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5.11 p.m.

Lord Paul: My Lords, at the outset, let me thank the noble Earl, Lord Sandwich, for introducing this Motion. Having had occasion to talk to him prior to this debate, I know that his knowledge and concern for India are great.

Allow me also to declare an interest. It is not the conventional kind of interest which custom requires, but an interest of emotion. As your Lordships are probably aware, I was born in pre-independence India. I remain deeply attached to the land of my birth and proud of its progress. Your Lordships will forgive me if sentiment shapes some of my observations today.

This Motion has a special significance in these times. After five decades of self-government, the entire south Asian sub-continent is now going through a profound transition. In India, in Pakistan, in Bangladesh and in Sri Lanka the exuberances of youthful expectations are giving way to the reconsiderations of middle age as these countries grow in nationhood.

India, the largest of these states in population and territory, is in the midst of a seminal collective self-examination, the kind of internal questing that its spiritual culture commends to individuals.

Since 1947 much has been attained. Who will not be moved by the commitment of the Indian masses to democracy, a commitment sustained under pressures which have swept away political liberties in the neighbourhood? Self-sufficiency in food production is a dream come true; and so are social and economic gains too numerous to mention. But the people of India realise that they have far to go before they redeem the pledge of Mahatma Gandhi to wipe the sorrow from every Indian eye.

And so, today, the needs and pace of development have provoked a challenging national debate about the merits of the four principles which have guided most Indian state policies for most of the past 50 years. Democracy, secularism, a planned economy and non-alignment in foreign affairs are being questioned and their validity discussed. Indians, as an intellectually lively and culturally diverse people, have many views and many proposals of revision. What is most encouraging is that this vitality is generally expressed without the prolonged violence that convulses many other nations.

From this vortex of discussion and reflection could emerge new features and new approaches. Democracy may well be refreshed as more government powers are devolved to regional and sub-state levels.

The introduction of the panchayati raj, empowering forms of local government, will create a fresh wellspring of democracy--three million newly elected legislators and councillors. The desire for economic reforms is widespread and enthusiastic, but enactment has much further to go. An economy cannot be vitalised only from the top or only by the few. Vast entrepreneurial energies remain to be unleashed and mobilising their release still needs attention. Nonetheless, the signals point in the right direction.

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As India embarks on the second half-century of its independence, its links with the United Kingdom symbolise a relationship of magnanimity. Rarely in history have rulers and ruled so rapidly dispelled the prejudices of the past. There are natural differences which, also quite naturally, emerge occasionally. We have seen this manifest itself during the recent Royal visit. Yet, as the Prime Minister of India mentioned to me in Edinburgh last week, these are tempests in a teapot and no damage to Indo-British relations has been done. We must accept the judgment of Prime Minister Gujral--a mature and balanced statesman--as the last word on this. These kinds of issues will always crop up. But the people of India and Britain are far too mature to worry about this. Whenever a Test match is played in this country, I have a battle, arguing with and settling disputes between my children and grandchildren as to who will win. If I tell them that India will win, I might find myself in trouble with one of the Members of your Lordships' House who is not here today!

The noble Baroness, Lady Flather, mentioned the relationship with the previous government. When the previous Labour Government was in power, a wonderful relationship existed. When my noble friend Lord Callaghan was Prime Minister he was greatly loved in India. I have no doubt that the new Government's relationship with India will be very good.

As we look ahead, there are many ways to strengthen the associations which India and the United Kingdom have so freely and voluntarily constructed. The British experience in social programmes, something we have long been engaged in, can be of immense value to any developing nation. We can make some significant contribution to improvements in Indian education, health, rural well-being and sanitation. In fact, this is where our focus should be.

All the foreign investment and technological improvement on earth will mean little to an impoverished citizen of the poorer nations if he or she has no clean drinking water and no immunisation from disease. In this context, Britain has much to offer and share with many Commonwealth countries--as, indeed, we have much to gain from international cross-fertilization.

Let me add a word on an issue of particular importance in current commercial transactions with the sub-continent and elsewhere. Let us export all we can of value and values, but we must not encourage abroad malpractices we deprecate at home. We must avoid contributing to the debasement of business ethics and standards. The OECD has now publicly expressed its concern about such matters. The Foreign Secretary, too, has commendably endorsed an ethical approach in his mission statement.

The post-colonial passage is a difficult one. India has, however, demonstrated that freedom achieved can be freedom enhanced. In the contemporary world, that is a rare accomplishment which we in Britain should specially welcome. The fates of Britain and India, historically closely intertwined, are joined today by a mutual confidence in democracy and liberty. May that long remain so.

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Let me conclude with a philosophical thought. In our century, few nations have contributed more great souls to the spiritual environment than India. The roll call is splendid: Vivekananda, Tagore, Aurobindo, Vinoba Bhave, Krishnamurthy, Mother Teresa and many more, especially Mahatma Gandhi. This is an ultimate strength for India.

As India moves into the modern age of high-tech and globalisation, and as we participate in her efforts to do so, I hope both she and we will understand the importance of nourishing that attribute. In the past, many individuals from this country helped India preserve her heritage--even to discover herself. That sharing of spirit must never be lost. More than a hundred years ago, an English educator in India reminded us, in very moving words, that:

    "Pity and need make all flesh kin. There is no caste in blood which runneth of one hue, nor in tears which trickle salt with all".

