>> just briefly, you reflected a long-standing indian frustrati frustration. and it's true. i know in the first part of this decade, that when indians or others would say there are still

can't, isi backed kansai jihad he groups operating in filtration, and pakistan hasn't shut them down or at some point president musharraf promised to shut them down and then the camps moved. that the u.s., when this was brought to the attention said we don't want to overload the system because we actually need their cooperation in its more important hunt al qaeda, and pakistan was able to basically play off those things. we're not going to do everything, and so this is more important and then they would say they were doing what was asked but didn't just wouldn't do it and i think in the real world of government, you go in with a list of the things that you quote are wanting or demanded from the other side and the order of the list matters. and the first thing is you are hunting al qaeda, and in the camps in kashmir are the six thing on the list and the guy on the other nsaids that was a six thing on the list.

i don't know how you'd do better than that, but i think that did happen, and it's a recurring problem. >> if i would just add. look, india has shown a great deal of restraint on that point so it's all to its credit. but on the other hand, i would also say that indians have made the judgment that for a variety of reasons it's a less of a priority for them now. it's still a priority, but they have made a calculation, making a point of that is less important than it was in years past their presumably they have made some calculation that serves their interests. again, i think it needs to be committed about the restraint they have made over the last overhears on these points are taken after the mumbai attack. on the other hand i think india has a very good idea of what its own priorities are. i don't want our friends to my right to not have to answer many

questions, so i want to throw one question on the table for them. as was noted earlier it looks like an end-user agreement is likely to be completed sooner than later. i'm just curious whether you think that's going to give rise, particularly in the congress to more debate about the relationship, or will the end-user agreement be something that is a loser relationship there, to have kind of a repeat on a smaller scale about the nuclear deal, that kind of debate? is the end-user agreement likely to be of a model that's going to folks are going to say that fits in with our general view about end-user agreements, or will it be constructed in such a way to be something of an exception? >> of course, a little hard to comment with authority not having seen drafts that are being negotiated.

so it really would depend what the end product looks like, but i expect that it will be a positive that the agreement negotiated will be one that is consistent with the u.s. law. as seen as such by the congress, and a few u.s. administrations have made a big deal about the importance of this issue. they are ensuring cooperation with the congress, which pays a lot of attention to these issues. and i would expect that an agreement reached would be reached in a way that would be acceptable to people in congress who follow this closely. >> the thing i would add, i think it's at the core of continued defense and security cooperation between u.s. and

india. with respect to cooperation at the industry level. where it may get more scrutiny, not near perhaps as much as the nuclear deal did. when it's a direct commercial sale versus a military sale case. after i think there might be a little pause in the action, but again, much like mike colleague indicated, not knowing the actual language and the boundary conditions associated with that, i think we would see on the fms cases a positive outcome and direct commercial sales, perhaps a little more scrutiny. >> we have time for one more question. so, please. >> i know you said no comments, but i can't help, i am compelled to take issue with dan

blumenthal's comment about designing things for export. as a company that lost one and a quarter billion dollars designing something for export that nobody wanted. the only way that our industry is going to make it in this internet, tough international business environment, is selling the stuff that the customers want and they don't want second great stuff ,-com,-com ma which is what the indians are currently getting from the russians. >> declared by my point i don't disagree. i don't disagree with you at all. my point is that we have an fms export system designed for the cold war that has to be upgraded. obviously, because we are moving into an era of war where we want arbors to be strong and have equipment that makes them strong, but i don't take issue with the fact that it has to be what the customer wants. i'm thinking of the f-22, for example, which is just, you

know, which is just a tragedy in a way because we have these, all these restrictions from years past. we can't export an airplane, and i'm not talking about two i-india. i'm talking about two other countries. but my point is, we build things that the customers want but we build things as a national strategy with the idea that we are trying to strengthen the partners, and i take no issue with your particular point. >> we're going to move straight into our next panel, which is on indian u.s. economic cooperati cooperation. before we adjourn i would like you to join me in a hand of applause for our panelists. they did a great job. [applause] thanks, mary.

