The Center on Democracy, Development, and the Rule of Law (CDDRL) at Stanford University has concluded its second year of Stanford Summer Fellows on Democracy and Development. This year's fellows - 26 outstanding civic, political, and economic leaders from 21 countries in transition - were selected from more than 800 applications.

The summer fellows program brought leaders from important, transitioning countries such as Iraq, Afghanistan, Iran, Pakistan, China, and Russia to Stanford for three weeks (this year, July 31 to August 18). The new summer fellows included presidential advisers, prominent journalists, key figures in human rights and democracy movements, academics, and representatives of international governmental and non-governmental organizations. The fellows participated in morning seminars with leading Stanford faculty, including CDDRL director Michael A. McFaul, Kathryn Stoner, Larry Diamond, Avner Greif, Erik Jensen, and Stanford President Emeritus Gerhard Casper. In the afternoons, fellows attended talks by keynote speakers and led class sessions themselves, sharing insight into how reform progressed (or failed to progress) in their home countries and exchanging ideas for positive change. This year's keynote speakers included Carl Gershman, the president of the National Endowment for Democracy; Joan Blades, co-founder of MoveOn.org; Marc Pomar, president of the International Research and Exchanges Board (IREX); and Judge Pamela Rymer, United States Court of Appeals for the Ninth Circuit.

The Center on Democracy, Development, and the Rule of Law (CDDRL) at Stanford University's Freeman Spogli Institute for International Studies (FSI) seeks to promote innovative and practical research to assist transitioning countries design and implement policies that will foster democracy, promote balanced and sustainable growth, and advance the rule of law. It supports specialized teaching, training, and outreach to assist countries struggling with political, economic, and judicial reform, constitutional design, economic performance and corruption.

The nuclear regime in place since the Nonproliferation Treaty (NPT) took effect in 1970 is broken and needs to be fixed, the world's highest-ranking nuclear official told a half-full Memorial Auditorium in a wide-ranging lecture about the future of nuclear energy and weapons yesterday afternoon.

"We have a dysfunctional system -- system that cannot endure," said Mohamed ElBaradei, the director general of the International Atomic Energy Agency (IAEA). "We're reaching the fork in the road. Events in the last few years have made it clear that we need to change course."

The big news from ElBaradei's speech was his support for American entreaties to Iran. But the 2005 Nobel Peace Prize recipient also commented on North Korea, India, Pakistan, Iraq, terrorism, disarmament and the future of nuclear energy.

He said there are probably eight current nuclear states, excluding North Korea. He worried aloud that countries which can currently produce nuclear energy peacefully are only six months away from developing nuclear weapons for military purposes.

"Acquiring the technology to enrich uranium or reprocess uranium basically is the key to develop nuclear weapons as we have seen in Asia and Iran," he said. "They are virtually weapons states because in six months time if they decide for security reasons to develop their own weapon, they are there."

Iraq

While not a household name, ElBaradei was a prominent figure in the news as the lead weapons inspector in Iraq during the run-up to the 2003 American invasion. He said at the time that he could not find evidence of Iraqi weapons of mass destruction, but he would not conclude that there were no weapons in the country or that Saddam Hussein did not have a program.

ElBaradei asked for more time to complete inspections, but the Bush administration declined his request and decided to invade. The U.S. never found the nuclear and biological material that some had promised existed.

"Luckily...well I'm not sure luckily...we were proven right that there was no nuclear or any weapon of mass destruction in Iraq," he said. "But I hope that all of us have learned from the Iraq experience that we cannot just jump the gun. You have to be absolutely sure of the facts."

India

ElBaradei surprised observers when he supported the U.S. agreement with India earlier this year, which allowed the country to continue developing nuclear weapons and energy. He said the agreement with India did not endorse its proliferation activities but was indicative of the kind of outside-the-box thinking the international community needs when considering the spread of nuclear weapons and material.

"The end result is India coming closer and working with the rest of the world," he said. "It is not a perfect agreement, but it has a lot of advantages. From the safety, security and nonproliferation perspective, I see that agreement as a win-win situation."

Pakistan

Pakistan developed nuclear weapons as a response to India. Some have criticized Pakistan for its poor stewardship and control of the bomb, pointing out that weapons were almost fired during a skirmish over the disputed Kashmir region.

AQ Kahn, a senior nuclear scientist who helped Pakistan join the exclusive nuclear club, was caught selling compact discs and other information about bombs to several other countries.

"How much damage was done in the process we don't know," ElBaradei said.

The release of this nuclear material demonstrates the need for a "more robust verification system," he said, adding that Pakistan has come closer to the international community in recent years.

North Korea

Kim Jong Il expelled all IAEA inspectors in Dec. 2002, withdrew from the NPT in Jan. 2003 and announced in February 2005 that his military had a nuclear deterrent.

"North Korea is still a major problem," ElBaradei said. "We don't talk about it enough, but North Korea is declaring right now that they have a nuclear weapon. And the longer that they continue to be in that status, the more it is accepted in the collective conscious. This would be terrible because it will have a lot of negative ramifications in South Korea and Japan."

ElBaradei said ongoing negotiations are an important development but more needs to be done.

"What we see with the current six-party talks should have taken place years ago," he said.

Nuclear Proliferation

ElBaradei stressed that he understands the value of nuclear power, which produces much of the developed world's energy. Reducing its use would create more dependence on greenhouse gas-creating fossil fuels, he said.

"We need to use nuclear energy responsibly to maximize benefit and minimize risk," he said.

He said his "number one nightmare scenario" is a terrorist group acquiring nuclear technology since terrorists are not deterred by the possibility of reprisal.

In the post-Cold War world, ElBaradei said he could see no justification for the U.S. and Russia to maintain their nuclear arsenals on ready alert to fire with thirty minutes notice. He called on America to lead by example and continue to disarm its nuclear stockpile.

"Rather than pass judgment, I'd definitely like to say the U.S. should do more in leading by example in terms of nuclear disarmament," he said.

In September 2005, ElBaradei was reappointed to a third term as director general of IAEA. The United States had considered holding up his nomination but dropped its objections under pressure from European allies, who admire the former law professor from New York University.