The Motion before this House evokes the spirit of universality which Sir Edwin Arnold embraced in his epic poem "The Light of Asia". I hope it will continue to illumine our relationship with India in the future.

5.23 p.m.

Lord Chorley: My Lords, I add my thanks to my noble friend Lord Sandwich for giving us this opportunity to discuss socio-economic development in the sub-continent. I am not sure whether my noble friend intended the debate to be principally about India, which it seems to have been, or to include in equal measure Pakistan. For my part, I shall speak on India for the simple reason that, as the noble Lord, Lord Desai, said, it is a large subject. I do so even though my prior ties tended to be more with Pakistan, a country for which I have an abiding affection.

One theme of the debate is the importance of a partnership approach to development. It is that on which I intend to speak by reference to what seems to me to be an outstandingly successful example of Anglo-Indian partnership. I refer to the work of the British Council in India. I must therefore at this stage declare an interest, in that I have the honour currently to be the deputy chairman of that excellent institution. It is an institution which seems to be far better known and certainly much better appreciated abroad, which is where we work, than at home. That is a pity.

The council has been operating in India for almost as long as that country's 50 years of independence. The great bulk of its work is of a developmental nature and, both directly and indirectly, much of its content is educational. It is my strongly-held belief--not a particularly controversial view--that the route to real and lasting progress in development, and in particular the relief of poverty, is through education and, to some extent, institutional change. That seems to be a much more fruitful approach than the great mega-projects such as large dams, which used to be all the fashion.

India is much the biggest operation of the British Council. And, interestingly--a fact I did not know till I was preparing for this speech--the great bulk of the council's staff in India are local people. There are 412

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professionally qualified local staff operating in India, compared with only a dozen or so UK expatriates. Over the years there has been increasing emphasis on forging local partnerships in that way because it increases local commitment and ownership of the council's programmes. I also make the point that the work is not just with the poor; it is also about working with those making strategic decisions and in identifying and supporting what may loosely be called the "young leaders" of the future.

One example of the many activities managed by the council has been the big DFID-funded Andhra Pradesh Primary Education Project, which was touched on by my noble friend Lord Sandwich. That raised learning achievement through teacher training and new textbooks for both boys and girls. New language books accelerate the acquisition of literacy; they also raise retention levels of the most deprived groups such as the scheduled castes and scheduled tribes. Teacher training contributes to raising the numeracy and scientific skills of both boys and girls. I am sure the noble Baroness, who is not now in her place, will be pleased to hear that we pay attention to girls too.

It is a cost-effective project. It is building more than 4,500 classrooms and providing more access to education for poor children. Experimental approaches to building schools using locally available materials and technologies both reduce unit costs and energy consumption. But they also raise the demand for labour, thus creating employment.

Project schools have increased enrolment, particularly of girls. When combined with the increase in learning that has taken place, the net result has been more poor children in school learning more. The evidence suggests that that will be to their private benefit as well as contributing to raising the growth potential of the economy.

Direct assistance to the poorest also involves meeting the needs of marginalised groups; for example, refugees, street children and migrant labourers who require a new type of education provision that is both flexible and low cost. For example, this year we worked with local partners to contribute to a number of regional seminars leading to follow-up programmes. One example was the, "Children as Partners in Education and Health" seminar in Calcutta, which included participation by street children alongside health carers and educationists from both government departments and NGOs.

Another major project--the Orissa Health and Family Welfare Project--is having a huge impact in the state of Orissa. That state has the highest infant mortality in India and one of the lowest figures for life expectancy. The project has helped the Government of India by increasing the availability, use, quality and effectiveness of health and family welfare services in 10 districts with a population of 20 million. It has found and tested new and more cost-effective methods of healthcare and delivery and substantially increased community participation in the planning and operation of health services. More recently, there has been an agreement, supported at ministerial level, for a new state unit to manage health affairs.

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At the other end of the education spectrum, the council manages at least 30 live academic and research links between Britain and India at any one time and is directly responsible for advising and placing 600 of the 3,000 Indians who come to the UK to study each year. Again, over 17,000 Indian civil servants, health professionals, educationists and others who deliver poverty alleviation programmes have been to the UK since 1971 for professional training. Graduates include the current President of India and the Comptroller and Auditor General. That seems to be a fairly good combination.

Human rights and open and accountable government are another important facet of the work of the council. While taking no political stance in the debate, the council has strengthened the capacity of institutions in civil society--often NGOs--which work towards the achievement of these aims while also targeting decision-makers to ensure that these issues are on their agenda. The council is also managing the Indo-British Legal Forum, led by the Chief Justice of India and the Lord Chancellor, which is due to be held in Delhi in December of this year. An exchange of ideas, including human rights issues, between the Indian and British legal systems will take place and the development of a more informed and independent judiciary will be encouraged.

I mention also our science, engineering and technology links; for example, the regional engineering project which is on the nature of vocational qualifications in engineering. This is very relevant to the Indian private sector which, as we heard from the noble Lord, Lord Desai, is now on the march and which is looking to the UK, and to the council in particular, for ideas and information on NVQs.

