its initial report on thestatus of implementation of the Optional Protocolfor consideration by the United Nations Committeeon the Rights of the Child (UNCRC).

Pointing out that India has spearheaded manyof the organisation’s initiatives, with enthusiasticsupport from the respective Ministries, Stategovernments, international organisations and the civilsociety organisations, the report says that variousfactors and difficulties continue to affect the degreeof fulfilment of these obligations.

The recently-launched Integrated ChildProtection Scheme will contribute to theimprovement of the well-being of children in difficultcircumstances and reduction of vulnerabilities, buttraditional mindsets and culturally sanctionedpractices, such as devadasi ,continues to exploityoung girls. Displacement and unsafe migration,which leaves a large number of children in urbanpoverty, majority of them living in informal andillegal settlements such as railway lines and on the

street, makes them vulnerable to exploitation, thereport says.

Inadequate facilities, especially counsellingservices and vocational skills training, creation ofnew options, and strengthening the existing initiativesfor the rehabilitation of children in institutions tooare far from satisfactory.

The Protocol was ratified by India onSeptember 16, 2005.

India, Vietnam sign pact for oil explorationin South China Sea

Unfazed by Chinese objections, India andVietnam inked an agreement to promote oilexploration in South China Sea along with a slew ofpacts, including an extradition treaty, to deepentrade, security and strategic ties between the twocountries.

Six agreements were signed after VietnamesePresident Truong Tan Sang and Prime MinisterManmohan Singh held comprehensive talks here onissues of mutual interest, including situation in theregion where they decided to launch a biennialSecurity Dialogue between their Home Ministries.

“India and Vietnam are maritime neighbours.We face common security challenges from terrorism,piracy and natural disasters. We believe that it isimportant to ensure the safety and security of the vitalsea lanes of communication. We have agreed tocontinue and strengthen our exchanges in thesefields,” Dr. Singh told journalists after the meeting.

The pact between the Indian and Vietnamesestate-owned oil companies includes new investmentsand the exploration and supply of oil and gas to thetwo countries. Irked by the Indian explorationprojects on Vietnamese blocks in South China Sea,Chinese authorities raised objections claiming thatit was in their area.

The Chinese claim on the South China Sea hasbeen rejected by both India and Vietnam, saying asper the U.N., the blocks belong to Vietnam. Indiahas also made it clear that its State-owned firm wouldcontinue to explore in the resource-rich South ChinaSea. In the field of security cooperation, the twocountries instituted a mechanism of a biennialdialogue on security issues between Ministry ofHome Affairs and its Vietnamese counterpart.



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“The Extradition Treaty signed today willprovide a legal and institutional basis for ourcooperation,” Dr. Singh said.

The two sides also decided to increase the tradetarget to $7 billion by 2015 from the present markof $2.7 billion apart from agreeing to work towardsearly finalisation of the India-ASEAN Free TradeAgreement in Services and Investment. This is thefirst visit by the Vietnamese President outside theASEAN region and reflects the importance attachedby both sides to the relationship, Dr. Singh said.

Japan Exempts India from ODA cutsAs Japan emerges from political instability

triggered by the fall of the Naoto Kan government,Tokyo has said that India will be exempted from cutsin Overseas Development Assistance (ODA)enforced on other countries following the tsunamiand the Fukushima disaster in March-April of 2011.

India, the highest recipient of Japanese ODAsince 2003 will thus maintain its pole position. Theaffirmation about Japanese commitment to helpingIndia’s infrastructure and social sectors came aheadof External Affairs Minister S.M. Krishna’s for theFifth India-Japan Strategic Dialogue on October 28and 29. Japan’s signal on ODA aid coupled with Mr.Krishna’s discussions on strategic issues includingmaritime security will set the stage for a visit byDefence Minister A.K. Antony.

Officials are trying to squeeze in a 2+2involving Defence and Foreign Secretaries from bothsides as also coordinate the dates for an India-Japan-U.S. trilateral. Diplomats are trying to time thistrilateral around the East Asia Summit — 10Association of South East Asian Nations along witheight observers — during which maritime security,especially in the South China Sea, would be discussedextensively.

Japan Keen on having Civil Nuclear Dealwith India

Notwithstanding the Fukushima incident,Japanese Prime Minister Yoshihiko Noda made it clearthat his country was keen on having a civil nucleardeal with India, hoping that it will be finalised soon.Mr. Noda, who is on an official visit to India,welcomed the progress in talks with India on abilateral civil nuclear deal and expressed the hope

that it will be finalised soon. He hailed India’s self-imposed moratorium on no-first use of nuclearweapons and hoped this stance would continue.“Japan is the only country which was attacked by anuclear weapon,” he said, adding that its safe usewas the tenet for his country’s relations with othernations. The Japanese Prime Minister maintainedthat there was a huge potential for cooperationbetween the two countries in the field of business,people-to-people contact and in forging a globalstrategic partnership.

He pointed out that while there were only 800Japanese companies working in India, there were20,000 Japanese firms in China and insisted 800 wastoo small a number and should be increased. He alsounderlined the need for expansion of bilateral trade.

He said “we are very much on course” toachieve the bilateral trade target of $25 billion by2014. The Japanese government has committed $ 4.5billion for the Delhi-Mumbai Industrial Corridorproject. The project is aimed at creating world classindustrial infrastructure along the Delhi-Mumbai RailFreight Corridor, which is under implementation.The bilateral trade between the two countries saw arobust increase of 24 per cent to $13.2 billion duringJanuary-September period on the back of the mutualfree trade agreement. Under the FTA, officiallyknown as the Comprehensive Economic PartnershipAgreement (CEPA), the two countries have slashedduties on large number of items of trade. As asignificant concession under the pact, Japan has givenaccess to Indian pharmaceutical products.

As trade Soars, India and Korea push‘Strategic’ side to ties

India and the Republic of Korea signed anuclear cooperation agreement last year. Since asimilar agreement with Japan is still some distanceaway, Korean capabilities in building reactor vesselswould be of use not just for bilateral projects butalso for third-country suppliers like Areva whonormally source components from Japanese firms.

The joint statement backed ASEAN’s leadershipof the East Asia Summit (EAS) process and welcomedthe U.S. and Russian membership of the EAS. Thetwo leaders also welcomed the idea of a trilateraldialogue between India, ROK and Japan at the Track-II level. Though a senior External Affairs Ministryofficial, Sanjay Singh, rejected suggestions byreporters that India’s growing ties with Korea were



India & The World



aimed at China, it was evident that Seoul and NewDelhi have common concerns about the situation inNorth Korea. Prime Minister Singh reiterated India’sview — in the run-up to Pyongyang’s upcoming long-range rocket launch — that “nothing should be donewhich increases tensions in the region and violatesthe relevant U.N. Security Council resolutions,” astand President Lee chose to highlight in his statementto the press after the meeting. With bilateral tradevolumes — especially after the ComprehensiveEconomic Partnership Agreement kicked in two yearsback-up — nearly 70 per cent to $20 billion, the twoleaders set a target of $40 billion by 2015. Anagreement on simplification of visa procedures wasalso signed.