Diplomat to the Core

The Egyptian native's sometimes broken English was interspersed with self-corrections and careful legalese nuance. ElBaradei answered questions posed by Political Science Prof. Scott Sagan, the director of the Center for International Security and Cooperation.

When Sagan made bold pronouncements about different country's nuclear activities, including the United States' "colossal failure" when North Korea violated the NPT, ElBaradei seemed careful not to point fingers, play the blame game or make enemies. Nonetheless, for a senior United Nations official, his speech was notably blunt.

"There's no international public servant whose integrity and work I admire more than yours," Sagan told ElBaradei.

Accompanied by his wife, ElBaradei spent the day at the University visiting with faculty and students. He spoke at a lunch sponsored by the Freeman Spogli Institute for International Studies and traveled to Sagan's home for a dinner with invited guests. He left the area at 8:30 p.m.

Divorce proceedings bring out the worst in people. When Abdul Rahman tried to get custody of his daughters in Kabul, Afghanistan, his wife's family told the court that he was unfit to care for his children because he had converted from Islam to Christianity some 16 years ago. A zealous prosecutor, hearing of the case, charged Mr. Rahman with apostasy, a crime punishable by death under some interpretations of Islamic law. If Mr. Rahman does not repudiate Christianity, the judge in the case has said, he will get the death penalty.

Mr. Rahman's case is a discouraging illustration of the uneasy balance between the democratic norms Afghanistan's Constitution enshrines and the conservative Islamic values its judiciary upholds. On the one hand, the Afghan Constitution states that "followers of other religions are free to exercise their faith and perform their religious rites within the limits of the provisions of the law," and it requires the state to adhere to the Universal Declaration of Human Rights, which clearly protects freedom of conscience and the right to change one's religion.

On the other hand, the Constitution also says that no law can be "contrary to the beliefs and provisions of Islam," and it gives judges broad power to interpret and apply Islamic law. Several schools of Islam do indeed prescribe the ultimate punishment for those who abandon the faith. And so Mr. Rahman's case may well come down to the interpretive leanings of the court.

Moderate Islamic jurists in some countries have attempted to balance or reconcile these often-conflicting interests. In Egypt, for instance, the Islamic Research Center decreed that although apostasy may be a crime, the time period for redemption is limitless - in other words, it is up to the individual, not the state, to adhere to divine will. The former chief justice of Pakistan, which has explicit anti-blasphemy laws, has written that the death penalty for apostasy is not required by the Koran and conflicts with other Islamic values.

Afghanistan's post-Taliban judiciary, however, has shown a propensity to use Islam as a political weapon. The country's chief justice, Fazil Hadi Shinwari, is a hard-line conservative associated with the Islamist parties of Abdul Rasul Sayyaf and Burhanuddin Rabbani. He has used the court as a bully-pulpit, issuing fatwas on a variety of issues outside his jurisdiction.

For instance, under Justice Shinwari's leadership the Supreme Court has variously attempted to ban co-education; tried to eliminate a rival to President Hamid Karzai from the 2004 elections; and jailed newspaper editors, all in the name of Islam.

In other words, the court has overstepped its bounds and contributed to the radicalization of Afghan politics in the process. To further his aims, Justice Shinwari has packed the lower courts with judges who have Islamic educations but no foundation in Afghan law or experience in the judiciary.

President Karzai has a unique opportunity to change this. Under the Constitution, Mr. Karzai must appoint a new Supreme Court this month, and he sent his slate of nine justices to Parliament for approval last week. Although the current chief justice has retained his position, there are some very promising choices among the eight other justices. They include known moderates, like the former chairman of the Judicial Reform Commission, Bahauddin Baha, and the deputy minister of justice, Qasim Hashimzai, who led a major corruption investigation involving members of President Karzai's cabinet.

These appointments mark President Karzai's first opportunity to compose Afghanistan's Supreme Court under a fully constitutional government. They are of momentous importance to the country's stabilization and the consolidation of its nascent democracy.

By creating a competent, professional and moderate judiciary, President Karzai will help to establish the rule of law. If, however, the court remains in the thrall of ideology and factionalism, Afghanistan's experiment in democracy will be compromised.

But the new judges will be powerless to reform the system unless they are given the political support and resources to do so. International involvement in Afghanistan's justice sector since 2001 has been inadequate. Both the Afghan government and its donors need a strategic vision for the judiciary's future and the political focus to make it a reality.

The new judiciary will need support to review the qualifications of the lower court judges, facilities to train new judges and functioning courthouses in the provinces. It will need to be able to share information, laws and legal decisions among officials throughout the country and to pay judges a living wage.

We must do more than simply react loudly to the most extreme cases, like that of Mr. Rahman. Instead, we must partner with the Afghans and other democratic governments in the Islamic world as they struggle to promote modernity and the rule of law. This means working with judicial systems on less controversial, bread-and-butter issues like criminal law and property disputes.

We have seen throughout the world, and in our own history, that competent and independent judges will stand up for the rule of law even when their decisions indict the powerful and defend the unpopular. Mr. Rahman's case should remind us of how important it is to help Afghanistan develop such judges if we want its democracy to succeed.

Before attacking Iraq in March 2003, the United States told the world that Saddam Hussein had reconstituted his nuclear weapons program in defiance of the United Nations. That claim, used to justify the war, was based on assessments provided by the United States intelligence community. But as everyone now knows, those assessments were wrong. So Jeffrey T. Richelson's history of American nuclear intelligence, including our attempts to learn about Iraq's nuclear program, could hardly be more timely.

In "Spying on the Bomb," Richelson, the author of several books on American intelligence, has brought together a huge amount of information about Washington's efforts to track the nuclear weapons projects of other countries. He examines the nuclear projects of Nazi Germany, the Soviet Union, China, France, Israel, India, South Africa, Taiwan, Libya, Pakistan, Iran and North Korea, as well as Iraq. Through interviews and declassified documents as well as secondary works, he sets out briefly what we currently know about those projects and compares that with assessments of the time.

