Carl Bildt Speech at the IISS-Citi India Global Forum

It is always a true pleasure to come to India and to feel how our world is
changing. We are living in an age of accelerating globalisation. We are in
the third phase of globalisation.

The first was the European phase - this was from the time when the ideas,
interests and individuals of Europe burst upon the global scene some
centuries ago, until the time when Europe nearly destroyed itself in the
devastating wars that dominated the first part of the last century.

The second phase was the one when the Americans dominated much of the later
parts of the previous century. The industrial and military might of America,
as well as its idealism and entrepreneurship, fundamentally reshaped the
global order of things.

And we are now in the early decades of the third phase of globalisation with
its distinct Asian face.

It is all about the return of Asia to the position that it had in the global
economy a millennium or so before the rise of Europe and then its offspring
on the other side of the Atlantic Ocean.

You can argue over when it started.

The rise of Japan has deep roots. Indeed, during the century between 1870
and 1970 Japan and Sweden were the two star performers in the global economy
- and my country had the benefit of living in peace throughout that period.

And let´s not forget that after the war in the early 1950s South Korea had
an economy on the same level as that of Sudan - today they seem to belong to
different worlds.

But it was really only when Deng Xiaoping in China in 1978 - thirty years
ago - started to open up a system that had failed so miserably and brought
so much suffering to the people of China, and then when India nearly a
decade and a half later under the then Finance Minister Manmohan Singh
started its new era of reform, that the comeback of Asia started to take
off.

The years since then have been spectacular. The impact of the rise of Asia
has been felt in every corner of the global economy.

And the last few years have seen the eyes of the world turning increasingly
towards India and its impressive performance.

We have seen the country growing at nearly 9 per cent a year, and it has
been argued that the almost quarter of a billion people that make up the
middle class of India are the most economically dynamic group on our planet
today.

This is only the beginning of the story.

I think everyone is aware of the challenges that India is facing as it moves
on, but I have yet to meet someone who doubts that these will not be
overcome one way or another, sometimes more quickly, sometimes more slowly,
sometimes easily, sometimes with greater difficulty.

The pace of further change and growth can never be certain - but there are
few doubts about the overall direction.

We are seeing the emergence of India on the global stage.

And this is happening as the entire international system undergoes major
changes.

From a European perspective, it is obvious that the peaceful demise of the
Soviet Union is one of the truly defining features of our time.

The disappearance of great empires is hardly unique - in the longer sweep of
history it is rather somewhat of a routine. But it always tends to be
associated with strife, conflicts and major wars.

In the wake of the uniquely peaceful implosion of the Soviet empire -
although the decade of wars of disintegration in the Balkans should not be
forgotten! - we Europeans are now engaged in a truly historic attempt to
build a genuinely new order of peace and prosperity in our part of the
world. A Europe whole and free, democratic and dynamic, united by the rule
of law anchored in our common institutions.

For us Europeans, the importance of this can hardly be exaggerated. But I
believe it is of far wider significance.

In the past century, it was the conflicts of Europe that twice spread all
over the globe and gave us worldwide wars. In the past century, it was the
totalitarian ideas of Europe that spread over the world and produced carnage
and suffering for countless millions.

And in decades not long ago, it was the conflicts over Europe that risked
producing that ultimate conflagration that led Albert Einstein to say that
while he was not certain which weapons World War III was going to be fought
with, he knew that World War IV would have to be fought with clubs and
sticks.

The building of this new order of peace and prosperity in Europe is still a
work in progress.

Much has been achieved.

We now have a Union of 27 states encompassing half a billion people. We are
the largest integrated economy in the world. We are by far the largest
trading entity - in fact, larger than the number two and number three taken
together. Most countries share a common currency that is now more traded on
global markets than any other currency. We provide nearly 60 per cent of all
the ODA of the world. We are the largest market for more than 130 nations -
India among them - around the world.

