~I thank you for the opportunity to address this distinguished gathering of business leaders, jointly convened by the apex trade and industry organizations of India and Thailand.

During my recent visit to Bali, I had the pleasure to attend an ASEAN-India Business and Investment Summit, with a combined group of businesspersons from ASEAN countries and India. Some of you in this audience were also there. Just over a month ago, we hosted an India-ASEAN business summit in India. That also had a strong representation from ASEAN countries, including Thailand. Two months ago, Deputy Prime Minister Korn visited India with a delegation of over 100 business representatives and officials from Thailand’s economic ministries.

The success of all these events, even though they have been held in such quick succession, illustrate graphically how the landscape of the India-ASEAN economic relationship has been transformed in recent years. Business, industry, and governments are waking up to the vistas of opportunity, which have opened up with the spread of technologies, the advance of globalization and the complementary strengths and needs of the economies of ASEAN countries and India.

India-Thailand economic cooperation has been one of the important contributors to this trend. In our case, there is firstly the compelling logic of geography. We are maritime neighbours. It is perhaps not so well known that India’s Andaman and Nicobar Islands are much closer to the Thailand coast than to the Indian mainland! It is therefore natural that India’s ~Look East~ orientation should have a sharper focus on the country, which lies just beyond our eastern islands.

Our two countries have inherited common traditions and share cultural and spiritual affinities. In the last few years, we have worked to give contemporary content to this historical legacy. The increased frequency in our high-level contact has improved bilateral understanding and mutual awareness. Our engagement is expanding across a range of political, security, economic, technological, social and cultural fields.

There are important convergences of interest and economic complementarities between India and Thailand, which should accelerate this process. I shall enumerate five of them.

• Thailand can be India’s commercial bridge to Southeast Asia, while India provides Thailand with a huge domestic market and a low cost, high skill manufacturing base for Thai businesses for their global access.

• Thailand’s acclaimed competence in infrastructure – including ports, airports, highways and urban amenities – match our growing requirements in these fields.

• In the knowledge economy, India’s software skills can usefully support the rapidly developing hardware capabilities of Thailand. Our growing skills in biotechnology can be combined to utilize the range of biodiversity in our two countries.

• India is among six countries with the ability to provide end-to-end capabilities in space—from design and fabrication, tracking and control, to launching of satellites. We have a special expertise in the area of harnessing space technologies to developmental applications.

• India can benefit from Thailand’s outstanding skills in developing world-class tourism facilities. The Thai hospitality industry has lucrative opportunities in India, particularly in the cultural and pilgrimage centres of common interest to both peoples.

What we need to be asking ourselves - particularly at a gathering such as this – is, why have these complementarities not translated into performance? When we look at our current trade turnover of about a billion dollars, we can only be astonished at the under-achievement.

If we look at two-way investment figures, there is a similar mismatch between potential and reality. India, which is a net capital importing country, has invested about 1 billion dollars in Thailand. The figures of Thai approved investment in India are only about 700 million dollars. When we look at the actual investment, this figure drops to less than 70 million dollars.

Prime Minister Thaksin has talked about Thailand’s desire to use the ~economies of speed~ to commercial advantage. With a market of one billion and the second-largest skilled workforce in the world, India offers economies of scale. I would suggest that the ideal strategy is to link the economies of speed and scale. India should therefore be a logical destination for Thai investment.

During my current visit, we have discussed ways to raise our partnership to higher levels. We have signed several important agreements, including a Framework Agreement on establishing a bilateral Free Trade Area. We have also signed other Agreements on cooperation in the fields of Tourism and Biotechnology.

The FTA Agreement will eliminate some of the major barriers to trade and investment. We have worked out an Early Harvest Programme for immediate tariff reductions for some products. We have to expand on this. I am aware that there will always be those who are not satisfied with the pace of our bilateral tariff reductions. Businessmen will find such measures too slow or too fast, depending on their interests. For some, tariffs can never be low enough; for others, they can never be high enough. It is therefore a delicate problem of balance. We will have to find a mutually convenient pace to move forward.

We need to promote the connectivity, which enhances the quality of economic cooperation. India has offered rights to Thai Airways for daily flights between Bangkok and our four major cities of Delhi, Mumbai, Chennai and Kolkata. We have also offered an unlimited number of flights to and from 18 other cities in India. I was happy to hear from Prime Minister Thaksin that Thailand would reciprocate this offer. Our bilateral Tourism Agreement will give further impetus to our tourism exchanges.

We have also agreed to promote the idea of cross-regional tourism linkages to enhance the attractiveness of Asian destinations to tourists. As a beginning, we will set up a twin-city relationship between Port Blair, in the Andaman Sea, and Phuket.

The process of establishing a closer economic relationship relies on the quality of interactions between our business communities. Governments should take the necessary steps to increase connectivity, to intensify people to people exchanges, and to strengthen the architecture of the partnership. But eventually, increased trade, investment and joint ventures can only be achieved through the efforts of the business community.

There must be more involvement and interaction between you to identify available opportunities. You should participate in trade fairs, exhibitions and business events. You need to form strategic alliances to develop markets in our common neighbourhood. Bilateral economic relations will acquire a dynamic of its own, when they are driven by business interests. Governments will then no longer need to set targets for trade turnover.

We are today at a happy confluence of India’s ~Look East~ posture and Thailand’s ~Look West~ strategy. Our partnership is not solely economic. We are located astride the sea-lanes for energy supplies from West Asia to markets in the East. Therefore we have a common stake in peace, security and stability in this region. We also have important interests in regional and sub-regional cooperation. These perspectives can result in significant spin-offs for business. The India-Myanmar-Thailand highway project is one such example.

In our discussions with the leadership of Thailand, it was evident to us that there is commitment in the two governments for our multi-faceted cooperation. We need stronger government-industry partnerships to give this process a quantum jump. I hope your deliberations today and in future business conclaves will explore ways of enriching such partnerships.

Thank You~.