This may sound like heavy going, but Richelson writes with admirable clarity. And along the way he has fascinating stories to tell: about plans to assassinate the German physicist Werner Heisenberg during World War II; about discussions in the Kennedy and Johnson administrations on the possibility of attacking Chinese nuclear installations; about Indian measures to evade the gaze of American reconnaissance satellites; and about the bureaucratic infighting over the estimates on Iraq.

The United States has put an enormous effort into gathering information about the nuclear projects of other countries. After World War II it equipped aircraft with special filters to pick up radioactive debris from nuclear tests for isotopic analysis. It created a network of stations around the world to register the seismic effects of nuclear explosions. Most important, in 1960 it began to launch reconnaissance satellites that could take detailed photographs of nuclear sites in the Soviet Union and China. Richelson occasionally speculates about the role of communications intercepts and of spies, but these appear from his account to have been much less important than the other methods of collecting information.

Through these means the United States has gathered a vast quantity of data, sometimes to surprising effect. Intelligence played a crucial role in the cold war, for instance, by reducing uncertainty about Soviet nuclear forces. Alongside such successes, however, there have been failures. One notable example concerned the first Soviet test, which took place in August 1949, much sooner than the C.I.A. had predicted. Another was the failure to detect Indian preparations for tests in May 1998, even though at an earlier time the United States, with the help of satellite intelligence, had managed to learn about preparations the Indians were making and to head off their tests.

But the most serious failure of all was in Iraq in 2003, because in no other case did the intelligence assessments serve as justification for the use of military force. The information needed for avoiding political surprise is one thing. That needed for preventive war is quite another, if only because of the consequences of making a mistake.

Beyond making the uncontroversial recommendation that "aggressive and inventive intelligence collection and analysis" should continue, Richelson draws no general conclusions. That is a pity, because his rich material points to issues that cry out for further analysis. He suggests in one or two cases that failures sprang from the mind-set of the intelligence community, but he does not elaborate on this point. He has little to say about relations between policy makers and the intelligence community, even though the quality of intelligence and the use made of it depend heavily on that relationship.

His focus is no less narrow in his discussion of foreign nuclear projects. He concentrates on the programs themselves, paying very little attention to their political context. Does that reflect a technological bias in nuclear intelligence? Would, for example, the prewar assessment of Iraqi nuclear capabilities have been more accurate if it had paid more attention to the broader political and economic circumstances of Hussein's regime?

The task of intelligence has become more complex than it was during the cold war. A single dominant nuclear opponent has now been replaced by a number of nuclear states, along with states and stateless terrorists that are aiming to get their hands on nuclear weapons. Meanwhile, the technology needed for producing nuclear weapons has become easier to acquire.

Many critics believe the recent performance of the intelligence community shows it has not responded adequately to this new situation. Richelson does not have much to say on this question; nor does he discuss the likely impact of the current reforms, initiated in response to the Iraq war, on the quality of intelligence. His reticence may imply that he does not think reform is necessary. Still, it is disappointing that he does not draw on his historical survey to discuss whether new approaches are needed for dealing with nuclear threats, and, if so, what those new approaches might be.

The nuclear deal reached during President Bush's recent visit to India unleashed a predictable wave of criticism. From editorial and op-ed pages to Congress, led by the left but supported on the right, the administration has been assailed for making a bad bargain.

Under the agreement, which still needs congressional approval, India would open much of its nuclear facilities to international inspections in return for gaining access to the world's supplies of uranium and U.S. nuclear expertise.

The attacks on the deal reflect the view of the nonproliferation lobby -- the experts and policymakers whose central concern is to stop the spread of nuclear weapons. I share their aim. But American arguments against the India deal are misleading and only expose the deep contradictions, if not hypocrisy, of our own nuclear policies.

There are two main criticisms of the agreement: first, it undermines the Nuclear Nonproliferation Treaty, the NPT, and second, it permits, even encourages, India to expand its nuclear weapons production.

The NPT issue is particularly sensitive at a time when the international community is trying to persuade Iran to give up certain nuclear technologies which many nations fear are part of a secret bomb program.

The NPT created two sets of global rules -- one for the five nuclear weapons powers it recognizes (China, the United States, Russia, Britain and France) and another for everyone else. The five, for example, allow only "voluntary'' international safeguards on their civilian nuclear facilities. They have no obligation to open their military programs to any kind of scrutiny. And the NPT places no real limits on their arsenals, other than a vague commitment to reduce and eventually eliminate all nuclear weapons.

The rest must open their nuclear energy programs fully to international inspection and agree never to build bombs. In exchange, they gain access to the peaceful uses of nuclear energy.

Iran -- and North Korea -- made that bargain and can be held to account for breaking the rules. But India consistently regarded that as an unequal trade-off and never signed the NPT; neither did Pakistan and Israel, two other nuclear weapons states.

India's nuclear program is the product of decades of largely indigenous effort; it did not result from secretive proliferation in violation of the NPT.

The deal with India turns the five into six. It treats India as a de facto member of the inner club. The deal would require changes in U.S. law to remove existing restrictions on the transfer of nuclear energy technology, changes that would allow India to be treated no differently from China.

That does not weaken the NPT -- it strengthens it. It brings it more into accord with reality and gives India a stake in a system it had previously rejected as unfair. It paves the way for India to join the Nuclear Suppliers Group, the international organization that controls nuclear exports.

The critics are right that the deal enables India to expand its production of fissile materials to make nuclear warheads. Eight of India's 22 power reactors will remain outside international controls, along with a new breeder reactor. The Indians fought for that exemption because they feel their nuclear arsenal may not be large enough to deter a nuclear first strike by Pakistan or China in the future. Critics fear that with increased access to uranium and limited inspections, India will set off an arms race in South Asia.

Again, the agreement simply treats India like the five. Nonproliferation experts claim that unlike India, however, the five have halted their production of plutonium and highly enriched uranium that could be used to build new weapons. This is true, but misleading.

The five have massive stockpiles of fissile material built up during the Cold War. "If I've got a full pantry, it's easy for me to swear off trips to the supermarket,'' said Michael Levi, an arms-control expert at the Council on Foreign Relations.