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i want to welcome everyone to our second panel this morning. titled the future of international economic corporation. civil nuclear cooperation, doha, and beyond. thank you to each of our panelists were being here. it seems like we have lost claude. >> the purpose of this panel is to examine u.s.-india economic relations postelection. u.s.-india bilateral trade has grown from 14.3 billion in 2000, two over 43.3 billion in 2008. the countries have stood shoulder to shoulder for the completion of the u.s.-india civil nuclear deal just a few months ago. but it's a distantly apart in

the doha negotiation round in the world trade organization. the economic crisis have also brought into question faith in free trade and open markets. this has raised concerns in the united states about outsourcing and immigration. to discuss these and related issues, we have with us today for eminent analysts. their full bios are on line, but let me briefly introduce you. our first beaker will be susan g. esserman. she is a partner in the washington office of steptoe and johnson where she chairs the first international law department or prior to joining steptoe, susan was deputy u.s. tr and held three additional senior post at u.s. gr and the department of commerce during the clinton administration. david goode joins the tata sons group in 2005. after a 34 year career at the

state department. at state, david was the director of the office of india, nepal, sri lanka and multi-affairs. following a three-year stint as american council judgment in mumbai. arvind panagariya, professor of indian political economy at columbia university. as well as a nonresident senior fellow working institution. he has also worked for the asian development bank, world bank, imf, injuries capacities. he has also published extensively including a recent book i-india, the emerging giant. my colleague claude barfield is a resident scholar here at aei. is the author or editor of a number of books on trade and science policy. and has also served as an advisor to the office of the u.s. trade representative. our format will follow the one

of the prior panel. each panelist will present eight to 10 minute remarks. we will then open up the floor for questions. so with that, i will turn the discussion over to susan. >> thank you and good morning, everyone. several factors provide a stronger foundation for u.s.-india cooperation today on bilateral and multilateral trade and economic issues than has been the case in the past. first the implications of the recent indian election your second, the extent of ties between u.s. and indian business today. and third, the fact that we are building on the stork u.s.-india civil nuclear agreement. there is, therefore, a case for optimism for some progress on trade, but there is this optimism really must be tempered

by realism. i would like to highlight a couple of aspects of the election results that i believe there favorably on the potential for movement on trade and economic co-op or asian. first, is the relative strength of the vote for congress. as you all know, congress itself won 206 seats, the best result by any party since 1991. but more importantly, is the strength of the congress party within the coalition where most of the coalition partners and the third parties outside the coalition did not do as well as what was expected. this combined with the fact that the congress party's no longer shackled by the communist party gives congress much for your rain on economic and trade

issues. further, today we have a new commerce minister who is from the ruling party and also close to sonya gandhi and the leadership. by contrast, when prime minister would return to power in 1999, he was unable to move forward at all on trade, due to the position of the then commerce minister, who was from a different party, very crucial to the coalition government. so the situation is very different today. second, it is significant, particularly for potential progress on trade that there appeared to be no real backlash in the polls against congress for its engagement and embrace of its relationship with the u.s. this suggests that the government of india may be less hesitant and less fearful of

political vulnerability, if they should stand shoulder to shoulder with the u.s. on trade initiative. as some in the audience know, there is a long history of indian officials from bjp led an congress led government who got great political mileage about opposing u.s. trade policy and positions here so hopefully this vote will really help to some extent to provide courage to the trade officials. third, is the fact that we have new trade officials. actually new trade officials in both governments. this gives an opportunity, a fresh start particularly in the case of the wto that has for so long been deadlocked, and i'm going to come back to that. and from the u.s. side, we have heard a very strong message from secretary clinton two weeks ago

about the importance of the u.s.-india relationship, about the obama administration's desire to take the administration -- to take the relationship to a new level. her hopes that an expanded partnership will be the signature accomplishment of both governments and of which economic corporation is a core element. but most significantly for the topic at issue here, trade cooperation, she recognized what i think it's long been the case in this area. and as she put it, we need bilateral cooperation between our governments to catch up with the business and people to people ties. with that in mind, and with strong government in both countries, it is time for the government to seize opportunity, to build confidence in the trade relationship, and to facilitate

rather than impede bilateral business ties. first we opted to start with the basics. and that is the government should seek to resolve long-standing bilateral trade irritants on both sides. that's what i would call low hanging fruit. the indian government should seek to remove tariff and nontariff barriers particularly where there is no competition, there is no competing in indian industry. progress in this area could help him turn to strengthen u.s. advocates who seek to resist protectionism and to extend tariff preferences and expand tft for india. second, we should not hold up ambitious bilateral cooperation until there is success in the wto because i fear we will be waiting a long time.

