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Books on India
REPUBLICAN REFERENCE
Area (sq.km)
3,287,590
Population
1,049,700,118
Capital
New Delhi
Currency
Irdian Rupee (INR)
President
Abdul Kalam
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Update No: 008 - (04/10/04)
Nuclear Issues
Asserting that the country had credible nuclear deterrence in place, India's
Defence Minister Pranab Mukherjee stated that specialized forces were being
raised to tackle the nuclear threat in all its dimensions. "Whatever is
needed to safeguard the country and to ensure effective deterrence, in line with
our nuclear doctrine of 'no first use', has been done," Mukherjee said in
an interview to PTI in New Delhi. According to Mukherjee, the Defence Research
and Development Organisation (DRDO) had a definite time-frame on test-firing of
the country's intermediate range 3000-km surface-to-surface ballistic missile
Agni-III. Moreover, he stated that India was committed to 'no first use' of
nuclear weapons and non-use of these weapons against non-nuclear weapon states.
The Defence Minister also said that India had reached an understanding with its
neighbouring countries to share information on missile test-firing. On the
question of establishing safeguards against selective nuclear strikes on forces
and on civilians, Mukherjee argued that special troops are being raised to
tackle such threats.
India-Pakistan Relations
This month was particularly eventful in a series of diplomatic negotiations
between the foreign officials of India and Pakistan beginning with the talks
between the two countries' Foreign Ministers and ending positively in New York
with the talks between Pakistani President General Musharraf and Indian Prime
Minister Manmohan Singh. These negotiations are part of the Composite Dialogue
Process that has been set in motion by initiating talks at the level of foreign
ministers. Before Musharraf and Manmohan Singh met in New York, the two foreign
ministers made positive steps by suggesting the start of a trans-border bus and
forging train links. However, issues like cross border terrorism and Kashmir
were not addressed squarely at these talks. But the diplomatic talks that ensued
between the leaders of the two countries were hailed as a "historic
moment". Pakistan's Foreign Office Spokesman, Masood Khan described the
talks as "rekindling" hopes for a viable settlement to the Kashmir
dispute. According to one of Pakistan's prominent daily newspapers, the Dawn,
the joint statement issued on behalf of Musharraf and Singh was "historic
and significant" as it promised to "look into all possible
options" for a negotiated settlement of the Jammu and Kashmir dispute.
President Musharraf is believed to have hailed the talks as a "major
breakthrough" and offering a "win-win" situation. India's Prime
Minister Manmohan Singh also seemed pleased with the positive outcome of the
talks.
Though the joint statement issued following the meeting between the two leaders
made little mention of India's concerns relating to cross-border terrorism, the
Indian Prime Minister later clarified that he raised the issue with the
Pakistani leader. At a press conference, Singh is reported to have said that he
had "unambiguously" conveyed to the General that talks hinged on the
commitment given by Pakistan. Pakistan had assured in January that territory
under its control will not be used for terrorist purposes against India. The
Prime Minister claimed there was a clear reference in the spirit of the January
6 joint statement. Both sides had agreed that Confidence Building Measures will
contribute to generate an atmosphere of trust and mutual understanding. "We
cannot discuss any substantive issue and CBMs, if terrorist acts are not
controlled. Therefore, there should be no doubt that this is the pre-condition
for moving forward," Singh said. The most important outcome of his meeting
with President Musharraf is that the two leaders agreed to discuss all options
to resolve the Kashmir dispute. Even though the topic of Kashmir has come up in
previous summit level meetings, this is the first time that the leaders of India
and Pakistan talked about possible solutions in a one-on-one meeting.
