New York
October 2, 2007

CHARLIE ROSE, HOST: Welcome to the broadcast. India recently celebrated the 60th anniversary of its independence. New York hosted a series of events last week called "India at 60" to mark the occasion. Tonight, we consider India from two perspectives. We begin with the foreign minister, Pranab Mukherjee.

PRANAB MUKHERJEE, FOREIGN MINISTER, INDIA: I don`t think that there is anything to containing Tehran, because we do not believe in containing anybody. We believe that there`s enough space to grow together to accommodate each other`s legitimate aspirations. But if the aspirations become illegitimate, I can`t tell.

CHARLIE ROSE: And we conclude with Nandan Nilekani, chairman of Infosys and one of India`s top business leaders.

CHARLIE ROSE: What worries you about the future of India?

NANDAN NILEKANI, CHAIRMAN, INFOSYS: Well, I think ...

CHARLIE ROSE: Political tensions.

NANDAN NILEKANI: No, you hit the nail on the head. I mean, if you don`t create a broad base of support for reforms and free markets and governments start losing, then they lose their appetite for reforms, and then they`re quite liable to take decisions that are politically expedient, but they`re not with the right set of reforms, and then the whole thing could start slowing down. I think that`s the fundamental worry that everybody has.

CHARLIE ROSE: India for the hour, coming up.

CHARLIE ROSE: Pranab Mukherjee is here. He is the foreign minister of India. He was previously defense minister in the current government. He is leading India`s diplomacy at a critical time. The country is widely recognized a growing power on the world stage. Recent years have also seen a deepening relationship between India and the United States. 

In March 2005, U.S. Secretary of State Condoleezza Rice announced that it was U.S. policy to help India become a world power. 

The foreign minister is here for meetings at the United Nations. He also met with Secretary Rice last week. I`m pleased to have him here at this table for the very first time. Thank you for coming. 

PRANAB MUKHERJEE: Thank you. 

CHARLIE ROSE: You have had -- and I just want you to reflect on this first -- a remarkable live in government. You`ve been finance minister. 

PRANAB MUKHERJEE: I have been. 

CHARLIE ROSE: Defense minister. 

PRANAB MUKHERJEE: Yes. 

CHARLIE ROSE: Now, foreign minister, or external affairs minister.

PRANAB MUKHERJEE: And I was also (inaudible) trade minister ...

CHARLIE ROSE: Yes.

PRANAB MUKHERJEE: And I was also the chairman of the planning commission, which is the national planning body. And, of course, I held that charge simultaneously with trade ministry and foreign ministry.

CHARLIE ROSE: You are a living embodiment of Indian history. Tell me what are the critical moments that you have seen in your country`s history.

PRANAB MUKHERJEE: Several critical moments, not one. For instance, immediately when we came to office in the `70s, we had confrontation with Pakistan, as a result of which a new nation was born, Bangladesh. Immediately after that, we had to confront with the first oil crisis. Substantially, our import cost on energy increased. Thereafter, we had very acute food shortage and very high rate of inflation because of severe drought. 

Then, because of certain internal disturbance, we had to declare emergency. And for the first time, Indian National Congress was defeated in the general election of 1977, including Mrs. Indira Gandhi, myself, and a whole...

CHARLIE ROSE: Yes.

PRANAB MUKHERJEE: ... host of others. Then we came back in 1980. We had problems. Mrs. Gandhi was assassinated at the hands of the terrorists. He was - she was succeeded by Mr. Rajiv Gandhi. We had massive majority in (inaudible) elections, parliament elections, and subsequently provincial parliament`s election, but unfortunately again we lost after five years. And then Mr. Rajiv Gandhi was assassinated. That means in a short period of seven years, less than 10 years, we lost two permanent leaders of our party.

CHARLIE ROSE: Mother and son. 

PRANAB MUKHERJEE: Mother and son, and both became the victims of terrorists. Thereafter, we had again (inaudible) congress government. And we made a remarkable change. We came out of our old economic policies and we introduced revitalized economic policy. The present prime minister was the finance minister at that point of time.

CHARLIE ROSE: 1991. 

PRANAB MUKHERJEE: 1991. And it unleashed the latent energies of the entrepreneurs and private sectors. And thereafter, we entered into a steady growth rate of GDP over the period of more than 15 years. And last two decades, we have registered the GDP growth of 6 percent. Prior to that, our growth rate was steady around 3.5 percent. And now Indian economy is robust. 

CHARLIE ROSE: What role does India want to play in the world today, with its economic power, with its growing prominence? With its nuclear capability? With its place in the geography of the world?