10. INDIA & SOUTH EAST ASIA

India Amends Tax Treaty with SingaporeIndia and Singapore amended their Double

Taxation Avoidance Agreement (DTAA) to enablemore effective mutual exchange of banking and taxrelated information.

Under the DTAA amendment protocol, whichwas signed by Central Board of Direct Taxes (CBDT)Chairman Prakash Chandra and Singapore’s HighCommissioner to India Karen Anne Tan Ping Mingon behalf of the two countries, the two nations haveadopted the internationally agreed standard forexchange of information in tax matters.

Singapore Host South Asian DiasporaConvention

A highlight is the presentation of perspectivesby thought leaders from Japan, S. Korea, China

The South Asian Diaspora Convention,programmed from July 21 to 23 is “the first of itskind anywhere in the world.”

Push to FTA on Services with ASEANSeeking to put the India-ASEAN free trade

agreement (FTA) on services on the fast track, Indiaon Saturday impressed upon the negotiators to ‘stepup efforts’ and show greater flexibility for an earlyconclusion of an FTA in services and investments.

For India, the services sector is crucial as itcontributes nearly 55 per cent to its GDP. TheEconomic Ministers of ASEAN, including the

Commerce and Industry Minister, Anand Sharma,reviewed the progress of the FTA talks on servicesand investment agreement at the “ASEAN EconomicMinisters meet” at Manado in Indonesia.

Both India and the ASEAN have already inkedFTA in goods and are engaged in intense negotiationsto expand this pact to include services andinvestments. “The Ministers reviewed the progressin the negotiations on services and investmentagreement. They tasked the negotiators to step uptheir efforts and exhibit greater flexibility forcompletion of these negotiations with substance,”an official statement issued said. Trade between thetwo sides increased by 24 per cent in 2010 and atstood at $51.3 billion. Foreign direct investmentinflows from ASEAN have touched $14.25 billionin May 2011 and accounted for 10.36 per cent ofthe country’s total FDI. Mr. Sharma also had bilateralmeeting with the Economic Ministers from the EastAsian Summit participating countries like Australia,China, Japan, Korea and New Zealand.

India-ASEAN Connectivity is our StrategicObjective, says Manmohan

Declaring that India’s partnership with theAssociation of South East Asian Nations (ASEAN) isthe foundation of its ‘Look East Policy,’ PrimeMinister Manmohan Singh has said that greaterphysical connectivity between India and the 10-member grouping remains New Delhi’s “strategicobjective.”

In his statement at the ninth ASEAN-IndiaSummit here, Dr. Singh listed proposals, amongothers, for an India-Myanmar-Thailand highway andits extension to Laos and Cambodia, and thedevelopment of a new highway also linking Vietnam.He also referred to a study on a Mekong-Indiaeconomic corridor, which proposes to link corridorsin the peninsular, and possibly the north-eastern,regions of India with the East Asian region.

With ratification of the India-ASEAN FreeTrade Agreement (FTA) for Trade in Goods in Augustthis year, the ideas to push for greater physicalconnectivity could be expected to gather pace. Dr.Singh said India’s trade with ASEAN had increasedby 30 per cent in 2010-2011, crossing the $50-billionmark, and with such a rate of growth, the target of$70 billion by 2012 would be feasible.



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India, Thailand Work on defenceCooperation Pact

Stepping up its engagement with countries inEast Asia, India held the first meeting of defencedialogue with Thailand, taken in line with theagreement between the two countries reached earlierthis year. Both sides exchanged views on the regionalsecurity issues and reviewed ongoing programmesincluding joint exercises, training of personnel,diplomatic sources said adding that work has begunon a possible Memorandum of Understanding in thearea. The defence dialogue with Bangkok comesclose on the heels of New Delhi’s similar engagementwith countries including South Korea, Japan,Vietnam, among others in East Asia.

Defence cooperation between India andThailand comprises regular joint exercises/jointmaritime patrols near the international maritimeboundary to counter terrorism, piracy and smuggling;training of officers at each others’ Armed ForcesTraining institutions and participation as observersin military exercises, staff talks and exchange oftrainee visits at various levels.

ndia, Thailand to Accelerate ExtraditionTreaty

After holding talks to step up defencecooperation, Thailand and India are aiming toaccelerate pacts to ensure that Bangkok does notremain a magnet for fugitives from here.Mega Ports

The two sides also held talks on connectingmega ports being built in Myanmar and Thailandwith Indian ports during the ongoing visit of ThailandForeign Minister Surapong Tovichakchaikul.

At present, the India-Thailand Joint WorkingGroup on Security Cooperation looks intotransnational crimes, counter terrorism and criminaljustice matters. “We are confident our cooperationwill be closer in future,’’ he said when asked if suchgestures would also be extended to non-westerncountries as well.

11. INDIA & AUSTRALIA

Australia, at last, May Sell Uranium to IndiaAustralia has given indications of reversing the

ban on selling uranium to India in return for greater

strategic proximity between the two countries.Australian Prime Minister Julia Gillard, after pushingfor India’s case in a newspaper article and at a pressconference, will have to persuade the Labour Partyto endorse her stand at its conference next month.

India welcomed the move with External AffairsMinister S.M. Krishna terming it an endorsement ofthe country’s “impeccable non-proliferationcredentials.’’ But it remains to be seen whetherAustralia will insist on a regime of inspections similarto its pact with China. Also, the Green Party, whichbacks the Labour Government, is opposed toAustralia supplying uranium to a non-signatory tothe Nuclear Non-Proliferation Treaty (NPT). Hometo 40 per cent of economically extractable uraniumand globally the third largest exporter, Australia hadagreed to supply uranium but the decision wasoverturned after the Labour Party defeated theincumbent Conservatives in 2007. This took a tollon the bilateral relations and India was prepared tosend an envoy to the Labour Party’s conference toexplain its energy needs and stand on proliferation.

Rio Tinto to Invest $2 b in IndiaEven as the India-Australia CEOs Forum met

in New Delhi for the first time, global mining giantRio Tinto announced plans to invest $2 billion (Rs.10,000 crore) in iron ore and diamond miningprojects in Madhya Pradesh and Orissa, one of thebiggest foreign direct investments (FDIs) fromAustralia.

