Public Diplomacy

Transcript of the media briefing by Secretary(ER) on 12th IOR-ARC meeting

October 30, 2012

Official Spokesperson (Shri Syed Akbaruddin): Good afternoon friends and thank you very much for coming to this interaction. I am particularly grateful for our colleagues in the media from the Indian Ocean Rim countries who are here. There are 31 of them and I would like to welcome them specifically to this first interaction that they are attending in the Ministry of External Affairs.

Our primary focus today would be a briefing on the Twelfth Meeting of the Council of Ministers of the Indian Ocean Rim Association for Regional Cooperation. I have here with me Secretary (Economic Relations) Mr. Sudhir Vyas, who is India’s representative at the Senior Officials’ Meeting of the IOR-ARC. He will brief you today on the events leading to the IOR-ARC Ministerial meeting. After that we will open the floor for questions on IOR-ARC.

Along with Secretary (Economic Relations) we have Mr. Dinesh Bhatia who is Joint Secretary (Multilateral Economic Relations), and Mr. Charan Jeet Singh who is Director (Multilateral Economic Relations). Both of them will assist Secretary (ER) in case you have some questions which are of such deep value that he would require further assistance from others.

With that, I would request Secretary (ER) to make his opening remarks and then we will open the floor for questions.

Secretary (Economic Relations) (Shri Sudhir Vyas):Thank you, Akbar. Thank you all for joining us this afternoon. Thank you for your attention and your interest in the subject. My welcome also to those friends from the media who are here for this important event.

External Affairs Minister Mr. Salman Khurshid will be chairing the Twelfth Meeting of the Council of Ministers which is the apex body of the Indian Ocean Rim Association for Regional Cooperation, which we refer to by its acronym IOR-ARC, on 2nd of November at the Oberoi Hotel in Gurgaon. This meeting is the culmination of a series of interactions of bodies of this Association. It will be preceded, therefore, by the Indian Ocean Rim Academic Group, the Indian Ocean Business Forum, the Working Group on Trade and Investment which is a group of government officials dealing with trade policy issues, and finally the Committee of Senior Officials which I will chair tomorrow and day after tomorrow.

The meetings have already begun with the Academic Group having met yesterday. Today the Working Group on Trade and Industry is deliberating issues of trade facilitation and so on. Tomorrow the Business Forum will meet to take up its agenda of business-to-business cooperation. The Committee of Senior Officials will meet alongside to pull the strings together and take stock of progress and decide upon its recommendations to the Council of Ministers, which will then meet on the 2nd and conclude this event.

A few words on the background to this Association. The idea of such an association actually goes very far back. You would be interested to know that our first Prime Minister Jawaharlal Nehru, in his book ‘Discovery of India’ which predates Independence, had envisioned a group of countries bordering the Indian Ocean and helping each other in tackling common challenges. A similar idea was mooted by the then Foreign Minister of South Africa Mr. Pik Botha during his 1993 visit to India, and given a further fillip by Mr. Nelson Mandela in 1994. It was also mooted by the Shah of Iran in 1974, and subsequently explored by Mauritius in 1980s. So, there is a very strong political will that underpins this Association.

When this led to a group of seven countries, one from each side of the Indian Ocean - Australia, India, Kenya, Sultanate of Oman, Singapore and South Africa - the so-called seven meeting in Mauritius in 1995 was called M7 (Mauritius 7) to talk about enhancing cooperation on the rim. In a Joint Statement they agreed on - interestingly these words are relevant - "Principles of open regionalism and inclusivity of membership with the objectives of trade liberalisation and promoting trade cooperation”. This was expanded to the M14 with the addition of seven more members. The Association was formally launched, after five more members had joined, in March 1997. This makes it the fifteenth year of the Association’s existence.

IOR-ARC is the only pan Indian Ocean organization of its kind - a unique group of states on the rim of the Ocean which accounts for no less than two billion people, states that are characterized by diversities in size, population, culture and economic development. A notable feature is the number of overlapping regional organizations which have their rationale. Therefore, the members of IOR-ARC are also members of other multilateral groupings like ASEAN, GCC, SAARC or SADIC. Therefore, IOR-ARC has to increasingly position itself as an apex body which takes into account the differing perspectives, the differing approaches and binds them together into a unified whole in spite of the diversity.

