>> INDIA HAS MADE A LOT OF ECONOMIC PROGRESS IN THE LAST TWO DECADES, BUT IS IT ENOUGH FOR THE COUNTRY'S HUGE, YOUNG POPULATION? WE'LL LOOK AT THE POSSIBILITIES NEXT ON "GLOBAL PERSPECTIVES.

" >> THIS IS "GLOBAL PERSPECTIVES" WITH PULITZER PRIZE-WINNING COMMENTATOR JOHN BERSIA.

>> WELCOME TO "GLOBAL PERSPECTIVES.

" AFTER TWO DECADES OF IMPRESSIVE GROWTH, INDIA'S ECONOMY MAY BE SLOWING DOWN — PERHAPS A VICTIM OF ITS OWN SUCCESS.

[ TRAIN WHISTLE BLOWS ] THERE IS NO QUESTION THE EXPANSION HAS LIFTED LARGE NUMBERS OF PEOPLE OUT OF POVERTY.

BUT SEVERAL FACTORS, INCLUDING THE RISING EXPECTATIONS OF SKILLED WORKERS, MEAN INDIA'S LOSING JOBS TO STILL-CHEAPER COUNTRIES.

INDIA'S LEADERS ARE AWARE OF THE IMPORTANCE OF BUILDING ON THE ALREADY SUBSTANTIAL RELATIONSHIP WITH THE UNITED STATES.

BUT ONE SUCH MOVE, TO OPEN INDIA TO LARGE WESTERN RETAILERS, GENERATED PROTEST CLOSINGS AND DEMONSTRATIONS FROM SMALL MERCHANTS.

[ SHOUTING IN NATIVE LANGUAGE ].

LONG THE BACKBONE OF INDIA'S DOMESTIC ECONOMY.

TODAY'S GUEST, PERSIS KHAMBATTA, A FELLOW IN U.

S.

-INDIA POLICY STUDIES AT THE CENTER FOR STRATEGIC AND INTERNATIONAL STUDIES, IS A SPECIALIST IN INDIA'S ECONOMIC DEVELOPMENT AND POLITICAL AFFAIRS.

WELCOME TO THE SHOW, PERSIS.

>> THANK YOU.

>> HOW DOES ONE BEGIN TO APPROACH A SUBJECT AS HUGE AS INDIA, ESPECIALLY INDIA'S RISE OVER THE PAST TWO DECADES? HOW DO YOU GET YOUR HANDS AROUND THAT? >> THAT'S A GOOD QUESTION.

IT'S ACTUALLY SOMETHING THAT I STRUGGLE WITH OFTEN, BECAUSE THE MINUTE YOU DELVE INTO ONE ISSUE IN INDIA, AS IN MANY OTHER COUNTRIES, 10 ISSUES COME OUT OF THAT.

WHAT WE'VE CHOSEN TO DO AT THE WADHWANI CHAIR IN U.

S.

-INDIA POLICY STUDIES AT CSIS IS TO FOCUS ON ECONOMIC-DEVELOPMENT ISSUES IN INDIA.

AND THAT STILL ENCOMPASSES A VERY WIDE-RANGING SET OF ISSUES, BUT IT'S A BIT MORE MANAGEABLE THAN DEALING WITH ECONOMIC DEVELOPMENT, SECURITY, REGIONAL RELATIONS [CHUCKLES] AND FOREIGN AFFAIRS ALL AT THE SAME TIME.

>> BUT, AS YOU SAID, IT TOO IS HUGE.

>> IT IS.

>> SO WHERE DO YOU START, AND WHAT IS YOUR PARTICULAR STARTING POINT AS FAR AS YOUR OWN BACKGROUND AND RESEARCH ARE CONCERNED? >> THANK YOU.

WELL, I USED TO WORK FOR AN N.

G.

O.

CALLED THE ASIA FOUNDATION, WHICH OPERATES THROUGHOUT THE ASIA-PACIFIC REGION.

AND I ALSO HAVE A MASTER'S IN INTERNATIONAL AFFAIRS, FOCUSING ON ASIA, AS WELL.

FROM 2007 TO 2010, I LIVED IN BOMBAY WITH MY FAMILY.

AND SINCE RETURNING BACK TO THE UNITED STATES, I'VE JOINED CSIS AS PART OF THE INDIA TEAM, WHICH IS PART OF A LARGER ASIA TEAM.

AND SO WHEN I LOOK AT INDIA, BECAUSE MY BACKGROUND IS IN DEVELOPMENT, I FOCUS ON ISSUES THAT I THINK ARE REALLY OF SIGNIFICANT IMPORTANCE, ISSUES THAT ARE GONNA EFFECT CHANGE IN INDIA IN THE NEXT DECADE.