12. INDIA & OCEANIC COUNTRIES

India’s Trade with IOR-ARC Touches $280Billion

India’s annual trade volume with membercountries of the Indian Ocean Rim Association forRegional Cooperation (IOR-ARC) has shown anupward trend in recent years and touched $280billon. India officially assumed the chair of the IOR-ARC from Yemen for two years. The meeting ofIndian Ocean Rim Business Forum discussed a broadrange of issues related to trade, investment, trade fairs,information technology, and small and mediumenterprises.

In pact, India, Maldives Flag Security andDevelopment

India and the Maldives have decided to put



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security and development at the heart of their tiesby signing a framework agreement of cooperationand development and a memorandum ofunderstanding, which will serve as the bedrock forjoint cooperation in safeguarding each other’s securityinterests.

Prime Minister Manmohan Singh, who metMaldives President Mohamed Nasheed, a day afterthe South Asian Association for RegionalCooperation summit, also announced $100 millionin credit to the island nation for stabilising its fiscalposition.

The Maldives faces a serious credit crunch; ithas allowed its currency, Rufiyaa, to float in a limitedband. With pirates having sacked the Mahe port inSeychelles and many students who had gone toPakistani madarsas having come under the influenceof the Salafi ideology, the Maldives has integratedits radar network with that of the Indian Navy’sSouthern Command and sought more avenues for itsstudents to study in a more secular environment.India’s offer of enhanced security and assistancecomes days after China opened its mission here,though it is meant to cater to its increasing businessinterests and employment to its personnel in thehospitality industry.MoU

India and the Maldives signed agreements oncombating terrorism and drug-trafficking; disastermanagement and coastal security; transfer ofsentenced prisoners; cooperation in culture for 2012-2015; construction of 10,000 houses costing $40million; developing a police training academy;enhancing ferry services and port development; andupgrading the Indira Gandhi Memorial Hospital inMale, the referral hospital in the island nation. Therenovation work is expected to be completed in 2013.

The Indian assistance will go a long waytowards the development of the Maldives, Mr.Nasheed said. On the promise of increaseconnectivity, he hoped that this would also includethe islands of Minicoy in the Lakshadweep, whichis the closest to Maldives. The Indian promise toundertake at the earliest a feasibility study fordeveloping a port north of Male (Kulduffuhsi) wouldmean that the Maldives could start development ofits northern parts.

13. INDIA & INTERNATIONALORGANISATION

Development Agenda of Doha RoundCentral

India remains fully committed to continuedengagement with all stakeholders for conclusion ofthe Doha round of the World Trade Organisation asa single undertaking in trade, services and investment,Union Minister of Commerce and Industry AnandSharma said. Noting that there was some divergencein sequencing an ‘early harvest’ package for the leastdeveloped countries (LDCs), the Minister said thenegotiations were complex but provided a greatopportunity for WTO and global trade.

“To put in place a rule-based multilateral traderegime, which is equitable, balanced and also fair,is to correct the historical distortions in the trade,”he said. India is engaged with all its coalition partnersin the developing world and is also having ameaningful dialogue with countries of the developedworld. The country had shown its commitment bytaking a leadership role and conducted the ministerialin 2009 in Delhi, which was crucial to resumptionof the Doha development round negotiations, headded. At the informal mini-ministerial, on thesidelines of the OECD meeting, recently in Paris, hesaid the “developments were reviewed to make anobjective assessment… we have something tangibleand it would be for the next ministerial [later thisyear] to take a final view,” he added.

On free trade agreements (FTAs), Mr. Sharmasaid the country had launched FTAs with Indonesia,Australia, Canada and New Zealand. With regard tothe broad-based trade and investment agreement withthe European Union (EU), he said the ChiefNegotiator and Commerce Secretary were engagedin a dialogue with their counterparts in the EUrecently and he would take stock of the progress soon.“We have had 13 rounds of negotiations and reachingan agreement on trade, services and investment ispreceded by complex negotiations, which are in theinterest of both the sides,” he said. India would belaunching talks for FTA with COMESA (CommonMarket for Eastern and Southern Africa) and was indiscussion with ECOWAS (Economic Communityof Western African States) for a similar agreement.



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On India’s engagement with Africa, Mr.Sharma described it as “distinct, very special.” Itcannot be compared to that of any other country’sengagement with Africa as “we have sharedexperiences, freedom struggle and the influence ofIndia on Africa has been significant, particularly thatof Mahatma Gandhi. India has supported the growthof Africa in a proactive manner and the relationshipis based on mutual respect and trust.”Challenges in Africa

Stating that the development challenges ofAfrica were similar to that of India, he said Africawas rich in natural resources, human resources andalso had sizeable arable land, which could meet theglobal challenge of food security. “Indian companiesoperating in Africa are generating value addition andmaking people participants by imparting skill-basedtraining,” said Mr. Sharma, who had a longassociation with the African anti-apartheid struggle.

According to the Minister, India was engagedin capacity and institution building and infrastructuredevelopment in Africa. The shining example of thepartnership is the Pan-African E-Network programme,which helps Africa bridge the digital divide. Forty-seven countries have joined the network. “The entireproject is a gift of the government of India,” he said.

At the first India-Africa Trade Ministers meet,held in Addis Ababa recently, it was decided to takethe bilateral trade from $46 billion to $70 billionby 2014.

India Poised to Join Shanghai GroupingThe six-nation Shanghai Cooperation

Organisation (SCO), which could play an importantrole in stabilising Afghanistan after the drawdownof foreign troops, opened its doors for India’smembership at its 10th anniversary summit beingcelebrated in the heart of the Great Steppes. BesidesAfghanistan, India feels an expanded SCO couldencourage Pakistan to weed out terror outfits basedon its soil as well as promote connectivity that inturn could boost economic activity. These pointswere made by External Affairs Minister S.M. Krishnaduring his intervention at the SCO summit that wasattended by nine heads of state, including thePresidents of Russia, China, Uzbekistan, Kazakhstan,Kyrgyzstan, Pakistan, Iran and Tajikistan. Lauding the

SCO for its “constructive and forward looking rolein contributing towards peace in Afghanistan,’’ Mr.Krishna hoped that by becoming involved with theSCO, Afghanistan could become the geo-strategicbridge between Central and South Asia as well as atrade and transit hub. Afghanistan is poised to beupgraded from Dialogue Partner to Observer thatwould give it access to all discussions of importanceat the SCO. The SCO consists of Russia, China andfour Central Asian countries (barring Turkmenistan).India, Pakistan and Iran are among those withObserver status. All these nations virtually ringAfghanistan that shares ethnic linkages with most ofthem. As officials explained, after Afghanistanbecomes an Observer, South Asia would becomecontiguous to Central Asia in the SCO. This wouldhelp all neighbouring countries achieve the two aimsthey desire in the region for Afghanistan — thecountry becomes a geo-strategic bridge as well as aterror-free zone. India has already been involved withthe SCO’s Regional Anti-terrorism Centre (RATS) andsome intelligence-sharing is taking place. “We toldthem about the obvious fact of the terror machinebeing based in the neighbourhood,’’ said sources inthe government. “We see the RATS as an importantregional answer to the terrorism challenge,’’ said Mr.Krishna.

