. despite these setbacks, southeast asian countries have not turned inwards, or tried to shut out the world. they continue to embrace globalisation as the best option for securing their future, and remain committed to plugging themselves into the global grid. individually, they continue to promote fdi, encourage exports, and pursue linkages with the outside world. they know that to try to keep out new investments, technologies and competition and go it alone will condemn them to poverty and stagnation. as a group, asean is strengthening economic cooperation among its members. intra - asean trade in manufactured goods is already practically tariff - free. last october, asean leaders went a step further, and committed to creating an asean economic community by 2020. this will be a single market for goods, services, capital and professionals. externally, asean is negotiating an fta with china, and is targeting to conclude the goods chapter by middle of this year. in parallel, asean is working on a comprehensive economic partnership arrangement with japan. the us, too, has announced the enterprise asean initiative, under which it will pursue agreements with individual asean countries, taking into account their respective progress in economic liberalization. southeast asia ’ s adherence to economic liberalisation and freer trade has helped the region to stay on investors? radar screen. most of its economies have recovered from the crisis. confidence has returned and the economies are growing again. stock markets have rallied as capital flowed back into the region. the countries have made progress remedying the structural weaknesses that contributed to the crisis. their finances are now much sounder - with balance of payments in surplus, and foreign reserves accumulating. thailand is doing particularly well as the fastest growing economy in southeast asia. malaysia, has maintained satisfactory growth rates, as has indonesia despite the political and security issues. vietnam escaped the asian financial crisis and is now opening up and taking off. singapore ’ s fortune has been more mixed. it weathered the initial storm well, but then got hit hard first by the global electronics downturn and then by sars. after all these tribulations the singapore economy is now at last picking up and on a growth path again. over the longer term, southeast asia remains a region of promise, with strong fundamentals. it is outward oriented, with a large and young population, strong emphasis on education, a positive work ethic, good infrastructure, and abundant natural resources. these enduring traits are embedded into our geography and culture, and will serve us well for

many years. india since the early 90 ’ s india too has been opening up since the early 1990s, although not at a uniform pace. since independence, india had adopted an economic model that emphasised self - sufficiency, strong central planning, and the state controlling the commanding heights of the economy. by the late 1980s this model had run into difficulties. in 1991 prime minister narasimha rao started to deregulate and open up the indian economy. countries in asia watched with close interest successive budgets of finance minister manmohan singh, as decisions that had hitherto been made centrally were devolved to the private sector, the rupee was devalued, subsidies were reduced, state - owned enterprises were privatized, and industries opened up to competition and foreign participation. they looked forward to a dynamic, prosperous india, participating fully in the regional economy. but the political situation in india changed after several years, and the pace of reform slowed down, or so it seemed to those watching india from afar. however, in the last few years under the bjp government led by prime minister vajpayee, not only have the reforms resumed, but a new spirit and vigour have manifested themselves across the country. last week ’ s mini - budget announcements show the resolve of the government to press on with the reforms. india is now a fast growing economy. bangalore has transformed itself from a provincial capital into a world class centre for the global it industry. mumbai is a thriving commercial centre. mncs are outsourcing backroom functions and call centres to india, attracted by india ’ s highly skilled, english speaking, and cost competitive professionals. in manufacturing, india is doing well in automobile, pharmaceuticals and chemicals. the recent bjp victory in state elections is widely seen as the indian people reaffirming their support for reforms. the current thaw in relations with pakistan is another positive sign. worldwide, people are becoming persuaded that the momentum for economic liberalization that has built up is irreversible. a subcontinent is on the move. nowhere is this more evident than in the self - confidence of indian companies. as one consultant commented, 5 - 10 years ago his assignments in india were about how to withstand the competitive threat. but today the question is how to grow the companies beyond india. therein lies an opportunity for india and singapore to work together. responding to globalisation both india and asean are opening up, reforming their economies, and pursuing the path