Paper no. 921	15. 02. 2004
ROMANIAN PRESIDENT ILIESCU VISITS INDIA OLD CULTURAL LINKAGES AND CLOSE ECONOMIC AND POLITICAL RELATIONS NOW by K. Gajendra Singh  Romanian President Ion Iliescu’s 5 day visit to India from 28 January highlights re-building of close political and economic relations after a short hiatus, because even during the Stalinist Nicolae Ceausescu era, relations between Communist Romania and non-aligned India were quite close underlining common strategic, economic and cultural determinants. Even the normal protocol was set aside as the 1997 visit by Iliescu’s predecessor Emil Constantinescu was not reciprocated because of Indian President Dr APJ Abdul Kalam’s priority of first familiarizing himself with all Indian states before venturing abroad. And that too at a time when the Indian government has unofficially entered the next general elections mode. Strategically located on the Black Sea, Romania is a large country with a population of 23 million in the region, where population of most of its neighbours is less than 10 million. Its military importance was reiterated once again when US war planes used Romania’s airport near Constanza and other facilities after March, 2003 when 50 year old Nato ally Turkey’s parliament turned down US request for use of its land bases and airports to attack Iraq.   After the break up of the Soviet Union and Communist bloc, Romania assiduously cultivated Europe for entry into Europe Union (EU) and USA for Nato membership .The latter efforts bore fruit in November 2002 when its admission into Nato was approved at the Prague summit in spite of many institutional deficiencies. For whatever the strategic configurations in Eurasia between USA, Europe Union, Russia, Caucasus & Central Asia and now  de-stabilised Middle East, Romania will remain an important strategic asset.   Its vast rail and road network linking it to central and western Europe and the seaport of Constanza on western shores of the Black Sea would provide a commercial hub across the Black Sea for Europe Union’s export to energy rich countries like Azerbaijan, Kazakasthan, Turkmenistan after oil and gas starts flowing out the Caspian Basin. Final negotiations for Romania’s entry into EU would begin in 2007.  With ample raw materials and even petroleum, unlike its neighbours and with trained and skilled manpower, Romania is an ideal location for investments for Indian and other entrepreneurs, resident or non-resident. Many NRI’s have already taken advantage of it but the window of opportunity would not stay open too long. To boost exchanges, Romanian airlines Tarom should seriously consider re-starting its Bucharest –New Delhi flights, which were unfortunately suspended in 1999.   While Romania’s laws are being modified to conform to EU norms, the implementation of the rule of law needs attention. There was a case of a well known Romanian national theatre personality, widely reported in TV and print media, who could not get possession of her ancestral land near Bucharest, in spite of a police force.. so strong is the hold of growing local mafia. Her land was occupied after the demise of the Communist regime. The writer’s flat near the President’s office was burgled in end 2000 (it can happen any where) but the police refused to give a theft report. The rule of law situation and robbing of public assets became worse during the 4 years when Iliescu was out of power from 1996 to 2000. Under him Romanian economy has bottomed out with 2000, the worst year, but after a painful reforms adjustment last year it recorded a 5% growth, highest in the region. A very talented people in music ballet and other arts, spiritually inclined, Romanians have remained fascinated with the philosophy and culture of the east, specially of India. Over centuries thousands of Indian classics and books on India covering a wide range of subjects have been translated. Many eminent personalities in philosophy, culture and literature were deeply interested in India. Mihai Eminescu, Bogdan Hasdeu, George Cosbuc, Constantin Brancusi, Lucian Blaga, and Mircea Eliade, were all deeply influenced by their encounter with the Indian thought philosophy and culture, and this found reflection in their works. They acted as interpreters of Indian mystical and spiritual traditions to the west, with teaching of Sanskrit in its universities going back to mid -19th century.  