'Our best chance of mutual security is a strong bilateral economic relationship' N.R. Narayana Murthy

Chairman and Chief Mentor Infosys Technologies Ltd

Excerpts from the speech

I am indeed honoured to address this Indo-Pak business summit. I commend CCI, the Times of India and the Jang Group for organizing this very important gathering. I am grateful for this opportunity to promote economic cooperation between our two great nations.

At a time when certain elements are committed to spreading violence to undermine our bilateral relations, the need for such meetings is more important than ever. These moments when we come together and interact on an individual level with each other are indeed invaluable. These relationships give us the opportunity to recognise our shared commonalities and to bring down the stereotype of the other that might exist in our minds. These stereotypes are not only wrong, but are indeed harmful. They encourage a narrow, negative view of a country and its people. I find it far more constructive to focus on the positive.

Instead of focusing on what divides us, we should remember that we were one nation, one people, united by common hopes, dreams and aspirations. Our common past is far longer than our divided present. We must find a way to recapture that spirit of oneness and togetherness. Such a spirit of togetherness requires us to work towards a lasting peace.

As M. A. Jinnah once said and I quote him, "our objective should be peace within and peace without, we want to live peacefully and maintain cordial and friendly relations with our immediate neighbours and with the world at large."

However a recent report on Indo-Pak relations by the World Bank concludes that the only way to achieve peace is by providing increased security of life and livelihood to people in both countries. Friends, I firmly believe that this assumption is indeed correct; our best chance of mutual security is to enter into a strong bilateral economic relationship. There are many reasons I believe this to be true. Firstly no country in this world has developed and survived without maintaining strong relationships with its neighbours.

Over 65 years ago the nations of Western Europe were struggling to rebuild societies shattered by two successive World Wars. Yet today they are fully developed economies, likewise the idea of Germany and France going to war is inconceivable today because the two have built such a strong economic relationship with each other. The EU has extended economic cooperation over the entire continent and within just one generation centuries of conflict have become a distant reality in Western Europe. If Europe can overcome the difficulties of history-then surely we can do that.

Building economic links would also help us to address the development problems that both our countries face. The statistics are indeed sobering. 71.8 out of every 1,000 Indian children will die before their 5th birthday. In Pakistan the figure is even starker, 90.4 out of every 1,000 children die before their fifth birthday. Our children, most importantly girls, lack access to education.... One out of every three malnourished children in the world is an Indian. The best way to address these problems is to not rely on international aid, but to work together to foster an economic relationship that will translate into higher GDP growth for both our countries, generating income that will enable us to build vital infrastructure... Close cooperation would also make it easier for our businesses to collaborate on funding public-private partnerships. If we can do this, we can transform ourselves from the poorest region in the world to one that is leading it, where hunger and disease will be a thing of the past.

Not only will we have the respect of the international community but we would have fulfilled the vision of our respective founding fathers.

Mutual economic cooperation also makes practical sense. The challenges of entering a new market are significantly diminished owing to cultural and linguistic similarities. We also have the advantages of a long border that lends itself to the free flow of goods and people. In North America, the United States, Canada and Mexico have turned their shared borders into economic cooperation through NAFTA. In Europe the situation is much the same, China too recently announced it sees the benefit of developing a trilateral relationship with South Korea and Japan to make up for its own economic deficiencies. India and Pakistan could easily follow these paths

In 2008, 2009 India's top five export partners were China, US, UAE, Saudi Arabia and Germany with total exports reaching approximately 190 million dollars. During the same period, Pakistan top export partners were US, UAE, Afghanistan, UK and China with its exports totalling around 21 million dollars. The numbers speak for themselves about the potential gains of developing cross-border trade in addition to focus on trading with third countries.

One potential area for cooperation is of-course the IT industry. India has achieved tremendous success in this area which is translated into a higher rate of GDP growth rate, increased prosperity for millions of youngsters and the creation of more degree programs in the technical sector. Unfortunately Pakistan has lagged behind in cutting into both the domestic and international demand for IT sector. In 2004 revenues from the IT sector I am told amounted to a small figure of 300 million dollars. However, this is clearly an opportunity for betterment. Like India, Pakistan can offer a talented pool of workers, who speak English and can be hired at competitive costs.

These steps and others will have a twofold affect. First they will help generate employment which is crucial to combating the appeal of violence and terrorism. Secondly, as Pakistan's internal security improves and the rest of the world sees India and Pakistan cooperating in a peaceful manner, investor confidence in Pakistan will increase creating even more jobs and security.

Friends this is all achievable only if we all step up and play our parts as business people. We as business people must speak up and express our desire for better cross border economic ties. We must call upon our elected officials to pursue such a relationship with vigour and refuse to be swayed by cowardly acts of violence. I believe that Indian political leaders, government officials and corporate leaders have a mindset of cooperation.

Tuesday, June 15, 2010

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