Prior to the arrival of the President of India on an official State Visit, the Korea IT Times conducted a wideranging interview with N. Parthasarathi, Ambassador of India ....Ed. Q: India is currently going through a high growth phase. How did this happen A. Since 1991, India embarked on a wide-ranging economic reform program aimed at privatisation, liberalisation and globalisation. As a consequence, Indian industries, both in the public and private sectors, became increasingly competitive, efficient and are attaining global levels in quality and output. Foreign Direct Investment (FDI) started to flow into India. The rapid growth in the Information Technology and other Knowledge-based sectors brought India into focus. A vast pool of English speaking technically qualified personnel became the engine of a new resurgent India. As more and more multinational companies started setting up their bases in India, India has become an outsourcing hub for a range of products from agricultural goods to automobile component to high end IT enabled services. Our telecommunication, IT, Bio-technology and Pharmaceutical sectors are growing at a break neck speed. All these have resulted in India achieving a high growth phase. Q. India's development model is considered unique. Can you explain A. India's development model is unique in one respect. There is no other country with a billion people, with tremendous cultural, linguistic and religious diversities that has attempted to modernise its society and transform its economy within the framework of a functioning democracy. There needs to be a broad political consensus on all our policies. The process may be a little slow but it is steady and irreversible. We are happy that our efforts at transforming India into an economy well-integrated with the global economy have been successful. During the past two decades the GDP growth rate has averaged at a sustainable 6 percent annually. We are hopeful of a 7-8 percent annual growth in the next few years. On the path of these trends, India is on an ascending economic trajectory with growing foreign exchange reserves, reduced rate of inflation, global recognition of our technological competence and more importantly more than 500 million people of relatively younger age who are ready to provide the necessary workforce and at the same time create a huge market. Our youth, which is largely English speaking, makes India a potentially attractive location for production of high-end services, such as knowledge-based technologies, engineering design, pharmaceutical and other sectors. There is a tremendous confidence and optimism in India which is acknowledged worldwide. International experts forecast that by 2020, India would rank among the top three economies of the world. Q. India has a sizeable market share of IT and IT enabled services globally. What is India's strength in IT A. Today the Indian IT and BPO industry is estimated to be around US$ 22 billion and it continues to grow. India is now well established as a premier IT destination in the world. While a large number of companies are outsourcing their software development to Indian companies, others are establishing a presence in India and participating actively in software development and export. India's strength lies mainly in its vast pool of English speaking technically qualified human resources, strong costeffective and leadership oriented companies, regulatory support, scaleable high-quality infrastructure, and a growing domestic market. At current estimation, India would have around 17 million people available to the IT industry by 2008. The Indian education system places strong emphasis on mathematics and science, resulting in a large number of science and engineering graduates. Mastery over quantitative concepts coupled with English proficiency has resulted in a unique set of skills ideally suited for the Knowledge-based industry. Q. Could you elaborate on the Indian government's IT policy A. The unprecedented growth in India's IT sector would not have been possible without the right policies. The Indian government recognizes the vital importance of the IT and other Knowledge-based sectors in the economic development in the future. IT is a part of government's national agenda and the liberalization and deregulation initiatives taken by the Indian government are aimed at supporting higher growth and integration with the global economy. The government is actively promoting FDI which can be brought in through the automatic route, based on powers accorded to the Reserve Bank of India. The new National Telecom Policy has opened the field for private participants. The government is playing an active role in developing the infrastructure to facilitate the development of information technology sector. A National Venture Capital Fund has been set up to promote IT units in the small-scale sector. The IPR law in India is well established and there is an independent and fair judicial system in India to address any disputes. Q. What is your assessment on India-Korea relations over the years A. Although India and Republic of Korea (ROK) are geographically distant, there have been historical and cultural contacts between the two peoples dating back to ancient times. According to "Samguk-Yusa" a Princess from Ayodhya came to Korea and married King Kim-Suro and became Queen Hur Hwang-ok in the year A.D.48. The enduring philosophy of the Buddha, which has influenced the lives and thoughts of the peoples of the two countries, has also provided a strong link. The literary contribution of Nobel laureate Rabindranath Tagore, who called Korea the 'lamp bearer of the East' in 1929, is cherished fondly even today in Korea. The rationale for a close relationship has been reinforced in modern times by economic complementarities and political convergence between India and ROK. In the 1990s, the relations took a leap forward owing to the deepening economic engagement. Korean FDI in India and the bilateral trade both have registered impressive surges over the last decade. The visit of the President of ROK to India in October 2004 proved to be an important milestone in India-Korea relations. Q. Can you give us an overview of India-Korea economic engagement A. India and the ROK signed a bilateral "Agreement on Trade Promotion & Economic and Technical Cooperation" in 1974. Bilateral trade between India and Korea has gained momentum over the past decade. Within the past decade, the India - Korea bilateral trade has more than tripled and is currently around US$ 5.4 billion. In fact, our bilateral trade with Korea is poised to overtake the India-Japan bilateral trade. Samsung, LG, Hyundai and other Korean companies have not only been successful in India but have major expansion programmes. Korea is the fifth largest investor in India as of December 2004. The Korean investment approvals in India have risen sharply in a relatively short period from mid 90s to reach US$ 2653 million. With the entry of steel giant POSCO into India-with an investment of around US$ 12 Billion, Korea is emerging as a top investor in India. However, these trade and investment volumes account for only a small percentage of the great potential which still remains untapped. In March 2004, Tata Motors Ltd., Mumbai acquired Daewoo Commercial Vehicle, Gunsan (South Korea) for US$ 102 million. This is a major Indian investment in South Korea. Potential exists in the pharmaceutical sector where Indian companies are keen to invest in Korea. There is potential for diversification of Korean investment in sectors like steel, mining, shipbuilding, petrochemicals, power, auto components, food processing, textiles (including dyed, printed), telecom, electrical and electronic equipment, industrial machinery, machine tools, commercial - office and household equipment, rubber goods and ceramics for re-export to ROK or third countries. Q. In the IT sector, what is the scope of collaboration between India and Korea A. The core competence of India is the technically qualified human resources well known for its software expertise. Korea has the cutting edge technology in IT hardware. There is tremendous scope for collaboration as complementarities and synergies are limitless. Already, there are a large number of Indian software personnel working in major Korean companies in Seoul. Major Korean companies also have there set up in India. However, there remains a large untapped potential for further cooperation in this sector. Q. Last but not the least, what is the significance of the forthcoming State Visit of the President of India A. This is the first ever State visit of President of India to the Republic of Korea. Hence, the visit is an important milestone in our bilateral relations. The President has an interesting programme in Korea. Besides the Summit meetings, the President, himself being an eminent scientist, is scheduled to visit centres of high technology. During President of ROK's milestone visit to India in October 2004, the two countries resolved to take India-ROK relationship to a much higher level in the 21st century and decided to establish a "Long-term Cooperative Partnership for Peace and Prosperity." The visit of the President of India is taking place within less than 18 months of Korean President Roh Moo-hyu's visit to India. Much ground has been covered in this intervening period for enhanced cooperation. The visit would signify regular exchanges at highest levels and help in further consolidating our relations. India and Korea would enter into a more intensive phase of broadbased relations.