India Withdrawing Helicopters fromU.N.’s Congo Mission

India is preparing to withdraw its fourremaining Mi-35 attack helicopters from theDemocratic Republic of Congo (DRC) after expiryof its contract with the U.N. mission, a top Indianofficial here has said. Manjeev Singh Puri, India’sDeputy Ambassador to the U.N., said that Indianeeded its helicopters. “The contract has ended,” hetold PTI.

Landmark ILOTreaty to Protect Domestic Workers

The International Labour Organisation passeda landmark treaty giving protection to an estimated52.6 million domestic workers across the world.

The new convention would ensure domesticworkers enjoyed conditions “not less favourable”than other workers, and require governments to ensurethey understood their rights, preferably through



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written contracts. The document also offers domesticworkers a full rest day every week, and prevents thembeing compelled to remain with an employer’shousehold during their annual leave or rest days.

The convention, which was adopted with 396votes for, 16 against and 63 abstentions, will comeinto effect upon the ratification of two countries. ThePhilippines and Uruguay have already said theywould ratify the accord. “We are moving thestandards system of the ILO into the informaleconomy for the first time, and this is a breakthroughof great significance,” said Juan Somavia, ILODirector-General. “History is being made,” headded. ILO data, which is a compilation of nationalstatistics, indicate there were at least 52.6 milliondomestic workers worldwide in 2010. But there arereasons to believe that the true number, concealedby undercounting among some states, could lie closeto 100 million, the U.N. agency added. Despite thelarge numbers, domestic workers are still among themost exploited and abused.

Nevertheless, joining the convention is onlythe first step. Countries would not have to implementthe treaty until ratification, while others may opt notto sign up, which could reduce its bite.

While it has secured the support of countriesranging from Gulf states to the United States,Indonesia, and Brazil, other governments, such asBritain, Malaysia, Singapore and Thailand, abstained.India’s agendaat the SCO

Since its formation in 2001, the ShanghaiCooperation Organisation has slowly begun toestablish itself as an important forum for the Eurasianregion. As a club that has China and Russia andmost Central Asian states as members, there is anobvious strategic dimension to the SCO. In theinitial years, Moscow and, to a lesser extent, Beijingused the forum to re-inject a dose of Cold Warpolitics into the region. At its 2005 summit, forexample, the SCO asked the United States to set adate for the eventual withdrawal of its troops fromAfghanistan. A lot of water has flowed down theOxus since then. Now that the U.S. has said it hopesto end all offensive operations in that country by2014, the Shanghai grouping realises it needs to stepup to the plate to ensure Kabul has the capacity todeal with those who challenge its authority. Terrorism

and Islamist extremism pose a critical challenge toRussia and China and both know the consequencesof instability in their wider region. This is where theSCO has an important role to play. The regionalformat allows its members to involve themselves ineconomic and even security-oriented initiativeswithout reviving uncomfortable memories, as in thecase of Russia, or triggering unnecessary rivalries, asin the case of China, India, and Pakistan.

NSG Ends India’s ‘Clean’ WaiverThe Nuclear Suppliers Group (NSG) Friday

adopted new guidelines on the transfer of sensitivenuclear technology that will effectively nullify the“clean” waiver India received from the cartel in 2008as far as the import of enrichment and reprocessingequipment and technology (ENR) is concerned.

The decision was announced from Noordwijk,the Netherlands, where the 46-nation grouping heldits 2011 plenary meeting. The NSG “agreed tostrengthen its guidelines on the transfer of sensitiveenrichment and reprocessing technologies,” a formalstatement blandly noted.

Prior to this, the NSG had a catch-allrequirement of full-scope safeguards — in paragraph4 of its guidelines — for the supply of any nuclearequipment or material.

The only additional requirement for ENRexports — as contained in paragraphs 6 and 7 of theguidelines — was that the suppliers were asked to“exercise restraint” and to ensure that any suppliedequipment or technology not be used to enrichuranium beyond 20 per cent.

The NSG’s September 6, 2008 ‘Statement onCivil Nuclear Cooperation with India’ waived thefull-scope safeguards requirement of paragraph 4 andexpressly allowed ENR exports, subject to paragraphs6 and 7. In adopting its waiver, the NSG said it wasacting “based on the commitments and actions” onnon-proliferation undertaken by India.

But, the cartel tore up that bargain, adopting anew paragraph 6 specifying objective and subjectivecriteria a recipient country must meet before an NSGmember can sell ENR to it. The very first of these isNPT membership.

Since all nuclear exports to the only othercountries outside the NPT – Israel, Pakistan andNorth Korea – are already prohibited by paragraph



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4, this provision in the guidelines was expresslydesigned to target India, to which the restrictions ofthat paragraph no longer apply.

When the U.S. first floated the guidelines inNovember 2008, Indian officials privatelycomplained that the NPT provision would amountto a “rollback” of both the NSG waiver and thefundamental American commitment to ensure “fullcivil nuclear cooperation” with India.

Ironically, the U.S. insists that its support forthe ban on ENR sales to India “in no way detract(s)from the exception granted to India by NSG membersin 2008.” The reality is that an entire category ofnuclear items which NSG members were allowedto sell to India as a result of the 2008 exception canno longer be supplied.

India Assumes UNSC Presidency forAugust

After a gap of 19 years, India assumed therotating presidency of the United Nations SecurityCouncil, a period it intends to utilise to establishits credentials for permanent membership by creatinga more “enduring” presence for itself. A temporarymember of the Council, India last held the monthlypresidency in December 1992.

No need to get liability law vetted by IAEA:India

India said there was no need to get its domesticnuclear liability law vetted by the InternationalAtomic Energy Agency (IAEA) to ensure it compliedwith the Convention on Supplemental Compensation(CSC). The issue again came to life after United StatesSecretary of State Hillary Clinton had introduced itduring the second strategic dialogue with hercounterpart S.M. Krishna in mid-July. The issue waslearnt to have been again broached when the twoleaders met at New York on the sidelines of theUnited Nations General Assembly.