But ahead of us lies the task of step by step including some further 100
million people. Countries that stretch from the south-east of Europe - the
previously war-torn Western Balkans as well as the reforming secular
democracy of Turkey - as well as those nations in the east of Europe -
perhaps primarily Ukraine with its 50 million people - in our quest for a
firm framework of the rule of the law, of open and competitive economies and
of common institutions to take the common decisions on our increasingly
important common policies.

Nothing of this will be achieved easily or quickly. Some of it will remain
controversial and contested until completed. But the direction in which we
are heading can hardly be doubted.

And I do believe that we will see a Union that remains the largest
integrated economy of the globe for decades to come as it integrates the
energies and ambitions of more than 600 million people with dynamic hubs
such as London and Istanbul linking us with the different areas of the rest
of the world.

When travelling in different parts of the world, I often hear people
complaining that the politics of Europe have been somewhat introvert in
recent years - that the voice of Europe has been somewhat missing in the
global debate.

There is truth in this.

The tasks that we have set ourselves to undertake have been tasks of an
historic dimension, and they have required a concentration of political
energies on these particular issues, to some extent to the detriment of
other tasks.

But it is my belief that this will change in the years to come.

After the Maastricht, Amsterdam and Nice Treaties we are now busy ratifying
the Lisbon Treaty that - hopefully - from the beginning of next year will
give us new instruments and institutions to develop our common foreign and
security policies.

Much has already been achieved.

We have launched 28 different so called ESDP missions in different parts of
the world. The most demanding today is probably the European force
supporting and protecting the humanitarian efforts of the UN and others in
Chad and the Central African Republic. But an ESDP operation was also
crucial in implementing the peace agreement in Aceh in Indonesia a couple of
years ago. And rule of law missions in Palestine, Iraq and Afghanistan will
grow in importance.

But more must come. We are aiming for a Europe that is far more of a voice
and an actor on the global stage.

That also applies in the relationship with India. I consider this to be one
of our strategically most important relationships in the decades ahead.

On paper there has existed a Strategic Partnership between India and the
European Union since the summit in The Hague in the Netherlands in November
2005. And annual summits - the latest one here in New Delhi in November last
year - have sought to develop that relationship further.

India and the European Union are the two largest democracies in the world.

We are multi-ethnic, multi-religious and multi-regional to a higher degree
than any other major political entities around the globe. We share a
pluralistic, secular and democratic framework that defines the values that
are also important in our respective relationships with the rest of the
world.

Both India and the European Union give priority to the shaping of a peaceful
environment for their respective political, economic and social
developments, and both do it in neighbourhoods that are not always ideal
from this point of view.

And increasingly, this neighbourhood that we have to be concerned with is
the same.

In this area we are faced with a number of challenges that are of key
importance to our respective futures as well as to our common future.

The threat of fragile, failing or failed states. The emergence of areas of
lawlessness and chaos. The rise of fundamentalism and violence. The risk of
a true clash between religions and civilisations. The challenges of energy
supply and energy security. The horrible risks that lie in further
proliferation of nuclear weapons.

The nexus on all of these issues - all of them of profound global concern -
lies in the regions between India and the European Union.

It is the area that, from the United States´ perspective, is covered by the
military command they call Central Command and that is run out of Florida.
But it is an area of perhaps even more central concern to us from a
political, economic and security point of view.

And it´s an area where the common interests and the common values of India
and the European Union make for a strong common interest to search for
lasting solutions and enduring stability.

To secure a stable Afghanistan - and to understand that this will require
our sustained commitment for many years to come. I don´t think we can ever
be militarily defeated by the Taliban - but building peace is inherently
more complex than just winning a war.

Recent steps to increase the coherence of the international efforts in the
country are therefore most welcome.

But securing the stability of the country can´t be done without the
commitment of all the neighbours of Afghanistan.

We must welcome the new democratic government of Pakistan. It is important
that it can stay the course during the years to come. And it is of course of
crucial importance that the country´s armed forces fully respect the
sovereignty of an elected government that is the hallmark of society
building a better future.

We must also seek a deeper dialogue with the government in Tehran on issues
of regional stability that are of common concern.

