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« Back to India Ascendent main page    Transcript for: India AscendentIndia Ascendent THINK TANK WITH BEN WATTENBERG #1203 India Ascendant FEED DATE: 07/01/04 Funding for this program is provided by... (Pfizer) At Pfizer, we’re spending over five billion dollars looking for the cures of the future. We have 12,000 scientists and health experts who firmly believe the only thing incurable is our passion. Pfizer, life is our life’s work. Additional funding is provided by the Lynde and Harry Bradley Foundation, the John M. Olin Foundation, the Bernard and Irene Schwartz Foundation, and the Smith Richardson Foundation. (opening animation) WATTENBERG: Hello, I’m Ben Wattenberg. India is the world’s largest democracy with 1.1 billion people. These days India has a vibrant economy and is best known for its advances in information technology and schools that produce world class high-tech personnel. But India has daunting challenges as well. Poverty is endemic. Its bureaucracy struggles with corruption, and a dangerous nuclear standoff with neighboring Pakistan has threatened the entire region. What is in store for India in the decades to come? Could India become a new superpower? And what does that mean for America? To find out, Think Tank is joined by Gautam Adhikari, former Executive Editor of the Times of India, a consultant with the World Bank, and a visiting fellow at the American Enterprise Institute; and Frank Wisner, former U.S. Ambassador to India, a 35 year veteran of the State Department, and currently a senior vice chairman at the American International Group. The topic before the House: India Ascendant. This week on Think Tank. WATTENBERG: Okay, Gautam Adhikari and Frank Wisner welcome to Think Tank. Gautam, India is always described as the world’s largest democracy...something to be very proud of. How did that come about? Just a very brief history of what happened. ADHIKARI: Well some would argue that India’s democracy goes back to the third century BC with, you know, the start of Buddhism and the tradition started by King Hashoka. WATTENBERG: No, I’m talking - you know what I’m talking... ADHIKARI: But now, very much more recently began as a part of the nationalist movement under the leadership of Gandhi and some other leaders who, while fighting the British, kept demanding more and more democratic rights. WATTENBERG: Now which Gandhi was this? ADHIKARI: This is Mahatma Gandhi. WATTENBERG: Right. ADHIKARI: The original father who was called the father of the nation. So it really began during that period during his leadership of the Congress Party and a little before. WATTENBERG: But the British left colonial India what - in 1948? Is that right? ADHIKARI: ’47. WATTENBERG: 1947. ADHIKARI: Yes. WATTENBERG: So it’s - and it was really the first of the less-developed colonial countries to have a full-fledged democracy. Is that right? ADHIKARI: Yes it was actually, I think, the first of the major colonies to get independence. And it started out as a democracy and looks like fifty years hasn’t made a difference; it’s still a democracy. WATTENBERG: And Frank, it was threatened once when Mrs. Gandhi declared what - Marshall Law? WISNER: Yes that’s correct. In the 1970s. WATTENBERG: And she was then booted out of office. WISNER: She lost office, but she came back later on again by democratic election. WATTENBERG: But didn’t try to take over the country as a... WISNER: No, she didn’t try to repeat the emergency rule that she instituted in the ’70s. WATTENBERG: Right. Now the big story that I wanted to investigate here a little bit is this economic growth. We are - my team here on Think Tank did some good research for me and I’ve been talking to people - people are talking about six percent annual growth, seven percent annual growth, eight percent annual growth. There was this Goldman-Sachs report, did it say eight or nine or ten? I mean these are phenomenal growth rates, albeit from a low level. You buy them? ADHIKARI: Well six percent is the average over the last ten years or so. WATTENBERG: And that’s very good. ADHIKARI: That’s very good. Last year wasn’t very good; it was around 5.4 percent or something like that. So from that slightly lower base, this year it’s climbing rapidly and in the last quarter... WATTENBERG: This year, 2004? ADHIKARI: The fiscal year in India is from April to the end of March and so it’s 2003 and 2004 right. So for that fiscal year its growth rate - some are saying could touch 7.5 percent this year because the last quarter was over eight percent. WISNER: India broke into the growth period in the early 1990s. It has been in the top four or five countries in the world in rates of growth going over these... WATTENBERG: So it’s really been going on for fifteen years or so. It was... prior to that it was