Even though these talks have been deemed to be "historic", it is
difficult to predict how far they will actually be successful in setting a
precedent. Both sides continue to be suspicious of each others intentions in
resolving the Kashmir issue which is a recurrent theme in the pattern of
India-Pakistan relations. For instance, this aspect becomes clear when we look
at the most recent attempts by President Musharraf to move the dialogue process
forward. Indian officials seem hesitant to accept President Musharraf's recent
assurance that the Pakistani army would not occupy Siachen glacier if Indian
troops withdraw from the world's highest battlefield. Musharraf made this offer
to Prime Minister Manmohan Singh during the latest round of negotiations held in
New York. The general distrust amongst army officials and politicians stems from
the bitter experience of the Kargil war of 1999. New Delhi seems unconvinced
about Musharraf's assurances since he is hailed by many in India as the
"architect" of the Kargil war. This war which the two countries fought
in 1999 was planned by the Pakistanis under General Musharraf's leadership.
Pakistan has also used cross border terrorism as a bargaining chip against India
to extract concessions from the latter on the Kashmir issue.
Economy
The $47 billion Japanese corporation NEC has finally put its foot directly
into the booming Indian IT space, with the announcement of operations of its
wholly owned subsidiary Niteo Technologies (P) Ltd, from Chennai. "This is
our first direct entry into India. We have been operating through partnerships
with tier I software companies like Infosys and Wipro since 1996. We want to
grow our business here and hence we have entered on our own," Yuji Ichimura,
Vice President, Corporate Planning and Marketing, NEC Solutions (America) said.
Niteo will follow a three pronged strategy in India. One of the major goals will
be to strengthen the partnerships which NEC has already established. "We
will grow the business with our partners. We source anything between $60 to 80
million worth of software services from Indian companies. Last year alone our
sourcing grew by 130 per cent. We will continue that growth pace with that
engine," he said. The second engine will be Niteo's own operations which
will initially be in the data field. "We will undertake mid to high-end
operations at Niteo like business intelligence and content management, he is
reported as saying.
The latest news on the outsourcing front in India is that the textile industry
in India is being seen as the next big outsourcing story for India. Apparel
Export Promotion Council chairman A Sakthivel estimates that Tirupur has seen an
investment of Rs 750 crore in plant and machinery and fresh employment of as
many as 15,000 people in the last single year. The Netaji Apparel Park in
Tirupur, being set up at an investment of Rs 300 crore, is about to go on
stream, and when fully functional, will see some 21,000 people working there. A
high-tech weaving and processing park that will house shuttle-less looms is
coming up near Surat, which houses the largest artificial silk and synthetic
textiles cluster in the country with around 6.5 lakh power looms. Total
garmenting capacity of Arvind Mills is expected to increase from the current
11.5 million pieces per shift to 14.5 million pieces by the end of 2004-05, and
this is proposed to be doubled by fiscal 2007 by working two shifts. The company
is also planning incremental investments of Rs 50-100 crore per annum in fabric.
A major development on the economic front is that Foreign Direct Investment (FDI)
in the crucial sectors of telecom and civil aviation are likely to be raised.
While the government received some initial opposition to this move from the left
parties, the latter have given their green light to hike FDI to 49 per cent from
the present 40 per cent in civil aviation, particularly in private Indian
airlines like Jet Airways and Air Sahara. Finance Minister P Chidambaram
convinced the Left parties on the importance of foreign investment. In return,
he agreed to seriously consider the Left's demands for hiking the EPF interest
rates to 9 per cent. In Civil Aviation it is now agreed upon that even after the
hike, Indian Airlines and Air India (the two major airlines in India) will be
out of the FDI ambit. "If the management control remains with Indians then
we have no problem if it is hiked to 49 per cent. It will help the airlines to
expand and modernize their fleet," says D Raja, CPI leader. And foreign
airlines will not be allowed to pick up equity in domestic airlines. But
analysts say the restriction on private airlines entering the domestic sector
will certainly hamper the growth of an industry that's desperate for big-ticket
investments. In the telecom sector, the internal differences between the
Finance, Home and Telecom ministries have been sorted out. The government has
opted for a middle path to hike the ceiling to 74 per cent. While the Telecom
Ministry will not insist on minority Indian shareholders controlling over 50 per
cent voting rights in the companies board.
Finance Ministry has also agreed that boards of telecom companies must have 50
per cent Indians, including Indian CEOs. Security clearance will also be
required but only from one agency, a move clearly to pacify the Home Ministry.
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