Moreover, the United States has embarked on a new program to rebuild its nuclear weapons production capability, including creating new facilities to produce plutonium cores for warheads and to assemble them.

India has agreed to back a global pact to cut off fissile-material production. But the Bush administration does not support a treaty that would actually verify this is taking place. And the U.S. Senate has refused to ratify the Comprehensive Test Ban Treaty that would permanently halt any new testing of nuclear weapons.

A Congress that can support those policies is hardly in a position to challenge the administration's agreement with India. Rather than block the U.S.-India deal, it makes more sense to improve it. This could include reaching agreements for cooperation between the two countries to ensure the safety and security of nuclear facilities, including those for military purposes, suggested Stanford Professor Scott D. Sagan, a leading expert on nuclear safety and nonproliferation. "Reducing the risk of terrorist theft of nuclear materials or weapons in India would also help protect the United States,'' argues Sagan.

Beyond that, the six acknowledged nuclear powers should begin to seriously fulfill their part of the NPT bargain -- to cap fissile-material production, to ban nuclear testing, and to eventually radically reduce stored arsenals of nuclear weapons and materials.

"The United States is the most powerful since the Roman Empire," stated Stephen Walt, the Belfer Professor of International Affairs and academic dean of the John F. Kennedy School, Harvard University, delivering the 2005 Robert G. Wesson Lecture in International Relations Theory and Practice, at the Freeman Spogli Institute on November 16, 2005. America's unmatched power is therefore of great interest and concern to leaders in most other parts of the world, from President Putin in Russia, to President Chirac in France, and President Musharraf in Pakistan. For Americans, however, the key issue is how others are now responding to U.S. power.

Speaking before an audience of Stanford faculty, students, and the broader community, Professor Walt examined three interwoven themes: why other states do not welcome U.S. power; what are the main strategies available to them for dealing with American power? and what should the United States do in response?

As an integral part of his analysis, Walt showed opinion polls demonstrating a striking gap between American views of U.S. primacy and other countries' perceptions of the current U.S. role. For example, although the 2002 Pew Global Attitudes Project found that 79 percent of U.S. citizens believe it is good that "American ideas and customs are spreading around the world," and 70 percent think that U.S. foreign policy takes the interests of other states into account either "a great deal" or "a fair amount," overwhelming majorities overseas say the United States considers the interest of others "not much" or "not at all." Similarly, a 2005 BBC survey of 21 countries found only five, India, the Philippines, Poland, South Africa, and South Korea, where a majority of people had "positive" attitudes toward the United States.

There are three major sources of anti-Americanism, Walt explained. First, our sheer power makes other nations nervous. Second, there is a perceived sense of hypocrisy between our words and our actions. The case of nuclear weapons provides a vivid example. We preach nonproliferation, yet accord new respect and policy cooperation with newly nuclear states, such as India. Third, how the United States behaves in the world-what we do-invites antipathy. This latter point is abundantly clear in global opinion polls: Even in regions where anti-Americanism seems most strident, nations and individuals report that they do not object to our values or to what we stand for but rather to what we do.

Other nations, Walt pointed out, can choose a strategy of accommodation to our power or a strategy of resistance. Commonly adopted strategies of accommodation include 'bandwagoning," or realigning foreign policies with U.S. wishes, such as Libya's abandonment of nuclear weapons; "regional balancing"-using U.S. power to balance regional threats; "bonding" to curry favor with the United States; and "penetration," a strategy aimed at infiltrating the American political system to influence foreign policy outcomes.

In contrast, countries that choose to resist American power pursue five strategies:

"balancing" our power, alone or in alliance with others; "asymmetric responses," such as terrorism, which try to exploit specific areas of U.S. vulnerability; "blackmail," like North Korea's efforts to extract concessions from its nuclear weapons program; "balking," or tacit non-cooperation; and "delegitimizing," or attempts to turn others against the legitimacy of our actions or policies.

In light of the growing antipathy to U.S. primacy in so many parts of the world, Walt proposed three major courses of action to produce a more favorable response to U.S. power. First, he urged that we reduce American's military footprint abroad-and especially our ground force deployments-and return to a more traditional policy of regional balancing in cooperation with other nations. This policy would make greater use of American air and naval power and limit American intervention to cases where vital U.S. interests are threatened. Second, we should work harder to defend our international legitimacy and rebuild the U.S. image abroad, through a sustained campaign of public diplomacy and by keeping key American institutions-such as higher education-available to foreign visitors. Third, he advocated a more nuanced approach to America's traditional support for Israel, one that balances our genuine support for Israel's existence with the urgent need to bring a lasting settlement to the Israeli-Palestinian conflict.

"The more the United States uses its power in an overwhelming and capricious manner," Professor Walt warned, "the more the rest of the world will resist us." Conversely, the more the United States recognizes and respects the interests of others, while using its power to defend its own interests, the more other nations will welcome U.S. power. "The task we face," he advised, "is to rebuild the trust, admiration, and legitimacy the United States once enjoyed, so the rest of the world can focus not on taming U.S. power but on reaping the benefits it can bring."

When India spectacularly burst into the headlines via its nuclear explosions in May 1998, then US president Bill Clinton had openly vented his fury before aides in the White House. "We are going to come down on those guys like a ton of bricks," he had remarked. Clinton's "volcanic fit" found its echo in the White House statement that expressed "distress" and "displeasure", culminating in Washington imposing a slew of sanctions against India.

These images from the past, culled out from Engaging India, then deputy secretary of state Strobe Talbott's book, appear incredible now. Especially as India readies itself to accord a warm reception to US President George W. Bush next week. The entente, the product of laboriously conducted diplomacy as much as geopolitical shifts that yoked the two together as 'natural allies', is now taking deep root. Sure, there will be protest rallies, strident voices will rail against Bush's hegemonic designs, Prime Minister Manmohan Singh will be cautioned against any tight clinch with Bush. Yet even these voices arise from the awareness that there's a growing relationship between the US and India, realized through knots of strategic partnership and cooperation in every conceivable field - from economy and nuclear technology to education, space and agriculture.