SO WHEN YOU'RE TALKING ABOUT ECONOMIC DEVELOPMENT, THOSE ARE ISSUES OF SKILLS TRAINING IN INDIA, OF EDUCATION, ACCESS TO HEALTHCARE, INDIA'S CONTINUED OPENING TO FOREIGN DIRECT INVESTMENT FROM THE OUTSIDE WORLD, AND THE POLICIES THAT WILL HAVE TO COME HAND-IN-HAND WITH THE OPENING OF THEIR ECONOMY IN ORDER TO BE AN INCLUSIVE-GROWTH STORY FOR THE NEXT CENTURY.

>> EDUCATION IS OBVIOUSLY A VERY LARGE PART OF THIS DISCUSSION, AND INDIA ALREADY HAS SOME OF THE LARGEST, IN TERMS OF ENROLLMENT, UNIVERSITIES IN THE WORLD.

COULD YOU EXPLAIN TO US WHAT KINDS OF CHANGES ARE NEEDED IN THE EDUCATIONAL SYSTEM? >> SURE.

SO, INDIA HAS — RECENTLY, THEY PASSED A RIGHT TO EDUCATION ACT, AND THAT IS SUPPOSED TO GUARANTEE FREE LOCAL EDUCATION TO CHILDREN IN THE K-12 GRADES.

NOW, IT DOES GUARANTEE THAT.

THERE ARE ISSUES WITHIN THAT SYSTEM THAT NEED TO BE FIXED, RANGING FROM TEACHERS SHOWING UP IN THE CLASSROOM TO, YOU KNOW, SCHOOLS ACTUALLY OPERATING AS THEY'RE SUPPOSED TO.

THAT DOESN'T HAPPEN EVERYWHERE, AND THAT COULD BE IMPROVED UPON.

BEYOND THAT, INDIA HAS A WONDERFUL REPUTATION FOR ITS VERY ELITE EDUCATION WITH INSTITUTES KNOWN AS THE I.

I.

T.

S AND THE I.

I.

M.

S, AND THOSE ARE SORT OF THE IVY LEAGUE SCHOOLS FOR ENGINEERING, TECHNOLOGY, AND BUSINESS.

AND THEY CATER TO — YOU CAN IMAGINE — A TINY, ELITE NUMBER OF STUDENTS WHO GRADUATE FROM THE TOP OF THE TOP FROM EACH OF THEIR CLASSES.

WHAT'S MISSING IS THE MIDDLE.

AND THAT IS THE SORT OF BLUE-COLLAR EDUCATION, THE COMMUNITY COLLEGES, AND THE SKILLS-AND-TRAINING CENTERS THAT ARE NEEDED TO TRAIN RECENT GRADUATES TO ENTER DIRECTLY INTO THE WORKFORCE, INTO MANUFACTURING, INTO SERVICES — INTO, NOT THE WHITE-COLLAR EXECUTIVE JOBS, BUT INTO THE MORE EVERYDAY, BLUE-COLLAR JOBS THAT ARE CERTAINLY ON THE RISE, BUT THEY DON'T EXIST IN THE NUMBERS THAT ARE NEEDED TO POWER INDIA'S ECONOMY.

>> WHAT IS THE NEXT STEP? IS IT A PUSH THAT HAS TO COME FROM GOVERNMENT? DOES IT COME FROM THE PRIVATE SECTOR? IS IT A COMBINATION OF THE TWO? >> IT IS.

IT'S ACTUALLY A LITTLE BIT OF BOTH.

AND WHAT'S HAPPENING NOW IS THAT THEY'VE SET UP A NATIONAL SKILLS DEVELOPMENT CENTER WITHIN ONE OF THE MINISTRIES IN THE GOVERNMENT.

SO, WHAT THAT CENTER IS SUPPOSED TO DO IS TO PROVIDE AN IMPETUS TO THE CREATION OF THESE SKILLS-TRAINING CENTERS AND COMMUNITY COLLEGES.

SO THEY'RE EMBARKING ON PILOT PROJECTS TO RUN A COMMUNITY-COLLEGE SYSTEM IN DIFFERENT PARTS OF THE COUNTRY.

THEY'RE NOT CLUSTERED TOGETHER.

THEY'RE CERTAINLY SPREAD APART.

AND WE'LL SEE HOW THE EXPERIMENT GOES.