Finally, the council has considerable impact on the dissemination of development information through its eight British libraries in centres throughout India. These libraries have a total of 100,000 members, many of whom work with the poor. The libraries are a vital network and all the centres are connected through information technology. The council is currently working with the DFID on designing a project which will develop these centres into a clearing bank for development information to be used from next year onwards by the World Bank, the UN agencies, other bilaterals and local NGOs.

Last November I had the pleasure of visiting Pakistan, where I opened the new library at Islamabad with the Minister of Education. Then I went on to Lahore and inspected a library there. What struck me most was that they were indeed information technology based. There were still some books but lots of computer screens. It was brought home to me that a modern library is very much about IT and information resources. It is not about entertainment.

My theme throughout has been the importance of local partnerships. It is important to recognise and to emphasise the importance to the council of its other partnership--its domestic partnership--with the Department for International Development, which I have mentioned two or three times and which of course

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funds much of the council's work both in India and Pakistan and indeed throughout the third world. We value that support. That seems to be a suitable note on which to conclude my remarks.

5.34 p.m.

Viscount Slim: My Lords, it is my lot to be the last to speak before the Government and Opposition Front Bench speakers. Like anyone standing where I am at this point in the debate, I have heard much of what I might have said and what in fact I was going to say. However, there are a number of points that I might emphasise and perhaps a couple of new ones that I might make.

I count myself as an Indian. If the noble Baroness, Lady Flather, were here, I would tell her that, at least among the noble Lord, Lord Weatherill, and myself, there are two extremely good Indians on the Cross-Benches. I was born in India and went to a most marvellous school there, the Military College of India, which I visited the other day. It still maintains the very highest standards. It filled me with such pride to go back. Two thousand of us old cadets, from Pakistan and Bangladesh and from the Indians who work in this country, Australia, Canada, the Gulf and America went back. Apart from myself, they all seemed to be most successful fellows. Within India, they all hold high ranks in the military; they are top civil servants; and they are top businessmen. They are remarkably good citizens. They are also very good friends.

After attending the school, I had the honour, like my father, and like the noble Lord, Lord Weatherill, of serving in the Indian Army during the war. I have so much respect for the Indian soldier, sailor and airman. They come from great warrior tribes in India and the Kingdom of Nepal. We lived together, we worked together, we trained together and we fought the enemy together. When we went on leave we visited their villages and got to know their families. I do not have an Indian son. I was never lucky enough to be given one. But, certainly, we have had most happy relations with the people who worked for our family. I promised my father that however broke I was I would always pay the pensions of those who worked for him and my family. I have only just finished paying the last one because the widow has died.

I feel comfortable in India. It does not take me long to become a good Indian. I often say to Indians here in our country who do so much for us today in the way of commerce, culture and the way we are going to live in the future, "I have lived in India longer than you have lived in England. When I live in India I try to be a good Indian, but I do not forget that I am British. When you live in Britain, I want you to be a good Indian but at the same time a good Briton as well".

As the noble Lord, Lord Desai, said, with the coming together of our circle and of the communities living here and living in India we cannot help but be friends and work together. Friends can disagree. Friends do not always have to agree. But, as the noble Lords, Lord Desai and Lord Paul, said, when we come to business,

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we have to learn to trust each other. For my part, as a businessman, I make certain that we work in that way in India and we gradually build up that trust. Businessmen should realise that one does not go there for a quick buck. One goes there with patience. One is then gradually accepted and mutual trust and friendship develops.

I am most impressed in India by the management. This great and large democracy has not just stood still. It has advanced. It is succeeding all the time in various ways. The British businessman would be sensible to recognise the further liberalisation of the business world in India. He should go to see whether it suits him and make friends. I believe that it is the businessman who will push India forward to success.

India today is probably the largest industrial nation in Asia. I do not see the noble Baroness, Lady Flather, in the Chamber, but I would say to her that what also impressed me about India was the female management. There are very highly educated and competent women in India who, whether they are married or single, are all running good, family businesses. That is very noticeable.

The main reason why I have supported India all my life and will continue to do so, is that if things go wrong in other parts of South East Asia and if our Chinese friends--I can say that because very often I work in a factory in my group in China--cut loose and do not do the things that we want in the years to come, the great country of India will be the bulwark between east and west. For that reason our nation should work sensibly with it on foreign affairs and where matters of mutual defence are concerned.

India is beginning to get over a particular problem. I would like to see her play a more prominent role in world affairs. India is so great and large. It has such culture and very wise people. Because it is growing internally and because of the problems that it has on some of its borders, the Indian political scene remains inward-looking. However, it is beginning to look abroad. I believe that it is the businessman who will take the Indian into the rest of Asia. I hope that I shall live to see the day when India is the prominent nation, if that is allowed in our grouping today. I hope that it will be a leader in the world and particularly in Asian affairs. I believe that that time will come.

In my view our little debate has been very instructive. We have heard a great deal of very good sense spoken. We have all learned a bit more about India. I end by saying that I believe that we should all go to India. I hope that the noble Baroness, Lady Thomas of Walliswood, will go there as quickly as she can. I hope that she will realise that the situation regarding children working in India is rather different from what it is here. If there is no education around the village or the city one is living in, it is no bad thing to get a job. We have to watch that the children are treated decently and properly when they work. I drew my first wage packet in India. Like the children of many noble Lords, my own children have worked during every holiday since about the age of 13 years. A little bit of work for one's children does not do any harm at all.

