Press Conference in New Delhi

I look forward today to my meetings with Prime Minister Vajpayee, Deputy Prime Minister Advani, National Security Advisor Mishra and last evening I had good discussions with my new counterpart, Ministry of External Affairs Sinha. The Prime Minister's team and I have established a good relationship over the past 18 months that has yielded, in my view, very, very positive results. As befits our transformed bilateral relationship, it is important that the leadership of India and the United States remain in close and frequent contact.

As President Bush and Prime Minister Vajpayee directed us last fall when they met, we have opened the new strategic dialogue to transform our relationship. We are conducting intensive and valuable diplomatic exchanges on issues ranging from Afghanistan to trade, we are working together on counter terrorism issues, on intelligence, on law enforcement and on science projects. We have deepened economic dialogue. We have agreed that there is enormous potential for additional trade between our two sides, a potential that we now move forward with a specific program to realize.

As the United States looks forward to pressing ahead with India on all of these fronts and more, we'll be doing it a very intensive way as reflected in the number of visitors who will be coming to India in the weeks ahead. Deputy Secretary Armitage will return in August, Assistant Secretary John Wolf will be visiting in early September to begin a new strategic framework dialogue with a focus on proliferation efforts. Assistant Secretary Christina Rocca will come back in late September to kick-off a regional dialogue. Under Secretary of State for Political Affairs Mark Grossman will continue our security dialogue. Treasury Secretary O'Neill will be in New Delhi in November and Under Secretary of Commerce Ken Juster will also visit this fall. And we look forward to welcoming many Indian officials to the United States so it can be truly seen as a two way street, going back and forth.

I'm sure that the Prime Minster and I will discuss the tensions that exists between India and Pakistan and to explore the further steps both sides can take to diffuse the tension. I do take note of the fact, however, that the situation has improved considerably over the past month. We have been able, for example, on the U.S. side, to return our families who had temporarily moved back and we have also been able to change our alert levels or caution levels to a point where we are now hopeful that more tourists, more American tourists will return to India and more businessmen and women will come and find ways to enhance trade between the United States and India.

I am pleased that the United States was able to play a role with the international community in helping to lower the tension level. Deputy Secretary Armitage's visit last month, Secretary of Defense Rumsfeld's visit, my very frequent phone calls to the Minister for External Affairs as well as the work we did at the other side, President Musharraf Pakistan, I think, has played a useful role in bringing the tension down but at the same time the tension is still there and there is much more that we need to do. Both armies remain mobilized. The situation remains tense. And so we look to India to take further de-escalatory actions as Pakistan makes good on its pledges to permanently cease support for infiltration. I look forward to my conversation later today with President Musharraf on the pledges that he has made to the United States and to the international community.

We are also looking to the future. It is time to get started on making regional stability permanent. Kashmir is on the international agenda. The United States will extend a helping hand to all sides so that they can achieve a more peaceful, less divisive future.

We are looking to both India and Pakistan to take steps that begin to bring peace to the region and to ensure a better future for the Kashmiri people. The problems with Kashmir cannot be resolved through violence, but only through a healthy political process and a vibrant dialogue.

We welcome India's commitment to hold free and fair elections, and we believe an inclusive election, meeting these standards can serve as a first step towards peace and reconciliation. We look forward to concrete steps by India to foster Kashmiri confidence in the election process. Permitting independent observers and freeing political prisoners would be helpful.

We also look to all parties to do their part to ensure that the upcoming elections can be held in safety and without interference from those who would like to spoil them, for those who do not wish to see peace and reconciliation. Kashmiri's want to run or vote in the elections. And if they do so, they should be allowed to do so, without endangering their lives. Elections alone, however, cannot resolve the problems between India and Pakistan, nor can they erase the scars of so many years of strife. Elections can however, be a first step in a broader process that begins to address Kashmiri grievances, and leads India and Pakistan back to dialogue. Only a productive and sustained bilateral dialogue on all issues, including Kashmir, will prevent future crises and will finally bring peace to the region. I would like to thank my Indian hosts for their hospitality, and for the constructive discussions that I've already had and I know will continue through the morning. And in the months and years ahead the United States will looks forward to deepening its friendship with a thriving, peaceful and democratic India.