I KNOW THAT A LOT OF INDIAN CITIZENS WHO HAVE COME FROM RURAL AREAS OR WHO ARE SORT OF IN THE LOW TO MIDDLE CLASS IN THE URBAN AREAS ARE REALLY HUNGRY FOR THIS EDUCATION BECAUSE IT GETS THEM THE OPPORTUNITY FOR A JOB AND A STABLE INCOME, WHICH THEY HAVEN'T HAD AS YET.

SO YES, THERE IS A CONCERTED EFFORT ON THE PART OF THE GOVERNMENT AND THE PRIVATE SECTOR TO START TO INITIATE THESE PROGRAMS AROUND THE COUNTRY.

>> TELL US ABOUT THE YOUNG PEOPLE IN INDIA TODAY.

WHAT ARE THEIR HOPES? WHAT ARE THEIR DREAMS? IT'S SUCH A LARGE PERCENTAGE OF THE POPULATION, AND THEY'VE NO DOUBT BEEN WATCHING THIS ECONOMIC GROWTH OF THE PAST COUPLE OF DECADES AND THINKING ABOUT OPPORTUNITIES FOR THEMSELVES.

HOW DOES ALL OF THIS FIT TOGETHER? >> WELL, THE YOUNG PEOPLE OF INDIA ARE REALLY ALMOST ALL OF INDIA.

THEY'RE FACING A DEMOGRAPHIC DIVIDEND, WHICH IS DIFFERENT THAN THEIR NEIGHBORS, AND IT'S DIFFERENT, ACTUALLY, THAN MOST OF THE WORLD.

1/2 OF INDIA IS UNDER 25 YEARS OLD, AND 2/3 OF INDIA IS UNDER 35 YEARS OLD.

SO THAT'S 800 MILLION PEOPLE UNDER 35 YEARS OLD.

YOU CAN IMAGINE — MANY OF THESE PEOPLE CAME OF AGE AFTER THE BIG BANG ECONOMIC REFORMS, WHICH WERE INITIATED IN THE EARLY '90s.

SO THEY DON'T HAVE A LOT OF MEMORY — OF THE DIFFICULT MEMORIES OF INDIA'S WARS AND INDIA'S INDEPENDENCE IN 1947.

THEY HAVE A MUCH MORE MODERN VIEW OF THEIR COUNTRY.

THEY ARE, YOU KNOW — IT'S BEEN IN THE NEWS OVER THE PAST TWO YEARS.

THEY ARE ABSOLUTELY FED UP WITH CORRUPTION, THE OFFICIAL CORRUPTION, WHICH THEY THINK OF AS BEING ENDEMIC IN SOCIETY.

IT'S CERTAINLY NOT ONLY LIMITED TO THE GOVERNMENT, BUT THAT'S WHERE THE REAL PROBLEMS ARE THAT BLOCK THEIR OPPORTUNITY.

SO THEY'RE TIRED OF POLITICS AS USUAL.

THEY'RE ALSO TIRED OF NOT HAVING ACCESS TO ECONOMIC OPPORTUNITY.

THEY WOULD LIKE BETTER EDUCATIONAL OPTIONS.

THEY WANT HEALTHCARE.

MANY OF THE THINGS YOUNG AMERICANS WANT IS WHAT THEY WANT.

IT'S JUST SLOWER TO COME TO THEM BECAUSE OF THE SHEER SIZE OF THE POPULATION AND THE DIFFICULTY OF GETTING THESE SERVICES OUT INTO, YOU KNOW, VERY FAR-FLUNG, RURAL SECTORS.

RURAL AREAS.

I'M SORRY.

SO WHEN YOU TALK ABOUT THE YOUTH OF INDIA, IT'S ALSO — THEY WANT DIFFERENT THINGS.

YOUTH IN THE RURAL AREAS WANT DIFFERENT THINGS THAN YOUTH IN THE URBAN AREAS.

THEY DON'T THINK THE SAME WAY.

WHAT THEY DO HAVE IN COMMON IS WANTING ACCESS TO ECONOMIC OPPORTUNITY.

>> YOU SAID THERE ARE DIFFERENCES.

ARE THEY ALL DISMAYED BY THE ISSUE OF CORRUPTION? >> YES.

THAT IS ONE BINDING FEATURE.

[ CHUCKLES ] AROUND THE COUNTRY IS REALLY A DISMAY WITH THE CURRENT LEVEL OF CORRUPTION.

IN ALL FAIRNESS, CORRUPTION DOES HAVE TWO PARTIES, USUALLY — ONE WHO'S BEING CORRUPTED AND ONE WHO'S DOING THE CORRUPTION.