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It has been an interesting and good debate. I very much look to the Government to re-establish the excellent relations that the previous Labour Government had with India. I hope that they will forge a new friendship and partnership, as the noble Lord said, with India. I hope that the Government will set about it without condescension, without preaching or teaching, but with both hands held out for mutual trust and fellowship. I assure the Minister on the Front Bench that I shall be watching.

5.45 p.m.

Baroness Rawlings: My Lords, perhaps I may seek the indulgence of the House. I have never formerly been mistaken for my noble and energetic friend Lord Moynihan. But working as a member of our foreign affairs team I have the very good fortune to respond to this debate as a spokesman for foreign affairs, not least because of my special interest in the subject.

Previous recent debates in your Lordships' House have been concerned mainly with terrorism. Therefore, I welcome the positive choice of title by the noble Earl, Lord Sandwich, for the debate which has provoked a very interesting and stimulating discussion today. It has attracted, too, so many distinguished speakers. I also compliment the noble Earl for giving us such a thought-provoking and wide-ranging introduction to what is an immense subject covering a gigantic country.

I must declare a deep and personal interest in India which I hope will endure for many years to come. I have great affection for the country, like so many other noble Lords who have spoken today. I spent my honeymoon there and I have been visiting India regularly now for over 30 years. I have very many dear friends there. It is a colourful nation, geographically vast and enormously rich in culture and history. It strives for, and has found, unity in its vibrant diversity.

The India that we know today is a remarkable achievement, as we have heard from nearly all noble Lords who have spoken today. Over the past five decades it has resisted the siren temptations of caste and religion and has remained united in a secular democracy. Indeed, in 1947, sceptics doubted whether the huge country that became the independent India--famously dubbed "a geographical expression"--which encompassed five religions, 18 major languages and 93 minor ones, could survive as a single nation. The early days did not appear to bode well for a nation born out of the violence and bloodshed of partition. But despite that India has remained intact and democratic. It has avoided the twin traps of autocracy and one-party rule which so many of her neighbours have stumbled into. India has proved that a multi-party democracy is equipped to reconcile the aspirations and the social and religious differences of a diverse and indeed divided society.

India's record of democracy, of free and fair elections, a free press and independent judiciary, is a record of which Indians are justifiably proud and it is one which the world admires. It is true that India's democracy has not prevented poverty, illiteracy or the blemishes of corruption. Nevertheless, it is a triumph for India and for the architects of her independence.

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There is little that has not been touched on by someone today even in the moving and fascinating speeches of the noble Lord, Lord Weatherill, and the noble Viscount, Lord Slim. But the potential of India to become the prosperous, democratic and progressive nation her leaders dreamed of in 1947 has not yet been fully realised. India has been blinkered in her progress and led astray down the blind alleys of protectionism, interventionism, narrow industrialisation and nationalisation which have been followed for so long and which have had disastrous consequences for India's economy.

India's enduring socialist rhetoric, which breathed its last gasp in the foreign exchange crisis of 1991, left behind a legacy of financial, intellectual, political and economic bankruptcy. At the beginning of this final decade of the century, India found herself an uncompetitive industrial island in a sea of poverty, paying the price for years of a socialist experiment which neglected and underfunded the basic infrastructure such as literacy, education and health. My noble friend Lady Flather told us of her very worthwhile micro projects in this regard.

The collapse of left-wing ideology elsewhere in the world ensured that the national consensus on socialism crumbled and was replaced by a consensus to liberalise and make market-friendly reforms. So India began the process of rapidly improving her "could-do-better" economic report card with widespread liberalisation. The sweeping away of Byzantine shackles of bureaucracy, including the tariff and licensing barriers of the "licence raj", has transformed the economy by starting to free the Indian market, bringing a wave of economic activity, inward investment and resultant prosperity in its wake. I am sure that the Minister will agree that government influence and intervention did not create prosperity for India, but that investment will.

We know that economic reform is not easy or without pain:

    "There is no easy walk-over to freedom anywhere, and many of us will have to pass through the valley of the shadow again and again before we reach the mountain tops of our desire".
That was said by Nehru in 1939. Economic reform is not always politically popular. It takes courage, persistence, focus and determination. Much has still to be done, but the effort will be amply repaid and with interest. Open markets create wealth and raise living standards. They promote greater choice and lower prices through competition. They provide opportunities for growth, investment and employment. That is the hard work that is necessary for India to give reality to her dreams of 50 years ago. I am sure that the Minister will agree.

Before our eyes, post-colonial, Congress-controlled and centralised India is being reinvented and replaced by competitive, decentralised, liberalised India. There are still major challenges to be faced in this new order: dealing with the rise of nationalist politics, fragmented along caste and religious lines is one such challenge.

The continued troubled relationships with neighbours Bangladesh and Pakistan is another. I should like to pay tribute to the statesmanship of Prime Minister I.K. Gujral and Prime Minister Nawaz Sharif who have acted

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recently to renew the stalled dialogue on Kashmir and who have set up a joint working party to address the issue. On behalf of the Opposition, I wish them success in that vital undertaking for peace.