PRANAB MUKHERJEE: I would like to suggest that these are all incidental, but the basic things are certain values. This morning, the United Nations declared as International Nonviolence Day, being the birthday of Mahatma Gandhi. Yesterday, I`ve heard (ph) this because India`s importance and prominence is because of certain values. And these values, we`re inculcating from the days of our freedom struggle, what we believe. 

First, this is the largest functional democracy. 

CHARLIE ROSE: In the world. 

PRANAB MUKHERJEE: 700 million electors are participating in (inaudible) 143 elected members having an average of 1.2 million voters per constituency. Secondly, we believe in inclusive groups. And when you talk of democracy, democracy is not merely a form or structure of government. We mean democracy, we offer (ph) decision-making, internally and it is equally externally. 

Then we want growth. But growth is not merely in statistical terms. Inclusive growth, both domestically and in our relations with external countries. Then, basically, which is the inherent strength of India, its pluralism. Cultural pluralism, ethnic pluralism, linguistic pluralism -- and these diversity -- and the religious pluralism -- you name any religion, you`ll find it in India.

CHARLIE ROSE: And the second largest Muslim ...

PRANAB MUKHERJEE: And second largest Muslim population, 147 million.

CHARLIE ROSE: A right to be proud. Do you think you`ll gain a seat on the U.N. Security Council?

PRANAB MUKHERJEE: We do believe that India should get a seat in the Security Council, because first we believe -- not only we, we believe certain other countries should also have its place in the Security Council, because in 1945 when these institutions were created, since then world has undergone major changes. And they have spoken of the India change itself. Similarly, all over the world, changes have taken place. Therefore, in the functioning of the United Nations, in its structure and in its contents, it should reflect the contemporary realities. That`s why the reforms of the United Nations is necessary, and, of course, India considers it qualifies all the ingredients necessary to be a permanent member of Security Council.

CHARLIE ROSE: I`m sure you made that point well. 

The most important thing, according to Nick Burns, who was on this program last night, the State Department official who has had the closest relationship with India, worked very hard on the nuclear agreement, was there right before we went there last year. 

He said this is perhaps the single most important initiative that India and the United States have agreed to in the 60 years of the relationship. There`s some quarters of America where they don`t approve of that agreement, as you know. Some are represented in the Senate. It is because they see it as rewarding someone who was not part of the treaty.

PRANAB MUKHERJEE: NPT.

CHARLIE ROSE: Why is it -- the NPT, Non-Proliferation Treaty. Why is it so important to you and your development as a nation?

PRANAB MUKHERJEE: You know, as I mentioned to you earlier, that we require economic growth, of course, we require growth for -- with justice. Growth with equity and inclusive growth, (inaudible) of all. But nonetheless, growth is important. We cannot share poverty. We can share prosperity. 

If we want to have growth, then we require energy. And it is one of the cleanest (ph) energy. Now people are talking of climate change. Environmental concerns is there, and it is rightly so. We have to leave this world for the living for the next generations. 

But if we want clean energy, therefore we must have access to civilian nuclear program. That`s why it is important. And not merely it is important from economic point of view. We also require access to superior technology. After all, technology is the power. Technology, with its proper application, can lead to the prosperity. And its mindless application can bring disaster. But we would like to apply it with a purpose, and the purpose is for the benefit not only of the Indians, but for the people of the whole world.

CHARLIE ROSE: One non-proliferation expert in the United States said, "The deal is a complete capitulation to existing U.S. laws that helps India reprocess fuel from a reactor to produce plutonium, which could be used in bombs, and it dilutes strict conditions that Congress has placed on (inaudible) India test a nuclear weapon again."

PRANAB MUKHERJEE: Look, so far the U.S. laws are concerned, we are fully aware of U.S. laws. But here, I would like to make one point quite clear: When we did not agree to sign Non-Proliferation Treaty, it is not that we disagreed with the ultimate objective of nonproliferation. It is in 1988, `89, leader and prime minister, Mr. Rajiv Gandhi, give his vision of the disarmament and disarmament of the nuclear weapons, in the special sessions of the United Nations for disarmament. And he agreed at that point of time, we did not have second explosions in 1998. We had two explosions, 1974 first; after a quarter of a century in 1998, the second one. 

But in between, in 1989, Mr. Rajiv Gandhi, in his vision of nuclear disarmament, clearly pointed out that we can manufacture a weapon, but we have kept our options open. We did not use our options. We did not graduate ourselves from the threshold level, because we want that there should be universally verifiable, nondiscriminatory non-proliferation arrangement, all over the world, and every country, including the nuclear weapon states, should have equal rights, should have equal obligations, and there should be a total stoppage of both horizontal and vertical proliferation. 