semi-socialist or a socialist country wasn’t it? WISNER: It was a command economy and you were looking at three- percent rates of growth. WATTENBERG: Yes. WISNER: Well below where India could compete in the Asian world and elsewhere. WATTENBERG: And the great irony. and you ought to know this, during the Cold War India was more or less allied with the Soviets rather than with their democratic alleged - I mean, putatively democratic cohorts, the Americans. Is that right? WISNER: That’s right. There were obviously a number of reasons and I don’t think the Indians ever would have agreed that they were allies, but there was a very close affinity. India’d been worsted in a war with China; Russia was present in Asia; India and Pakistan were at odds; we were friends with Pakistan and so the Indian association with the erstwhile Soviet Union was a real fact. But when the Berlin Wall came down and the former Soviet Union fell apart then India was out looking for new rooting in the world. WATTENBERG: And there’s something else going on in India, which is terribly important, which is that the birth rates and the fertility rates have come way down from about six children per woman to about three children per woman, which really puts you in a - and it varies throughout the country - but in a modern sort of a setting. ADHIKARI: Yes, the growth rate is now 1.7 percent. WATTENBERG: No, no. I’m talking about the number of children per woman. I mean it’s been way down. ADHIKARI: Okay, yes. Yes. WATTENBERG: Now how many languages are there - dialects, ethnicities in India? I mean that’s - I don’t know, specific numbers. I had them here somewhere, but... ADHIKARI: Well there are officially seventeen official languages, with three - two national languages, which is English and Hindi. There are... WATTENBERG: Now is English the language of the elite or do many people...is it a required course? ADHIKARI: Not in every state but there - for awhile many states dropped English as a requirement - and then they fell back in comparison to other states. And therefore it’s been reinstituted by most states. But it is still a language of a relative few... WATTENBERG: So you have sixteen official languages, and then how many ethnicities and.? ADHIKARI: Oh, the dialects would be... WATTENBERG: ... the dialects... ADHIKARI: ... anything between 800 to 2000, I mean there are various estimates of this but at least 800 dialects within the Indian subcontinent. WATTENBERG: And how many ethnic groups? ADHIKARI: That is difficult to measure because the ethnic groups are - it depends on whether you’re talking in cultural terms, linguistic terms or genetic terms you would have to sort of define it in India. Everything... WATTENBERG: A ballpark figure, it’s hundreds? ADHIKARI: Probably hundreds. WATTENBERG: Yes. ADHIKARI: Yes. WATTENBERG: So it’s... ADHIKARI: And five major religions. WATTENBERG: And five major religions? ADHIKARI: Yes. WATTENBERG: It’s one of the largest - I mean it’s a Hindu country but its minority Muslim population is one of the largest Muslim populations in the world. WISNER: It’s second in the world. WATTENBERG: Actually probably next to Indonesia I guess or... ADHIKARI: Indians in fact don’t like themselves to be described as a Hindu country because constitutionally they’re a secular nation and that is one of the major points of disagreement with Pakistan. Even from the time of partitions, Pakistan is an Islamic country, which is dominated by a Muslim population which is about 98 percent of the total population. In India; the Hindu population would be about 80-82 percent. WATTENBERG: Now there’s talk that finally India and Pakistan are going to sit down and try to get rid of this border war up in the north in - where’s that? ADHIKARI: Kashmir. WATTENBERG: In Kashmir. ADHIKARI: Right. WATTENBERG: Is that going to work, Mr. Ambassador? WISNER: Ben, we have all got to be hopeful. It’s just terrific news what’s happened seeing the Prime Minister of India, the President of Pakistan come together in recent days building over the last nine months, putting together a lot of confidence building measures, people-to-people contact, trade, transportation links and how they’re committed to actually sit down and talk about the hard political issues, of which Kashmir is the toughest. WATTENBERG: That’s where we’ve had the riots and the fighting and all that stuff. WISNER: There’s been an active insurgency, a lot of cross-border violence and terror for the past decade-plus... WATTENBERG: Initiated by the Pakistanis? WISNER: Coming across the border from Pakistan. WATTENBERG: Coming across the borders. I mean you were... WISNER: ... a native insurgency in the beginning but heavily fed with cross-border infiltration. WATTENBERG: And the issue is who’s going to control Kashmir. which now is a northwestern India province. Is that