AND THIS IS — IT REQUIRES A CHANGE IN MIND-SET, WHICH IS — IT HAS BURST ONTO THE NATIONAL SCENE IN A VERY DRAMATIC WAY IN THE PAST TWO YEARS.

>> HOW DOES THAT TRANSLATE INTO MEANINGFUL CHANGE? DOES IT COME THROUGH POLITICAL PRESSURE? DOES IT COME THROUGH POPULAR PRESSURE? >> MM-HMM.

YES.

THERE ARE MANY DIMENSIONS TO THE PROBLEM — AND THE SOLUTION, AS WELL.

LIKE YOU SAID, THERE IS AN INSTITUTIONAL MECHANISM PUT IN PLACE.

THE CONGRESS-RUN GOVERNMENT DID ENACT SOMETHING CALLED THE RIGHT TO INFORMATION ACT.

SO, THAT GUARANTEES ANY CITIZEN THE RIGHT TO KNOW WHAT IS GOING ON WITH A CERTAIN POLICY OR WHAT HAS HAPPENED WITH A PARTICULAR PROJECT IF THEY WRITE TO THE GOVERNMENT AND THEY REQUEST THAT — SIMILAR TO OUR F.

O.

I.

A.

REQUESTS IN THE UNITED STATES.

SO THAT'S GONE A LONG WAY IN GIVING SORT OF A DEMAND FOR THE END TO CORRUPTION.

PEOPLE KNOW WHAT'S GOING ON MUCH MORE THAN THEY USED TO.

THE MEDIA PLAYS A ROLE IN THIS, AS WELL, WITH EXPOSING A LOT OF CORRUPTION SCANDALS THAT HAVE COME OUT SINCE 2010 AND AFTER.

THERE WERE SOME BEFORE, BUT IT REALLY HAS BECOME A CRITICAL MASS.

AND I BELIEVE INDIA'S REALLY AT A TIPPING POINT, WHERE THE YOUTH AND THE URBAN MIDDLE CLASS IS SO FED UP WITH CORRUPTION.

AND THEY UNDERSTAND HOW IT'S HOLDING THE COUNTRY BACK NOW, BECAUSE IT'S IN THE MEDIA AND BECAUSE IT'S SO COMMONPLACE TO TALK ABOUT IT.

IT WASN'T LIKE THIS 10 YEARS AGO.

YOU SORT OF HAVE A CONFLUENCE OF EVENTS.

YOU HAVE PEOPLE WHO HAVE GONE TO THE BIG CITY AND NOW HAVE JOBS, AND THEY SEND MONEY HOME, USUALLY, TO A VILLAGE.

SO PEOPLE IN THE VILLAGES KNOW WHAT OPPORTUNITY IS THERE IN THE CITIES, AND THEY'RE INCREASINGLY ASPIRATIONAL.

THIS IS YOUTH.

THIS IS ADULTS.

THIS IS EVERYBODY.

THEY WANT JOBS AND ECONOMIC OPPORTUNITY IN THE BIG CITIES, IF NOT ABROAD.

THEY'RE ACTUALLY IN THE MIDDLE OF A MASSIVE MIGRATION INSIDE OF INDIA, FROM THE VILLAGES TO THE CITIES, FOR EXACTLY THIS REASON.

BEYOND THAT, YOU ALSO HAVE POLITICAL PRESSURE.

THERE'S BEEN AN ANTI-CORRUPTION MOVEMENT.

THERE WAS RECENTLY A POLITICAL PARTY IN THE DELHI ELECTIONS, WHERE DELHI IS THE CITY-STATE THAT HOUSES THE NATION'S CAPITOL.

AND THERE WAS A THIRD PARTY, CALLED THE AAM AADMI PARTY, WHICH PLAYED THE SPOILER IN THE ELECTIONS, SURPRISING EVEN THEMSELVES BY WINNING 1/3 OF THE VOTES.

SO THEY ACTUALLY TOOK OUT THE CONGRESS FROM RULING THE CITY-STATE, AND THEY LESSENED THE BJP — THE CHIEF OPPOSITION PARTY'S CHANCES OF RUNNING THE GOVERNMENT.

SO, WHAT HAPPENED WAS, THEY ACTUALLY HAD TO FORM THE GOVERNMENT, AND THEY'VE DONE SO WITH THE BACKING OF THE CONGRESS PARTY.

SO FOR THE FIRST TIME, YOU ACTUALLY HAVE A PARTY WHICH WAS RUN VERY SPECIFICALLY ON AN ANTI-CORRUPTION PLATFORM WHICH IS NOW IN POWER IN ONE OF THE STATES.