Exchange of high level bilateral visits;  India established diplomatic relations with Romania in 1948.. Starting with President Radha-krishnan’s visit to Romania in 1965, visits at the highest level have been regularly exchanged. During the last few years Romanian ministers of Defence, Education & Research, Communications & IT, Foreign Affairs, Economy & Trade and the Senate President and others have visited India. From Indian side ministers of Defence, Commerce & Industry, Parliamentary Affairs with a delegation have been to Romania.   Iliescu’s January Visit President Iliescu and his delegation held extensive talks with Indian President Abdul Kalam, Prime Minister Atal Bihari Vajpayee and other leaders on bilateral, regional and international issues. The two sides agreed to cooperate at UN and other fora (Romania is member of UN Security council for 2004 and 2005).  In spite of India and Romania coming closer to USA individually, both are unhappy at the situation created by US invasion of Iraq and the growth of terrorism of different kinds in the world. They indirectly criticized Pakistan supported terrorism in Jammu and Kashmir and elsewhere in India In the joint statement they “reaffirmed the need to uphold the principles of International Law and the provisions of the UN Charter in regard to international relations. They noted the importance of political and diplomatic ways of settling international conflicts."  ”The Parties condemned the growth of terrorism and religious extremism, which threatens international peace and security. They reiterated that terrorism cannot be justified on any grounds, whether political, ethnic, religious, or others. They agreed that every State has the duty to refrain from organizing, instigating, assisting or participating in terrorist acts in another State or acquiescing in organized activities within its territory directed towards the commission of such acts, and further agreed that all States must refrain from providing any form of support, active or passive, to entities or persons involved in terrorist acts. In this regard, both Sides stressed the importance of the effective implementation of Security Council Resolution 1373.”  On Indo-Pakistan relations the statement said, “In the context of India-Pakistan relations, Romania welcomes the recent events that have reshaped the overall relation between India and Pakistan and created the ground for a bilateral dialogue, which will help in regional and global stability.”  India appreciated Romania’s contribution to regional stability in the Black Sea and Greater Middle East areas, and its efforts to fight terrorism, organized crime, illegal trafficking, and illegal immigration. It also appreciated Romania’s very important role in strengthening the stability and security in her European area, and (that it ) is also a bridge of productive, open and friendly cooperation between India and Central and Western Europe.   Romanian support for permanent seat for India in UNSC  Romania was very positive in its support for Indian candidature for a permanent seat in UNSC. The statement said that “Underlining the importance of expanding the United Nations Security Council in order to make it more representative and to increase its effectiveness, in the context of the overall reform of the United Nations, and taking into consideration the reputation that India, home of one sixth of humanity, has achieved within the international community and the growing political and economic role India plays in the international fora, Romania regards India as a natural contender for United Nations Security Council Permanent Membership.   “Romania also considers India an important player at the regional level. India has assumed a very important role in dealing with regional issues, by supporting a growing cooperation between the SAARC member states, aimed at eradicating the poverty and improving the standard of living of the peoples of the South Asian countries.”  Iliescu Urges Human face for Globalisation  While addressing the captains of Indian industry on “integration and globalization” in New Delhi, President Iliescu urged the international community to create a global institutional framework to regulate the functioning of the world market to protect the interest of poor nations. Iliescu added that governments, especially those of less-developed countries, need to protect the interests of economically weaker sections and ensure social justice in order to meet the challenges posed by globalisation. “While totalitarianism has failed to usher in development in many countries, a completely unregulated market also creates hurdles in the process of development.” He how ever added that democracy was the only means by which development could be ensured for all sections of society. He was sidelined by the Ceausescu regime because of his suggestion to give human face to orthodox Communist policies.  