India committed to peace with Pakistan, says President

President Shankar Dayal Sharma on Thursday said that India was committed to end confrontation with Pakistan and establish a ''harmonious and durable peace'' as provided in the Shimla Agreement.

Addressing the joint session of Parliament on the opening day of the budget session, the President said, ''We believe that fostering people-to-people contacts and promoting trade and economic links will contribute to this process.''

He said India was ready for a dialogue with the new government of Pakistan and hoped for an early resumption of talks.

The President said that strengthening the nation's defence was among the foremost priorities of the government on which there could be no compromise.

The government was conscious of the urgent need to modernise the armed forces and was committed to provide all the inputs which might be needed for fulfilling this objective.

The President said that acquisition of technologically superior armament along with continued upgradation of the existing equipment would help strengthen the defences of the country.

He said production of the versatile main battle tank Arjun would start from this year. The country has attained the capability to design and field any type of missile systems needed by the defence services.

The modernisation of the navy was a matter of urgency and a number of steps to upgrade and equip the navy for its need were being taken, he added. The light combat aircraft project was also making steady progress towards its flight trial during this year.

He said the armed forces remained a state of constant preparedness to safeguard ''our territorial integrity.''

Dr Sharma said the challenges to internal security of the nation could not be underestimated. The destabilising influences emanated both from within the country and outside. The government was fully conscious of these forces and had met these challenges with determination. Sharma said that sustained operation against terrorists coupled with vigorous welfare and development efforts have brought about qualitative improvement in the situation in Jammu and Kashmir.

The activities of militant groups in a few states in the northeast continue to cause concern. These groups are taking advantage of the difficult terrain along the long international borders.

The government has taken a major initiative with its neighbours to tackle the problem of insurgency in the region. It is also taking effective steps to tackle the situation through a multi-pronged strategy, including economic uplift of the region.

The President said the coalition governments can be stable and promote durable socio-economic development. The constitution has excellent features defining the relations between the union and the states.

The government will respect the constitutional provisions without any discrimination and endeavour to strengthen the arrangements for a cooperative approach to our national problems, he added.

On the Sarkaria Commission recommendations, the President said a standing committee of the Inter-State Council has been set up a review its recommendations especially those relating to devolution of financial powers to the state and changes required in Article 356 of the Constitution.

Dr Sharma said the Indian economy was firmly set on a high path of ensuring at least seven per cent growth during the ninth plan period.

The economy was growing at an average rate of about seven per cent in the past three years. The foreign currency reserves had also grown steadily and were presently about 19.5 billion dollars, he said.

The government was also committed to economic reforms aimed at faster economic growth. To create an environment conducive to private investment, laws and policies were being suitably adapted for each sector, Dr Sharma said.

He said procedures have been simplified to provide for quicker clearance of proposals and to make the process transparent. Action has also been initiated to create confidence that investors will get fair and equal treatment.

The Foreign Investment Promotion Council has been set up to promote inflow of foreign capital. Specific guidelines for foreign investment have been laid down for each sector. ''We are committed to achieving our goal of attracting at least 10 billion dollars a year as foreign direct investment,'' he said.

The banking sector is being geared up to conform to international norms. Steps are being taken to attract long-term pension and insurance funds from abroad.

However, the President said that to sustain the buoyancy in the economy, substantial augmentation of investment in crucial infrastructure areas such as power, transport, and irrigation was essential.

The process of opening up the mining sector to allow foreign and Indian private investment was taken a step further with the issue of guidelines for granting large areas for prospecting licences in October 1996, he said.

In oil and gas sectors, the President said the deficit in the oil pool account would reach about 155 billion by the end of the current year.

Healthy development of the oil sector demanded that the oil pool account was in balance. ''We have to make massive investment in the oil sector to step up exploration and production. We should generate enough resources not only to cover current cost, but also take care of fresh investment.''

He said that vigorous growth in agriculture has to go hand in hand with fast industrial development. This was essential for removing poverty and for meeting the increasing demand for agricultural products.

The President said the government intended to bring before Parliament several bills in the current session. These include the broadcasting bill, the Prasar Bharti amendment bill, and the Indian telegraphy bill.

He said India was a beacon for sustaining democratic values, rule or law, human rights, and secularism. ''Our policies have produced a balanced a achievement of freedom and economic betterment.''

India, he said, was on the threshold of unprecedented opportunity as its prepared itself for entering the 21st century with hope and confidence.

The President also reaffirmed India's commitment to the nonaligned movement, saying India would continue to give the fullest support to its objectives and principles on the South Asian cooperation. ''We have consistently sought mutually beneficial relations with the South Asian neighbours, both on bilateral basis as well as through South Asian Association Regional Cooperation.''

UNI

Illustration: Dominic Xavier