Kazakhstan and India: Problems of Cooperation and Prospects

In the system of external political priorities of the Republic of Kazakhstan countries of the East occupy one of the main directions. Strengthening of the trade-economic relations, creation of good neighborhood and regional stability are main elements in the achievement of strategic goals. The bases for the development of Kazakhstan-Indian relations currently and for the future are our long traditional interrelations as follows:

1. Migration of some representatives and groups of different ethos;

2. Joining the same political formations;

3. Exchange and trade with handicraft items, works of art;

4. Mutual influences in the sphere of material culture;

5. Effects in the sphere of spiritual culture and religion.

Contacts and relations between Kazakhstan and India were established during ancient times. For instance, Cornelia beads of Indian origin in Sacs complexes of the Central Kazakhstan and the later tombs of Semireche allow to conclude that beads beginning from the middle of the I century b.c were brought from Middle Asia to the Central Kazakhstan. Further links reached their highest point in Kyshan time, when northwestern regions of India, Middle Asia and pert of Kazakhstan joined the empire Kyshan. By VII – beginning VIII century in the influence of Buddhism in many regions of the Middle Asia significantly expanded.

Buddhism churches were excavated in Ak-Beshim, in the town Red River (Semireche) and etc. Together with religious ideas of Buddhism various elements of Indian science, literature, and art came to Kazakhstan from India. Starting from XII the route crossing Semireche and Southern Kazakhstan, which directed to the West, entered into the systems of the Great Silk Road. Moreover, from the second part of XII this way had been revived. The writing sources of XVI – XVII confirm that trade ways connecting China, India and Middle Asia crossed the territory of Kazakhstan: pilgrims, merchants, artisan and military groups passed them.

The existed proofs of eastern authors allow stating about the regular trade relations. Actually, trade between Kazakh and neighboring nations continuously developed even in the time of wars though the latter circumstances were strong impediments for the development. As known, in XVI in the Northen India the empire of the Great Moguls, the founder Babur of which had been originated from Middle Asia was established. Kazakh tribe aristocracy among Turkic supporters of the empire founder took an active part in his campaigns. The Turkic aristocracy of the Mongol strongly affected on all sides of the Mongol Empire. The sources prove that The Indian people keep in mind the genealogic tree of their gender due to the existed custom to compose Shadzara (shezhere). It is known that the founder of the dynasty Kutb Shah (Kui Kutb-al-Mulk) was originated from Turkestan and its associates aonsisted of people originated from towns. In dynasty chronicles it is possible to find other examples that prove the wide spread of this phenomenon and the significance of Turkic influence in the life of Turkic society. At that period large traditions of cultural communication and contacts of the Central Asia and the Great Mongol Empire were existed. The Middle Asia played a specific role in promoting the Indian culture, which many cultural values had been spread in neighboring countries including Kazakhstan. Starting from XVI Indian merchants from the Northern India began to develop trade to the north to Afghanistan, Iran, Middle Asia, and Kazakhstan. The new aspect of Kazakhstan-Indian relations in XVI - XVIII century, which has not been researched yet, presents a significant interest. The specific feature of the Kazakhstan-Indian trade was that it was made with the participation of Middle Asian, Indian and Afghan intermediaries. Kazakh mainly sold livestock transferred through the Middle Asia to India. Horses were among goods transferred directions of caravan route. The significant number of horses was taken to India from Buhara; especially the Kazakh breed of horses was valued. There are some documents proving that Kazakh merchants transferred to India up to 40 thousands of horses.

However, the intensity of the Kazakhstan and Indian relations was not continuous. Depending on military and political conflicts, socio-economic state of the Indian and Kazakhstan societies the periods of active interaction were replaced with periods of recession and sometimes even with full termination of mutual contacts. So, the conquest of Dekan by Turkic headed by Babur very favorably affected on the development of Indian and Kazakhstan contacts, promoted better acquaintance of nations of mutual cultures of two regions. For example, Indian people in addition to introduction to each other’s cultural values of Turkic nations they actively learned interpreted them in accordance with cultural traditions of India itself. Finally, it resulted in the unique combination of material, spiritual and cultural values in Dekan that significantly changed the character of traditional Indian culture originated from Vedas. From the other hand the English conquest of India and a part of Central Asia by Russia in XIX had a specific influence on the history of both countries.

