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Diplomacy in Action

Remarks at the East-West Center "Key Developments in South Asia"

Robert O. Blake, Jr.
Assistant Secretary, Bureau of South and Central Asian Affairs
Honolulu, HI
April 27, 2012


Thank you very much, Charles, for that kind introduction. I must say that it’s really a great pleasure to be here at the East West Center. It’s such a well known institution here both in Hawaii but also in Washington. And once I thought I was coming here to speak to PACOM and a lot of our friends in the military, I immediately contacted Charles and his colleagues. I thought it was a wonderful opportunity to talk to all of you as well about some of the important developments in South Asia. As Charles said, I’m responsible for one of the more problematic regions of the world. You probably wonder why I’m smiling. I’m smiling because I’m in Hawaii.

It’s quite a pleasure to get off an all-night plane ride, and come here, and see the palm trees swaying, and to hear Bruddah Iz in the background, and you know that things are quite different in this place than most of the places I spend my time. So, anyway, it’s really a pleasure, and again I want to thank the East West Center in particular, because we not only do take advantage of opportunities like this, but we partner a lot with the center on so many different things. We were just talking about some of the wonderful journalist programs that are now underway. A lot of the terrific programs to bring people from the region together, in this case journalists, but on many, many other topics as well, and those kinds of people-to-people and Track 2, Track 1.5 efforts are really so important to diplomacy that we practice every day.

I’d also just like, before I start, offer condolences to the East-West Center family on the passing last week of the great Japanese strategic thinker and somebody who was on the Center’s Board of Governors, Tadashi Yamamoto. It is really notable that his passing took place just as the Government of Japan was hosting the second-ever India-Japan-U.S. trilateral consultations and Yamamoto-san, I think, had really dedicated his life to building these kinds of ties. So I just wanted to pay tribute to him, and to say that his legacy will be honored by everyone in this region, as we continue to pursue a safer, and more cooperative, and more prosperous Asia-Pacific region.

I’d like to take this opportunity today to offer a briefing on the key developments and trends in the U.S. Government on how we see things developing in South Asia. And what I’ll do is focus primarily on India, and then talk a little bit about the central role of India in fostering regional economic integration, and then brief about some of the other key developments in the countries of South Asia.

So let me start first with India. India, as all of you know, is the world’s largest democracy, and a country that is projected by most to become the world’s largest economy by the year 2050, and also the world’s most populous country by the year 2030. And at a time when much of the industrialized world is facing rapidly declining birthrates, half of India’s population is under the age of 25, and therefore offers a huge opportunity for a growing population, a market economy, and again a country that is going to, I think, have a sustained economic rise over the next 40 or50 years, and for that reason alone, become an important partner for the United States. President Obama has said, “the United States not only supports India as a rising power, but …we have worked to help make it a reality.” Indeed, we have made much progress building a global strategic partnership between our two great nations. I’d like to provide a few examples.

First, our strategic ties and across-the-board interconnectivity are stronger than they’ve ever been. I’ve been working on U.S.-India relations since 2003, and I could tell you that everything from defense sales and exercises, to our growing education partnerships, what’s really striking is the broadening and deepening aspect of our strategic ties. We are working together to address some of the most complex and important challenges of our era. For example:

· India is an important and valuable partner in Afghanistan. It has a $2 billion assistance program; it has plans to invest almost $10 billion in the Hagicak iron ore mine; and it’s a lynchpin, as I said, in efforts to promote regional integration between South and Central Asia, a topic that I will come back to.

· Our defense cooperation continues to expand. We just completed joint Army exercises last month that were unprecedented both in their complexity and in their scale.

· Our respective navies recently participated in the MALABAR exercise that involved thousands of soldiers, and sailors and more than a dozen ships. We want a defense relationship between the United States and India, where at a moment’s notice our militaries could plan a joint peacekeeping operation or a joint humanitarian evacuation.

· Our U.S.-India Science & Technology Endowment Fund is a public-private partnership that we have developed to accelerate jointly-developed technological innovations, including the transition to high-performing, low-emissions, energy-secure economies through the research and deployment of clean energy technologies. As many of you heard, Secretary Clinton just announced that she’ll be going to India in about a little more than a week’s time, and I think we will be highlighting a lot of the clean energy efforts the United States and India are undertaking. · Also under the S&T area, our Fund recently announced its first grantee – a cold storage solution for fruits and vegetables – and we’re working to identify additional grantees.