Sources said during closed door talks, the U.S.had specifically objected to Section 17(b) of theIndian law. This expands the scope of the operator’sright to compensation from nuclear suppliers in caseof an accident due to faulty equipment.

Washington is also unhappy with Section 46,which implicitly allows accident victims to file tortclaims. In this respect, officials point out that while

the CSC can have the provision to bar tort claims, itwas not practical because only the Supreme Courtcould decide regarding the compatibility or otherwisewith the CSC.

Traditional mindsets and cultural sanctionsprevent fulfilment of U.N. obligations:India

Traditional mindsets and culturally sanctionedpractices continue to affect the degree of fulfilmentof obligations under the Optional Protocol to theConventions on the Rights of the Child, the Sale ofChildren, Child Prostitution and Child Pornography,2011, India has told the United Nations. It hasadmitted to lack of awareness and the inadequacyof shelter homes and rehabilitation. India has saidthis in its initial report on the status ofimplementation of the Optional Protocol forconsideration by the United Nations Committee onthe Rights of the Child (UNCRC). Pointing out thatIndia has spearheaded many of the organisation’sinitiatives, with enthusiastic support from therespective Ministries, State governments,international organisations and the civil societyorganisations, the report says that various factors anddifficulties continue to affect the degree of fulfilmentof these obligations. The recently-launched IntegratedChild Protection Scheme will contribute to theimprovement of the well-being of children in difficultcircumstances and reduction of vulnerabilities, buttraditional mindsets and culturally sanctionedpractices, such as devadasi ,continues to exploityoung girls. Displacement and unsafe migration,which leaves a large number of children in urbanpoverty, majority of them living in informal andillegal settlements such as railway lines and on thestreet, makes them vulnerable to exploitation, thereport says. Inadequate facilities, especiallycounselling services and vocational skills training,creation of new options, and strengthening theexisting initiatives for the rehabilitation of childrenin institutions too are far from satisfactory.

The Protocol was ratified by India onSeptember 16, 2005.

IBSA needs to step up pace on trade withinthe grouping and security

Prime Minister Manmohan Singh arrived here



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for the Fifth IBSA (India-Brazil-South Africa) Summitat a time when all three are serving concurrently asnon-permanent members of the United NationsSecurity Council (UNSC) and there are questionsabout its relevance after South Africa joined the BRIC(Brazil-Russia-India-China) grouping in which it wasthe only one among the three excluded till the Sanyasummit held in April.

Starting as a grouping that was stung by westernintransigence at the Doha Round of trade talks, Indiahas differentiated it from BRICS by pointing out thatit is a grouping of democracies from three continents.

But as was seen at the BRICS summit in Sanya,China, most formulations in the joint statementclosely mirrored those at previous IBSA summits. Thedifference lay in IBSA’s accent on tackling socio-economic distress due to globalisation and settingin place a trilateral trading bloc — two aspects noteven on the radar of the BRICS grouping.

Since its inception, IBSA has focussed on moreaspects than BRICS. BRICS pulls more weight onpolitical and economic issues as two of the members— Russia and China — are permanent UNSCmembers. On the economic side, one is in G-8, theother has become the world’s second largesteconomy. But IBSA brings about more focus and hasexpended much energy on tackling the social aspectsof globalisation internally.

Also IBSA would have to step up the pace ontwo other aspects — intra-IBSA trade and security.India has already signed a Preferential TradingArrangement (PTA) with Mercosur (of which Brazilis a part) and so have Mercosur and SACU (SouthAfrica Customs Union). That leaves just the India-SACU agreement to seal the triangle.

On security, the three nations have differentperspectives on security issues. Brazil is moreconcerned about issues in its Latin Americanbackyard. South Africa lays more emphasis ondevelopments in the African world, of which thereare many, while India’s geo-strategic interests lie inits immediate neighbourhood. But they have soughtto find common ground in the seas that border them.This has resulted in two rounds of naval exercisescalled IBSAMAR. But officials feel IBSA has notreally lived up to its potential and this summitprovides an opportunity to carve out a path that drawson but also differs from the BRICS strategy.

IBSA plan to accelerate trilateral FTA talksIn an attempt to accelerate talks on a trilateral

free trade agreement (FTA) , the India-Brazil-SouthAfrica (IBSA) Summit that held at Pretoria (SouthAfrica) decided to hold an annual meeting of tradeministers from the three countries beginning fromnext year. Commerce and Industry Minister AnandSharma has offered to host the first annual trilateralmeeting in New Delhi.

The analysis at the IBSA meet is that trilateraltrade has done well despite the 2008 economicslowdown and its aftershocks, including theprevailing uncertainties in the eurozone.$25 b trade by 2015

Trilateral trade is already close to $20 billion,having crossed the target set for 2012 three yearsearlier than envisaged. India’s trade with its tradepartners in IBSA accounts for a majority of this trade.The leaders at the IBSA summit felt that the trendsindicated that the target of $25 billion trade by 2015would be achieved early, and “this gave reasons tobe optimistic and more ambitious,’’ said an officialnote. The South African and Indian trade ministersdecided to enter into long-term contracts for purchaseof raw materials and commodities, and the recentlyopened office of MMTC in South Africa has beenasked by Mr. Sharma to begin work on this proposalimmediately.

The Ministers also felt that with the ratificationprocess of the MERCOSUR SACU FTA advancing,and initiation of the process of deepening of the IndiaMERCOSUR Preferential Trade Agreement (PTA), thedeck was now clear for making progress on a trilateralFTA involving India SACU and MERCOSUR.

“This FTA linking developing countries in thethree continents is envisaged as one of the mostambitious free trade areas and will be a symbol ofgrowing south-south cooperation,’’ noted Mr.Sharma. His sentiment was shared by hiscounterparts from Brazil and South Africa.

The three ministers also plan to meet beforethe WTO’s 8th Ministerial conference in mid-December to coordinate their position on all issuesrelating to the WTO negotiations and to discuss thepossible outcomes of MC8 as well as the wayforward on Doha Development round.



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Commonwealth lacks money to set uprights monitor: India

India is unhappy with a recommendation toset up a mechanism to monitor the human rightsrecords of Commonwealth countries, arguing thatthe 54-nation group simply does not have the financesto take on such a task which is already being doneby other authorities within the group, as well as theUnited Nations. Instead, the Commonwealth woulddo well to focus its limited resources on thedevelopment needs of its smaller States, ForeignSecretary Ranjan Mathai told journalists, indicatingthat the Indian government is likely to oppose themove at the Commonwealth Heads of GovernmentMeet (CHOGM) in Australia this.

