The world is in the midst of transition covering both political and economic spheres. Political transitions are underway in countries of our neighbourhood as also in the world's leading power.

The global economic crisis shows no sign of an ending soon. Issues of energy, environment, food security, and water, to name a few, are becoming more complex. Above all, the effects of the processes of globalisation are throwing up new challenges; but they also provide opportunities for our national endeavours.

We have to ensure that our interests and security are safeguarded and promoted. As a stakeholder in the international system, we need to manage the strategic shifts that are underway to maintain our stability and security and bring prosperity to our people.

In our neighbourhood we have continued with our efforts to deepen engagement, either bilaterally or multilaterally and even by assuming a built-in asymmetry in responsibilities.

An objective assessment shows that this policy has yielded results except with Pakistan. The recent terrorist attack on Mumbai was unprecedented both in terms of its scale and audacity. This and the series of terrorist incidents preceding it including the attack on our embassy in Kabul, where we lost our colleagues, indicate that terrorism emanating out of Pakistan is acquiring an increasingly dangerous dimension and continues to threaten peace and stability in this region and beyond.

We have so far worked at several levels. At the international level we have sought the support of the international community to put pressure on Pakistan to deal effectively with the terrorism. We have highlighted that the infrastructure of terrorism in Pakistan has to be dismantled permanently. We are not saying this just because we are affected but because we believe that it will be good for the entire world and also for Pakistani people and society.

This terrorist infrastructure in Pakistan is the greatest danger to peace and security of the entire civilised world. There has been some effort so far by the international community but this is not enough. Much more needs to be done and the actions should be pursued to their logical conclusion.

We need effective steps not only to bring those responsible for the Mumbai attacks to justice, but also to ensure that such acts of terrorism do not recur. Unfortunately Pakistan's response so far has demonstrated their earlier tendency to resort to a policy of denial and to seek to deflect and shift the blame and responsibility.

We expect the civilian government of Pakistan to take effective steps to deal with elements within Pakistan who still continue the use of terrorism as an instrument of state policy. We have so far acted with utmost restraint and are hopeful that the international community will use its influence to urge the Pakistani government to take effective action. While we continue to persuade the international community and Pakistan we are also clear that ultimately it is we who have to deal with this problem. We will take all measures necessary as we deem fit to deal with the situation.

The international financial and economic crisis presents another set of transitional challenges for us. From our perspective, we need to see how we can manage the crisis and also place ourselves in a position so that we can play a role in any future global financial or political structure. The challenge for us is to shape a set of policies encompassing both the security and foreign dimension such that we can ensure an external environment conducive to India's transformation and continued development.

However, I wish to point out some facets which will require particular attention, given the transitional global political and economic environment that we now find ourselves in.

We have today a multiplicity of actors on the global firmament, including think-tanks, NGOs and the media. These actors are exercising a significant level of influence. During the civil nuclear cooperation discussions, we saw how a concerted effort was made to unsettle negotiations, by portraying a narrow and distorted view of the negotiations.

Therefore, even though these actors may exercise varying degrees of influence and hold views which may be antithetical, there is no alternative but to take cognizance and engage with them. This engagement can be at various levels in its intensity and range. In the coming years, the crafting of sound policies will also depend on the influence we are able to bring to bear and the way in which we manage these processes and actors.

In this context, our soft-power is an asset we need to utilise with a greater degree of cohesiveness and with an outcome-oriented approach. We have scholarships and mid-career training programmes, we offer defence cooperation and related technical programmes. A vast amount of money is spent on these programmes.

Unlike some other countries, we have till date eschewed monetising these programmes. Perhaps, we may now need to conduct a more realistic assessment and undertake an audit of the utility of these programmes, of these tools of soft-power at our disposal. The database of participants can be augmented not only by annual ITEC days but perhaps by promoting alumni of graduates of Indian institutes. We should capitalise on the existing goodwill, in creative ways, and I expect our missions to assist in this task.

Our chanceries and facilities for those seeking passport, visa and other consular services represent our public face and need a special mention. The maintenance and upkeep of these facilities should be a priority. At the same time we should endeavour to provide services comparable to best international standards. 

The Indian diaspora is an asset. They are not only affluent in many countries and are also influential, being well integrated into their local communities. The efforts of previous years to engage them, has proven to be beneficial and they can be a source of strength. We need to continue to nurture them.

On the economic dimension, India's economy has proven to be both outward looking, competitive and resilient. Our companies are no longer shy in exploring new opportunities and our manufacturing is setting new standards and earning a healthy reputation. This can be utilised to enhance our reach and effectiveness in other countries.

The larger process of globalisation has unintended consequences. There is the accelerated interaction, due to the speed and spread of the electronic media. This has severely compressed the time available for decision-making. We have to be aware of this in our work both in headquarters and in missions.

We must be clear in our analysis and in our presentation of options. The transitions underway globally also makes it harder for us to arrive at assessments but we should gear ourselves to discerning the different strands, particularly the underlying currents which are influencing policy making. The fluidity of the situation provides us an opportunity, to fashion new frameworks to enhance our interest.

To conclude, it is not merely the structure of the international system that is changing at a rapid pace. The challenges themselves are rapidly evolving. Traditional approaches must make way to more forward looking approaches of cooperative solutions. We should prepare to play a leading role in shaping the emerging world, by preparing long term strategies as an influential and respected member of the international community.

External Affairs Minister Pranab Mukherjee [Images] spoke at the inauguration of the 3-day Heads of Missions Conference in New Delhi [Images] on December 22, 2008