  • Launched in 2009, our Partnership to Advance Clean Energy seeks to improve energy access, promote low carbon growth, and accelerate the transition to high performing, low emissions energy-secure economies through the deployment of clean technologies.
  • We’ve mobilized more than $1 billion for clean energy research and development, including a research center and a clean energy finance center to promote finance and investment in this vitally important sector for the United States and India.
  • The U.S. Department of Health and Human Services has worked to create the Global Disease Detection Center within India’s National Center for Disease Control in New Delhi, and to develop bilateral working groups on maternal and child health, infectious diseases, and strengthening health systems.
  • And we see great potential in other areas of cooperation, in areas like space and our recent joint initiative to open an Open Government Platform, a web portal that provides public access to government data to improve government transparency and civic participation.

So as you can see, our government-to-government partnership is substantial and broad. But these official ties are in large measure built on the people to people and commercial links that have grown spontaneously over the last two decades. Our role as governments is really to ensure that actors in the trade and commercial spheres have the opportunity to harness the incredible dynamism and innovation that now exist in our two knowledge-based economies.

Already, our bilateral trade relationship with India is booming. Bilateral trade in goods and services in 2011 reached $90 billion and will certainly surpass $100 billion this year. Interestingly, India is also a growing source of foreign direct investment and jobs into the United States, which we value very much. In addition with 1.2 billion consumers, India offers tremendous opportunities to U.S. exporters of goods and services. Businesses in all 50 states of the United States are now exporting to India. And while we’re pleased with the progress that’s been made, we must do more to address the impediments on both sides. With the rollout of our new Model Bilateral Investment Treaty, also known as a BIT, on April 20, we hope that the United States and India can soon begin negotiations on a Bilateral Investment Treaty, a development that really could revolutionize bilateral investment and trade between our two countries.

So we hope to highlight and build on all of this when Secretary Clinton hosts her counterparts in India in June in Washington for the U.S.-India Strategic Dialogue. Let me just turn now a little bit to the regional integration piece, which is so important. While our bilateral relations with India are certainly very, very important, the prospect for comprehensive regional economic integration, with India as the anchoring economy of the region, is perhaps the most important development for South and Central Asia and our own interests in that region.

Billions of citizens from India through Afghanistan and Central Asia, and Southeast Asia and beyond, could benefit. In a way, this is just an update of a very old idea, melding ancient trade and cultural links with modern economics. Why is regional economic integration so important? For one, the world is entering into a transpacific century, in which future economic growth, development, and the promise of innovation will come to define the rise of Asia. Economic opportunity changes lives for the better, and one of the ways to increase economic opportunity is obviously through growing trade. Right now, the need for greater economic integration and cooperation is stark. Negligible trade occurs between the countries of South and Central Asia, and in both regions, intra-regional trade comprises only five to ten percent of their total trade,, making these regions the least economically integrated regions in the world. But progress is occurring. The United States is extremely encouraged by the positive recent steps that have been taken by the Governments of India and Pakistan to initiate closer trade and commercial ties. Businessmen and women and civil society from both countries are at the vanguard of this effort, driving their respective governments forward. And let me just highlight some of the major recent developments:

  • Over the last few months, the two Commerce Ministers have led trade missions to each other’s countries.
  • Pakistan’s cabinet recently approved a new trading policy towards India, designed to promote, not restrict, the flow of goods. And India has agreed to reduce the regulatory restrictions and barriers that have stymied trade.
  • On April 13, after two years of construction, the two Commerce Ministers inaugurated a new “Integrated Check Post” at the Wagah crossing border, which could more than quadruple the commercial capacity of that crucial border crossing.

In Afghanistan, we were also pleased by the historic transit trade agreement between Afghan government and Pakistan; the full implementation of this agreement will provide a boost to the economies of the region by reducing the costs and delays in transport, and expanding regional reach to world markets.

At the Chicago Summit in May, the United States in partnership with NATO countries hopes to solidify long-term international support for Afghanistan’s security forces. And the Government of Japan will host in July a conference on supporting Afghanistan’s economic future. These conferences will send a powerful signal about our collective commitment to Afghanistan’s future beyond 2014. The United States also just completed a Strategic Partnership Agreement with Afghanistan that will outline the long-term parameters of that relationship. Let there be no doubt, we remain committed to Afghanistan through the transition in 2014 and for many years thereafter.

India has played a very helpful role, as I said earlier, in encouraging economic growth in Afghanistan. In addition to its $2 billion program, that has done so much to develop roads, power lines, hydro-electric dams, capacity-building, and training of various kinds, India signed a Strategic Partnership Agreement on Afghan President Karzai’s recent visit to India and is doing a lot in many ways to promote other kinds of trade. One of the most important is a “North-South” corridor, that is now being developed, which is a multi-modal transportation network that could dramatically cut the time for Indian exports to reach the European Union and other markets beyond there.