I do not shrink from stating the obvious: Britain and India have a unique relationship, as was expressed so eloquently by the noble Lord, Lord Desai. As we near the millennium, our economic relationships are excellent. Over this decade, contact between our countries has matured into a flourishing partnership, fostered in the spirit of mutual interests and co-operation. As we have heard from the noble Lord, Lord Paul, with his great experience, we are linked together in so many ways, through our intertwined histories spanning centuries, both in times of conflict and of peace, through our intermingled cultures and our deep commercial links. We also share a common language, which facilitates both business and cultural exchanges between our countries.

I should like to pay tribute to the work of the British Council, which was mentioned by the noble Lord, Lord Chorley. I totally agreed with all that he said. The British Council's operation in India is its largest in the world. We have a long-established tradition of academic exchanges, such as the Foreign Office Chevening Scholarships, which have enabled young Indian lawyers, bankers, journalists and managers to study in Britain. In 1994-95 some 550 students from India received support through British government scholarship schemes.

Moreover, the huge entrepreneurial and cultural contribution made by the 1 million strong Indian community living in Britain to our multi-ethnic, multi-religious society is invaluable and creates an unbreakable and dynamic bond between our two countries. Trade runs deep in the instincts of both our peoples. Our trading links span 400 years. We already conduct a vast amount of trade and investment opportunities together and the volume is increasing steadily. Today's figures make inspired balance sheet reading. Our exports to India in 1995 were worth more than £1.6 billion, an 80 per cent. increase since 1992.

I invite the Minister to pay tribute to the outstanding work of John Major in this respect. It was his foresight and vision, together with that of his Indian counterpart, Prime Minister Narasimha Rao, which led to the formation of the Indo-British Partnership in 1993. I am sure that the Minister will join me in applauding the success of that partnership. Since its foundation, British investment has grown by more than 50 per cent. with over 600 new Indo-British joint ventures established, many of which involve small and medium-sized businesses new to the Indian market. The huge Towards 2000 exhibition which was recently held in Delhi (at the time of the Queen's visit) was the latest step towards reaching the previous government's target.

I turn now to the second part of the Motion, which was carefully covered in great detail by the noble Baroness, Lady Thomas of Walliswood. Five decades on, poverty and India are no stranger to each other. Nehru's dream of ending poverty, ignorance and disease has not been realised. India is still one of the poorest nations on earth. Its 960 million people comprise

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one-sixth of the world's population and about one-third of those live in absolute poverty, existing on less than 1 US dollar a day; 130 million have no access to basic healthcare; 220 million have no safe drinking water; 70 per cent. of the country lacks basic sanitation and half of the country is still illiterate.

I pay tribute to the strong voluntary spirit in the United Kingdom and to the vital work of the voluntary organisations in India, such as Oxfam and Save the Children. I pay tribute also to the smaller charities, such as IMPACT, which does incredibly good work, and the travelling eye hospitals that I visited recently. I pay tribute also to all other charities working in this area.

I am pleased that the Government have already accepted many of the targets set by their predecessor; for example, the commitment to work with our overseas partners to halve the number of people living in absolute poverty by 2015. I hope that they will continue to lead on other of our initiatives with our partners; for example, on our work to produce a resolution on the plight of street children at the UN General Assembly in 1992, which was followed up at the UN Commission on Human Rights in March 1993. I hope that the Government will continue our efforts to ensure that children's rights are at the forefront of the international agenda and that they will encourage all countries to ratify the UN Convention on the Rights of the Child.

I am sure that the Minister will continue to support our joint assistance partnerships with the World Bank, the United Nations specialised agencies and the European Union and that the Government will continue to lend support to the activities of organisations such as the Commonwealth Development Corporation, which spent more than £56 million on new investments in India in 1995.

I ask the Government to continue to persuade our partners in Europe and Asia that India should be included in future Asian-European summits as of right. I should like to have an assurance that under the present Government the UK is committed to continuing a modern partnership with India which is based on mutual respect that has learned from the lessons of the past and can put them to good use in the future.

India is already one of Asia's greatest regional powers. She has the capacity to be one of the world's economic powers if she continues with the current programme of economic reform. The increased authority that will come with greater prosperity will bring India new challenges and responsibilities. But as a nation of producers and consumers, by exploiting her immense human talent with help from her international friends India can graft the foundations of economic success into her rich heritage. I predict that it will not be 50 years before India reaches, not this time a tryst with destiny, but a tryst with posterity. As a global economic power, India will have a seat at the top tables in the international organisations and institutions of the 21st century. India will be a leading member of the Commonwealth, a full participant in the World Trade Organisation, ASEAN and the United Nations. This is an exhilarating prospect, and I do not believe that India

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will shirk the challenge of stepping out of the old into the new. An age of socialism has ended and the future--Asia's century--beckons India now.

I hope that the Minister will be able to take away with him the points so well made by so many noble Lords from all parts of the House today.

6.1 p.m.