Focus on Technical and economic cooperation  But another point of focus was to fully acquaint President Iliescu and his delegation with India’s strong suites in Info-tech, research in science and technology and Indian entrepreneurs and investors. President Iliescu and his delegation were taken around Bangalore ( where INFOSYS and Indian Institute of Science are located), the 'Silicon Valley' of India, and home to more than one thousand foreign companies and Mumbai CII (Confederation of Indian Industry), FICCI (Federation of Indian Chambers of Commerce and Industry in New Delhi). Meetings for captains of Industry and others were arranged for exchange of views and identifying concrete projects. Information Technology, Energy, including Oil and Natural Gas, Power Generation, Transmission and Distribution, Engineering and Pharmaceuticals were identified as sectoral priorities. A Joint Working Group was established to implement the Memorandum of Understanding signed in October 2002. With old Romanian tradition of expertise in oil and refining (who constructed India’s first Refinery at Guwahati in 1950s) its Ministry of Economy and Commerce and the Indian Ministry of Petroleum and Natural Gas were asked to work out a legal framework for long-term mutual relationship to identify joint economic projects by promoting research in engineering, marketing but also considering environmental issues. Romania is also interested in dipping into India’s vast Pharmaceutical sector, in which the former was quite good in the communist era. Romania is looking for help in pharmaceutical education and research, joint ventures and training .It wants Indian pharmaceutical companies to establish manufacturing bases in Romania. This would be done via the Indo-Romanian Joint Commission and the Indo-Romanian Joint Business Council. Other sectors identified for cooperation were machine tools, automobile components, textile machinery, metallurgical, oil industry and power equipment.  The following bilateral agreements already exist   There are already a number of Agreements, Protocols and MoUs signed between the two countries. A Cultural Agreement was signed way back in 1957. Agreement for Double Taxation Avoidance was signed in 1987. Agreements signed in post-Communist era cover Cooperation in Science and Technology in 1992, Air Services Agreement, on Combating Organized Crime, International Terrorism, Illicit Trafficking in Narcotics and Psychotropic Substances and other illegal Activities, Cooperation in Tourism, Bilateral Promotion and Protection of Investments, Trade and Economic Cooperation envisaging mutual MFN treatment and trade in hard currency and Banking Agreement to formalise rupee payment arrangement. A MoU for collaboration in Information Technology was signed in Delhi in October 2002. A number of programmes and protocols to implement these agreements are in operation.   New agreements  During the visit an Agreements on Visa Free Regime for Diplomatic Passports Holders and on Cooperation in Plant Protection and Phyto-sanitary Quarantine field were signed. A Memorandum of Understanding between the Romanian Television and Doordarshan and another Memorandum of Understanding between the Romanian Broadcasting Corporation and All India Radio were also signed. To promote and protect economic cooperation, negotiations have commenced to sign a new Double Taxation Avoidance Agreement Bilateral Trade and imports and exports:  From 1959 to 1992, bilateral trade with Romania was conducted on the basis of clearing system. (During the writer’s 1981-84 tenure the two way trade increased from US$ 175 million to US$ 250 million ). In February 1993, a new Agreement on Trade and Economic Cooperation envisaging mutual MFN treatment and trade in hard currency was signed .After the fall of the Communist regime bilateral trade declined but is again on the upswing. It has grown from a low of US$ 68 million in 2000 to US$ 101.2 million in 2002, with the trade gap marginally in India 's favour. It is expected to grow by an estimated 30% to approximately $130 million in 2003.   Indian exports to Romania consist of Iron Ore, Drugs, Pharmaceuticals & Fine Chemicals; Sesame seeds, Cotton Yarn, fabrics and made-ups, Plastic & Linoleum products, Machinery and instruments etc. Indian imports from Romania are: Iron & Steel, Organic chemicals, Metals, ores & metal scrap, Inorganic chemicals, Machinery, Non-ferrous metals etc.  