Prime Minister of India - Dr. Manmohan Singh

PM's speech at the CII Partnership Summit, 2005

Shri Buddhadeb Bhattacharya, Shri Ratan Tata, Shri Sunil Kant Munjal, Shri Deveshwar, Shri Muthuraman, Distinguished visitors from overseas, Ladies and Gentleman,

It is always a pleasure to be in Kolkata. I am particularly delighted to be here to inaugurate the Tenth Partnership Summit of the Confederation of Indian Industry. Kolkata is not only the birthplace of CII but also of the Partnership Summit. Ten years ago, when Prime Minister Narasimha Raoji inaugurated your 1st Partnership Summit, your partner country was Singapore and our Government had unveiled its "Look East" policy that has since brought India closer to our eastern neighbourhood. I sincerely hope that Kolkata will once again emerge as a bridge between India and the rest of Asia.

The past two decades has been for us a period of change and adaptation to a new world. Despite many changes in Government at the Centre, the economic and foreign policies that were initiated in the early 1990s have stood the test of time and there is today a broad national consensus around them. I must compliment CII for playing a pro-active role in building this consensus at home and in projecting the change abroad. I value the partnership we have been able to build between Government and Business and thank the leadership of CII for its helpful role.

Today this partnership between Government and business is exemplified by the fact that Shri Ratan Tata heads the Investment Commission our Government has set up to step up the rate of investment. I have great expectations from the initiatives this Commission will take because we cannot step up the rate of economic growth and of employment generation without increasing the rate of investment. India needs investment - in infrastructure, in manufacturing industry, in the services sector, in education and healthcare and most importantly, in agriculture and agro-processing. Stepping up the rate of investment is receiving our Government's highest priority.

I am also delighted to be here today because of the opportunity to share a platform with the dynamic Chief Minister of West Bengal, Shri Buddhadeb Bhattacharyaji. When I read in the newspapers that Shri Azim Premji had called him the Nation's "Best Chief Minister" I was not at all surprised. I have greatly admired his wit and wisdom, his qualities of head and heart, his courage of conviction and his passionate commitment to the cause of the working people of India and, in particular, to the people of Bengal. India needs more such visionary and courageous political leaders who understand the challenge of modernization.

It used to be said in the 19th Century that "what Bengal thinks today, India thinks tomorrow". In more recent times doubts began to be raised whether this was any longer true with other States moving ahead in the race for development and modernization. With Buddhadeb babu at the helm of affairs it appears Bengal is once again forging ahead. During my visit to New York, when some foreign investors raised some doubts with me about the influence of the Left parties on our Government's economic policies, it was Shri Purnendu Chatterjee who came to our defence, re-assuring them that if Buddhadeb's Bengal is investment-friendly, can't the same be true of the government in Delhi? With certificates like these from Premji and Purnendu, I do not have to re-assure this audience that not only is our government committed to providing an investment friendly environment but also has the full support of our left allies in doing so. We have committed in the NCMP to boost private investment and encourage FDI particularly in areas of infrastructure, high- technology and exports. If Communist China can be the top investment destination in the world and if a Left Government in West Bengal woos FDI aggressively, I see no reason why the UPA government cannot make India an equally important FDI destination.

Ladies and Gentlemen,

When I look back at our efforts to change the direction of economic policy since the early 1990s I am convinced that our most difficult challenge and, hence, our biggest achievement, was to change people's "mind set". Karl Marx had once said, "when ideas capture the minds of men, they become a material force in society". If today there is a meeting of minds between Delhi and Kolkata, it is because the ideas that I and Buddhadebji represent have captured the minds of the people of India. This is the idea of growth with equity and social justice. The idea that economic liberalization and modernization have to be mindful of the needs of the poor and the marginalised. There is no doubt that the idea of economic openness and social democracy have captured the minds of our people. These ideas have become a material force and, indeed, a motive force of change. India today is willing to be more closely integrated with the world. I do believe that those who may have been skeptical about this at the time of the 1st Partnership Summit here in 1995 are today convinced that we are today more willingly engaged with the world than ever before in history.