Over the last few years, the countries of the Indian Ocean Rim have clearly come together on one account, that their strategic interests are served by the wellbeing and stability of the maritime domain. That is what brings this Association together and what has given it its increased relevance in the contemporary period.

The Indian Ocean is the third largest body of water on Earth linking the developed economies of the West to the bourgeoning powerhouses of markets of Asia in the East. Seventy per cent of global traffic in petroleum products and energy and half the world’s containers traffic transits across the Indian Ocean. Apart from its major reserves of oil and gas, the Indian Ocean Rim is rich in resources from fisheries to precious minerals, from agricultural wealth to valuable human technical expertise. And the Indian Ocean has its challenges. We know the threats in parts of the Indian Ocean to maritime security, the incidents of piracy that have taken place over the last few years, Indian Ocean region has been the victim of a tsunami in 2004, all these are issues that are of concern to the membership.

Therefore, the wellbeing and stability of the region has been and continues to be critical for the membership as well as for global economic growth. It is interesting that despite the global economic slowdown and the slow recovery, Indian Ocean Rim economies performed well in 2011. In 2011 the combined GDP of IOR-ARC members was estimated at US$ 6.5 trillion, up from 5.7 trillion in 2010, in just one year. From 2001 to 2010, regional trade more than tripled from US$ 1.1 trillion in 2001 to US$ 3.5 trillion in 2010. And the share of intra-IOR-ARC trade in global trade increased from 8.6% to 11.6% over the same period. Its regional investment trends have also shown a steady growth, both FDI inflows as well as outflows. FDI inflows into Indian Ocean Rim countries quadrupled to US$ 201 billion in 2011 from a mere 50 billion dollars in 2001. Share of IOR-ARC’s global FDI inflows increased from six per cent in 2001 to 13.2 per cent in 2011.

For India, the Indian Ocean occupies a particularly important position in our economic and strategic perspectives. Across the Indian Ocean move 90 per cent of our energy imports - it gives you a sense of the criticality of the wellbeing of this domain for us - and over 80 per cent of India’s international trade. India’s total trade with the RIM states has grown more than eight-fold to reach 156 billion dollars during the period 2001 to 2010. It was 156 billion dollars last year. Our telephone and internet connectivity is largely dependent on quality under sea communication cable infrastructure in the Indian Ocean.

Let me talk a little bit about the Association itself. Today, IOR-ARC has 19 members. Seychelles has joined as the 19th member in the last Council of Ministers meeting at Bengaluru last year. The members are: Australia, Bangladesh, India, Indonesia, Iran, Kenya, Malaysia, Madagascar, Mauritius, Mozambique, Oman, Seychelles, Singapore, South Africa, Sri Lanka, Tanzania, UAE and Yemen. There are five Dialogue Partners for the Association, namely China, Egypt, France, Japan and the UK. There are two observer organizations, namely the Indian Ocean Research Group and the Indian Ocean Tourism Organisation based in Oman.

IOR-ARC has established three institutions so far. Institution-building, excellence in disciplines and areas of interest and relevance and value to the Indian Ocean Rim are a critical component, an important component of the work of our Association. Take for example the fisheries sector. The Fisheries Support Unit was established in 2005 in Oman for enhancing the cooperation in fisheries sector and an action plan is under finalization. And it is clearly realized by all members that action in such fronts cannot be handled by one country alone. Cooperation can augment individual resources and produce results.

The Regional Centre for Science and Technology Transfer in Tehran has the mandate for facilitating transfer of technology at a regional level in dissemination and commercialisation of knowhow and technology. Maritime Transport Council, established in 2010, is envisaged as a regional specialized agency for strengthening cooperation in maritime transport issues.

I had mentioned earlier that IOR-ARC is an association of tremendous diversities including in levels of economic development and financial capacity. Therefore, it has instituted a special fund at the Sixth Council of Ministers Meeting in Tehran, to help support Indian Ocean Association projects by some of its less developed members who may require additional financial resources to organize workshops, events or interactions. In fact, India was the first country to announce an initial contribution to this special fund and it has been followed by Iran, Oman, Yemen, China and others. Last year, India announced a further contribution of one million dollars at Bengaluru, and I am happy to state that this fund we would like to put to best possible use. We are also in the process of simplifying and laying out clear-cut procedures to enable this fund to be put to best use.