Bush's visit next week prompted Karl Inderfurth, who was assistant secretary of state for South Asia in the Clinton administration, to say, "All of this represents a refreshing degree of continuity in US foreign policy, based on a recognition by the last two American presidents that India is a country that will be a key player in the 21st century." Similarly, Robert Hathaway, of the Woodrow Wilson Center for International Scholars, is impressed that "two successive Indian governments representing different political views and parties... both came to the same conclusion that it is in India's interest to forge a better relationship with the US."

From imposing sanctions against India to laying out a blueprint for nuclear cooperation, both New Delhi and Washington have come a long way in an inordinately short time. Ironically, it was Clinton who provided the impetus for this transformation. Talbott says the former president, after coming to terms with the Pokhran II realities, found it "downright distasteful and counterproductive" to impose sanctions against a country he was trying to improve relations with. Consequently, Talbott, Inderfurth and senior director in the National Security Council Bruce Riedal were entrusted with the task of pulling out Indo-US relations from the abyss in which it had been languishing from the beginnings of the Cold War era.What followed was a dialog between foreign minister Jaswant Singh and Talbott, both seeking to convey to each other the security and strategic interests of their respective countries.

The dialog started yielding dividends immediately, even during the Kargil conflict. Clinton's confrontation of then Pakistani prime minister Nawaz Sharif at their July 4, 1999, meeting in Washington took trust patterns between the US and India to a new level. "Throughout this period, we kept the Indian government informed of what we were doing to try to ease the crisis," recalls Inderfurth, who played a key role in the dialog with Sharif. "All of this turned into an important confidence-builder in our new relationship with India."

"The July 4 meeting was the turning point," agrees Michael Krepon of the Henry L. Stimson Center in Washington. "It demonstrated that US engagement in the India-Pakistan imbroglio would not be detrimental to New Delhi's interests, and it shifted the Clinton administration's focus from proliferation to engagement." The trust was manifest in Clinton's spectacularly successful visit to India in March 2000. An enabling factor in the budding Indo-US romance, says former ambassador Richard Celeste, was the now-forgotten Y2K factor. "The crisis introduced India's enormously talented manpower to our business leaders. Today, the 24/7 bond between companies in the US and service providers in India is the stuff of books and myth-making."

The budding romance acquired a new meaning with the advent of Bush in the White House. His most perspicacious decision was to appoint confidant Robert D. Blackwill as ambassador to India. Blackwill appealed to the popular imagination; his unequivocal pronouncements against Pakistan for fomenting terrorism in India further bolstered the trust between New Delhi and Washington. More importantly, he sought to impart a new heft to the relationship by putting his formidable weight behind the "Next Steps in Strategic Partnership", which envisaged cooperation between the two countries in civil nuclear energy, hi-tech trade, space and dual technology. "If Clinton was the pioneer of the new relationship, Bush is its architect," says Teresita Schaffer of the Center for Strategic and International Studies in Washington.

The impulse for the new relationship is linked to the question: why has India started to matter to the US? Inderfurth cites three reasons: India will become the world's most populous nation, it may well have the world's fastest growing economy by 2020, and it is the world's largest democracy. Krepon adds one more to the list: intellectual capital. "The world expects India to do more heavy lifting," he says.

Ultimately, a relationship in international affairs hinges on convergence of interests. Ashley Tellis of the Carnegie Endowment for International Peace, who's now advising under secretary of state R. Nicholas Burns, listed a string of "common interests" at a congressional hearing last year. These included:

preventing Asia from being dominated by any single power that has the capacity to crowd out others and which may use aggressive assertion of national self-interest to threaten American presence, American alliances, and American ties with the states of the region; eliminating the threat posed by state sponsors of terrorism; protecting the global commons, especially the sea lanes of communications, through which flow not only goods and services critical to the global economy but also undesirable commerce such as drug trafficking, people smuggling and weapons of mass destruction technologies.

So, isn't China the "single power" that Tellis thinks could threaten American interests in Asia? He denied this assumption to Congress, but many feel China is indeed the factor behind Washington's attempts to assist India in becoming a major world power.As author Sunil Khilnani, of the Johns Hopkins School of Advanced International Studies, says, "Many current inhabitants of the Pentagon see an India allied to the US as a potential bulwark to a China whose ambitions are still difficult to read." Washington's long-term view is that since China will not support the US war on terror, it's a threat against which the US needs a counterweight. "Japan has proven it does not have the emotional and intellectual muscle to face China. Hence, India should play that role," explains Rafiq Dossani of Stanford University.

The Bush regime's keenness on India also springs from the disaster his other foreign policy initiatives have been. "Bush would like to leave at least one foreign policy achievement as his legacy. He'd like to claim that he 'delivered' India to the US, just as Nixon could earlier claim the same about China," says Khilnani.

These reasons apart, the relationship has gathered great momentum from business-to-business links over the last decade. Says Anatol Lieven of the New America Foundation in Washington, "India's abandoning of its social democratic economic model, derived from the Nehru period, in favor of globalization and free market economics has made it much more attractive to investment and ideologically sympathetic to the US." Indeed, the more the two countries deepen their economic interdependence, the more each will have a stake in the other. And this economic interdependence can deepen, says Stephen P. Cohen of the Brookings Institution, through the removal of obstacles to US investments. "Infrastructure, (inadequate) liberalization, and education are three real obstacles. These (improvement in the three areas) will make it easy to implement the strategic relationship."

That India matters to the US is no longer a promise of the future. At a recent conference, former state department official Walter Andersen pointed out two US decisions that underscored India's enhanced importance. First, the four-country tsunami relief efforts involving the navies of the US, Japan, Australia and India. Two, the Bush administration's efforts to exempt a nuclear-capable India from exports restrictions on nuclear and dual use technology.

The blossoming ties have enabled significant partnerships in the international arena too. India has supported the war on terror in Afghanistan; its navy protected high-value US cargoes through the Straits of Malacca; more recently, India voted with the US at the International Atomic Energy Agency to declare Iran in "non-compliance" with the nuclear Non-Proliferation Treaty.