And I am now prepared for your questions.

SPOKESMAN BOUCHER: Begin with Mr. Gedda.

GEORGE GEDDA: Mr. Secretary, an Indian spokeswoman said last night that infiltration levels across the line of control have decreased only marginally over the past six weeks. I don't believe you referred to that when your opening remarks. How do you assess the situation along the line of control?

SECRETARY POWELL: There has been reduction in infiltration levels whether one would classify it as marginally or not marginally, I can't answer. But it seems clear from the information I have that infiltration is continuing. And I think we must make every effort to end it. President Musharraf has pledged that he would end it, and would end on a permanent basis and I look froward to discussing that in greater detail with him and sharing the information he has compared to the information I have received here in India. I think it is important that the infiltration come to an end so that we can create conditions that will allow dialogue, will allow both sides to be in confidence in one another again, that will create conditions that will permit a peaceful, fair and open election in Kashmir later this year and then following the Kashmiri elections then Pakistani parliamentary elections, we will be in a better position to see the kind of sustained dialogue that I think is needed between the two sides to move forward on a variety of issues that are outstanding between the two sides to include the issue of Kashmir.

AMIT BARUA, HINDU: It appears that the U.S. is very intensively engaged in South Asia and in deference to India's wishes, you say you are not playing the role of a mediator but effectively don't you think in South Asia that the U.S. is playing the role of a mediator?

SECRETARY POWELL: What the U.S. is trying to do is play a role of a friend. A friend to India, a good friend to Pakistan, a good friend the other nations of South Asia. I met in my office the other day with the Prime Minister of Sri Lanka. When last I was here, on my way out, I visited in Nepal. So, the United States has good relations with all of the nations of South Asia, perhaps better then at any time in the last quarter century. And we are anxious to improve those relations: U.S. Indian relations, U.S. Pakistani relations, U.S. Sri Lankan, Bangladeshi, all of those nations and if we improve those relations, and we are seen as a good partner to all those nations, then we are in a position to perhaps, from time to time, assist nations in resolving differences that they have,

not as an interfering friend, not as a mediator but somebody whose good offices can be used in order to bring people to the table so that they can talk to one another and deal with the problems that exists between the two of them. So I see that as the role of friends whose good offices are used to help people get into a room and begin discussion and move away from conflict, not as a mediator or somebody who is interfering in someone else's internal or external affairs.

ROBIN WRIGHT: Mr. Secretary you've outlined for us what do you like to ask of Pakistan but on the way here you said you had certain, you were going to ask for certain steps to be taken by both sides. Can you tell us what you've asked India to do and what the response has been?

SECRETARY POWELL: Those discussions of course are still going on. I met with my new colleague Minister Sinha last night evening and I have three meetings this morning so I think I'll wait until I have concluded all of those meetings and have a full exchange before commenting publicly on what I might have discussed with them.

SINGH, ANI: Mr. Secretary, are you in favor of the Hurriyat parties taking part in the Kashmir elections?

SECRETARY POWELL: I think that the election should be as open as possible. And groups that have demonstrated responsible action and wish to participate in the free open and democratic process should be allowed to do so.

REUTERS: Mr. Secretary I understand a Palestinian delegation is coming to Washington coming shortly after your return. Can you confirm that you will be meeting them, what you will be discussing and does this mean that the Palestinian Authority has in some way been rehabilitated in the eyes of the United States?

SECRETARY POWELL: I do expect to meet with the Palestinian delegation upon my return. Last week I met with an Israeli delegation. And this is part of our process of moving forward to help the Palestinian community transform itself. The specific names of the delegation members we'll announce in due course. And I'll be discussing with them security transformation, the work of the task force that will be announced in New York the week before last, what the different working groups will be doing and how we can link in with the Palestinian leadership. I hope that the people coming to see me will be individuals who have been enpowered to speak for the Palestinian people and who will have the authority to execute whatever decisions we arrive at or positions we arrive at. And so this is all consistent with the plan that President Bush has laid out with respect to the transformation of the Palestinian community and is consistent with the work that we have been doing with core tech group as it is known and now the expanded core tech group called the task force.

