Thank you very much David for your kind words of introduction, Mr Neville Roach, the Consul General for India, the Deputy High Commissioner for India, ladies and gentlemen. The first time I met my counterpart, the current Prime Minister of India Manmohan Singh, was in December 2004 at a gathering in Vientiane in Laos to mark the 30th anniversary of the formation of ASEAN, a gathering to which Australia and New Zealand, as well as the ASEAN Plus Three participating countries had been invited. And in his very incisive, reflective way, the Prime Minister said to me, Australia and India are two countries that have so much in common, but so little to do with each other. And it did in a sense encapsulate the paradox of our relationship, and I thought after that discussion of my own understanding and knowledge of India. I had in fact, long before entering public life on the pilgrimage that so many Australians of my generation made to Europe after leaving university, and spending a year there wandering around Europe, and normally from a base in London, I did in fact pass through India a spent a week or so travelling in a limited part of the country. And I can remember, for want of a better thing to do, and I didn't stay there very long, wandering into a sitting of the Indian Supreme Court which was debating a constitutional challenge by the Indian states against some outrageous intrusion in their rights by an overweening federal government and; sound familiar? And I recall, and I've forgotten the name of the case, I recall a case from the High Court of Australia being quoted in the course of the discussion and it was a reminder to me of those great links of law and language that have always brought us together. And of course as I've already been outed for my passion for the lovely game of cricket, we had that in common, we had the shared experience of fighting together in fighting in two wars in common, we had a lot of history and a lot of culture and a lot of language and a very strong common commitment to democracy. But somehow or other there was no sense of connection in the relationship.
I recall going to India as Prime Minister in 2000 and I was graciously welcomed. It was very friendly, it was very hospitable and the conversation turned almost immediately to a discussion of cricket and history. And they are very important things and they should remain a precious part of our relationship. But there is now something very different and something rather more to the relationship than just history, a common language and cricket. There is a real sense of excitement and a sense of anticipation about the relationship that our two countries have. And this was brought home to me very vividly during my visit to India with a business delegation in March of this year, and Neville Roach accompanied me on that visit. And there are occasions in a reasonably lengthy period of a Prime Ministership when you can look back on particular visits to particular countries where you feel there has been a quantum shift in the relationship. I certainly had that experience after a visit I paid to Beijing in 1997, once again accompanied by a business delegation. And it followed a time when our relationship with China had gone through a rather bumpy period, after the change of government in Australia in 1996. And although the circumstances leading up to my visit to India didn't include any particular bumpiness, there was nonetheless a sense on that visit, that so much had changed, that the dynamism that was now very apparent in the Indian economy had begun to filter through in a very big way to the relationship with China.
The rise of India, of course, is one of the great phenomenons of the early part of the 21st Century. We are living through this extraordinary transformation in the centre of gravity of the world's middle class, away from it's overwhelming concentration in Europe and North America, to a situation where it will be predominantly, not exclusively, concentrated in the nations of Asia. There are now 200 million middle-class citizens, with all that that connotes with their purchasing power and economic impact, in India, an equal and growing number in China. And those two nations together, are so very important, not only to the world, but they are remarkably important to Australia. And it's worth noting the irony of something that we all feel the pain of at the present time, and that is high petrol prices. High petrol prices caused by high crude oil prices are there because of more than anything else, because of the rise, economically, of China, and also increasingly of India. And the growing demand of those two countries on the world supplies of fuel, have created, to a significant extent, the very high prices that we now groan under. Yet ironically Australia is a greater beneficiary of the rise economically of those two countries than most other developed countries. And although that doesn't represent any kind of balm or excuse, or explanation, or any kind of salve towards unhappy consumers of highly priced petrol, it is worth understanding the total context in which some of these economic developments are occurring.
The statistics which describe India's growth are well-known to an audience such as this, the fourth largest now in purchasing power parity terms amongst the world's economies. Its national income will double every 30 years. It has a young population, and it has a real prospect, unlike China, of growing rich before it grows old, which is a very significant observation to make in relation to the comparison of those two countries. I believe that our relations with India on a diplomatic and foreign policy level are made easier by there no longer being an east/west divide in the old cold war terms. I say this without in any way being disrespectful of India's continued adherence to the Non-Aligned Movement. But in the days when you had a bipolar world, you had a Soviet bloc and you had an American bloc, the studied neutrality of India in foreign policy terms, did represent some kind of restraint on the warmth and the depths of the relationship that existed between our two countries. The opportunities, of course, to build the relationship are legion. Like most of you in this room, I guess, there are occasions when one reads a book that has a more than immediate impression, and one such of those that I have read recently is that well-known tract, Tom Friedman's book on The World is Flat; Tom Friedman the New York Time's columnist. And it's a wonderful encapsulation of the realities and the opportunities of the global environment in which we live. And it drew out very graphically to me some of the enormous advantages that India has as she enters this 21st Century and all the economic opportunities that it presents.