All this doesn't mean the US and India will automatically collaborate on every problem dogging them. "Nobody expects a perfect alignment ever, but increasing alignment is something we hope will come naturally," says Schaffer. Partly this alignment can be brought about through changes in the conduct of foreign policy. For instance, the US, Hathaway admits, needs to recognize that India expects to be treated on a basis of equality. Similarly, Khilnani contends, a section of Indian political elites need to shed its instinctive anti-Americanism. "This does not mean renouncing a critical position, or an independent assessment of our own interests. It means engaging more deeply and confidently, and picking battles more selectively and prudently," he says.

Obviously, like any two countries, there will be disagreements. "Indeed, there have been over the past few years on a number of issues, including the war in Iraq," says Inderfurth. But, he adds optimistically, "the fact that this has not disrupted the upward trajectory of our relationship is a good sign and a promising one for future relations."

SELECT: What is the current size of the outsourcing market? What percent of U.S. software development, call centers, etc., have already moved to developing nations? Is the amount of outsourcing still increasing?

Dossani: To provide some perspective, although the off-shoring of services has been going on for mans Nears, technology led by the widespread use of the Internet has changed things. The resulting new twist in the provision of services is that the required interaction between the seller and the consumer has been substantially limited. The advances in information technology made possible the parsing of the provision of certain services into components requiring different levels of skill and interactivity As a result, certain portions of the serviced activity that might or might not be skill-intensive, but required low levels of face-to-face interaction could be relocated offshore. The sequence of events that enabled this process is the following:

First, the digital age allowed (or, at least, revolutionized) the conversion of service flows into stocks of information, making it possible to store a service. For example, a legal opinion that earlier had to be delivered to the client in person could now be prepared as a computer document and transmitted to the client via e-mail or, better yet, encoded into software. Easy storage and transmission allowed for the physical separation of the client and vendor as well as their separation in time. It also induced the separation of services into components that were standardized and could be prepared in advance (such as a template for a legal opinion) and other components that were customized for the client (such as the opinion itself) or remained non-storable. Taking advantage of the possibility of subdividing tasks and the economies that come with the division of labor, this reduced costs by offering the possibility of preparing the standardized components with lower-cost

labor and, possibly at another location.

The second fundamental impact of digitization was the conversion of non-information service flows into information service flows. For example, the sampling of tangible goods by a buyer through visiting a showroom is increasingly being replaced by virtual samples delivered over the Internet. Once converted to an information flow, the service may also he converted into a stock of information and subjected to the above mentioned forces of cost reduction through standardization of components and remote production.

Third, the low-cost transmission of the digitized material accelerated the off-shoring of services. Services such as writing software programs which were off-shored to India in the early 1970s were enabled by digitized storage and, in the 1980s, by the standardization of programming languages. Still later, as digital transmission costs fell in

the 1990s (just as digital storage costs had fallen earlier), even nonstorable

services, such as customer care, could he handled offshore.

The offshore services outsourcing market (excluding software development) is still small and will probably be approximately $10 billion for 2005. It employs about 500,000 people, two thirds of whom are located in India. The rest are widely distributed, with developing Asia and Ireland accounting for most of the remaining employment. About 60% of the employment is in call centers. The U.S. and U.K. call-center industry together employ about five million people, so the percentage of offshore jobs is still small. It is even smaller for other services.

Offshore software development employs approximately another 500,000 people. This compares with U.S. employment of about two million. This is a larger percentage of the total software development labor market. although most of the outsourced work is programming, while work such as systems integration and design continue to be done in the U.S.

The growth rate is still high and there are concerns about whether or not this rapid growth rate will hurt the quality of work done. However. this rate will still likely he in excess of 30% in 2005 and 2006. The reason for this is the massive wage differential.

Clearly there have been massive failures as well as outstanding successes in outsourcing. What are the critical success factors for making outsourcing work?

The infrastructure (telecom. finance, power) has all been standardized, although the solutions might not he the same as in developed countries. The critical success factors are two: the quality of labor and supervision; and managing growth. Unbelievable there is a growing shortage of labor. The result is that the quality of work is declining. Project supervisory skills are also in short supply. Managing growth, especially keeping attrition

under control, training, developing new vertical skills, moving into back-office work, and offering the client turnkey packages are some of the critical managerial factors for success.

Short of being willing to work for $15,000/year, what can western IT professionals do to provide sufficient value to prevent their functions from being outsourced?

The U.S. educational system still turns out a good product. It is sufficiently ahead of the comparable Indian product so that a recent computer science/computer engineering graduate from the average U.S. university can earn a premium of at least 100% over his Indian counterpart from a good university such as the IlTs, with substantially higher premiums for graduates from schools such as MIT and Stanford. The problem occurs more with mid-career professionals. Those with older skills are unable to compete with freshly trained graduates from India. Therefore, they need to update those skills regularly and take advantage of opportunities to globalize and convert them into managerial skills. This may have to he mandated at some point, as has happened in the financial sector, where stockbrokers need to regularly sit for exams to renew their licenses.

That said, most of the offshore jobs are relatively low-skilled. For example, the single largest category of offshore services is outbound calling for the financial services industry for selling mortgages or collecting overdue receivables. The work is routine, based on scripts that pop-up on the computer screen in response to prompts.

Do these findings suggest that developed countries are likely to be only marginally threatened by the globalization of services? Even if high-end work is stays within developed countries, as has happened in the software industry, the problem is that not everyone in developed countries can readily shift to high-end work. Since the 1960s, the shift in the economies of developed nations towards service-based economies certainly increased the number of highly-skilled service workers, but there was an even greater swelling in the number of other less-skilled service workers. This is partly a consequence of the nature of many services as linked, inseparable sets of activities with different

skill levels, combined with a pyramid of labor requirements, i.e., there is more demand for lower-level work than for high-end work. In manufacturing. the unemployment created by the reduction in demand for blue collar labor in developed countries was offset by the absorption of much of the surplus labor into service industries, often with minimal training. But the shift of low-end service workers to high-end workers will require a longer period of re-education and may have significant interim consequences on unemployment rates.