Economic and Industrial Cooperation:  Cooperation between India and Romania during the Communist era covered projects in India in fields of petroleum, petrochemicals (when western powers refused to help India), power and metallurgy. The major projects were the oil refinery at Guwahati, the thermal power plant at Singareni, the Mangalore pelletization plant, the Durgapur agglomeration plant and the Hyderabad tractor plant.   Mittal’s Ispat holdings buy biggest steel plant;  In July 2001 Laxmi Narain Mittal of Ispat-LNM Holdings purchased for  $55.00 million  90% shares of massive steel complex Sidex, spread over 1500 hectares near Danube delta .It can produce up to 6 million tons of steel per year and even more. The plant contributes 5% of the Gross Domestic Product of Romania and is the largest such plant in South East Europe. The plant was losing $300 million per year because of mismanagement and corruption. The production has since been doubled and Mittal has got his investment back. The contract provided for buyer's commitment for investment and expansion. With his record of success, banks are vying to grant credits at favourable rates.  In early 2003, LNM Holding-ISPAT also acquired 70.76% of shares of the “Tepro” company in Iasi from the Romanian government. Tepro Iasi specializes in manufacture and trade in steel pipes, metal works and zinc parapets . In October 2003, LNM Holdings also took majority stakes in the "Siderurgica" steel mill at Hunedoara [for $ 43 million] and also in the "Petrotub" pipe-making unit at Roman [for $83 million]. Siderurgica Hunedoara produces continuous cast billets, hot rolled profiles and bars, light, medium and heavy structurals and wire rods, and has an annual steel making and rolling capacity of 750,000 tonnes. Petrotub Roman is a producer of seamless pipes of different grades and varieties, including casing, tubing, and line pipes and has an annual capacity of 500,000 tonnes.  A shrewd Marwari, Mittal cut his teeth by establishing a green plant in Indonesia as steel making in India was reserved for the public sector until 1980s. In his quest to become the top world steel producer, he chose a quicker route by turning around run down decrepit plants after buying them dirt cheap. It appears that for donations to the British Labour party, Prime Minister Tony Blair’s government and his ambassador in Romania went all out to help Ispat purchase Sidex, which led to regular adverse write ups in the British media. (But Ispat had also contributed to the Conservative party) Mittal’s Ispat could be more transparent and socially conscious to ward off rumours and allegations. Bill Gates, another successful man in a hurry, is finally learning about social responsibilities and obligations of corporate giants and making charitable donations such as to help AIDS victims and other causes.   Other NRI investments are three metallurgical plants in Buzau. “Ductil SA”, makes wire drawn equipment, “Beta SA” makes heat exchangers, and another plant makes iron powder from scrap. The total investment is about US$10 million. In 2003, the Lohias of the Indorama group out of Thailand bought M/s Petking, the PET packaging/bottle manufacturer located in Campulung, north-west of Bucharest. There are plans for NRI investment in eco tourism in Danube Delta which will offer ayurvedic massage, meditation and nature therapy by Indian experts, alongside traditional pastimes like fishing, yachting, etc.  Multi-Billion Dollar Bonanza up for Grabs.  Ceausescu left behind over 30 million tons of refining capacity, which is not fully and efficiently utilized. An energy entrepreneur could transport crude from the Caspian basin just across the Black Sea by old ships from Georgian and even Russian ports, refine it and transport the products by road or river Danube and latter by pipelines to central and western Europe .The Caspian basin reportedly has reserves from 70 to 200 billion barrels. Middle east is likely to remain unstable and in any case for Europe Caspian basin oil is the nearest. While many other outlets for Caspian basin oil are under construction and planning, including via Turkey, Russia and Iran, west Europe and even USA would prefer to use the Romanian route . With the origins of Romanian oil industry going back to over hundred years (Nazis captured its oil fields in 2nd World War) skilled labour and expertise is readily available. All it needs is an oil sector entrepreneur like an Ambani to become a regional energy Czar with little investment and repeat Ispat’s successful experiment. Why should Indians also not make hay in an era of globalization?  