The contemporary situation. When India assumed the Chair of IOR-ARC first time incidentally at Bengaluru last year, at the 11th Council of Ministers, chairmanship is for two years, there was clearly an expectation and a sense in the air that this association needs to add much more value to its deliberations. There is so much at stake in the Indian Ocean region and we need to channelize it in a manner which can serve the interests and expectations of its membership. So, we made a beginning in Bengaluru last year by identifying six priority areas for the work of our Association. I should have mentioned this earlier. The Association’s primary objective is economic wellbeing, economic cooperation for the welfare of the peoples of the Indian Ocean. A lot of elements feed into this primary objective. The first of our priorities is one such – Maritime Safety and Security which includes anti piracy operations. Whether we can coordinate our efforts and put our individual efforts to best use on this? Capacity building in this area, and so on.

Secondly, the core area of trade and investment facilitation. Again as I mentioned earlier, IOR-ARC is not a monolithic body. It overlaps with other regional organizations and, therefore, has to find a means and a way of organizing its work of trade facilitation and liberalization that does not conflict or run into conflict with the priorities of the others. So, we follow a very deliberative approach. We can talk about it later. Third, fisheries. I mentioned this in the context of the Fisheries Support Unit. Many countries, particularly for example of the coast of East Africa, talked about the amount of poaching that takes place in their very rich exclusive economic zones of fish. How do we manage, monitor, conserve and make use of fish stocks? Do we know the requirements? This is the second area of priority cooperation.

Disaster risk reduction and humanitarian access. The region has suffered from a tsunami in 2004. Tomorrow if there is an oil spill considering the amount of crude that travels across the Ocean, it could be devastating for one of the smaller economies. Therefore, humanitarian access and disaster management is a critical area which was identified as a priority.

Academic and science and technology cooperation. I mentioned the Academics Group which has just met yesterday. Do we know our domain? Do we understand our domain? Do you know the monsoons? Do you know the hydrology, the oceanography of the Indian Ocean? Do you know the coastal zones and how they would be impacted by coastal erosion? All these issues, the patterns of trade, the history behind the Indian Ocean, all this is relevant to this priority area, academic and science technology cooperation.

Finally, tourism promotion and cultural exchanges. Tourism is a USP of the region. Cultural commonality exists across the region which goes back centuries. Therefore, this is a fit subject for priority.

As chair of IOR-ARC, our approach has been to take forward cooperation within each of these priority areas and I am happy to see that we are seeing some forward movement …

I will touch upon, if you are interested later, the kind of activities that we have initiated over the last year in pursuit of the objectives. But let me not take time in just reading about them. But I would want to mention that a lot of these have been extremely well attended, and I am happy to see that there is lot of interest in the activities. We are planning some major ones in early next year.

Future perspectives. Despite the enormous potential for cooperation in such a range of areas we feel, and I am sure this feeling is widely shared in other member states also, that IOR-ARC could do much more, and that is a challenge before us. That is what we have tried to do as the Chair to try and build body, build substance and value to this Association. As I said, this year marks the fifteenth year of the creation of IOR-ARC. We have chosen a theme for the Twelfth Council of Ministers Meeting, which is "IOR-ARC at 15 – The Next Decade”. We would like to discuss amongst ourselves what could be the focuses of cooperation under our Association, what could be the directions of its growth in coming years, ways and means to further consolidate our efforts so that IOR-ARC can cope with the fast-changing global economic and strategic environment, and in particular enhance its capacity to meet the contemporary expectations of its members and the challenges that this region is faced with.

This is by way of background. If you have any questions, we would try and answer them.

Official Spokesperson: Any of you who would like to ask a question, please raise your hand so that we can identify. Many of you are coming here for the first time. Maybe you should identify also on the mic before you ask the question.

The floor is now open for questions on IOR-ARC at this stage.

Question (Bangladesh Media): I want to know the state of cooperation between Bangladesh and IOR-ARC.

Secretary (ER): Between Bangladesh and the Indian Ocean Rim what I can tell you is that Bangladesh has been a very active participant in the affairs of the Indian Ocean Rim. It has brought value and substance to all our meetings and interactions. If you are looking for example for figures, like the ones that I mentioned, of trade between India and the other Indian Ocean countries, I think that question you probably will have to address to the Delegation of Bangladesh, which would be best placed to respond to that. But having said that, we value the Bangladesh’s contribution to all our deliberations, particularly in areas of scientific and technical cooperation and trade facilitation it has come up with some very useful suggestions and ideas and have been taken onboard.

