We said, look, we’ll do this, but we want to leave these areas better off than they were before the earthquake. We want to have functioning models of economic development. We want to involve non-governmental organizations. We want to have better health systems, better education systems. And we set about doing that work. But all of that can be wrecked by this. In the year I spoke the Indian parliament, they had had, by then, about eight years of the benefits of economic reform, seven huge high tech centers doing brilliant work, but the per capita income of the country was still about five hundred dollars a person, and the Indian parliament had just approved a twenty-two percent increase in defense spending. And you know what’s happened in the last couple of years. So now we have a new break. Prime Minister Vajpayee at the age of seventy-eight said, one more time in my life I’m going to try to resolve this with Pakistan.
And President Musharraf had a good response. And they’re going to re-establish diplomatic relations. And Mr. Armitage was just there. I think it’s very important that the United States support this process. It’s the only place in the world where there is a continuing hot conflict between two nuclear powers who have, I might add, less than perfect knowledge about each other’s capability and doctrines. And I think it is profoundly important. Furthermore, now that the United States has warm relations with India for the first time in forty years, and that’s something, again, I would say, I strongly support the fact that the Bush administration continued our rapprochement with India, it’s the biggest democracy in the world, we can't afford to be alienated with it for antiquated, Cold War reasons. But, now that we’re friends again, we ought to fulfill the duty of friends and tell our friends the truth when we think things are amiss.
The horrible violence between the Muslims and the Hindus in western India which began with the destruction of the mosque ten years ago, eleven years ago now, and keeps reiterating itself, and then resurfaced with the horrible burnings of the Hindu nationalists on the train, and then the deaths of some two thousand Muslims afterwards in Gujarat, these things make a mockery of Ghandi’s vision, and look bizarre next to the breathtaking advances in technology that are going on all over India. I think the United States, if we are more closely involved with the Indians, and they believe we are there for the long run in a responsible way, can have a very positive impact in trying to help them deal with their religious diversity. Ghandi wanted India to be for the Hindus and the Muslims and the Buddhists and the Sikhs and the Jains and the Christians and the Jews and anybody else who showed up.
And people, for political reasons, are making religious arguments to absolute truth, certainty, and right. Including the claim on that little piece of land, which the Hindus want for a temple to the Blue Skinned god, Rama. We’ve got to figure out a way to help them get out of this, because we will all pay a terrible price if this continues. And I personally believe it will be almost impossible to find a rapprochement over Kashmir if Indian politics itself is still riven by sectarian violence, and if there are perceived benefits to Hindu nationalists by continuing a policy of estrangement. So I hope we’ll find a way to say that out of love and affection and respect, because it’s going to have a big impact on our future.
Finally, let me say I think it’s important that we keep our traditional alliances alive. We re-figured our security alliance with Japan near the end of my term, it’s as firm as it’s ever been. We had alliances in Iraq with Australia on the front lines, with Japan, the Philippines and others, and I think we forget that at our peril. Let me just say one other thing about the security situation. I believe that economics is an important part of it, and I think that there is a significant risk which ought to be analyzed in the aftermath of the Asian financial crisis, that we could dilute our military strength and the political influence it gives us if we have several years in a row of huge budget deficits and huge trade deficits requiring us to import huge amounts of foreign capital, leading to a dramatic weakness in the American dollar, which, in turn, might be replaced by a strong Euro as the stable currency of choice in international transactions. That would have a devastating effect on America’s position in Asia and our ability to advance the goals, the interests, the things we believe in. So, for whatever it’s worth, I guess the two parties have kind of changed positions, and I find myself in the old fashioned conservative position of fiscal responsibility, but I think the globalization of currency exchange has meant that no nation is big enough, strong enough, rich enough, or powerful enough to ignore ordinary rules of fiscal discipline. And I don’t believe we are, over the long run. So I hope we will see a bi-partisan return to a policy that will keep the dollar strong enough that our economic policy will be consistent with, and reinforcing, our political and military strength.
The second point I’d like to make is that globalization is about more than military and economic strength. China’s decision to look outward into the world even as it has tried to maintain more closure within its society than most of us would like has accelerated the movement of the world toward inter-dependence. It certainly has done so economically, but it also involves other things. China now is under more pressure to be more open in the SARS crisis. At least Elisabeth tried to put pressure on them to be more open about AIDS. They have to develop a better legal structure, a better regulatory system. They’re under great pressure, I wish we were under more pressure, to be part of the international movement to preserve the environment, as we grow the economy.
So, we need to keep working on these things that will bring us together beyond political and military issues. And the SARS epidemic is just the latest example of that. But the most important example is AIDS. India is at a crossroads with AIDS, and so is China. The city of Bombay has about eighteen million people, and a third of them are homeless. India already has, I believe, four or five million AIDS cases. India has the capacity, through CIPLA and other to produce the anti-retroviral medicine at very low costs. My foundation just negotiated a deal with CIPLA to provide drugs in the Bahamas at five hundred dollars a year, a person.