Brussels - 04-12-2003 Organised by Global Organisation of People of Indian Origin (GOPIO - Belgium) In Association with The Embassy of India Brussels

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We hope to replicate this feat in the areas of biotechnology and pharmaceuticals. In automobile and engineering industry, we have already established a substantial relationship with Europe. For your information, we are one of the top suppliers of quality auto parts to the European automobile industry. We are also exporting over 37 000 small cars per year.

Space sector has thrown up tremendous possibilities of cooperation in the field of science and technology. Some of you may not know that India has an ongoing programme of exchange of scientists between the ESA (European Space Agency) and the ISRO (Indian Space Research Organisation). Eight Indian satellites have already been launched on board Ariane. India also assisted in the development of the German Bird satellite which was launched aboard an Indian polar satellite launch vehicle (PSLV). The same launch carried a Belgian satellite called PROBA. India and France are participating in MEGHA TROPIQUE Programme to study the effect of water cycle on weather. As per the Indo-EU Summit Joint Press Statement, India is also going to collaborate with EU on its Galileo project.

Today’s India is, thus, defined not only by her manufacturing technologies and labour power but increasingly by her knowledge and human capital. It is widely acknowledged that our human resources are among the best in the world. We have over 380 Universities with 11200 Colleges, over 1265 engineering colleges, 170 medical and 78 dental colleges and 1500 research institutions. Thanks to our Institutes of Science, Engineering & Technology, we possess a huge reservoir of over 4 million trained professionals and Indian institutions churn out over 3,80,000 engineering graduates, 2.1 million other graduates, 3,00,000 post graduates and around 9000 PhDs every year. They are not only highly skilled but are also world- class and very competitive. They can contribute substantially to the joint ventures that we think of.

Business outsourcing to India can be another natural way for the European companies to grow. As per Gold Man Sach’s survey, the cost saved by shifting from in house to offshore development of computer application in India can be as high as 70%. Mckinsey and Company declared in October 2001 that productivity and quality in remote processing centres in India was higher than achieved in their parent company. A.T. Kearney also has declared India as the best BPO destination. There is a certain apprehension in certain quarters about its negative impact on the local industry and employment in Europe. But, there is no need for such apprehensions. BPO is a business model that has come to stay and the market economies can ignore this phenomenon only at their peril. If EU is not to fall behind others in the area of productivity, innovation and economic growth, then BPO route will have to be adopted by EU Industries, without hollowing out themselves from their core activities. It is rather odd that while over 250 of the 500 Fortune companies of USA have chosen India for various types of BPO activities including over 100 choosing India for its R&D activities, the EU companies have yet to take the plunge.

India is very often compared with China in terms of the ability to attract foreign investments. China is said to be attracting, on an average, around $40 bn of FDI per year whereas the equivalent figure in case of India would work out to about 8 bn $ if reinvestments are taken into consideration as is done in case of China. It is pointed out that China has fared far better in attracting investments and has been able to do so because of its fast approval procedures, investor-friendly infrastructure, and complete lack of delays in setting up businesses and operations. It is also said that, in this, they have been largely helped by their diaspora who have played no mean role in projecting China’s image and facilitating the flow of investments.

In my view, the truth is a little more complex. I would share the sentiments when the credit is given partially to the Chinese diaspora in facilitating the investments into China. I would also acknowledge that there is a growing recognition of the need for the Indian diaspora to play a similar role with regard to their parent country. However, I would like to stop at the comparison here. Comparisons are odious and mostly flawed. Most often, they are incomplete. The simple fact is that our approach to development is not the same as in China and some other countries. In some countries it does not matter whether the cat is black or white as long as it catches mice. In India, on the other hand, we do not like the cat-and-mouse games to be played when it comes to the serious business of playing with others’ money. We would like the investors to have full trust in us and suffer not the slightest discomfort when they place their money in our custody. In short, our investment regime aims at being not only investor-friendly but also democratic and politically stable.

It will be a mistake to look at India mainly as a large market of the future. Very soon, India will also emerge as a manufacturing hub and a global provider of services. Services are clearly a winner if we think of a new area that can generate a great momentum. As per demographic projections, the ratio of working population to the pensioners in the existing member states of EU, is going to go down to 2:1 from the existing 4:1, in the next two to three decades. India has undergone a demographic revolution where 54% of her population is below 25 years of age. This has created a revolution of expectations where a powerful new force of young people, full of optimism and ambition, fired by boundless energy, is actively seeking opportunities for wealth, success and prosperity. This youth force is outward looking and is willing to accept challenges. EU would need the services of India's young workers and professionals in a large measure in course of the next decade if it has to remain on its growth trajectory. India can provide such skills and expertise in health, IT, accounting, engineering and a host of other fields. However, this needs the free and hassle-free movement of professionals in each other's territories. This obviously needs the removal of various controls in the form of restrictions on visa and work permits for professionals and businessmen moving from India to Europe. There are restrictions that are practically impossible to fulfil for setting up of businesses even on a short-term basis. EU should not confuse the issue of movement of professionals with the issue of immigrants - an attitude that clearly comes in the way of our growing partnership. EU would in fact be hurting herself by denying herself the growth opportunities that become available by harnessing such talents. We need to move ahead and create conditions that are conducive to such growth.