>> I'M GUESSING THERE IS, OF COURSE, NO AVERAGE YOUNG INDIA PERSON, 'CAUSE PEOPLE ARE SO DIFFERENT.

BUT ARE THERE THINGS THAT SOME YOUNG INDIANS THINK ABOUT OR ASPIRE TO THAT MIGHT BE TYPICAL OF THE COUNTRY AT LARGE? >> I CAN SPEAK FROM PERSONAL EXPERIENCE OF THOSE THAT I KNOW, YOU KNOW, WHETHER THEY'RE IN BIG CITIES OR IN THE SUBURBS.

AND THEY WOULD EVEN DESCRIBE THEMSELVES AS "ASPIRATIONAL AND DEMANDING.

" THEY REALLY CRAVE LEADERSHIP IN INDIA — STRONG LEADERSHIP.

WHICH IS WHY YOU SEE SOMEBODY, A POTENTIAL CANDIDATE — HE IS A CANDIDATE FOR A POTENTIAL PRIME MINISTERIAL POST, CHIEF MINISTER NARENDRA MODI.

YOU CAN SAY WHAT YOU WANT ABOUT HIS POLITICS AND ECONOMICS.

AT THE END OF THE DAY, HE'S A STRONG LEADER, AND HE DOESN'T LEAVE DOUBTS ABOUT WHERE HE STANDS ON ISSUES.

LEADERSHIP IN INDIA HAS TENDED TO LEAVE OPEN QUESTIONS LIKE THAT.

YOU DON'T KNOW FIRMLY WHERE THEY STAND ON PARTICULAR ISSUES, AND THERE'S A LOT OF READING BETWEEN THE LINES.

AND I SEE YOUNG INDIANS AS CRAVING THAT CERTAINTY AND PREDICTABILITY AND STRONG FEELINGS FOR ISSUES THAT INVOLVE INDIA.

I DO SEE THEM AS BEING QUITE NATIONALIST.

AND NOT IN A BAD WAY AT ALL.

I THINK THEY'RE VERY PROUD OF THEIR COUNTRY.

THEY'RE VERY PROUD OF THEIR ACCOMPLISHMENTS.

THE COUNTRY'S CHANGING IN MASSIVE WAYS THAT THEY SHOULD BE VERY PROUD OF.

AND THEY'RE PROUD PEOPLE.

AND LIKE YOU SAID, THEY JUST WANT ACCESS TO GOOD JOBS AND TO BE ABLE TO SUCCEED — YOU KNOW, MOVE OUT ON THEIR OWN AND, YOU KNOW, BE THE ONES WHO DRIVE THEIR OWN SUCCESS.

AND I THINK THAT THE PRIVATE SECTOR HAS HAD A REALLY LARGE ROLE TO PLAY HERE IN SORT OF PUTTING INTO PLACE A MERITOCRACY WITHIN THE WORKPLACE.

INDIAN SOCIETY FOR EONS HAS BEEN, YOUR SUCCESS IS NOT BASED ON YOUR MERIT.

IT'S BASED ON YOUR POSITION IN SOCIETY OR OTHER COMMUNITY FACTORS.

AND THE PRIVATE SECTOR HAS REALLY SHOWED THE WAY INTO MERITOCRACY.

AND THEY BELIEVE VERY STRONGLY IN THIS.

THEY WANT TO SUCCEED ON THEIR OWN MERITS.

>> I'M GLAD YOU PUT MORE OF A NATIONAL-PRIDE TWIST ON THE NATIONALISM QUESTION, BECAUSE OFTENTIMES WHEN YOU HEAR "NATIONALISM," IT'S NOT PERCEIVED AS SOMETHING THAT'S POSITIVE.

AND WE TALK ABOUT RISING NATIONALISM IN CHINA TODAY AND RISING NATIONALISM IN JAPAN, AND THAT USUALLY MAKES PEOPLE A LITTLE BIT APPREHENSIVE.

BUT I THINK WHEN IT'S IN THE NATIONAL PRIDE CONTEXT, IT'S A DIFFERENT DISCUSSION.

WHAT ARE THE MAJOR CHALLENGES THAT, YOU KNOW — WE'VE HAD TWO DECADES OF BUILDING UP THIS NEW ECONOMY, BUT NOW, AS WITH ALL EXPERIMENTS OF THIS KIND, YOU'VE RUN INTO A ROAD THAT IS POTENTIALLY NOT SMOOTH, AND SO YOU'LL HAVE SOME DOWNS AS WELL AS UPS.