Unfortunately, and then repeating the word, unfortunately, international community did not listen to us. Therefore, because of our geopolitical situation, everyone is aware of it. I`m not going to repeat it. We had to go for the second nuclear explosions in 1998. But there, too, immediately after that, irrespective of sanctions or not, we voluntarily declared our nuclear doctrine. And three essential ingredients of that are, A, there will be no first use. B ...

CHARLIE ROSE: No -- no first use? 

PRANAB MUKHERJEE: No first use. B, it will not be used against non-nuclear -- non-nuclear weapon states. C, we declared ourselves voluntary moratorium on further test. D, we wanted to have minimum credible deterrent for self-defense, not for aggression.

CHARLIE ROSE: What is the danger in the world that we live in now of proliferation?

PRANAB MUKHERJEE: Always I`m repeating what I have just stated right now. We can have a credible program, and in my speech yesterday in the General Assembly, I have repeated that to us, our concept is nonproliferation and disarmament does not merely mean arm control or non-proliferation. Disarmament is more comprehensive. Non-proliferation and arms control, control of weapons of mass destructions are part of the disarmament. If we accept universally, verifiable, nondiscriminatory, non-proliferation regime, in there (ph) we like to contribute its might (ph), and that process, it is still open. We`re still open to do that.

CHARLIE ROSE: What is the relationship -- what happens if the U.S. Congress doesn`t pass it?

PRANAB MUKHERJEE: Of course, it will not go through.

CHARLIE ROSE: Of course not. But what does it mean -- what does it mean to India, what does it mean to the U.S.- Indian relations?

PRANAB MUKHERJEE: No, I do not think so. I`m afraid that I do not pin hope only on the -- this particular arrangement, because this arrangement we started talking off from 1995, June, during the visit of prime minister, Dr Monmahan Singh. 

But our relationship -- you talked of 60 years relationship. That means from the very beginning, we have good relationship with USA. Sometimes there have been -- in every relationship, there maybe things that maybe don`t work, but nonetheless, we have good relations from the day one. 

The United States of America is the single largest country to us, (inaudible) our export-import, and apart (ph) from the oil. The single largest industrial and technical collaboration we had with one country, that is the United States of America. Therefore, this is not the only matter on which our entire relationship depends. Of course, it is an important milestone, but I do not feel that if this will collapse, or if this will fails to (inaudible) our relationship, we`ll go back to the negative situation. It`s not like that.

CHARLIE ROSE: Iran. Characterize your relationship with Iran.

PRANAB MUKHERJEE: You know, in our foreign policy, not now but from day one, we believed that our foreign policy is best on certain principles. Therefore, our relationship with one country does not depend on our relationship with other countries. It is independent of that. 

And the basic principle, 1949 when communist China came, India was one of first countries to reorganize it, only one China. And even when we had differences in the early 1960s with China, if somebody goes through the record of this, even (inaudible), even in the 1960s we are good. They`re not Taiwan. But People`s Republic of China is the real representative of China, and they should have a permanent seat in the Security Council, because it was a question of the principle. 

Therefore, our relationship with Iran is best on several issues (ph). It`s one of important suppliers of energy to us. About 4 million expatriates, Indians, are living around that region. Not Iran alone, around that region.

CHARLIE ROSE: Is your relationship with Iran a problem for the United States? 

PRANAB MUKHERJEE: I do not consider so. Because we have made it quite clear both to Iran and the United States that our relationship does not depend on the relationship or closeness with USA, or it will be effected because of relationship with Iran. These are totally independent stands. 

CHARLIE ROSE: Do you believe Iran wants a nuclear weapon? 

PRANAB MUKHERJEE: I`m discussing this with them. Therefore, what we feel that even this morning I had a discussion with the Iranian foreign minister, and we do believe that as we have every right to pursue a civilian nuclear program for peaceful purposes, similarly, Iran has that right. At the same time, as a signatory to NPT, it has its obligations....

CHARLIE ROSE: NPT, right.

PRANAB MUKHERJEE: It has its obligations to the international community, because Iran signed NPT voluntarily. India did not sign. That`s the difference.

CHARLIE ROSE: I understand the difference. You did not sign the NPT, the Non-Proliferation Treaty, and then you did -- and Iran did. 

PRANAB MUKHERJEE: Therefore, I suggested that you should satisfy IAEA, and the queries which they are having. 

CHARLIE ROSE: And if they don`t satisfy... 

PRANAB MUKHERJEE: You should respond to their questions, and it is in the interest of you, it is in the interest of all of us. 