It has a dismal and worsening record on human rights, and it still has to
live up to the obligations laid down by the UN Security Council concerning
its nuclear activities; but the proud nation of Iran can never be just
isolated into a policy of greater regional responsibility.

Europe is seeking a dialogue with Iran - and we have every reason to
intensify that search.

We have every reason to intensify our engagement with the different
countries of Central Asia as they chart their future.

Some of them must clearly address internal shortcomings in order not to
endanger their future stability, but I think we have a mutual interest in
making certain that their choice in terms of partners for the future is not
narrowed down to just Russia and China.

We must be very clear on what is at stake in the peace process for the
Middle East initiated in Annapolis in November last year.

Final status negotiations will result either in a peace agreement later this
year - or in the high probability of a gradual slide towards confrontation
and war. And we all know that one of the most important sources for those
rivers of rage that run through the Muslim world is the situation in the
territories occupied by Israel.

We must be ready to do more to support the efforts of the United Nations to
bring peace and stability to Iraq. Here, all the neighbouring countries have
a crucial role to play, but so has the wider international community.
Failure in Iraq will bring new threats to us all.

On 29 May, the International Compact with Iraq will meet in Stockholm under
the chairmanship of UN Secretary-General Ban Ki-moon and Iraqi Prime
Minister Maliki to assess progress and see what more can be done. The voice
of India would be important in that meeting as well.

We must also discuss how we approach all of the issues of Africa in the
years to come. The European Union is deeply engaged in trying to strengthen
the different efforts of the African Union, and we have historical and other
links of great importance with the different parts of the continent.

We have every reason to welcome the recent meeting here in Delhi between
India and the countries of Africa. With our common democratic values, there
should also be scope for an intensified dialogue between Europe and India on
possible common approaches to the different issues of that dynamic and
important continent.

But beyond these pressing issues in the regions between India and the
European Union we share a commitment to the development of a framework of
multilateralism that can secure the benefits of globalisation, allow us to
handle common challenges and also turn all our neighbours - Russia and China
come to mind - into truly responsible stakeholders in a common system.

And common frameworks are important.

Let´s just take the rapidly emerging issue of the fast rise in food prices
that now threatens to cause instability in one country after another.

It is a structural phenomenon far more than a cyclical one, and it therefore
requires a structural and long-term response.

But what we are seeing now is the emergence of actions in country after
country that risk making a difficult situation even more difficult. Price
controls, export tariffs and restrictions on international trade can only
serve to reduce the amount of food available on the global markets and limit
the incentives to the expansion of production that is so essential.

They risk creating more hungry people today and even more hungry people
tomorrow.

But without an international framework in which these pressing issues are
addressed, there is a risk of short-term actions aggravating the long-term
problem.

The same of course applies to all of the challenges associated with the
issue of climate change. It is obvious to everyone that they will be in
focus as we head towards the important meeting in Poznan in Poland later
this year and the decisive meeting in Copenhagen in Denmark in December of
next year.

These issues also illustrate the need to further develop our institutions of
global governance - the role of countries like India, China and Brazil is
critical and they must be given place and weight in international financial
institutions, as well as in bodies like the G8, if the world is to be able
to move harmoniously forward.

All of these - and many more - are issues where I believe India and the
European Union share common interests and common ideas.

There are strong reasons to seek to develop the Strategic Partnership
further. The conclusion of a Free Trade Agreement - negotiations are
proceeding rather slowly - would obviously be of importance.

But it may well make sense to start looking at the possibility of a new and
more political agreement between India and the European Union - both have,
in terms of both interests and capabilities, outgrown the Cooperation
Agreement signed in 1994.

In this age of accelerating globalisation - and the return of Asia - there
is a need to look at the strategic relationship that would be necessary in
order to best safeguard our interests and secure our values.

And a stronger strategic relationship between India, as it emerges as an
increasingly important and democratic power, and the European Union, as it
now also consolidates its institutions for its common foreign and security
policies, is clearly called for.