Question (Iranian Media): I have one question. What is India’s plan to promote IOR-ARC’s status among other international organizations, for example, G8, G20 or SAARC? Do you plan to have a political body for this organization such as that organisations?

Secretary (ER): Thank you for that very interesting question. The Association’s objectives as defined in its charter are primarily economic and social wellbeing of the region. There is no proposal at the moment to give it a political content. However, when we talk about the strategic relevance of the Indian Ocean to all its membership, it is inevitable that some issues which are not necessarily purely economic in nature impact on the work of the Association. Take for example, I just mentioned this, maritime security, issues of piracy, issues of humanitarian access and disaster relief, these are not necessarily economic but they impinge and impact directly on the economic welfare of our region and the economic activities and objectives of our region. Therefore, they will certainly form part of the Association’s work. The other issue about its association with different bodies, given the value and the relevance of this Association not only to its members but also globally, because we are now talking of an oceanic domain which is a domain that is of interest and of relevance globally, we sense, and this is something that we are going to discuss, we would like IOR-ARC to position itself as an apex body for the region. It is the only association that brings together the entire rim. Therefore, as an apex body, should work with overlapping institutions like SAARC, like SADIC, like ASEAN to see whether we can build on commonalities. We would also for example like to work with the United Nations system, the ECOSOC, as we believe that we can bring value and substance to organizations like this. This is again a subject of ongoing debate and will be debated during this forthcoming meeting and I hope with positive outcomes. I cannot predict obviously what would happen. But my understanding is that it is very much in the minds of all the membership.

Question (Malaysian Media): I notice that IOR-ARC has steered clear of defence. Is this consciously done or given the fact that the increasing concern over American and Chinese presence in the Indian Ocean, which would of course affect all countries on the borders of the Ocean. Should this be on the table? And will it be on the table at this meeting?

Secretary (ER): Again the charter envisages this grouping as a primarily economic and social grouping. If there are needs and requirements, again I revert to this whole question of maritime security. We are not talking about defence here, we are talking about capacity building and cooperation, two hands being better than one in managing improved and improving maritime security environment in the Indian Ocean because that impacts on the work of the Association and that impacts on the wellbeing. You have piracy. Take for example, the incidents of piracy that have taken place. Today you see that rising insurance rates for shipping impact on the economic wellbeing of all our countries. Therefore, it is a fit subject and a relevant subject for it to be brought in. So, if you ask me directly a pointblank question whether defence is going to be brought in, I cannot give you an answer. If it is relevant to the charter, we will find a way to deal with it.

Question (Sultanate of Oman Media): When the Indian Embassy sent us the invitation for this conference, we did not know what this conference is about, even my boss. So we had to google it. I have heard that this was the case of many of the journalists in the group itself. So, do not you think that the Ministry of Foreign Affairs have to work more in promoting this conference and maybe make more fast and serious decisions that really make a difference in the Indian Ocean rim countries?

Secretary (ER): A splendid question! And you are spot on! I completely agree that the commonalities of the Indian Ocean and what we need to do should permeate very deeply into the thinking population, journalists, academics, because without that kind of awareness things are not going to move forward. Having said that, Oman is a founder member of IOR-ARC, you should have known what this conference is about.

Question (Bangladesh Media): I would like to know your organisation IOR-ARC …

Secretary (ER): Our organization please.

Question: Yes, our organization is working with various aspects. But especially maritime security is the most important part of this organisation’s work. I would like to know maritime boundary with Bangladesh has a complaint at international tribunal, which will be solved in 2014. Is not there any option or opportunity to solve the maritime boundary problem in discussion by this organization logically, reasonably we can resolve by this organization? Is there any opportunity? In this conference, can we discuss this?

Secretary (ER): I know there are mechanisms for dealing with these kinds of issues which routinely arise in many parts of the world. But no, this association as a conscious policy excludes bilateral or divisive issues. It is looking at areas where all the countries share a common interest and we can build capacities which will be of value to them. It excludes bilateral issues.