The threat to developed countries is increased by the fact that, apart from software, the largest growth in off-shoring is happening in business services. These are also the sectors with the largest growth in U.S. employment.

Further, there is evidence that even higher skilled functions can be moved offshore or might evolve on their own. For example, interviews with people at a firm earlier this year revealed that they had initially been contracted by an American firm to call its clients with overdue credit card payments. The offshore company eventually purchased the receivables from its client and assumed the collection risk itself. Another firm, Wipro Spectramind, managed the radiology services of Massachusetts General Hospital for its second and third shifts. Thus, American radiologists, who earn an average of $315,000 a year were replaced by Indian radiologists, who earn $20,000 a year on average.

I understand that there is a whole subculture in Pakistan and India of people who go to work in the late afternoon or evening and then work a full day on U.S. time. What effect has outsourcing had on the cultures of the countries that are recipients of much of the outsourced work? Have labor rates dramatically increased? Is it difficult for local companies in India and Pakistan to get quality IT talent?

Indeed such a subculture now exists. It is viewed as very stressful work and not suitable for a long-term career. Companies that do such work try to ameliorate the stress by hiring psychiatric counselors to provide free counseling to stressed-out employees. They also provide free meals and transportation, sports facilities, etc.

However, labor rates have increased only, a little. This is more than offset by

the rise in productivity of this labor over time.

Outsourcing is clearly a temporary solution. As labor rates equalize, the benefit of outsourcing decreases. In Pakistan and China, there are still huge differences in labor costs, but in Turkey, rates are closer to what they are in the 11.5. and other Western states. Realistically, how long can we gain a significant benefit form outsourcing?

India and China, and to some extent, Pakistan, have large labor pools. That is why, in manufacturing, Chinese wage rates have not changed despite massive employment growth over the past three decades. I think that wage rates in India will actually fall because of increasing supply, which is being drawn into outsourcing. This would mean several more decades of benefit from outsourcing.

One way in which developed countries may retain value is if their firms control the work done, either through providing the risk capital or through subsidiaries. While it is difficult to predict which organizational types will dominate, a number of firm-specific factors that influence the liability of off-shoring and organization structure are summarized here:

The knowledge component of the activity. A higher knowledge component makes the firm more concerned about whether the quality of the service will change due to a location change or the transfer process.

The interactive components of the process.

The ability to modularize the process

Savings from concentrating an activity in one location, leading to

benefits of scale and scope.

Reengineering as part of the transfer process. To transfer a business process, it is necessary to study it intensively and script the transfer. In the process of study, often there will he aspects of the current methodology for discharging the process that do not add value. Very often these aspects are legacies of earlier methodologies that were not eliminated as the production process evolved. During the act of transfer these are easier to abandon than at an existing facility' where they have become a "natural' part of the daily routine. Our interviews identified other unexpected benefits that go beyond the efficiency effects. Simply examining the business processes may reveal previously undetected inefficiencies. During the transfer process, these inefficiencies can be addressed without disrupting work patterns. Workers in the new location then use the reengineered process which is usually more efficient.

The time-sensitive nature of the work.

At a time of unusual US interest in south Asia it is useful to see how specialists there look at the two issues explored in this book -- the Kashmir conflict and south Asian nuclearisation. Twelve of the 15 contributors are US-based and therefore it is not surprising that the book is largely by Americans for Americans. But this does not detract from its value for Indians and Pakistanis, because the scholarship is impressive and analyses mostly free of bias. The volume contains 13 essays including a short introductory one by the editors. The remaining 12 are grouped into three parts.

The four essays in the first group (Pakistan: Politics and Kashmir) are "Islamic Extremism and Regional Conflict in South Asia" by Vali Nasr, "Constitutional and Political Change in Pakistan: The Military-Governance Paradigm" by Charles H. Kennedy, "The Practice of Islam in Pakistan and the Influence of Islam in Pakistani Politics" by C. Christine Fair and Karthik Vaidyanathan, and "Pakistan's Relations with Azad Kashmir and the Impact on Indo-Pakistani Relations" by Rifaat Hussain.

Vali Nasr provides a succinct account of how Islamic fervour and Islamic extremism grew in Pakistan after 1971 and how political players in the country, especially the army, tried to make use of it for domestic political and foreign policy gains. He provides a good analysis of how the Pakistani elite is torn between de-emphasising Islam for the sake of socioeconomic gains and stressing it for political advantage. In case of the army there is the additional factor of "jihadi" usefulness in pursuing regional strategic aims.

Charles Kennedy presents an interesting analysis of how the army captures power and holds on to it. He shows how Ayub Khan, Zia-ul-Haq and Musharraf have adopted essentially the same approach in this regard -- following the stages of making things legal, eliminating political opponents, becoming president, stressing local government, intimidating bureaucracy and judiciary, fixing the constitution and orchestrating elections. Two key observations he makes at the end are "the failure to develop a stable constitutional system is the fault of both Pakistan's military and civilian leadership" and that "constitutional stability can only be achieved if there is an accommodation between the interests of the two sets of actors."

Christine Fair and Karthik Vaidyanathan have tried to assess the influence of Islam in Pakistan partly on the basis of three polls conducted to gauge Muslim reaction to war against terrorism, and partly on the basis of interviews. Two noteworthy conclusions of the authors are that there is little popular support for extremist Islam in Pakistan (the good performance of MMA in the 2002 elections is rightly attributed to the political vacuum created by Musharraf and strong post-9/11 anti-Americanism), and that the Pakistan military's current effort to control, rather than eradicate, terrorism cannot work.

Rifaat Hussain has given a detailed account of India-Pakistan relations during 1979-2004, but his effort to explain Pakistan's relations with "Azad" J and K does not go beyond the little that is generally known. The lack of detailed, unbiased information about the society and politics of "Azad" J and K, which Pakistan pretends is not under its thumb, and of northern areas, which Pakistan has unabashedly incorporated into itself, is a major knowledge-gap that handicaps the search for peace in J and K.