right? WISNER: Well the original state of Kashmir at the time of partition was in the fighting between India and Pakistan in 1947-48. Part of the state went to Pakistan; the majority stayed with India, and that portion with India’s been the contested portion for nearly fifty years. ADHIKARI: It’s actually 35 percent area-wise - 35 percent with Pakistan; about 45 percent with India and 20 percent with China after the 1962 China/India border war. China took about 20 percent of Kashmir and it’s still there. And nobody in fact talks about it. That’s almost given up. WATTENBERG: And both India and Pakistan have nuclear weapons now? ADHIKARI: They do. Yes. WATTENBERG: Very dangerous situation. ADHIKARI: It is a dangerous situation. WATTENBERG: Are either of you concerned that India is in danger of losing its democracy to some of these extremist religious groups like the Hindu Nationalist Party or is that not... ADHIKARI: Well, Ben I would say that India has no option but to be a democracy for precisely the reasons we talked about earlier, which is that with its diversity... WATTENBERG: It’s so disparate. ADHIKARI: It’s so disparate and also apart from that it is a country that has grown out of a democracy movement - the nationalist movement - and the traditions have gone deep into the Indian population. At the village level, every election is almost like a festival out there. People assert their rights and the people from the lowest castes are today in positions of power. There are chief ministers who come from the lowest caste in the caste hierarchy within India and that has been possible because the democracy and people aren’t going to give that up just like that. Besides it’s almost impossible I think to rule India in a dictatorial manner. WATTENBERG: Gautam, tell me about the story we’re all reading about all the time, which is information technology, which is going on. Bangalore and Hyderabad - those are the two centers? ADHIKARI: Well those are the two main centers at the moment but I mean there are centers coming up all around the major metropolitan cities. WATTENBERG: And these are staffed by Indian nationals who have gone through technical training in what I gather are some of the best schools in the world. Is that your observation? WISNER: Excellent, excellent, excellent technical training areas. Some modeled after the American experience or after the MITs and producing just brilliant people, many of whom have come to live in the United States. WATTENBERG: Is India a good place to invest? WISNER: India is a good place to invest. WATTENBERG: As good as China? WISNER: I would say both countries require you to be astute. India’s not a place you invest if you’re fainthearted. There is a lot of regulation; there are a lot of problems with infrastructure but basically... WATTENBERG: But more free. More free by far with each year going down the road I gather? Is that right? WISNER: Yes; though the rate of change has been uneven. I’m an optimist about India. WATTENBERG: It’s said that India is the first less-developed country. You’ve told me this as well. It’s the first less-developed country to take off , not on the basis of muscle power and brawn and natural resources but on intellectual sorts of things. ADHIKARI: Well it’s yet to be demonstrated and proven, but it looks like this is going to be so because there’s talk of India leapfrogging certain stages of development because of its tremendous grasp over the information technology sector as well as its tremendous strides in telecommunications and other forms of communications. The problem is infrastructure, which I think Frank would in a better position to talk about, but I can tell you that in the energy sector and other inroads and transportation there still are major problems. But they are being looked at now with great seriousness. See, India had one handicap, which is it really started its reform process forty years after it gained independence from the British. So we shouldn’t write off everything that they did. But at the same time I think I would agree broadly with that statement. WISNER: Ben, I’d add something I’m sure Gautam would agree with as well and that is you look into this century if you’re like me, biomedicine... WATTENBERG: This century meaning this 21st century. WISNER: The 21st century. What’s going to happen in biotechnology is just going to transform our lives in the most fundamental ways. WATTENBERG: And Indians are... WISNER: And Indians are on the cutting edge of those changes. ADHIKARI: Including stem-cell research. WATTENBERG: Is that right? ADHIKARI: Yes. WATTENBERG: Well what are the big - okay, we’ve told the story that every Indian would like to hear - what are the big internal stumbling blocks? I mean this is not a paradise to say the least. WISNER: Well I’ll take a crack at it first, Gautam. WATTENBERG: Be honest, now. WISNER: I think that the... WATTENBERG: You’re not an ambassador anymore and you’re not the editor of the Times of India anymore... WISNER: I said to you earlier Ben, I believe I’m an optimist about India’s future. WATTENBERG: Yes. WISNER: But the pace with which she advances will be - is still a bit of a question. Depends how squarely India addresses the key economic reform challenges she has before her, and that is getting - expanding, deepening, broadening the financial sector so you’re generating capital; developing infrastructure so there’s adequate electricity and transportation means before the country... WATTENBERG: What about corruption? WISNER: Corruption’s an important issue... WATTENBERG: You’re not an ambassador anymore... WISNER: ... that as a businessman I’ll tell you Ben, in India an American businessman can say no and still get ahead with his investment. You are not forced to enter into corrupt practices because you want to do business in India. You’ve got to be tough about it, but you can get ahead with your investment without... WATTENBERG: You buy that, Gautam? Or is there a lot of corruption still? I mean it’s still a pretty slow-moving bureaucracy. ADHIKARI: Oh, yes and it’s one of the largest bureaucracies in the world so there’ll be lots of corruption. WATTENBERG: And there are a lot of palms to grease. ADHIKARI: But there - however, I mean from 1991 to now there’s a whole reform process going on, which is that it is reducing the number of rent-seeking or rent collection points, as they say in economics, which is that there are places in the bureaucracy where they can say yes or no and make a big difference to a business decision. And therefore you can probably... WATTENBERG: So you’re diminishing the possibility of corruption. ADHIKARI: ...diminishing, yes. Take industrial licensing, for instance, because it followed a command-economy kind of pattern of growth. Industrial licensing was there in almost everything. You had to take permission from the state government, from the central government, the state government had to take permission from the central government. It was a complete maze the way this thing used to be done. Now that has changed for almost every sector of the Indian economy except I think for about 18 of which they call priority sectors. WATTENBERG: Now India is still by far a rural, peasant society. Is that correct? WISNER: Yes, I certainly would agree. Ben I think that one of the important points you’ve been making during the course of this discussion is India’s diversity and it’s as true in the economy as it is in the population. India is four or five economies all operating at the same time. You have on the one end a 21st century, high tech economy that is catching the attention of the world. You’ve got a 20th century industrial economy and India’s a very strong producer of chemical steel. She’s a very capable producer of modern industrial goods - straight 20th century. She’s got 19th century economy. A cumbersome, bureaucratic government, a lot of state-owned industries, slow-moving. And you have a medieval economy. In much of the rural areas. People with very small plots, family plots, and survival agriculture. WATTENBERG: That’s rural Oxen with wooden plows and... WATTENBERG: If you have this kind of economic growth and you have 1.1 billion people, it’s going to go up to 1.5 billion and then allegedly come down, according to these U.N. statistics, but it’s gone up. Are there going to be environmental strains on the land, on the water, on air that are possibly treacherous? ADHIKARI: There already are. And they’re pretty severe problems. Drinking water remains a severe problem in India, but water availability is still a problem in India. And that is an issue that the government is trying to tackle, but it’s a mammoth problem. So it will take a long time to WATTENBERG: Do you buy that? WISNER: I buy it. Air quality another serious issue, particularly in the major metropolitan areas in northern India. Environmental sensitivity is rising very sharply in India. Long past the day... WATTENBERG: Yet what we have seen, and we saw it in east Europe and west Europe, is that the richer a country gets the better it can handle these sorts of problems. ADHIKARI: I think being a democracy helps a lot. You see there are thousands, literally thousands upon thousands of NGOs - non-government organizations, many of whom are in the environmental sector. WATTENBERG: Right. ADHIKARI: And they’re keeping up a constant pressure, either by petitioning the government, stating demonstrations, writing, using television as a medium, using film as a medium. WATTENBERG: Frank, let me ask you this. What is the reason for this Indian economic boom, if you had to try to isolate it. I think, you’re in the business community, what do you see there