Nowadays, India is a country of great changes and great expectations. The most substantial achievements within 50 years of independence are: integrity and unity of sub-continental nation, establishment of democratic system tested by many crises, essential improvement of the life of million people. In the social and political views of modern India the following provision has been set up: If the nation with billion populations starts the process of changes it will change the world trade and non-implementation of the economic potential of both coun­tries in the sphere of bilateral relations, the Kazakhstan‘s side, to our mind, should intensify efforts on expanding economical links with India in the conditions of market economy and using new financial-economic mechanisms, stimulating mutual investment, introduction of initiatives into the small and medium business. To pay the special attention to small and medium business in the sphere of Kazakhstan - Indian trade — economic relations is important also because the third part of the gross national product is provided by a private sector. At the same time, it is necessary to make efforts for supporting and developing links with enterprises and organizations of the state sector. On this issue, the Kazakhstan’s side finds the cooperation with India in military and technical sphere especially attractive.

In order to make bilateral trade and economic relations steadily stable in the conditions of our country it is necessary to create an appropriate infrastructure allowing to develop a cooperation on new market principles. In connection with that from our point of view it should be stressed on the following aspects of bilat­eral relations.

First, it is stimulation of new forms of the business cooperation, creation of JS, mutual participation in investment processes and privatization processes in both countries. Directs relations between already existed and forming banking agen­cies which serve for the new economic interaction would meet the interests on expanding bilateral economic relations. Operation of this system should be based on close connections of financial, bank and insurance equity and also other inter­ested units of both countries. In connection with that, the need of regular contacts between ministries and agencies of both countries, interaction with non-govern­mental organizations and commercial structures become specifically important. In November 1999 in Deli the Memorandum on mutual understanding and coop­eration in the development of small enterprises and creation of new working places was signed. Also within the exchange of experience the introduction of Kazakhstan partners with modem Indian technologies is stipulated.

Currently the Agency of Republic of Kazakhstan on regulation of natural monopoly, competition protection and support to a small business jointly with the National Institute of the development of entrepreneurship and small business un­der the Ministry of Industry of RK are working on the creation of a joint Center of enterpreneural development in Astana. Last years the volume of mutual trade between two countries has been increased. The main points of Kazakhstan export are leather resources, ferrous metals. India imports tea, processed vegetables, prod­ucts, organic units, pharmacological products, (epher oil), detergents, equipment, and mechanical facilities. India covers 56 % of all demand by import. The volume of “black gold” delivered to the country comprises about 40 millions tons. Ex­penses for their purpose amount to more than 60 billion $ that is 25 % from the total volume of import. In the nearest future the increase of import of energy bearers can be increased according to forecasts. In this connection Kazakh-Indian cooperation in the oil sphere seems very prospective. Oil-gas industry is one of the main factors of Kazakh economy development. This is a basic strategic branch of the stable and dynamic development on which the wealth of millions Kazakhs depend on. At the same time oil and gas for us is very effective external political tool, operative mechanism of adjustment of the mutually beneficial international

around. This approach confirms the thesis that India shows the synthesis of the rich ancient tradition with modem life.

India always played a constructive role in the international world. Policy of non-joining and peaceful co-existence gives for India a higher moral authority in the world in XX century and complies with the new philosophy of international relations at the beginning of XXI century. Currently India is interested with the establishment of full and close relations with independent countries of Central Asia. Interrelations with the Central Asian region for the Indian policy and economy are filled with new content and have strategic importance. The restore of common historic links with the Central Asian Republics and transformation of traditional relations into close and long term economic and political cooperation become an actual direction of external political development of this great country.

During last years the relations between Kazakhstan and India acquired a definite content in the field of inter-governmental political, economic, scientific- technical and cultural relations. Kazakhstan expresses its satisfaction with the In­dian sides support of the Conference on the Interaction and Measures of Trust in Asia (CIMTA). We consider the participation of India in the meeting of minis­tries of foreign affairs of countries-members of CIMTA) held in September 2000 in Almaty as the concern of India for the development of multi-sided structures of regional security. The prospects of expanding multi-lateral relations were discussed at the meeting of the President Nursultan Nazarbaev with Jaswant Singh within CIMTA forum.