The four essays in the second group (India: Politics and Kashmir) are "Who Speaks for India? The Role of Civil Society in Defining Indian Nationalism" by Ainslie T. Embrie, "Hindu Nationalism and the BJP: Transforming Religion and Politics in India" by Robert L. Hardgrave Jr., "Hindu Fundamentalism, Muslim Jihad and Secularism: Muslims in the Political Life of the Republic of India" by Barbara D Metcalf, and "Jammu and Kashmir in the Indian Union: Politics of Autonomy" by Chandrashekhar Dasgupta.

In his essay Ainslie Embrie has tried to explicate the complex relationship between the state and civil society in India. The tension and overlap between secular and Hindu nationalisms have been presented with deep understanding. The Gujarat massacres of 2002 have been explained in relation to the various constituents of the Sangh parivar. Indian attitudes to matters of sub-nationalism have been explained not only in relation to Kashmir but also to the north-east and Punjab.

Robert Hardgrave's essay covers much the same ground although the focus is more squarely on the BJP and the RSS. He speaks of sections within the RSS that want to align "Hindu" India with the west against Islam. At the same time he underscores how the demands of power have moderated the ideological temper of the BJP. Both Embrie and Hardgrave have written with western readers in mind and much of the ground they have covered would be familiar to Indians.

Barbara Metcalf's essay about Muslim Indians draws attention to the fact that the post-9/11 war against terrorism evoked no response from them, unlike the case with Muslims elsewhere. She has explained thoughtfully the reasons for this as well as for the rise in anti-Muslim sentiments in India from the 1980s. The contents of this essay can provide useful insights to Indians and Pakistanis. Metcalf warns that Hindu extremism can help recruit Muslim terrorists in Pakistan and Bangladesh and, in the long run, possibly within India itself. She also makes a case for declaring organisations like the VHP "terrorist" in the light of Gujarat killings.

Chandrashekhar Dasgupta's essay on J and K and autonomy is "balanced" by Indian standards. He writes that New Delhi should "accommodate Kashmiri demands for autonomy to the maximum extent compatible with the legitimate regional interests of Jammu and Ladakh and with the requirements of democracy and good governance in the state as a whole. The interests of Jammu and Ladakh can be protected by a mix of regional autonomy; devolution of power to lower (district, sub-divisional and panchayat) levels; and an equitable inter-regional revenue-sharing formula." But while offering this sound advice, Dasgupta has carefully steered clear of examining its practical implications.

The four essays in the final group (India's and Pakistan's Nuclear Doctrines and US Concerns) are "The Stability-Instability Paradox: Misperception, and Escalation Control in South Asia" by Michael Krepon, "Pakistan's Nuclear Doctrine" by Peter R. Lavoy, "Coercive Diplomacy in a Nuclear Environment: The December 13 Crisis" by Rajesh M. Basrur, and "US Interests in South Asia" by Howard B. Schaffer. In the reviewer's view, this is the most interesting of the three sections in the book and merits careful reading in both India and Pakistan.

Michael Krepon has explored the ramifications of the use of force by south Asia's nuclear-armed adversaries. He stresses the danger emanating from the two sides drawing (largely for public consumption, in the reviewer's view) opposing lessons from tests-of-will like the Kargil war and Operation Parakram. A useful point to note is how Krepon has, over the years, shifted stress from nuclear confidence building measures(CBMs) to conflict resolution in reducing nuclear risks in south Asia. This can be seen from the following sentences in his concluding paragraph: "Much could go badly wrong on the subcontinent unless Pakistan's security establishment reassesses its Kashmir policy and unless New Delhi engages substantively on Islamabad's concerns and with dissident Kashmiris" and "The best chance of defusing nuclear danger and controlling escalation lies in sustained and substantive political engagement." Nuclear CBMs can only do so much.

Nuclear Doctrine

Peter Lavoy's essay is a good piece on Pakistan's nuclear doctrine. He has listed eight separate "uses" for Pakistan's nuclear weapons. In specific relation to India, there are four, viz (i) Last resort weapons to prevent military defeat or loss of territory; (ii) Deterrent to conventional military attack; (iii) Facilitators of low-intensity conflict; and (iv) Tools to internationalise the Kashmir issue. He has drawn attention to the fact that Pakistan's nuclear "redlines" are vague which, the reviewer might add, is true of all countries that reserve the right of "first use."

Rajesh Basrur's essay is about the coercive and nuclear dimensions of Operation Parakram. His narrative of events, diplomatic moves and public statements is valuable for separating chaff from wheat. He has drawn attention to how much India's "compellence strategy" was played out through the US, which had forces in close vicinity. During the confrontation both India and Pakistan sought to "create a fear of nuclear war in the global community, especially the US". He also highlights the fact that India decided to withdraw its forces when Pakistan ceased "responding" to Indian pressure.

The book has no conclusion. The last essay is by Howard Schaffer on US interests in south Asia. Schaffer writes about how the relatively low US interest in the India-Pakistan hostile relationship began to climb in the 1980s when the threat of nuclear war entered the calculus. He says "The US has now come to regard Kashmir less in terms of the equities of the issue -- the lot of the Kashmiri people, the morality or immorality of the insurgency in the Kashmir Valley. Instead it sees the dispute primarily as a tinderbox that could be the flashpoint of a nuclear conflagration." He concludes his essay with the comment that "Washington's view of US interests in the region and the way it goes about promoting them" is unlikely to become more consistent than in the past. Both are valid observations and Indians and Pakistanis would do well to mull over their many implications.

It is not stated in the book, but this volume had its beginnings in a conference at the Asia-Pacific Research Centre in Stanford in early 2003. This was soon after Operation Parakram and before India-Pakistan relations began to thaw in late 2003. Although contributors have updated their narratives to mid-2004, the milieu in which the arguments have evolved was a period of considerable tension. The peace possibilities that have opened up in early 2004 and have got slowly augmented since have, therefore, not been adequately factored in. The book has avoided making any kind of prediction about peace prospects in south Asia although the very title of the book leads the reader to expect some exploration in this area.