Indian Community in Romania  Indian economic presence is increasing. There are a large number of Indian businessmen and executives in commercial organizations established by NRIs and others. Indians have invested in 180 Romanian companies. The Indian community, negligible in the Ceausescu era is now around 1000 strong, spread in Timisoara, Bucharest, Oradea Galati Arad, Iasi, and Constanta etc. The majority are students (nearly 500 Indian students attend courses in different Romanian institutions, mainly pursuing medicine on self-financing basis at Timisoara and Oradea. It is cheaper than India), followed by businessmen, technical specialists, employees of multinationals and others.      Indian-Romanian Cultural Linkages When the Indian Foreign minister visited Romania in 1983, a list of Indian classics and books translated into Romanian or books written by Romanians on India was made. It filled 50 pages and covered a. wide range; starting with Vedas, Upanishads, hymns, coins, history, geography, philosophy, culture and literature. It is easy to find complete works of Rabindra Nath Tagore, Prem Chand and others in Romanian. Tagore, who visited Romania in 1926, is a household name. In 1983, the writer saw up north at Iasi University, an exercise book which had an almost complete translation of Panini’s grammar done in 1883, by Romania’s all time great poet, Mihail Eminescu - a sort of Ghalib and Tagore rolled into one. He had studied Sanskrit at Berlin and had translated Ashtadhaya to take his mind off his depression.    Sanskrit has been taught in Romania since 19th century. Poets and intellectuals like Eminescu, Mircea Eliade and S.Al-George have brought Indian philosophy, religion, art, history and poetry to Romania and acted as interpreters to the West. Illiade had studied Sanskrit and Indian philosophy at Calcutta and Shanti Niketan in late 1920s and spent 6 months at an ashram in Rishikesh. Later he taught at Paris and Chicago and was a prolific writer on Raja yoga, Indian philosophy and mysticism. His book Maitreyi caused considerable controversy. It was made into a film too.  But the new Romanian generation is west and consumer oriented. There is a sad story of Dr Amita Bose, who had taught Sanskrit, Bengali and Indian culture in Bucharest for twenty years. She died soon after the change of regime, unwanted in her country of adoption and unsung in India, whose cultural ambassador she had become. But she left behind thousands of students, many still pursuing Sanskrit studies and Indian philosophy. Indian films with socialistic themes starring Raj Kapoor used to be very popular in communist era. Once again new Indian dance and song films with “dishim dishum” are becoming popular on Romanian TV channels.  Unfortunately the most devastating development with long-term consequences is the precipitous fall in educational standards. Romania was rightly proud of its exacting high standards in technical and medical education. Tens of thousand students, mostly from Arab and African countries but even from the West and USA used to study at its polytechnics and medical schools. But shrinking budgets for education leave little money for labs or books with Professor’s salaries declining to $200 per month. Life is a struggle and there is little teaching. Instead teachers try to earn money otherwise and elsewhere neglecting their duties .So the new engineering and medical graduates ( hundreds from India are studying in Romania) might not be up to the mark. Similarly sectors like health and culture have also suffered.   With no role models and no discipline or regulation, the young have taken to enjoying themselves. Tall, slim and beautiful, some stunningly so, a result of multi-ethnic mixture, the new generation presents a pleasing sight; the effervescence of sheer youth, joie de vivre bubbling up after decades of communist uniformity and drabness. From the matrons of communist era have emerged slim tall beautiful girls.   Romanians are a highly cultured people with their theatre, ballet, and music developed at par with the best in the West in communist era. Before the 2nd World War Bucharest was known as the Paris of the Balkans. It could again acquire that reputation.  With a traditional flair for dance and music, it is only a matter of time before the new generation comes up with its own international stars in music and dance. (K Gajendra Singh, Indian ambassador (retired), served as ambassador to Turkey from August 1992 to April 1996 with concurrent accreditation to Azerbaijan.  He was earlier posted as ambassador to Jordan, Romania and Senegal .He is currently chairman of the Foundation for Indo-Turkic Studies. The views expressed are his own  Email Gajendrak@hotmail.com)
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