At the beginning of the new century the economic effect on the world policy and formation of the new quality of the world economy became main parameters of a new system of trade-economic relations with India. India pays a special atten­tion to deepening trade and economic relations that seems as the most perspective in the world economic exchange. Economic potential of both countries supports such evaluation. India enters the first ten countries in the world on the size of the gross internal product.

Within economic reform the successes of India are connected with the policy of the state support of small and medium business. For these purposes both eco­nomical and administrative levers are used. Such measures should include, first of all, a significant group of goods that are prohibited to be produced by large com­panies and are made exclusively by small industry. For example, more than thou­sands of goods are partly produced mainly by small companies and are purchased by the state on fixed prices, providing a guarantee sale.

The ramified system of bank services for small industry (State Bank of small industry development, the State Corporation of the small industry and also com­mercial banks) operated in the country. The latter having more than 65 thousand branches in the country in accordance with the state scheme which recognizes the small business as a priority, at first, provides funds to this sector higher growth tempers of small industries in India without essential declines during last half of the century allows to assume that this sector possesses definite self-sufficiency internal incentives of development, which initially depend upon the general eco­nomic situation in the country. Taking into account the increasing role of India in

cooperation. The Indian Oil Company “ONGC Videsh Ltd.” expressed the inter­est in exploring and investigating carbon- hydrogen resources in Kazakhstan. Cur­rently negotiations on determination of mutually accepted forms of cooperation are being conducted.

The tendencies resolving a transport problem in bilateral relations has been marked that allows in the future increasing the trade volumes and investment cooperation between Kazakhstan and India. In Almaty the Agreement on trans­port-freight forwarder service of export-import and transit shipments between stock company ‘Kazinterfraht” under the Ministry of Transport of Republic of Kazakhstan and the Indian company “J.M.Bahi” has been concluded. The indi­cated Agreement regulates interaction of parties related to the organization of railway and auto- transportation of export-import and transit cargoes. The trans­port prices are determined by the tariff policy within the tariff agreement of rail­way carriers of countries - members for the relevant freight year. It must be noted that on the whole the content of the Agreement complies with international stand­ards. Its implementation in a full volume will allow Kazakhstan commodity - producers to enter the Southern and South-Eastern Asia markets and goods of the latter may be presented at the Kazakhstan's market.

It is obvious that the volumes and range of the Indian — Kazakhstan coop­eration still are not consistent to the potential and possibilities of both sides. One of the reasons is the lack of effectively operated transport scheme, non-solvency of mutual payment problems between partners of both sides, and also the narrow commodity structure in the trade between two countries. In order to intensify the trade and economic cooperation between two countries and to resolve the prob­lem of mutual payments it is necessary to start developing and signing the Agree­ment on Inter-Bank cooperation between Kazakhstan and India, Agreement on cooperation in oil industry. The joining of Kazakhstan to the tripartite agreement on international transit of goods between Turkmenistan, India and the Islamic Republic of Iran signed in February 22, 1997 in Teheran is still critical. It is re­quired to intensify the promotion of interests of our country with the purpose of the effective use of the Iranian transport corridor and further communication between Bander-Abbas (Iran) and Bombay (India) ports. On this point for Kazakhstan to use possibilities of the newly opened Eurasian transport corridor from the Caspian Sea to the Indian Sea seems very promising. From the analytic’ point of view the total profit due to the difference between the indicated new and old round way (across Sues channel or around Africa to Saint-Petersburg) amounts to 30-40 % of both time and expenses for the delivery of goods. After the comple­tion of the reconstruction of the international port Aktau and adjustment of ferry transfer from Aktau to the port Anzely and organization of ferry crossing from Akita to port Ensile the actual Indian-Iran-Kazakstan transit and transport coop­eration may be started. Then, cargoes may be delivered not only from Bombay but also from Madras or Colombo (Shri-Lanka) and also from other ports at the coast of the Indian Ocean. A new Silk Road is becoming the reality already in the new century. Implementation of these proposals meets the long-term interests of our countries and will enhance our bilateral cooperation.