Lord Whitty: My Lords, I am sure that all noble Lords are grateful to the noble Earl, Lord Sandwich, for providing this opportunity to debate the relationship of Britain with India and developments in that country. Not for the first time in this House I feel slightly daunted by the great experience of many noble Lords who have spoken--and some who have not spoken--and who have deep personal experience of India and emotional attachments to the success of that country. I speak of those who were born there, who have lived there, who have worked there and--with respect to the noble Baroness--those who have honeymooned there.

It is timely that in the wake of the Commonwealth Conference, to which organisation India's leaders have contributed so much, and the 50th anniversary of India's and Pakistan's independence, we should be holding this debate. I am glad to have the opportunity to underline the commitment of the Government to co-operate with India and other countries of the sub-continent in the task of eliminating poverty in that part of the world.

The Motion of the noble Earl draws particular attention to the socio-economic achievements of India over the past 50 years. In many respects India has achieved remarkable success over that period. Despite its three-fold increase in population, average real incomes have more than doubled and the proportion of people who are living in desperate poverty has fallen to under a third. Life expectancy has almost doubled. At independence only one in three children was enrolled in primary school whereas the figure is now over 80 per cent. Since independence India has rid itself of famine and mass starvation and is now self-sufficient in food. At the same time, it has developed a broad-based industrial structure and a high level of technological skills. As my noble friends, Lord Paul and Lord Desai, the noble Earl, Lord Sandwich, the noble Lord, Lord Weatherill, and others have said, despite the odds all of this has been achieved within a framework of a very robust democratic system in the face of potentially dangerous ethnic and cultural difficulties across the country.

However, today we have also heard about the extent of the social, environmental and economic challenges that remain. In India hundreds of millions of people still lack minimum levels of nutrition and shelter. India's progress in reducing poverty has perhaps not been quite as fast as that of other developing countries. Nevertheless, the Indian economy has begun to grow more strongly in recent years, averaging about 6 to 7 per cent. in the past three years. Despite the slowdown, the estimate for this year is 6 per cent. The exchange rate is stable; foreign exchange reserves are healthy; and foreign investment is increasing. The rate of inflation is at a historically low level.

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Recent successive governments of India have made considerable efforts to modernise and liberalise the economy. However, further reforms are still required. My noble friend Lord Paul and others say that unfortunately far less progress has been made in improving the physical infrastructure, particularly the social infrastructure, of the Indian economy. Without such improvements growth is likely to slow again in the medium term and to be of little benefit to the people of India who are still very, very poor. In our view and that of most Indian authorities, to obtain the resources needed to attack that poverty will require a substantial re-allocation of both public expenditure and private effort with a shift away from the numerous poorly targeted subsidy programmes still existing in some parts which often benefit the better off in India and which, in some cases, are prone to corruption.

All of this must be done within a democratic framework. One needs to create an India that is not like China or the tiger economies of south east Asia. My noble friend Lord Desai referred to it as a fleet-footed elephant. A fleet-footed elephant is a much nicer being than a tiger and takes the people with it. That is the great benefit of the democratic activity within India. But for the poor to benefit from the economic growth they need reasonable health and basic literacy. I refer in particular to the position of women in India. As the noble Baroness, Lady Flather, and other speakers emphasised, India still faces a serious problem in this respect, particularly among poor women. In many states only one-quarter of women are literate. To be illiterate worsens employment prospects and weakens the status of such women in society as a whole.

I agree with the noble Earl that Britain has a historic obligation to India. As the noble Baroness, Lady Flather, indicated, the relationship with India has not always been positive. There are some serious scars in our history. The record of the colonial, and sometimes post-colonial, power has not always been good. However, there is another side to the story. I am indebted to my noble friend Lord Callaghan, who is no longer in his seat, for reminding me that in the famine in 1947 ships on the high seas on their way from Australia to Britain were diverted to India to deliver grain to prevent a famine at that most difficult time for all of us. As a consequence, there was bread rationing in the United Kingdom. The record is not all negative, but there are some bad examples.

Nevertheless, in the past 50 years Britain has played a major role in India's achievements. India has been the largest recipient of British development assistance and investment from the Commonwealth Development Corporation. In 1996-97 our bilateral country programme for India was £87 million. In that year, including CDC investments, our total assistance stood at over £150 million. All of that was in addition to the very substantial British contribution to multilateral aid to India, especially through the European Union, the World Bank, the UN system and other multilateral support. Those figures exclude the public's contribution through non-governmental organisations and the private sector.

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Reference has been made to the recent state visit by the Queen and the Secretary of State to India. We believe that in reality the state visit was a very substantial success, notwithstanding the unfortunate coverage in the Indian and British media. Tens of thousands of people turned out to see the Queen in Amritsar, Madras and Cochin. She received an extremely warm welcome. The visit as a whole gave a real boost to Britain's interests. The Queen opened the largest ever Indo-British trade exhibition in New Delhi. The next day 10,000 business people visited it.

My noble friend Lord Desai, referring to the unfortunate press coverage, touched on the position of the High Commissioner in Delhi who had to deal with some of it. I can only repeat our total confidence in the High Commissioner and deny any implication that he was responsible for the bad press. As my right honourable friend the Foreign Secretary said in the other place yesterday, and as I have said, the High Commissioner has conducted himself with great dignity, sometimes in very difficult circumstances.