Intensify Trade, Manmohan tells SAARCNations

Prime Minister Manmohan Singh gave a callto the member-states of the South Asian Associationfor Regional Cooperation (SAARC) to intensify tradewith each other in order to beat the global slowdown.

The Prime Minister acknowledged the specialresponsibility of India in accelerating this economicintegration but suggested that the pace should becomfortable for all countries. In this respect, hereferred to India deciding to reduce the Sensitive Listfor Least Developed Countries under the South AsianFree Trade Area Agreement from 480 tariff lines to25 tariff lines. Zero basic customs duty access wouldbe given for all items removed with immediateeffect, he declared at the SAARC summit.

Dr. Singh recognised that non-tariff barrierswere an area of concern and promised India’scommitment to dismantling them as “competitionbegins at home.” He said, “Our industries have tolearn to compete if our economies are to have a futurein this globalised world that we live in.”

Taking the cue from this summit’s theme“Building Bridges,” he suggested fullimplementation of a six-year-old resolve to provideunrestricted access to airlines from the SAARC states,and hoped the regional Air Services Agreement wouldbe sealed next year.

Dr. Singh suggested giving priority to a RegionalRailway Agreement and a Motor Vehicle Agreement.India would be ready to facilitate the developmentof a regional telecommunications infrastructure too.

Addu Declaration Decides to meet HalfwayIndia, Pakistan on Observers

India and Pakistan played out a draw of sortsover the future composition of the South AsianAssociation for regional Cooperation (SAARC),whose 17th summit ended here. A few days beforethe summit, they had unveiled different positions oninducting more Observers and enhancing the existingones’ role. The eight-nation SAARC now has nineObservers. An Addu Declaration adopted at the endof the two-day summit decided to meet halfway thestand taken by the two neighbours.Strengthening Mechanisms

The Declaration decided to strengthen theSAARC mechanisms, including the Secretariat andRegional Centres, through an inter-governmentalprocess, thus catering to India’s desire to stabilisethe organisation’s internal processes and institutionsinstead of adding more Observers. It alsoaccommodated Pakistan’s view by resolving toundertake a comprehensive review of all mattersrelating to the SAARC’s engagement with Observers,including the question of dialogue partnership,before the next Session of the Council of Ministersin 2012.

Pakistan had suggested that the moratorium onexpansion of Observers be lifted, and supportedTurkey’s request for becoming an Observer. It hasalso welcomed China’s interest in an interactivepartnership with the SAARC. India does notcompletely agree with Pakistan’s position, arguingthe SAARC should strengthen its Secretariat and beginimplementing the decisions taken earlier — whichthe SAARC decided to do with respect to air and seaconnectivity. The SAARC’s current engagement withObservers is based on the guidelines adopted in2008. Observers are now allowed to participate inthe inaugural and closing sessions of summits. Thatsummit also imposed a moratorium on admissionof new Observers. At SAARC summits in the past,other members have sought to get back at India duringperiods of a trough in bilateral ties by proposing agreater role for Observers.

The summit has decided to set a time line forfinalising a framework on rail and sea connectivity.The Declaration shed some of the despondencyreflected in the previous summit in Thimphu. Whilethe Thimphu Declaration has been disappointing



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over a “number of initiatives not translating intotangible and meaningful benefits to the people,” thelatest one welcomed the summit recognising theimportance of “bridging differences” playing on thissummit’s theme of “Building Bridges.”

In this respect, the eight leaders at the summitdecided to finalise a Regional Railways Agreementand complete the preparatory work on an IndianOcean Cargo and Passenger Ferry Service by this year-end.

The Declaration also decided on earlydemonstration run of a Bangladesh- India-Nepalcontainer train. On the trade front, the emphasis wason effective implementation of the free trade pact,paring the sensitive lists, eliminating non-tariffbarriers and harmonising standards and customsprocedures. All these factors have limited the SAARCtrade to 10 per cent of its actual potential.

Liability Rules no Obstacle to NuclearSuppliers: India

As Prime Minister Manmohan Singh arrivedin Bali to attend the ASEAN Summit, senior officialsin Delhi insisted that the just-notified rules forimplementation of the Civil Liability for NuclearDamages Act were no ‘obstacle’ to suppliers of thenuclear equipment and were consistent with Indianlaws, leaving no scope for anyone to raise questions.The officials maintained that the rules were withinthe framework of the Indian laws and they shouldcome as no surprise to anyone.

Since the passage of the Civil Liability forNuclear Damages Act by Parliament in August 2010,Washington has been making a case that thelegislation should conform to internationalconventions and the existing laws were heavily tiltedagainst the suppliers.

The rules empower the nuclear equipmentbuyers to claim compensation for patent or latentdefects or sub-standard services under a contract. Theofficials said the rules were aimed at expeditiouscompensation for any nuclear mishap.

With the Fukushima plant explosion in Japanfresh in mind and opposition within India fromsections of political forces and civil society, theManmohan government could not afford to be seenas soft on the issue. A section of the Opposition hasalready charged the government with pandering tothe western interests in framing the rules.

Distinction for India at Bonn MeetAs intense discussions begin in Bonn in

preparation for the December 5 internationalconference on Afghanistan, India will for the firsttime get attention it has never gained during similarinternational meetings around the globe over the past10 years. India goes into the Bonn conference withthe tag of being the only country with whichAfghanistan has signed a security pact. The U.S.,which has invested the most, is still finalising thecontours of a similar pact. A few days back, an Indianconsortium was given mining rights to the region’sbiggest untapped iron ore deposits south west ofKabul. And if the confrontation between the westand Iran deescalates over time, India would be theonly country with an alternative route largely in placefor bringing in men and material for construction andexporting steel from the Hajigak mine.

It will be on the last aspect that the globalcommunity would be closely examining the headwaymade by India. A gas pipeline from Central Asia willcut through Afghanistan to supply gas to Pakistan andIndia. And while European companies were agonisedon policy issues, India walked away with three outof four Hajigak mine blocks which will actually bea package deal of producing semi-finished productsfrom the ore, a power plant and evacuation routes.China has been successful with the Aynak coppermine but unlike India it does not have a visiblepolitical role. Apart from agreeing on exploring forhydrocarbons and minerals, the India-Afghanistanstrategic pact has a clause for training Afghan securitypersonnel. India had been carrying out small scaletraining for the security personnel in addition to itslongstanding programmes for military cadets fromdeveloping countries and the strategic agreement“puts together all that we had been doing so far withthe aim to build on it,” said diplomatic sources.These developments add to the soft power India hasalways enjoyed in Afghanistan through its soapoperas and films.