QUESTION: You have been speaking of inclusive elections and free and fair elections in Jammu and Kashmir. If the Hurriyat and the separatist moderate leaders stay out of it would the international community still look upon these as free and fair elections and are there any measures that you have outlined to the Indian government during, or will be, about how to make these more representatives: the polls in Kashmir?

SECRETARY POWELL: Free, fair and open in our minds might suggest that all should be allowed to participate if they are responsible participants and ready to play by the rules. In my conversations with the External Affairs Minister last night I made the point that moderate elements should be encouraged, that there should be the release of those who have been detained who can play a positive role in generating turn out, there should be hopefully an atmosphere of safety and peace provided by both sides. And I will be speaking to the Pakistani side about taking every effort to avoid disturbing these elections. And I hope that those who so far had indicated reluctance to participate will by time the elections come around find that the atmosphere of confidence has improved to the extend where they can come out, feeling safe, and feeling able to participate in an open political process. If you don't have that then the international community may not judge the elections in a proper way and an opportunity may have been lost. This is the message I am giving to both sides.

BARBARA SLAVIN, USA TODAY: Can you explain to us the resistance of the Indian government to having independent election observers. You've pointed out that this would be very helpful. Can you explain why they consider this to be an impediment or interference in some way?

SECRETARY POWELL: They believe that they are capable of running the elections without formal monitoring system but at the same time they recognize the value of having outsiders, international personages, present in the region. Now I have encouraged them to make it as easiest as possible for people to travel to the region outsiders to travel to the region, because it will give grater credibility to the results even if it isn't an official global sponsored monitored regime. But if you have an enough outsiders there you can see what is taking place, you can see what people are able to campaign in peace, you can watch the process of debate among candidates who can the monitor the actual conduct of the elections, who see the actual conduct of the elections, and then can give there own individual impression and statements about what they have seen. That seems to add a level of credibility to the election that would benefit the Indian government and would benefit the perception that the international community would have of the elections. So we're encouraging the Indian government in that regard.

DEEPAK ARORA, NATIONAL HERALD: You mentioned yesterday in your meetings that India and the United States have to work together in several areas, work harder together to the several areas to improve the ties. Could you tell us what are those areas and what exactly steps being taken to improve these bilateral ties?

SECRETAY POWELL: The two leaders Prime Minister Vajpayee and President Bush when they met laid out a number of areas that we believe that we should cooperate on: counter terrorism, energy, the environment, trade, commerce, proliferation,

non- proliferation, education issues. We should not restrict our agenda just to a single list but that's a pretty good list to start with. We really are looking for the broadest possible relationship with India--- the two greatest, largest democracies in the world the United States and India, should be doing much more with each other, to talk to one another to get to know one another, to increase the level of trade between the two nations. As large as India is and as large as America is with its large economy, there isn't enough trade, there isn't enough commerce between the two nations. And so I think that ought be one of our highest priorities. And the reason I want to focus on these issues is that very often people look at U.S.-Indian relations only through the prism of what's going on the line of control. That is important and we will watch that and will work with both sides on reducing tension and conflict across the line of control. But we will have to keep in perspective the broader relationship and that is why I wanted to focus on that end and touch on what the Prime Minister and President committed themselves to last year and all the areas I touched on and all the various officials I may mention to was for the purpose of saying to the people of India we are not just here, I am not just here, because there is crises in the region. I am here for the third time in ten month because India is important to the United States. India plays an important role in South Asia and the United States understands that. And we want to build on the friendship that exists between our two nations, transform it in to a deeper relationship. But we also want to do the same thing with Pakistan. And we want to do it in a way that both nations will see that the United States can be friends to both. It is not as zero sum game and every time somebody sees we are doing something that looks like it benefits Pakistan it is not necessarily at the expense of India. In fact it won't be at the expense of India. We can move forward with both the nations, enhancing our relationship and improving life for all of the countries, the Untied States, Pakistan and India and do it the way it shows the United States is here as a friend and a partner.

Thank you.