My noble friend Lord Desai referred to the visit as a family quarrel. That probably pitches it a bit high. It was more like a warm family occasion, much enjoyed by all, but with a few fraught edges, as happens. Unfortunately, those fraught aspects were greatly exaggerated by the rather excitable international press which was in attendance. The term "tempest in a teacup" may be a better epithet for the visit. The Prime Minister and the Indian Prime Minister at Edinburgh last week agreed that it had been a great success. The Prime Minister told Mr. Gujral that the Queen had greatly enjoyed it. Mr. Gujral replied that the Indians were honoured that she had visited them. It was a great example of the mutual affection which exists between our countries.

Britain has supported a wide range of innovative projects to help the development of India. The main areas for DfID have been health, education, water and sanitation, urban development, rural development and the reform of the energy and power industry. During the state visit, the Queen and the Duke of Edinburgh were able to visit some of those projects.

It is also important to recognise that British development assistance has changed in recent years. The noble Baroness, Lady Flather, referred to micro projects. There has been a shift away from big industrial projects in electricity generation, coal mines and railways to smaller projects involving the private sector in India and in Britain. Our assistance programme has concentrated increasingly on supporting policy changes and management reform in key sectors of the economy and on financing projects which directly tackle poverty and environmental problems and involve local people.

The creation of the department in May marks another milestone in our development assistance effort. DfID is now working with the Indian Government to ensure that our development assistance programme is focused more tightly on the elimination of poverty. Our aim is that all activities should make a real contribution towards improving the lives of the several hundred million people in India whose living standards are, by any standards, unacceptably low.

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The noble Earl, Lord Sandwich, my noble friend Lord Paul, the noble Lord, Lord Chorley, and others referred to the central importance of education, and, in particular, to the projects in Andhra Pradesh. At least a quarter of children in Andhra Pradesh receive no schooling. The latest gross enrolment figures for the first five years indicate that 73 per cent. of the age cohort has enrolled. Seventy nine per cent. of boys in this age group are enrolled; only 68 per cent. of girls. The position is especially bad for the scheduled castes. In some districts, less than 6 per cent. of scheduled caste girls are in schools.

To help address those problems, DfID and its predecessor departments over the past decade have been supporting primary education in Andhra Pradesh. The Andhra Pradesh primary education project has supported a major programme of training teachers, providing educational materials and constructing classrooms. There has been a significant improvement in enrolment and attendance, in teacher performance and in pupils' motivation to learn. That project has recently come to an end but in order to ensure that the gains made through it are consolidated and replicated DfID has committed a further £88 million for primary education in Andhra Pradesh and West Bengal through the Government of India's district primary education programme. We remain strongly committed to supporting primary education in India and ensuring that the experience we have gained through our relationship in Andhra Pradesh is used to good effect in other parts of the country.

Another aspect of our educational commitment was mentioned by the noble Baroness, Lady Rawlings, and the noble Lord, Lord Chorley. It is the role of the British Council. It has played a major part in improving educational links and resources in India and the developmental effects that they provide while at the same time sustaining British/India relations. I pay tribute to the British Council for the role it plays in that respect.

Others speakers referred to India's health requirements. Since 1990 Britain has committed over £100 million to health projects in India. DfID is helping to introduce a new method of providing TB care. We have made the largest ever grant for vaccination to the Government of India's polio eradication programme: £47 million over three years.

Family planning was mentioned by the noble Baroness, Lady Flather. The innovations that Britain supports include the building of partnerships between Indian state governments and other Indian NGOs and British NGOs to give people greater access to family planning. India's population is still growing at about 20 million a year which stretches national resources. Those efforts are aimed at giving couples choice of contraception and helping them to improve their own and their children's lives as well as potentially relieving pressure on future economic resources.

There are also the health hazards caused by inadequacies in water and sanitation. That was mentioned by the noble Baroness, Lady Thomas of Walliswood. DfID is helping the Indian Government to develop long term strategies for urban and rural water

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supply and sanitation as well as supporting a variety of projects; for example, the £16 million Maharashtra rural water supply project where DfID is financing four piped-water supply schemes to 210 villages and one small town. The provision of healthy water and sanitation will greatly improve not just the quality of life but the economy and society.

The noble Baronesses, Lady Thomas and Lady Rawlings, referred also to child rights and child labour. Although basic primary education in India has increased and improved greatly, millions of children--perhaps as many as 45 million--still spend their childhood working. The great majority of those children will never attend schools. They will be poor, illiterate and extremely vulnerable. There is a complex approach to eliminating child labour in India. There are numerous initiatives of government and non-government agencies. Children are working in hazardous industries such as firework manufacturing, but children in those industries are in a minority compared to the huge numbers working in agriculture. Girls suffer particular problems in the under-age sex industry. Britain is providing support to the ILO's programme to combat trafficking in children and their exploitation in prostitution. We also fund NGO activities through Christian Aid and Oxfam.