India needs ‘NonAlignment 2.0’, NewPolicy Report Says

Warning that the time for India to get its acttogether is now because of the favourable growthprospects, demographic profile and internationalenvironment it faces — all of which maysubsequently change — a group of foreign policy



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experts released a report here, NonAlignment 2.0:A foreign and strategic policy for India in the 21stcentury, which identifies the basic principles anddrivers that would make the country a leading playeron the world stage while preserving its strategicautonomy and value system.

As the report reiterated several times, the trendsfor India to extend its global role and influence arefavourable but time is of essence. The basic structuressuggested by the report must be quickly implementedbecause the “underlying factors that are propitiousfor our growth may not last long.” But the authorssay India’s big challenge will be to aim at not justbeing powerful but to set new standards for what thepowerful must do, because in international relations,“idealism not backed by power can be self-defeatingand power not backed by the power of ideas can beblind.” India’s legitimacy in the world will comefrom its ability to stand for the highest human anduniversal values and at the global level, “India mustremain true to its aspiration of creating a new andalternative universality.”

In a situation where the world is no longerbifurcated between two dominant powers,nonalignment today will require managingcomplicated coalitions and opportunities in anenvironment that is not structurally settled, the reportsay. But former NSA Brajesh Mishra, who spoke atthe launch, questioned the approach of the report,especially its view that India not take sides in therivalry between China and the U.S. China’s approachwas that of the Middle Kingdom, it wants to benumber one, and India’s priority should be to builda closer partnership with Washington.

The report deals with India’s approach towardsthe ‘Asian theatre,’ the international order,hardpower, internal security, non-conventionalsecurity issues like energy and nuclear options, theknowledge and information foundations of power aswell as the state and democracy.

NSA Shivshankar Menon commended theoverall thrust of the report, especially the link madebetween the manner in which India dealt with itsinternal and external challenges. West BengalGovernor and former NSA M.K. Narayanan said thereport should have devoted more attention to leftwing extremism and questioned some of itsconclusions on the internal security front.

The report emphasises that for its strategic andforeign policy to be successful, India must sustain

domestic economic growth, social inclusion anddemocracy. Its approach must be to secure themaximum space possible for its own economicgrowth in order for the country to become reasonablyprosperous and equitable. Although India’scompetitors will put roadblocks in its path, “thefoundations of India’s success will depend on itsdevelopmental model.”

World Bank Chief Post should not beRestricted to U.S. Nationals: Krishna

With the race for a new World Bank chiefgathering steam, External Affairs Minister S.M.Krishna said its next president should be selected onthe basis of merit and the choice shouldn’t berestricted to U.S. nationals. “If in the past U.S. hadrepresentatives as head of the World Bank, it is nownecessary for other countries to come out withsuitable names of candidates who have the wisdomand merit to hold the post,” Mr. Krishna said, onthe sidelines of a seminar organised here by theSingapore-based Institute of South Asian Studies.

India wanted a solution to be found throughconsensus and backroom negotiations and thecriterion should be merit, he said.

China Defends BRICS Bank move amidDollar Discontent

Defending the move by the BRICS nations —Brazil, Russia, India, China and South Africa — toset up a bank, China said the developing world hadbeen left with few options, stressing the need forgovernments to allocate the initial seed money forthe initiative. Growing Chinese concerns aboutfluctuations in the U.S. dollar and a fresh drive topromote cross-border settlements in the Renminbiwere behind Beijing’s renewed interest in pushingforward the move, according to officials in Beijing.

If Beijing had its way, after leaders of the fivecountries approve the pacts for local currency tradeand the bank, the idea could be forwarded to otheremerging countries at the forthcoming G-20 summitin Mexico. This is an idea that India and Brazil hadalso suggested at the G-20 Finance Ministers’meeting. The bank would “downgrade the risk of upsand downs in other international currencies”,Chinese Foreign Ministry official Li Kexin said. Chinaexpects a broad consensus to emerge at the BRICSMinisterial meeting on Wednesday, a day before thesummit proper. Mr. Li said he was hoping that India



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— as chairperson of BRICS till the next summit anddraft-country for the action plan — would be ableto draw up a realistic timetable of follow upmeetings to make it a reality.

Supply-side Factors May hurt BRICS:Manmohan

Prime Minister Manmohan Singh said supply-side factors such as energy, food, water and capitalcould upset the growth story of BRICS (Brazil, Russia,India, China and South Africa) in the medium term.Dr. Singh advocated reforms in most globalinstitutions and active sharing of expertise among thefive nations to overcome the adverse effects of supplyside factors in not just the developing world butEurope as well. Of the four constraints, he identifiedcapital as the one that should be tackled urgently.BRICS must address the expansion of the capital baseof the World Bank and other multinationaldevelopment banks to enable them “perform theirappropriate role” in financing infrastructuredevelopment. Side by side, BRICS was examining aproposal for a South-South development bank thatwould be funded and managed by the developingcountries.Greater Interaction

Intra-BRICS complementarities could beleveraged by promoting greater business-to-businessinteraction, liberal business visas, removing barriersto trade and investment flows and avoidingprotectionist measures. “Inevitably, we will handlethe problem differently, but it may be useful for usto share experiences in this area,” Dr. Singh said.

Put up Common Nominee for WTO chief,Pillai asks BRICS

The BRICS Trade & Economic ResearchNetwork (BRICS-TERN) has called upon Brazil,Russia, India, China and South Africa to buildconsensus on fielding a common candidate fromamong the developing countries for the post ofDirector-General of the World Trade Organisation.

BRICS should propose adaptable andaffordable green technology transfer includingthrough appropriate amendments to the TRIPS (trade-related aspects of intellectual property rights)agreement and there should be enhanced greentechnological cooperation among the BRICSmembers, and multi-stakeholder consultations and

research including a cost-benefit analysis towards agreen economy in relation to sustainabledevelopment.

U.N. Asks India to repeal AFSPAThe United Nations has asked India to repeal

the Armed Forces (Special Powers) Act, saying it hadno role to play in a democracy. The AFSPA — in forcesince 1957 in the North-East and since 1990 inJammu and Kashmir — has become a symbol ofexcessive State power.

India Inks Pacts with ADBIndia, inked three loan agreements worth $826

million with the Asian Development Bank (ADB)to shore up the country’s power transmission systemsfor efficient transfer of electricity from surplus regionsto deficit regions. According to an official statement,a $500-million sovereign-guaranteed loan along witha $250-million non-sovereign corporate loan will helpestablish a more than 1,300-kilometre inter-regionaltransmission link to allow bulk transfer of electricityfrom independent power producers in Chhattisgarhto high power demand areas in the north, includingthe National Capital Territory (NCR) region of Delhi.