We did not want another conflagration in our neighborhood. Therefore, it would be better to resolve the problems through negotiations, however strenuous it may be. And I`m repeating, however strenuous it may be, we should pursue that. 

CHARLIE ROSE: The pipeline that was to go through South Asia and connect with Iranian fields, will it take place? 

PRANAB MUKHERJEE: Look, this we are discussing with them for quite some time. 

CHARLIE ROSE: With Iran. 

PRANAB MUKHERJEE: With Iran and Pakistan. And also, it`s commercial (inaudible). We are interested in having gas, but gas must be at an affordable cost, an economic cost. Therefore, we are currently engaged about the transfer fee which Pakistan is demanding from us for the transfer of gas through the territory of Pakistan. And unless that issue is resolved, we cannot participate in the talks. Currently, we are engaged in bilateral negotiation with Pakistan to sort out this issue. 

CHARLIE ROSE: Do you worry about the stability of the Pakistan government? 

PRANAB MUKHERJEE: For the individuals concerned, I cannot give any guarantee that a certain individual A or B will continue. But what we want, what my desire, I can tell you, my desire with respect to Pakistan, is that there be stability and prosperity in Pakistan. It`s helpful to me for my own stability, for my own development for my own prosperity. 

And insofar as the current problems are concerned, I hope in the whole subcontinent which was part of larger India before 60 years, it has its own way of self-correcting the crisis that it is (ph) to face. And Pakistan is no exception. 

Therefore, if Pakistan finds its own way of correcting the present problem, I will not be surprised. It may be possible, because at one point of time, it appeared that the judiciary is in total confrontation position with -- but it is not so. Therefore, in relationships between different organs (ph), between different countries, sometimes it may appear that it`s going to be insurmountable, but in course of time, it gets it corrected. 

CHARLIE ROSE: Everybody I have ever talked to in India, everybody, from the prime minister, the national security adviser, to business people, to other members of the government, including the finance minister, say to me that they see the relationship with China for the near term growing, comfortable and OK. Some of them worry about where it might be 25 years from now, 50 years from now. Do you? 

PRANAB MUKHERJEE: No, because I have seen -- excuse me, as a student of history, I have seen that no relation is permanent nor any relation is temporary. Every relation is partly temporary, partly permanent. Could anybody imagine in the 50`s or even up to mid-60s that the close relationship between China or USA will develop as it developed in the mid`60s onwards? 

CHARLIE ROSE: Or even India and China when they had a border war. 

PRANAB MUKHERJEE: Exactly. Exactly. Therefore, what we`re trying to do -- we had excellent discussions and relations between our leaderships and -- Indian leadership and Chinese leadership. In the recent years, we had two important visits, visit of the Chinese prime minister and Chinese president, and in the last week of this month, president and chairperson (inaudible) has been. 

I`m also going to visit China for the trilateral foreign ministers consulting mechanism which we have -- India, China and Russia. We have another not trilateral, but quadrilateral -- India, China, Brazil, Russia. 

Therefore, these groups have groups (ph) (inaudible) international relations are developing. So our relationship, and thereto I must give credit to the young prime minister, Mr. Rajiv Gandhi. You know, after 1962, there was a cold spell in our relationship between India and China. But in 1988, after his visit to China, that relationship was -- started improving substantially. And thereafter, in 1993, 1995, 1996, we made major changes in our relationships. And during the visit of the President Hu Jintao, we have agreed and both sides agreed and shared the same views, that there`s enough space for both India and China to grow together, and it`s not necessarily that one will grow at the expense of the other. 

CHARLIE ROSE: Do you believe that America`s interest and its strategic relationship with India has something to do with containing China? 

PRANAB MUKHERJEE: I don`t think that there is anything to containing China, because we do not believe in containing anybody. We believe that there is enough space to grow together, to accommodate each other`s legitimate aspirations, but if the aspirations become illegitimate, I can`t tell you. 

CHARLIE ROSE: Let me finally talk about Burma. You have had in the beginning a different relationship than you had now. Tell me how you see it today and the clash that is taking place there. 

PRANAB MUKHERJEE: In fact, I also had a discussion with my counterpart, foreign minister of Myanmar. And I expressed our concern. And I told him... 

CHARLIE ROSE: Myanmar. I should have said Myanmar right at the beginning.

PRANAB MUKHERJEE: And I told him that, look, you yourself have showed the international community that the process of political reconciliation and national reconciliation and political process will (ph) start and it will take its logical conclusion involving the people. Now the time has come to demonstrate before the international community that you were serious. Therefore, this process must be expedited. It must be inclusive. And under no circumstances, nobody is going to accept the killing and violence. Therefore, it is necessary, even I have suggested, that to satisfy the international community, it would be desirable if you some sort of inquiry to find out why this actions has taken place, and of course it must be credible (ph). 