There has been considerable publicity over the weekend about the UNICEF report on child labour with some slightly misleading reporting. The report recognises that there needs to be priority in tackling the problem of child labour. Those priorities should concentrate on the exploitation of children in highly exploitative and dangerous work. This very morning my right honourable friend the Secretary of State for International Development was attending a conference on child labour in Oslo. In a speech she reflected the concern felt in Britain about child labour. She said:

    "There is huge public interest in the UK for world wide support to the governments, communities, workers and families who are tackling problems of child labour in their own countries. UK consumers are increasingly not prepared to buy goods produced by exploiting children, but we are also learning that boycotts or overnight exclusions of children from certain industries can hurt those most whom we are trying to help".

The Secretary of State gave the example of football stitching which she described as a highly exploitative industry in Pakistan, although it was not the most intolerable work. It is one that has rightly drawn international attention. She was delighted to announce that DfID under the Government of Pakistan memorandum of understanding intends to fund Save the Children to implement a social protection programme for the children involved in that trade which should ensure that when, at the end of next year, children stop working in the football stitching industry they are not forced into more hazardous and equally exploitative work. That is a model of partnership between government, business and NGOs.

I have dwelt substantially on the role of government, but NGOs and the private sector have their role to play. Many Indian NGOs are making a great contribution as is a wide range of British NGOs which have been generously supported by the British public. Among those operating on a large scale in India are Oxfam, Christian Aid, Action Aid, Save the Children and CARE

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International. Although non-governmental organisations have smaller resources at their disposal than government programmes, they are often much more able to work effectively on small scale projects with local communities, and, as my noble friend Lord Paul said, with local government and the new democracies at that level in India. The White Paper to be produced by the Department for International Development will review the support for NGOs with a view to strengthening it.

There is also a vital role to be played by the private sector. The private sector in India itself has brought about much of the transformation of the economy, as my noble friend Lord Desai and the noble Lord, Lord Chorley, as well as other noble Lords said, but so has the international private sector which has provided a huge increase in inward investment in India. Not least I should mention the Indian entrepreneurs based partly in India and partly in Britain. There has been a major contribution by the Indian community in Britain to the development of India over recent years.

In all development issues we are committed to ensuring that the elimination of global poverty is a determining factor in our international policy. I have dwelt substantially on India in this debate, as have most noble Lords. Obviously, we also have parallel policies in relation to Pakistan, Bangladesh, Sri Lanka and Nepal. We are committed within that region of the world not only to bilateral arrangements but also to the work of the EU, the UN and many multilateral institutions of which we are members in making a more effective contribution to the elimination of poverty.

In a country so vast as India, partnership with central government is not enough. That is why DfID is also working to develop close partnerships with several of India's state governments. We are keen to focus our efforts in those states where our help is most needed and where it can be most effectively used. In the global fight against poverty, no partnerships will be more important than the partnerships we make with the countries of south Asia. Substantial reductions in global poverty depend crucially on reducing poverty in that area. Our long history of friendship with India and the other countries of the region, our shared commitment to democratic values and the close links at all levels between our institutions and peoples, which have been much touched on in this debate, give us great opportunities to build and strengthen our partnerships. The Government are strongly committed to seizing those opportunities and to making the most of them in the vital work of eliminating global poverty.

I am very happy to concur with some of the remarks of the noble Baroness, Lady Rawlings. We intend to move into the 21st century in a modern partnership with India based on mutual respect and longstanding friendships between so many in this country and so many in India.

6.23 p.m.

The Earl of Sandwich: My Lords, I feel that I am in a holy place. There have been many soothing words this afternoon, not least from the Minister who has just sat down. It has been an encouraging and enjoyable debate.

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I want to detain the House for only a minute or two. At the risk of being regarded as racist, I particularly congratulate today our Indian colleagues who have brought to this debate a quality which perhaps we ought to hear more often. I should like to thank those noble Lords in particular.

I noted that the Minister made no attempt to defend the assault on Indian socialism by the noble Baroness, Lady Rawlings, who carried out that job very ably. I am relieved that we do not need to go into those past experiences. There have been awful experiences within India and between ourselves and India. The whole thing has been gradually laid to rest by what noble Lords have said. I thank especially the noble Lord, Lord Paul, for his remarks about the relations between our communities and the words of the Prime Minister over the Queen's visit. We are all reassured by that.

I should like to thank the Minister for his detailed responses, which I look forward to reading tomorrow, particularly as regards the NGOs. We all look forward to the White Paper. This will be a tremendous job, but we shall take it carefully. Taking things carefully is another theme that has been mentioned this afternoon. We must not expect all the results to come at once. My enthusiasm at the beginning of the debate has been properly tempered, not least by the two soldiers on either side of me with their tremendous stories, reminding me of the importance of nostalgia at certain times.

We should spare a thought for the mahout--this poor coalition government--which has to deal with the fleet footed elephant. We have not said a lot about that. The noble Lord, Lord Paul, and others reminded us that a coalition means getting closer to the people. It means more participation and more representation, as the noble Lord, Lord Desai, said. It is exciting. Women are also coming forward.

On a final and sombre note, the United Nations gave me a figure which staggers me. Some estimates indicate that in their entire education Indian girls stay in school for only two years on average; I do not say that that is a national average. We have to help India--we do not have the answers; India has them--to overcome the very challenging targets. I beg leave to withdraw the Motion.

Motion for Papers, by leave, withdrawn.

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