I am aware that at times some of the views expressed by our alliance partners on the Left may have raised some doubts in your minds. But I am sure you will leave this Summit re-assured and convinced that there is today a wide-ranging consensus on the necessity for India to be actively engaged with the world economy. Our Government has already taken several steps towards this end. I have repeatedly reaffirmed our commitment to the successful functioning of the multilateral trading system and to broadening the agenda of the World Trade Organisation with an increasingly liberal flow of goods, services and labour. We are committed to lowering our tariffs at least to ASEAN levels. This is a policy priority for us. You are also aware that we are negotiating Free Trade Agreements with Singapore and ASEAN. I have stated my commitment to the idea of creating an Asian Economic Community, an arc of prosperity across Asia, in which there are no barriers to trade and investment flows and to the movement of people.

India is moving quickly to re-discover its historic and organic links with Asia. The India-ASEAN Car Rally, sponsored by CII, was a resounding success because it generated enormous popular enthusiasm all along the route, bringing the people of our neighbourhood closer to us. I want to see more such people-to-people and business-to-business interaction across our entire Asian neighbourhood. As the response to the recent Tsunami tragedy showed us and the whole world, the destinies of India and Asia are increasingly bound together, in good times and bad times, in joy and sorrow, in prosperity and pain.

Ladies and Gentlemen,

The time has come for India to make bold and rapid strides. I urge you to think big. At the recent meetings of the Council on Trade and Industry and of the Manufacturing Competitiveness Council, I was heartened to see many of our business leaders share this sense of urgency and of the necessity to THINK BIG and THINK BOLDLY. The era of incrementalism is over. We cannot afford to just do things better. We must do them differently. The challenge before us - in economic policy, in social policy, in education policy, in foreign policy - is to "think out of the box". We must think anew, afresh and ahead.

An important step we must take to enable this change of mind set is to innovate and rejuvenate our "knowledge institutions". Our schools and colleges, universities and research laboratories, our think tanks and policymaking institutions. I have decided to create a National Knowledge Commission to strengthen the roots and sinews of our capacity and capability building so that we are better prepared for the challenges of the 21st Century.

This Commission would be a catalyst in setting ambitious knowledge targets and enabling agencies to attain them. The agenda of the National Knowledge Commission will be shaped by a knowledge pentagon with five areas for action, namely: to increase access to knowledge for public benefit; develop new concepts of higher education; rejuvenate Science & Technology institutions; enable application of knowledge by industry to enhance manufacturing competitiveness; encourage intensive use of knowledge-based services by government to empower citizens.

We must make our universities world class and centers of innovation and excellence. Our Science laboratories must be repositioned for creation of knowledge necessary to develop new products and services. We must orient our industries to create application of new knowledge to increase productivity, gain competitive advantage and improve conditions of people engaged in work. We must improve services provided by government through the use of information technology. Above all we must become not merely a knowledge producing society but a knowledge-sharing and knowledge-consuming society. We must reinvigorate knowledge sharing units like public libraries and create knowledge hubs in every village. Knowledge must be used to empower the disempowered, like scheduled castes and scheduled tribes, other backward classes, minorities and women. Access to knowledge will strengthen liberal democracy at the grassroots. I want business leaders as well as our political and intellectual leaders to work with the Knowledge Commission so that we can build a more open society and a more open economy. Building a knowledge economy and a knowledge society is the only way in which we can meet the challenge of globalisation.