that’s going on? WISNER: I think India has got it about globalization. India realizes that she can fundamentally alleviate the historic burden of poverty if she gets in the world trades, exports goods and services and particularly gets out ahead of the pack, capitalizes on her intellectual capital and moves into the 21st century in information technology and biotechnology. She will be a significant player on the world’s stage. WATTENBERG: Is India’s success good for America? WISNER: I believe India’s success is good for America. India’s not only going to be a great market for American goods and services; India’s going to be a constructive, not always agreeing with using force for peace and stability in Asia and a growing global presence that respects democratic norms and sees the world as a world of balance; sees the world by necessity of the resolution of disputes by non-forceful means. ADHIKARI: I think in two ways it’s very good for America, because we have to point out that the Indian constitution was largely modeled on the American constitution. WATTENBERG: But it’s a parliamentary system. ADHIKARI: Nevertheless, the way the constitution was written, especially by one of its founding fathers, Dr. Umbedka, he actually studied at Columbia and studied the American constitution system. And, you know, introduced certain rights within the Indian constitution from day one, which were definitely borrowed from the American system. Of course it’s a parliamentary system modeled on the British one. So in that sense India demonstrates the same values that America not only cherishes but wants to promote around the world. And in another sense India demonstrates, which you had mentioned earlier, that democracy and economic growth are not mutually exclusive. If India with its billion people can remain a democracy... WATTENBERG: I think they’re contingent upon one another. I mean in the long run history will tell us whether that’s true or not but that’s ... ADHIKARI: Absolutely. I think I agree with that. ADHIKARI: But many people would argue that democracy holds back economic growth. Many people in Southeast Asia have argued the Asian values argument. But India in a way demonstrates that, yes, the wrong economic policies kept it back for forty years, but once it started adopting the right economic policies from 1991, democracy has been a boom, an aid to economic growth. WATTENBERG: So if you have a market system and a democracy, you likely have a winner. ADHIKARI: Yes. Absolutely. WATTENBERG: There’s this great drive and President Bush has given three huge speeches this year about pushing democracy and human rights forward around the world everywhere. Is the subcontinent of India, with a billion people as good democrats, which is a pretty sloppy system, generally gone on basically for fifty years, is that the proof when people say 'oh, well democracy can’t work everywhere.' I mean you know, people aren’t ready for democracy. Is India the place where you say 'well, you’re wrong. Look at India'? WISNER: Ben, I could look at India and I feel very good about our great democratic experiment. Messy, uneven as it is, India has had a terrific run with democracy; it’s been good for the country, it’s maintained national unity and now it’s giving economic prosperity. But I argue a point that Gautam made at the beginning of the show and that is democracy was born inside of India. Democracy can’t be imposed from the outside. WATTENBERG: On that note, Gautam and Frank, thank you both for joining us on Think Tank. And thank you. Please remember to send us your comments, we think it helps us make a better program. For Think Tank, I’m Ben Wattenberg. Announcer: We at Think Tank depend on your views to make our show better, please send your questions and comments to New River Media, 1219 Connecticut Ave NW, Washington, DC 20036 or email us at thinktank@pbs.org. To learn more about Think Yank, visit us online at pbs.org and please let us know where you watch Think Tank. Funding for this program is provided by... (Pfizer) At Pfizer, we’re spending over five billion dollars looking for the cures of the future. We have 12,000 scientists and health experts who firmly believe the only thing incurable is our passion. Pfizer, life is our life’s work. Additional funding is provided by the Lynde and Harry Bradley Foundation, the John M. Olin Foundation, the Bernard and Irene Schwartz Foundation, and the Smith Richardson Foundation. This is PBS. Back to top  Think Tank is made possible by generous support from the Smith Richardson Foundation, the Bernard and Irene Schwartz Foundation, the Lynde and Harry Bradley Foundation, the John M. Olin Foundation, the Donner Canadian Foundation, the Dodge Jones Foundation, and Pfizer, Inc. ©Copyright Think Tank. All rights reserved. 
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