To the east, Prime Minister Singh’s visit to Dhaka in September 2011 highlighted gradually improving ties with Bangladesh. Both sides have taken steps to liberalize trade, and India supports construction of the Padma Bridge as a critical link between these two countries, and very important to this vision of East-West connectivity running through Burma and to South East Asia. India’s “Look East” policy has been transformed into an “Act East” policy. With a strong focus on maritime security, infrastructure development and improving trade ties, India is managing its strategic priorities in Asia through an economic lens. It has signed Comprehensive Economic Partnership Agreements with several South East Asian countries, as well as Japan and South Korea. And New Delhi annually also hosts the India-ASEAN Delhi Dialogue to foster more pan-Asian ties. India maintains the largest bilateral merchandise trade relationship with China in the region; bilateral goods trade in 2010 registered more than $80 billion, and are growing fast. It also has close ties to Singapore and has established new strategic partnerships with Indonesia and Vietnam. So clearly, the economic map of Asia is poised for significant changes in the 21st century, and the South Asia region stands to benefit if it can take advantage of its potential to tap global markets – beginning with greater regional inter-connectivity.

Turning from India to neighboring Bangladesh, we see a moderate, Muslim-majority democracy of 180 million people – nearly 2 percent of the world’s population – that has racked up a series of impressive and frequently unheralded achievements over the past few decades, and I’d like to just recognize Ambassador Jim Moriarty, who was recently our ambassador there and has done so much to propel forward our relations between India and Bangladesh. We’ll see how sorry we are that he left government [laughter]. Newly-independent Bangladesh lay in ruins at the end of 1971, after a brief but brutal war of independence. But overcoming long odds, Bangladesh in 2012 is a very different place. Although Bangladesh’s population has doubled since that time, the country is headed towards self-sufficiency in rice production, and some of the previously famine-prone areas in Bangladesh are now exporting rice to other parts of the country. Bangladesh also has made remarkable progress in lowering child and maternal mortality, which helped the country win a 2010 United Nations award for its remarkable progress towards the Millennium Development Goals. Bangladesh has become more adept at dealing with natural disasters, and – despite energy shortages and infrastructure challenges – it is now the world’s third-largest exporter of ready-made garments. More than 90 percent of the workers employed by the garment industry are women, enabling them to be a primary source of income for their families.

And the country’s vibrant civil society has taken on an increasingly important global role with homegrown institutions like BRAC and Grameen Bank exporting their successful models of microfinance and community development to countries further afield. BRAC, to take just one example, is sometimes called the world’s largest NGO; and it operates health clinics and schools in every province of Afghanistan. Bangladesh is also the world’s largest troop contributor to United Nations peacekeeping operations worldwide, with more than 10,000 men and women serving in some of the world’s most dangerous places. In this way, It’s is a key friend and contributor to global security. The United States is a collaborative partner with Bangladesh in all of these positive endeavors. The bulk of our $200 million in assistance program goes into projects that advance President Obama’s three key development initiatives: food security, global health and climate change. Despite these achievements, Bangladesh continues to face numerous challenges; many typical of developing countries including inadequate energy and vulnerability to global price volatility. It must also address concerns of its own vibrant press and civil society that are concerned that the government may be seeking to shrink the space for civil society.

Turning to the island nations of Sri Lanka and Maldives, both nations are strategically located along the busiest shipping lanes of the Indian Ocean, a region emerging as a central strategic arena in which enduring U.S. interests are increasingly at play. The United States is working with the Government of Sri Lanka to further reconciliation and accountability following their terrible civil war that ended in 2009. As part of our efforts, we – along with India and 22 other partners – supported a successful resolution in last month’s session of the UN Human Rights Council in Geneva. This resolution urged the Government of Sri Lanka to take real and meaningful steps to implement the constructive recommendations of its own Lessons Learnt and Reconciliation Commission report and to hold accountable those who are alleged to have committed human rights violations. The resolution encouraged the UN High Commissioner for Human Rights to provide technical assistance to the Government of Sri Lanka in pursuit of these goals, and to report on the government’s progress in one year’s time.