14. PERSON OF INDIAN ORIGIN

5 PIO Varsities Coming up for IndianDiaspora

The Government of India proposes to set upfive PIO (person of Indian origin) universities indifferent cities in the country to “deepen itsconnectivity with the diaspora.” Bangalore is oneof them, Didar Singh, Secretary in the Ministry ofOverseas Indian Affairs, announced in the just-concluded mini Pravasi Bharatiya Divas Banglore.“These universities will be set up under theInnovation Universities Bill, which has beenintroduced in Parliament.” Their focus would be onlyon innovation. “Students won’t be bothered aboutpassing exams or marks.” They would be full-fledgeduniversities built in public-private partnership and50 per cent seats would be set aside for students fromthe Indian diaspora.

NRIs will get Right to Vote; Pension fundfor Overseas Workers

Prime Minister Manmohan Singh called upon



Current Affairs



the Indian communities living abroad to play a moreactive role and contribute “much more” to thebuilding of a modern India and promised significantsteps to facilitate, encourage and promote theirengagement with the country of their origin.

Inaugurating the 10th Pravasi Bharatiya Divas,Dr. Singh also announced the right of franchise tothe non-resident Indians who are registered under theRepresentation of the People Act, 1950. A newpension and life insurance fund for overseas Indianworkers, to enable them to voluntarily save for theirreturn and resettlement, has also been introduced.

Trinidad and Tobago Prime Minister KamlaPersad-Bissessar is the chief guest at the three-dayfestival, which began. About 1,900 NRIs and Personsof Indian Origin (POIs) are taking part in the flagshipevent. Dr. Singh said that while the notifications hadbeen issued to enable Indian residents abroad toparticipate in the country’s election processes, a Billhad been introduced in Parliament to merge andstreamline the PIO and Overseas Citizen of Indiaschemes by amending the Citizenship Act. Thiswould provide for an overseas Indian card that wouldbe given to foreign spouses of the holders as well.The new pension and life insurance scheme, fulfillinga long-pending demand, would enable the overseasIndians to save for their old age after returning to thecountry, said the Prime Minister. Listing the stepstaken for safety and security of the Indians livingabroad, particularly in the regions of instability, Dr.Singh said the government was “acutely conscious”of the security needs of over six million Indiansstaying in the Gulf and West Asia. “We haveconveyed to [these] countries that we have a stakein the peace and stability of this region. We expectthat they would appropriately look after the interestof Indian communities.”

Krishna Doctrine for Indian MissionsAway from the culture of high browed

diplomacy, External Affairs Minister, S.M. Krishnais prodding Indian diplomats to shift course andbecome more people-oriented. Addressingambassadors of the West Asia and North Africa(WANA) region, the Minister made it plain thatdiplomats need to make a conscious effort to shedelitism, and respond with humility and urgency tothe needs of Indian nationals abroad – especiallythose in distress. The “Krishna doctrine” will findfurther amplification in the days to come. He will

carry a similar message when he travels, soon afterthe Cairo visit, to Singapore, where a similar meetingof Indian ambassadors posted in South-East Asia isbeing held. That will be followed by another meetingnext month in Abu Dhabi of Indian envoys postedin the Gulf region. After the parliament session, Mr.Krishna plans to travel to Europe to personally conveyhis message of outreach – that for diplomats, thewelfare of the India community is as important astheir role in projecting the country’s foreign policy.He pointed out that several episodes, including thetrouble faced earlier by Indians in Australia; theincidents of violence in the United Kingdom and therecent child custody row in Norway have sharpenedMr. Krishna’s focus on reaching out to Indians indistress through the channel of Indian embassies andconsulates.(Emergency Situations), the Minister said,both sides discussed the Russian proposal to set upa joint commission to implement the December2010 intergovernmental agreement on cooperationin dealing with natural and man-made disasters.

Mr. Chidambaran suggested that India andRussia share experience in forecasting tsunami andother natural calamities.

Rotary International Plans South AsianSummit to Promote Peace, Cooperation

Rotary International, headed by industrialistKalyan Banerjee, plans to organise a conference ofIndia, Pakistan, Sri Lanka, Bangladesh, and Nepal topromote peace, cooperation and development in theregion. The United States-based international socialservice organisation, with a presence in over 200countries, will also be renewing its focus on polioeradication in India, Pakistan and Afghanistan.

China Ready to Support Indian bid forUNSC

China was ready to back India on UnitedNations Security Council reforms and delink itsrelationship with Pakistan to take forward ties,Chinese officials have said.

China was even ready to support India’s movefor a permanent seat on the UNSC if India did notassociate its bid with Japan, top Chinese diplomatstold Sitaram Yechury, Communist Party of India(Marxist) Polit Bureau member.

Mr. Dai also “bent over backwards” to explainthat China was not against India’s bid for a seat in



India & The World



the UNSC — a recent sticking point in the bilateralrelationship. China is the only one of five permanentmembers that is yet to back India’s bid. Mr. Dai toldMr. Yechury that China’s reluctance to voice supportwas more sourced in India’s decision to put forwardits bid along with Japan, Germany and Brazil, underthe banner of the G4 group of nations. He said Chinacould never accept Japan’s bid because of “historicalbaggage”, and was hence opposed to the G4grouping.

India-Korea Civil Nuclear Cooperation onAgenda of President’s visit

Discussions on a civil nuclear cooperationagreement between India and the Republic of Koreaare on the agenda of President Pratibha Patil’s seven-day visit to Korea and Mongolia.

Although on the sidelines of the Asean-IndiaSummit in Hanoi last year, an agreement wasannounced in principle, it has not yet beenformalised. In October 2010 in Hanoi, NationalSecurity Adviser Shivshankar Menon had announcedafter a meeting between Prime Minister Manmohan

Singh and Korea’s President Lee Myungbak that thetwo countries “have finalised an agreement oncooperation in civil use of nuclear energy” and this“now awaits signature.” India could be looking atthe possibility of using Mongolia’s coking coal, itwas said, even as government officials admittedtransportation cost of coal from Mongolia to Indiawould be prohibitive. The high profile visit is partof India’s “Look East” policy formulated in 1992.

With Korea, there have been regular high-levelvisits and strengthening of bilateral relations againstthe backdrop of a booming trade that grew by 40 percent to $ 21 billion in 2010 with a target of $ 30billion for 2014. Over 300 Korean companies arepresent in India.Vishnu Prakash, spokesperson for theMinistry of External Affairs, said a number ofagreements will be signed in Seoul and inUlaanbaatar, but he declined to spell out the details.However, it is confirmed that a strong Indian businessdelegation will be present in the capitals during thevisit with a view to taking forward economicrelations.

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