Question (Yemen Media): How do you look to the current economic cooperation that is going between Yemen and India as we have historical and business and investment right for centuries? And how do you look at the cooperation that is currently going on in the Association? When you discuss piracy, we know that Yemen has been affected badly by the piracy and the shipping to Yemen is the most expensive for security issues? You are helping us. What I know is that the insurance companies are not accepting to load the ships to Yemen when it comes to shipping. So, they rather go to Djibouti rather than going to Yemen. The prices are increasing tremendously because of the shipping costs. Can you just brief us on how you are helping Yemen to get out of this problem?

Secretary (ER): Very relevant. Yemen of course is at the forefront of this anti piracy effort and has clearly been impacted very severely by what is happening. The whole challenge of piracy off the Horn of Africa which borders Yemen has clearly impacted very heavily. This has been identified as a priority for our efforts in IOR-ARC and will certainly be debated with some intensity, and some in-depth views will hopefully emerge. We are also looking at workshops and seminars for capacity building in this particular area. A couple have already been held and we are looking at organizing one in, if I am not mistaken, April next year on the whole issue of maritime security and piracy. We are planning to hold a seminar in India which can act as a focus for cooperation within IOR-ARC in this area. You ask me a little bit about bilateral figures of trade and investment between India and Yemen. I am afraid I do not think I have the bilateral figures with me but we can certainly get them for you. That is no problem at all. At this point of time I am not in a position to share this with you.

Question: …(Inaudible)…

Secretary (ER): Of course, historically the relations between Yemen and the west coast of India go very very far back. Born on the monsoon winds, which blow in one direction for half of the year and the other direction for the other half, our traders have been moving back and forth between the Yemen coast and the west coast of India. There is actually a wealth of historical documentation and literature for that matter. It has spawned some superb literature, stories and so on in India, historically. We had an exhibition of archives under the Indian Ocean Association auspices recently. The archival material available with the National Archives of India should bring out vividly and beautifully the kind of exchanges that used to exist between India and Yemen historically. But the potential is growing.

Question (Singapore Media): You said that 90 per cent of economic imports and 80 per cent of international trade go through the Indian Ocean. Is that correct?

Secretary (ER): The figures that you mentioned pertain to India. Ninety per cent of India’s energy exports come across the Indian Ocean. Question (Singapore): Okay. You have also said that piracy is impacting the economies of the IOR-ARC nations. The melting ice in the North Pole is opening up new sea routes. Will this affect the economies of the IOR-ARC countries? If it does, what is the plan that the organization has?

Secretary (ER): That is looking very far into the future. But yes, that is an area of interest undoubtedly.

Question (Singapore Media): It has already started and the shipping lanes …

Secretary (ER): The melting of ice has already started and there is a whole host of implications. One can debate them and study them. I would certainly like the Academic Group for that matter of IOR-ARC to take this on as a subject of its interest, very much. The Academic Group will deliberate on this. If not this time, it will do it next time. We meet every year.

Question (Iran Media): Do you have any special plans to enhance trade interaction with Iran within the framework of this Association given the fact that Iran is under sanctions and India needs Iran oil and we import goods from India?

Secretary (ER): I think that is a little bit outside the purview of the work of this association. Certainly the Association would be looking at matters of trade facilitation, ease of business and so on and so forth. But where it comes to bilateral issues, and these kind of issues, I think that is a little beyond the purview of this Association.

Question (Indonesia Media): As we know, Somalia is the host of these pirates. Is there any plan of the Association to include Somalia into this Association? Or is there any plan of a legal or political action against Somalia for this case?

Secretary (ER): The issue of piracy I do not think can be categorized in black and white terms. There are a whole host of elements that are behind the growth of this scourge in the western Indian Ocean. It is issues of livelihood, it is issues of governance, it is a whole host of factors that come into play. So, these are not easy issues for which you can find immediate answers. The issue of combating piracy will certainly be a subject and a very important subject, a priority subject in IOR-ARC discussions, workshops and seminars, but perhaps not in such a black and white manner in which you are putting it.

As far as Somalia joining the association, yes, at some point in future, if you are looking at an inclusive association of the Indian Ocean, when it is in a position to join, when it has a government – there is a transitional government of course – but a government that is in a position to contribute and benefit from this Association.

Official Spokesperson: Thank you very much. With that we come to the end of this part of the interaction.


New Delhi
30 October, 2012

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