achieving bilateral result in a trade area, whether it's on market access or more ambitious initiatives, are the best way to confront the naysayers in the congress and to resist protectionist trade actions. we should, and i believe that the governments will go forward in the near term to launch bilateral investment treaty negotiation. here you have a rare situation where the indian and u.s. private sectors have come together to urge jointly their governments to launch bilateral negotiations. that is where in the history of our trade relationship. the convergence in this area is not surprising because there is a mutual knowledge of interest and to a flow of investment and i'm sure we will be hearing a little bit more from david good on that. so in this area also, the government should catch up with the private sector and begin

negotiations. now, the obama administration is today undertaking a review of the mottled bit. but my sense is that the negotiations between the u.s. and india in the investment area will move forward shortly, as was commonly suggested in secretary clinton's speech last week. i really do not believe that the review under way now will materially affect our country's ability to go ahead and negotiate in this area. as to the wto, new commerce minister, chambre, has initially set up very positive signals on the round. it is very good mood music. he has talked about the importance to india of completing the round, especially in this difficult economic

environment. he even said that the logjam, the impasse from last year, in the wto negotiation has been broken. he has stressed in his talks when he was here in the united states the importance of finding middle ground. and he has even offered to host a summit of the g-20 members on the wto round. i believe this is to occur in september of this year. good news is also that he will be aided by a strong and highly knowledgeable and experienced new commerce secretary. i think that can be very, very constructive. so i think we are off to a good start. although already today, i was

reading about backtracking from these initial positive signs, such as always the case with wto negotiations. and that really makes the point, which is the mood music, the tone is really essential, necessary but not sufficient. you need a new tone. you need political will, and you need to come up with reasonable compromises because as an alternate negotiation but particularly the wto, the devil, is in the detail. and here are the big question is, sonja gandhi and anand sharma, a developer around be reconciled with what the obama administration says it needs. as they have said, it is an

ambassador kirks word that it will be necessary to correct the imbalance in the current negotiations in which the value of what the united states would be expected to give is well-known, and easily calculable, whereas the broad flexibility is available to others leave unclear the value of new opportunities for workers, farmers, ranchers and business. so the real question is how do we reconcile those different positions. i think we shouldn't kid ourselves. this is not going to be easy. but the old bomb unde obama adm, will not gain the support of congress or the business community if it were to go for a vote. obviously a deal between the

u.s. and india was really only between two parties and to be successful in the round of unique instances of all 160 or so wto countries. but given the contentious history between the u.s. and india, a breakthrough or meaningful progress could have the effect of really galvanizing progress in the talks. as a final point, i think it is hard to talk about future economic corporation without mentioning the climate change issue, particularly given its prominence now and the lead up to copenhagen and the legislation that just passed the house on friday. i must say that i worry that we are headed for friction and multilateral talks in a way that is it really familiar to those

of us who have participated in wto talks. perhaps the u.s. intense engagement with china on climate could spark more involvement by india in these talks. but here again, i think that public-private partnership such as in clean energy could really help to defuse the inevitable differences that we will see in this area. thank you. >> thank you, susan. david? >> thank you very much neena. i'm really glad that i have come on after you because that was a wonderful sort of tour of the issues that we are still facing india moving economic

relationship forward. i think it will be no surprise to anybody that i speak from the perspective of indian business, which is a little bit strange for me since i spent 34 years in the state department and i have to really resist being able to speak about policy in a way that i probably wasn't able to speak about when i was in government. but for the last four and a half years i have been representing the indian corporate tata sons, who i think most of you know. there is a lot of i think disagreement about exactly where we are right now in the relationship, or exactly what the implications are and whether it is positive, parts of it are positive, parts of it are negative. i think all of us agree we are in a place now that was almost unbelievable 10 years ago. now how we got here has been the subject of hundreds and thousands of pieces