The early and extensive and astute investment made by India in education, particularly technical education, something that can carry a lesson for 21st Century Australia as well as other countries around the world. And that investment made very early, and I was given a wonderful example of it when I visited the Madras Technical Institute which is one of the most respected of those institutions around the world. But what opens up in the relationship is not just a relationship based on the exports of our resources, it is also a relationship that is based upon a much broader base of economic exchange, a relationship that will build very heavily of course on the IT needs of both of our countries. A relationship that is importantly strengthened by the people to people links that we now have.
About 11 to 12 per cent of Australia's migration programme is now made up of citizens from India. It is the third largest source of migration to Australia and the second largest source of overseas students. And all of the indications are that that is something that will grow and strengthen as the years go by.
So can I say to the business council and to all of you, this is a moment in the relationship and the history of our two countries where, if we all in our different ways grab hold of it, it can have enduring importance. And it's a relationship because of those common links of history and of language and of sport and of commitment to democracy; it's because of those things that it ought to be an easier relationship to fully develop and fully exploit in the best sense of that word.
And in doing that, we should never diminish in any way the admiration that we should have for the way in which the Indian people have embraced and held hold of democracy. It is a quite remarkable thing and there were so many cynics around in 1947 who said that the embrace of democracy in India would not work. And at various stages democracy in that country has been challenged and it was temporarily suspended, but only for a relatively short period of time, and the natural democratic instincts of the Indian people came to the fore again. And it is the most astonishing achievement, this huge nation, clearly the largest democracy in the world, has been so incredibly successful.
And of course sadly, and in recent times, India has shared this other modern day horror of which Australians have experienced to date in other parts of the world, and that is the attacks and the depravations of terrorism. And the steadfast response of the Indian people to the attack in Mumbai only two short months ago is a reminder that that is another modern day reality, a horrible one that India shares with us.
But can I make what I think is the central observation that should be made about the opportunities that the relationship now presents to us and the way in which India has become such a power in the world and the nation that everybody is watching very attentively and very carefully; and that is what brought it about. And in many respects, although the democracy was there, the stable system of Government was there, the language was there, the educational system was there, the fact is that until the early 1990s, India was an overregulated, inward looking, heavily subsidised, heavily protected and heavily regulated economy. And it was the reforms, particularly the opening up of India to foreign investment when the current Prime Minister was Finance Minister in the early 1990s, which laid the ground work for the modern growth and prosperity of India.
And it's yet another and perhaps the most compelling illustration that I can point to of the fact that we are forever, and irreversibly, part of a globalised world economy, and there is no future for nations in retreating back to protection and trade barriers. And although their removal will and reduction will always be heavily contested and will always be the subject of fierce economic debate within the borders of individual nations, lesson after lesson is there to be found of countries opening up their economies and prospering as a consequence in direct denial of the criticism of those policies. And if India had not opened up under Manmohan Singh in the early 1990s she would not be in the strong and growing economic position in which she finds herself.
And you won't be surprised if I draw some kind of contemporary Australian parallel from that. The truth is that today's prosperity is a product of yesterday's reforms. And that is true of India, it's true of Australia, although our starting points were different and our per capita living standards are still a long way apart and we shouldn't pretend otherwise. But the truth is that the prosperity that our country now has is a product of reforms that have been carried out over a period of time. As many in this audience will know, I have never been reluctant to deny that some of those reforms were carried out with our support by our political opponents when they were in office.
But there is a lesson generically to be learnt from this that unless you keep going with the process of reform, you'll begin to slip behind. India has come a long way, she has a long way to go before, in per capita living standards, it is anywhere near what we are fortunate to enjoy. But overwhelmingly if you look at the history of that country those reforms, the opening up to foreign investment, the removal of many of the tariff barriers, the welcoming approach that India took to the world, all those things have been fundamental to the achievement of what is now a remarkable and fascinating economic story in India.
I am personally very committed to the relationship and I know the Prime Minister of India is and I know that both sides of India politics are very strongly committed to it. It's added value, of course, is that it comes on top of those bonds of history and sport which many Australians, through different experiences have enjoyed and will continue to enjoy in the future.
I wish the council well, I thank all of you for the support that you are giving to it and I believe that when, in the fullness of time, the history of this period of Australia's life is written, in 50 years time or whatever; and I hope it is written in a proper, orthodox fashion with a proper historical narrative and it's not a fragmented stew of moods and issues, can I say that the relationship that we have with those two giant countries of China and India and the way in which they have progressed and the way in the which the relative fortunes of those two countries have played out each against the other and each independently, will represent the most fascinating chapters, I believe, of the history of this period.
I wish the people of India well. There is great goodwill towards them amongst the people of Australia and the cause of Australian-Indian relations can only have been enhanced by gatherings such as this. Thank you.
[ends]