Now, if you permit me, I would like to as we are having very frank discussion and I`m glad, somebody that (inaudible) that India being the largest functioning democracy, how it is that it can have its -- as its close neighbor a system which is totally different from democracy. 

CHARLIE ROSE: A dictatorship, a military dictatorship. 

PRANAB MUKHERJEE: But what can I do? Can I change my neighbor? What can I do? If in the subcontinent -- and incidentally at one point of time, not only Bangladesh, Pakistan, they were part of India before 1947. Even Myanmar, which was then known as Burma, and Sri Lanka, which was then known as Ceylon, they were administered by the Britishers from Delhi itself. Therefore, there is some sort of administrative affinity. 

And when we became independent, almost at the same time, all of us accepted the parliamentary form of democracy. But in the Myanmar, it collapsed. In Pakistan, it collapsed after 11 years, 1958. Bangladesh, of course, was created in 1971 as a result of a bloody struggle that is part of the history. Sri Lanka (inaudible) presidential form of government, but a democracy.

Now, India a democracy, parliamentary democracy, flourished, despite poverty, despite backwardness, despite illiteracy, despite slow growth rate. 

Therefore, what do we have to do? We have to live with our neighbors. We cannot change our neighbors. We have to live with them. It`s better to live in peace. I cannot alter the government in my neighborhoods. It is for the people of the countries concerned to decide what type of government they would like to have. 

CHARLIE ROSE: I`m not sure the people decided. 

PRANAB MUKHERJEE: No, as soon as they decide, it will be for them. I do believe no power can prevent the desire of the people. It may be delayed, but at some point of time, it will assert itself. 

CHARLIE ROSE: Finally, I know you have to go back to India tonight, clearly poverty is a big issue. In your country, the distance between the haves and have-nots -- true in China, true in a large part of the world. So because of your experience, will the economic growth enable you to have the political will to bridge that gap? And will it have the same effect in China? And will it enable the word to come to -- somehow come to do something to alleviate the fact that too many people are too poor, too malnourished and too absent the basic essentials of a good life? 

PRANAB MUKHERJEE: Exactly, exactly. This is precisely the point. And again, I am referring to the teaching of Mahatma Gandhi. Just now in the morning, we celebrated the International Nonviolence Day. 

And one of the basic teachings of Mahatma Gandhi is that Mother Earth has enough resources to meet the need of every individual, but it is inadequate to meet the greed of even a few. Therefore, keeping that objective in view, we do not believe merely in growth in terms of statistics. We believe growth with equity, growth with social justice. And growth must be inclusive.

And here, what the point -- at some point of time, people started believing -- I have not mentioned the name of the countries -- that if there be a quick decision-making process, economic growth may be faster. Therefore, instead of democracy, there should be some other type of system of government. 

But we did not believe that. And perhaps we have been able to establish that, yes, growth and democracy are compatible. It`s not in cancellation of each other, though the process may be slow. 

When we began our independence, nearly more than 50 percent of our people were below the poverty line. Over the last 60 years, it is not that we have been able to eradicate poverty. Still, a little over one-quarter of our population -- and that`s a huge number, because we have one-plus, one billion plus population -- still, they are below the poverty line. Nearly 40 percent of our children are undernourished. 

CHARLIE ROSE: Forty percent?

PRANAB MUKHERJEE: Forty percent. Are undernourished. Therefore, these are the targets, and the entire process, with the growth, with the new economic policies, which have unleashed the latent force of growth. Our basic objective is to ensure empowerment and entitlement. This, just two years back, we passed a legislation of providing legal rights to unemployed youths to have the guaranteed employment. Not full yet, but at least 100 days in a year. 

A couple of days back, our prime minister has declared that this program will be extended to all 600 districts. That means the entire rural area will be covered. The major task during the current plan period which we are giving, all these are directed towards this underprivileged sections of the society, because for them, state policy and state intervention is needed. Merely giving it to the market forces is not possible. Yes, market forces will generate employment, market forces will generate wealth. But for the distribution of the wealth, what is required is some sort of guided state interventions, which we are bringing (ph). 
And it will take some time, but we are confident that through this process, it will be possible for us to achieve it. Because the disparities which you are talking of, this is a serious challenge, and collectively we shall have to meet this challenge. That`s why we want more energy. That`s why we want access to technology, and technology for the betterment of the people. 

CHARLIE ROSE: Thank you very much for joining us this evening.