ARE PEOPLE PREPARED FOR THAT? ARE PEOPLE UNDERSTANDING? ARE THE CHALLENGES THAT LIE AHEAD MANAGEABLE FOR INDIA? >> MM-HMM.

YES.

THEY'RE CERTAINLY MANAGEABLE.

BUT LIKE I SAID, THEY DO TAKE A VERY STRONG-WILLED LEADER IN ORDER TO BE ABLE TO GUIDE THE COUNTRY THROUGH IT, I BELIEVE, IN ORDER TO REALLY INJECT A DOSE OF REALITY — AT THE SAME TIME, INJECTING A SENSE OF HOPE AND OPTIMISM FOR THE POPULATION.

OPENING INDIA TO THE WORLD IS NOT AN EASY TASK.

OPENING A MASSIVE ECONOMY — THEY ARE THE THIRD-LARGEST ECONOMY IN P.

P.

P.

TERMS IN THE WORLD.

AND THEY — YOU KNOW, IN THE EARLY '90s, THEY OPENED THE ECONOMY WITH THIS BIG BANG — THEY'RE KNOWN AS THE BIG BANG REFORMS — TO THE GLOBAL MARKETPLACE.

EVER SINCE THEN, THOUGH, AFTER THE FIRST ROUND OF THOSE REFORMS, IT SLOWED DOWN A BIT.

THEY SORT OF BECAME APPREHENSIVE, REALIZING THAT THEY DIDN'T HAVE THE INSTITUTIONAL STRUCTURES IN PLACE WHICH COULD HANDLE ALL OF THE CHANGE AND ALL OF THE CAPITAL THAT WAS COMING TO THEM.

THAT HAS BEGUN.

THE STRUCTURAL CHANGES ARE BEING PUT INTO PLACE IN ORDER TO, I WOULD SAY, HANDLE A SECOND WAVE OF REFORMS.

BUT THE POLITICAL WILL TO PASS THESE REFORMS AND SORT OF PLUNGE THE COUNTRY INTO WHAT POTENTIALLY MIGHT BE A LITTLE BIT MORE CHAOS — BUT ABSOLUTELY MANAGEABLE CHAOS — THAT POLITICAL WILL ISN'T THERE JUST YET.

THEY DO NEED TO PASS SECOND-STAGE REFORMS WHICH WOULD BE STRUCTURAL IN NATURE, ANYWHERE FROM INFRASTRUCTURE — YOU KNOW, PROVIDING CLEAR LAND-ACQUISITION PROCESSES TO COMPANIES AND FIRMS WHO WANT TO COME IN AND DEVELOP THE AREA FOR ROADS, RAILWAYS, ET CETERA.

THEY NEED ENERGY SYSTEMS PUT IN PLACE IN ORDER TO POWER THE NATIONAL GRID, ACCESS TO LIQUEFIED NATURAL GAS FROM AROUND THE WORLD.

THEY'RE A VERY ENERGY-HUNGRY COUNTRY, AND THEY DON'T HAVE ACCESS TO THE SUPPLY THAT THEY NEED TO POWER THEMSELVES JUST YET.

IT'S COMING, BUT IT'S NOT — IT'S NOT IN AS GOOD SHAPE AS IT COULD BE YET.

AGAIN, THE EDUCATIONAL SYSTEM REALLY NEEDS TO BE BOLSTERED IN ORDER TO TRAIN WORKERS FOR A 21st CENTURY MARKETPLACE.

THEY'RE REALLY SHIFTING FROM AN AGRICULTURAL, AGRICULTURE-BASED JOB MARKET, I WOULD SAY, TO SERVICES.

THEY'VE MADE THIS HUGE SHIFT, BUT THEY'VE FORGOTTEN THE MIDDLE AGAIN, AND THAT'S THE MANUFACTURING AND THE INDUSTRIAL BASE.

AND THEY NEED TO MOVE — BY THEIR OWN DEFINITION, WANT TO MOVE 100 MILLION PEOPLE INTO MANUFACTURING.

THIS IS NOT A SMALL TASK.

[ LAUGHS ] >> I CAN IMAGINE THIS IS SO DIFFICULT AND CONFUSING TO PEOPLE ON THE INSIDE.

FOR PEOPLE ON THE OUTSIDE, IT'S JUST MIND-BOGGLING.

AND WHEN YOU TALK ABOUT MOVING 100 MILLION PEOPLE FROM ONE SECTOR INTO ANOTHER, THAT'S LARGER THAN MANY COUNTRIES.