The United States remains committed to giving Sri Lanka the time and space that it needs to take real and meaningful action towards improving the lives of Tamils in the north and east and to avoid a return to civil war in the coming years. We support efforts to improve conditions in the north and east, including the resettlement of tens of thousands of internally displaced persons,

We also support the improvement of infrastructure damaged after years of war, and extensive humanitarian demining efforts that are underway. Secretary Clinton will meet with Foreign Minister G.L. Peiris in Washington on May 18 to discuss the way forward. The U.S. Agency for International Development has sought opportunities to support Sri Lankan priorities as the country moves through post-war recovery and transition. To address immediate humanitarian needs, we have provided $11 million in demining assistance, $27 million in food aid, and $17 million for livelihood, shelter and water, sanitation, and hygiene assistance.Public-private partnerships will allow USAID to work collaboratively with the Sri Lankan private sector to create new jobs in the north and east, jump-start economic growth in former conflict areas, and promote social integration.Moving to the southwest across the Indian Ocean, Maldives is a young democracy facing a number of serious challenges, including political stalemate stemming from the February 7 resignation of former President Nasheed.

In the aftermath of the transfer of power to the vice president, Maldives experienced ongoing street demonstrations, disruptions and closures of the Majlis, the local parliament, as well as political stalemate.Along with others in the international community, the United States continues to encourage Maldives to work within existing democratic institutions to resolve these political challenges peacefully and transparently.It is critical that the international community now support a peaceful transition that allows Maldives to continue to adhere to democratic norms. The United States has consistently called for dialogue among all the parties to create conditions conducive to early elections. USAID recently allocated half a million dollars for an election program to assist and support Maldives as it works to resolve its political impasse. Since the first democratic elections in Maldives in 2008, our two countries have steadily built a robust political and security relationship.

In addition to providing maritime and airspace access, Maldives consistently stands with the United States on the international stage on a number of important issues on which we enjoy shared values. With the support of the United States, Maldives successfully ran for a spot on the UN Human Rights Council in 2010, effectively depriving Iran of a seat. And since joining the HRC, it has co-sponsored numerous forward-learning resolutions supporting US positions on Iran, Syria, Sudan, and Libya. And now, finally I’ll discuss a country known as “the rooftop to the world” – home to Mount Everest, along with eight of the ten tallest peaks in the world. Nepal is also on an upward trajectory. There is a very good chance that Nepal will complete its protracted peace process by the May 27, 2012 deadline.

Since the end of a 10-year conflict in 2006, Nepal has faced challenges in completing the peace process although, notably, there has been no return to violence. Since August 2011, the pace has picked up considerably with the arrival of Nepal’s current Prime Minister Bhattarai.

Most recently, former Maoist combatants – who have been sequestered in cantonments for the better part of six years – have agreed to a series of steps which resulted in the closing of the cantonments and the handover of weapons to the Nepal Army. Many of the former combatants have accepted a “golden handshake” and will be returning to civilian life. A significant minority, however, will be integrated into a new Directorate of the Nepal Army where they will work with their former enemies to protect Nepal’s forests and wildlife preserves and provide disaster response. Nepal faces challenges beyond the peace process, including a faltering economy which relies on remittances and tourism, poor infrastructure, and energy shortages that cause rolling blackouts.

Even so, there is great hope and promise in Nepal. Nepalis have shown remarkable resilience, creativity, and patience in the face of considerable hardship and struggle. The United States has long been Nepal’s development partner. We have worked hand in hand with Nepal for more than 60 years, since Nepal first opened its doors to the outside world. And we note with pride that Nepal is one of the few countries to meet the Millennium Challenge Development goals for infant and maternal health and mortality – an incredibly important accomplishment. This year the Peace Corps is being enthusiastically welcomed back to Nepal after an eight-year hiatus. Nepal has also met the indicators necessary to make it qualify for a threshold program with the Millennium Challenge Corporation. So let me conclude, ladies and gentlemen, by saying that the South Asia region is teeming with opportunity and promise.

And while we are bullish on the future of this region, we are also clear-eyed about the challenges that we face: conflict in Afghanistan, the very real threat of global terrorism, regional rivalries, and the potentially catastrophic effects of global climate change from Bangladesh to the Maldives. But despite these challenges, the United States sees the entire Indian Ocean region as a principal arena for economic growth and prosperity in the 21st century, led by burgeoning people-to-people connectivity and commercial innovation. The growth of a globalized South Asia, from Male to Mizoram, and from Colombo to Kabul will play a leading role in improving the lives of – literally – one fifth of humanity. The U.S. will remain a strong partner in working with our friends in the region to help them realize the tremendous promise of South Asia and beyond.

So again, let me thank the East West Center for offering me this opportunity, and I’d be glad to take a few questions if there’s time. I’m in Charles’ hands. Thank you very much.

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