I am convinced that India has to be a more open economy and must derive the benefits of globalisation, even as we equip ourselves to deal with its challenges. This is a course which we have set and we shall stay this course. I commit our government to an open, caring economy, an economy where the marginalized are empowered so that they become partners in development and share the benefits of growth. We have been taking firm steps in this direction, systematically and steadily. We have begun the process of rationalizing our indirect tax structures with a movement towards a VAT system and a common goods and services tax. We have opened up international markets to our airlines so that they become global players. Policy measures are being taken to make a quantum leap in infrastructure sectors such as airports, roads, power, ports and railways. At the same time, we are increasing the emphasis on education, health and employment. The education cess, the Rural Health Mission, the Food for Work Programme to be followed by an employment guarantee are all major initiatives to make our economy a caring one.

I am happy to inform you that we will be doing away with the restrictive provisions of Press Note 18 for all future joint ventures with foreign partners. This is a regulatory provision that has been a source of some discomfort to investors. As I listened to tales of success of Indian firms in the global marketplace and the words of optimism at a recent meeting the Manufacturing Competitiveness Council, I was convinced that measures like Press Note 18 are anachronisms today, having outlived their purpose. In the new dispensation, while existing joint ventures will continue to be protected by a few provisions of Press Note 18, new joint ventures and collaborations will have to be shaped by commercial contractual agreements based on the free will of partners without government interference. For existing joint ventures, the protection will be restricted to the same - and not allied - field and not for defunct or sick joint ventures. My colleague Shri Kamal Nath will be making a detailed announcement to this effect later today at this summit.

Ladies and Gentlemen,

The Partnership Summit has been a forum where you have debated India's economic and strategic relations with the world. In this sphere too, we must move away from "incrementalism" to seeking "out-of-the-box" solutions to the challenges we face. Whether it is the challenge of development and political and social stability within South Asia; Or, the challenge of stabilizing our relations with Pakistan and China: Or, the challenge of improving our relations with Major Powers; Or, even the challenge of increasing our share of world trade and investment flows. We must have the courage to question our assumptions and challenge pre-conceived notions. We must show a willingness to listen to others, even as we articulate our own concerns in a reasonable and convincing manner. We cannot compromise on our core national security concerns, nor indeed can we compromise on the values that define our Nationhood. In dealing with the outside world, every Nation draws a bottomline defined both by the values and principles of its Nationhood and by the concerns of its national security. However, once we have drawn this bottomline we must have the imagination and courage to engage the world, to strike deals, to win friends and influence people. I hope forums like yours will encourage bold intellectual engagement, based on a clear understanding of our national interest and of our obligation to posterity and to mankind.

Friends,

The national response to the Tsunami tragedy was not only heartening but also showed that in the face of a crisis we have the national will and resources to meet the challenge head on. The people of India have shown their generosity in a time of distress. They have also shown their determination to be self-reliant, even while being gracious in responding to offers of assistance. Our response was not shaped by false pride or by chauvinism. We are happy to be part of a global community and to work with it. We will seek international assistance for our reconstruction effort. I submit to you that the "do-it-yourself" mood of the Nation is not an index of our isolationism. Far from it, it is an index of our resolve to turn an adversity into an opportunity. I hope we can all join hands to do just that and give the Nation a new sense of hope and direction.

Many decades ago, Rabindranath Tagore dreamed of a 'heaven of freedom' for his country. Today, as we stand in a free democratic sovereign nation, I can do no better than recall the immortal words that so aptly describe the India of the present �

Where the mind is without fear and the head is held high

Where knowledge is free

Where the world has not been broken up into fragments

By narrow domestic walls

Where words come out from the depth of truth

Where tireless striving stretches its arms towards perfection

Where the clear stream of reason has not lost its way

Into the dreary desert sand of dead habit.

Dear Friends,

Today, India is firmly on the road to attaining the vision of our poet. We need to strive to make that vision a reality in the near future. For this to happen, we seek partnerships for development even as we demonstrate to the world our ability and our capability to stand on our own two feet. That, I believe, has been India's message to the world. I sincerely believe that the world appreciates this and values the contribution we have been able to make to global peace and prosperity. I wish the deliberations of this summit all success.

Jai Hind.