SO, HOW DO YOU HELP THE PERSON ON THE OUTSIDE UNDERSTAND WHAT IS GOING ON IN INDIA? FROM THE OUTSIDE, MANY TIMES, PEOPLE THINK THIS IS JUST A GIANT BUT HOMOGENOUS COUNTRY, AND YET, THAT'S NOT EVEN CLOSE TO REALITY.

COULD YOU GIVE US A SENSE OF HOW DIVERSE INDIA IS? >> ABSOLUTELY.

INDIA EXISTS ON A NUMBER OF DIFFERENT FRONTS.

LIKE YOU SAID, IT IS NOT HOMOGENOUS.

IT'S NOT EVEN CLOSE.

IT'S PROBABLY THE MOST DIVERSE COUNTRY ON EARTH, WITH, YOU KNOW, 22 OR 25 OFFICIAL LANGUAGES.

BEYOND THAT, OTHER DIALECTS ARE SPOKEN AROUND THE COUNTRY.

DIFFERENT RACES, DIFFERENT ETHNICITIES.

MY OWN FAMILY COMES FROM A VERY TINY MINORITY IN INDIA, AS WELL.

IT IS THE FARTHEST THING FROM A HOMOGENOUS SOCIETY AS YOU CAN GET.

IT'S A VERY PLURAL SOCIETY, AND IT'S A VERY TOLERANT SOCIETY — FOR THE MOST PART.

INDIA ALSO EXISTS ALMOST IN DIFFERENT TIMES AND IN DIFFERENT AGES AT THE SAME TIME.

YOU CAN GO FROM A BIG CITY AND BE FIRMLY IN THE 21st CENTURY, AND YOU CAN TRAVEL A FEW HOURS OUT INTO THE COUNTRYSIDE, AND YOU FEEL LIKE YOU'VE LITERALLY GONE BACK IN TIME INTO A MUCH SIMPLER TIME.

HOW DO YOU MAKE SENSE OF IT? [ Chuckling ] YOU FOCUS ON ONE PART AT A TIME, REALLY.

YOU CAN'T TACKLE INDIA IN — YOU CAN'T EVEN LIVE THERE FOR A YEAR AND UNDERSTAND THE PLACE.

YOU HAVE TO BE THERE FOR A CONCERTED PERIOD OF TIME, AND YOU HAVE TO BE VERY OPEN-MINDED, AND YOU HAVE TO BE FOCUSED.

THERE ARE MASSIVE INTERNAL CHANGES GOING ON.

ONCE YOU START TO SEE HOW THE PIECES OF THE PUZZLE FIT TOGETHER, IT STARTS TO MAKE A LOT MORE SENSE.

THE POLITICS FLOWS INTO THE ECONOMICS, WHICH FLOWS INTO OPPORTUNITY.

>> WHAT ABOUT THE RELATIONSHIP BETWEEN INDIA AND ITS NEIGHBORS? WE WERE TALKING ABOUT INDIA AND WHERE IT STANDS, RELATIVELY SPEAKING, IN GLOBAL ECONOMIC TERMS.

BUT IN TERMS OF SOUTH ASIA, IT'S THE 800-POUND GIANT.

AND HOW ARE THOSE RELATIONSHIPS? >> I THINK INDIA REALIZES THAT IT IS THE 800-POUND GORILLA IN ITS NEIGHBORHOOD.

AND IT'S INCREASINGLY REACHED OUT TO TRY AND BUILD POLITICAL AND ECONOMIC BRIDGES TO ITS NEIGHBORS.

THIS IS A RECENT PHENOMENON.

INDIA AND PAKISTAN TRADE TIES ARE STARTING TO FLOURISH — OR ARE ON THE CUSP OF STARTING TO FLOURISH.

FOR A WHILE, THEY'VE BEEN TRYING TO FIGURE OUT HOW IT IS THAT THEY CAN EXPAND TRADE TIES AMIDST A LOT OF POLITICAL UNCERTAINTY.

AND OFTEN, YOU KNOW, THEY DON'T GET ALONG [LAUGHS] IN A SECURITY SENSE.

BUT IN A TRADE SENSE, THEY HAVE A REALLY LARGE CONSTITUENCY ON BOTH SIDES OF THE BORDERS THAT'S STARTING TO SUPPORT INCREASED TRADE TIES.

WITH BANGLADESH, TRADE RELATIONS ARE EXPANDING AND POLITICAL TENSIONS ARE COMING DOWN.

THAT RELATIONSHIP IS DOING MUCH BETTER, AS WELL.

WITH SRI LANKA, IT'S.

WHAT WOULD I SAY? IT'S GIVE AND TAKE.

SOMETIMES IT'S GOOD, SOMETIMES IT'S A LITTLE TESTY.

BECAUSE ONE OF THE SOUTHERN STATES, TAMIL NADU, HAS A LARGE TAMIL POPULATION, WHICH IS ALSO FOUND IN SRI LANKA.

SO SOMETIMES THEY HAVE DIFFICULT RELATIONS, BUT THEY'RE, ON THE WHOLE, INCREASINGLY GETTING BETTER.

INDIA'S ALSO REALIZING, WITH SOUTHEAST ASIA, THAT NOT ONLY IS IT LINKED BY TRADE TIES, IT'S LINKED BY CIVILIZATIONAL TIES, AND THEY'RE BUILDING ON THAT RELATIONSHIP.

THEY'RE EAGER TO BE MORE INVOLVED IN SOUTHEAST ASIA, AND SOUTHEAST ASIA IS VERY EAGER TO HAVE THEM MORE INVOLVED.

SO INDIA'S REALLY REACHING OUT IN THE NEIGHBORHOOD, AND IT'S GROWING IN CONFIDENCE, AND IT'S GROWING IN ITS CLOUT.

>> IN TERMS OF THE WORLD, IT SEEMS TO BE BUILDING KEY RELATIONSHIPS WITH A NUMBER OF COUNTRIES IN ALL REGIONS AND HAS, OBVIOUSLY, A SPECIAL RELATIONSHIP WITH THE UNITED STATES, WHICH MANY HAVE SAID COULD BE AND NEEDS TO BE MADE EVEN STRONGER — A STRATEGIC RELATIONSHIP.

>> MM-HMM.

>> WHAT RECOMMENDATIONS DO YOU HAVE FOR THAT RELATIONSHIP, IN A BROAD SENSE? >> WELL, YOU'RE ABSOLUTELY RIGHT.

ACTUALLY, PRESIDENT OBAMA CALLED THE U.

S.

-INDIA RELATIONSHIP ONE OF THE DEFINING PARTNERSHIPS FOR THE 21st CENTURY.

NOW WE HAVE VERY WIDE-RANGING GOVERNMENT-TO-GOVERNMENT RELATIONS.

THAT MEANS WE HAVE OVER 30 — UNDER THE RUBRIC OF A STRATEGIC DIALOG IN WHICH THE HEAD OF OUR STATE DEPARTMENT MEETS THE HEAD OF THEIR MINISTRY OF EXTERNAL AFFAIRS ONCE A YEAR — UNDER THAT RUBRIC, WE HAVE OVER 30 OFFICIAL DIALOGS AND WORKING GROUPS NOW.

SO YOU CAN IMAGINE, THERE'S MORE THAN ONE OF THEM MEETING EVERY MONTH.

WE TALK ABOUT ISSUES RANGING FROM ENERGY SECURITY TO STRATEGIC AFFAIRS TO INTELLIGENCE SHARING TO AGRICULTURE AND EDUCATION.

I MEAN, IF THERE'S AN ISSUE, WE HAVE A DIALOG THAT TALKS ABOUT IT AND INCREASES COLLABORATION ON IT.

WE ALSO HAVE BUSINESS-TO-BUSINESS TIES, WHICH ARE THE CRUX OF THE GROWING RELATIONSHIP.

AND BUSINESS INTERESTS ON EITHER SIDE ARE GROWING.

INDIA'S ONE OF THE FASTEST-GROWING INVESTORS IN THE UNITED STATES, AND THE UNITED STATES IS LIKEWISE ONE OF THE LARGEST SOURCES OF F.

D.

I.

IN INDIA.

WHAT I SEE IS A NEED TO NOT ONLY ASPIRE TO A LARGER, MORE STRATEGIC RELATIONSHIP, BUT TO BE VERY REALISTIC ABOUT IT AND TO BE ALMOST TOO PRAGMATIC ABOUT IT.

THAT'S WHAT'S NEEDED, I THINK.

NOT LOFTY GOALS.

WHILE THAT'S CERTAINLY ONE PART OF HOW YOU RELATE TO ANOTHER COUNTRY, WHAT'S NEEDED IS NOT LOFTY RHETORIC.

WHAT'S NEEDED IS JUST THE NUTS AND BOLTS OF A STRATEGIC RELATIONSHIP.

>> GREAT.

WELL, THANK YOU FOR JOINING US TODAY, PERSIS KHAMBATTA.

>> THANK YOU FOR HAVING ME.

>> AND THANK YOU.

FOR "GLOBAL PERSPECTIVES," I'M JOHN BERSIA.

WE'LL SEE YOU NEXT TIME.