SWEET & SOUR: Rasmussen (right) has again raised the Kashmir question

When it comes to dealing with the Third World, or developing countries as they are more charitably described, many Scandinavians combine political correctness with supreme condescension. Looking back to a period not too far back in history, Denmark's Prime Minister Anders Fogh Rasmussen told the European Union (EU)-India Business Summit that "The India-EU relationship to a large extent revolved around development aid from Europe to India. Not so today, I am glad to say."

Tragically, that gratuitous admission of reality is yet to sink into society. For a Danish society accustomed to doling out some $20 million (Rs 96 crore) as aid-aid Delhi is anxious to phase out-India is still a society desperately in need of a benign help hand. Which is why it went apoplectic after the 1998 Pokhran blasts and tried to bring India to its knees by stopping aid.

This sanctimoniousness was once again in evidence at the EU summit when Rasmussen and some of his colleagues soured the atmosphere by trying to inject Kashmir and Indo-Pakistan relations into the joint statement. It prompted Disinvestment Minister Arun Shourie's aside that it would be inappropriate to equate arsonists with firefighters.

VALUABLE FRIEND: Vajpayee secured Clerides' (right) support for UN Council seat

Part of the problem in Copenhagen could well be attributed to the supreme incompetence and irrelevance of the local Indian Embassy-it was wisely bypassed during the preparations for the prime minister's visit. At a more serious level, however, the fact that the EU has separate summits with only a handful of countries, including the US, Russia, China, Japan and Canada, isn't sufficiently grasped by large chunks of civil society. Yet, a section of the EU believes it is the conscience keeper of India-a privilege not granted to the other strategic partners.

But change is in the air. CII President Ashok Soota who is heading the Indian business delegation was pleased with the "larger mind-share India is occupying in the EU". "In the old days," says Soota, "meetings like these would at best attract 80 people. This time there were some 300 people at the meeting." Information technology has been the buzzword for some time now. Joining the list is biotechnology and what is being touted as "knowledge partnership". Together, they have the potential of boosting bilateral trade well beyond the present level of Euro 25 billion (Rs 1,17,500 crore or 26 per cent of India's exports and 25 per cent of its imports) and extricating India from its overdependence on the rag trade (textiles and clothing make up 41 per cent of EU imports from India). India has set a target to boost bilateral trade to Euro 35 billion by 2005 and Euro 50 billion by 2008.

INDIA LINK: Cyprus First Lady Lilla-Irene (right) is a Bene-Israeli from Mumbai

Equally significant, claims FICCI Secretary-General Amit Mitra, is that the interactions between Indian and European industry were not interspersed with concerns over the security environment. The India-Pakistan face-off in the summer has been brushed off as a unwarranted distraction. The successful conduct of the Kashmir elections has put Indian diplomacy on a new moral high which even Denmark's sanctimoniousness could not destroy.

If there is still a niggling image problem it is by no means uniform. In his speech to the Business Summit, Vajpayee warned against extreme market radicalism: "Public accountability and a social conscience have to govern (the Government's) actions. It cannot adopt a shock therapy approach to economic reform." This is sound advice considering that global investors, reeling from the shocks of plummeting bourses, are not exactly jostling to secure a stake in India. Interestingly, this has little to do with the impasse over the privatisation of HPCL and BPCL-a subject that preoccupies India's political and editorial classes. The subcontinent still remains trapped in the ambivalence of "potential", despite Europe's common understanding with the problems of bureaucracy.

On the political front though, the ambivalence is less marked. Cypriot officials were simply staggered at the bandobast that accompanies an Indian prime ministerial visit. This imperial legacy may seem wasteful to those who perceive foreign policy through the eyes of an accountant but it-minus the overbearing security arrangements-contributes to a sense of aura. Cypriot President Glafcos Clerides' unequivocal endorsement of India's claim to a permanent seat on the UN Security Council may evoke sniggers among cynics but in two years Cyprus will be a full-fledged member of the EU and a valuable friend of India in Brussels. As will be the new entrants to the EU from the erstwhile Soviet bloc. Of course, it has helped that Cypriot First Lady Lilla-Irene Clerides is a Bene-Israeli from Mumbai with a deep sense of attachment to the land of her origin.

Cherie Blair's occasional fascination for the sari may have played a role in raising India's already high profile in Britain but Vajpayee's lunch with Prime Minister Tony Blair at Chequers has a significance well beyond economics. As postmaster-general to US President George W. Bush, Blair's role is to persuade India to be more accommodating of US concerns in Iraq. If there is a quid pro quo, it will, hopefully, be sizeable. That, however, is in the future. For the moment what is significant is that India is perceived to be a power worthy of constant strategic dialogues. Delhi hasn't entered the big boys' club but it has one foot on the door mat. No wonder Blair truncated his Moscow visit to ensure that he got to speak directly to Vajpayee.

The problem is that the Indian establishment is only half aware of its own enhanced stature. In Nicosia, Vajpayee expressed the hope that direct flights between India and Cyprus will soon become a reality. In fact, the announcement would have taken place during the visit if it hadn't been for an amazing display of cussedness by Air-India. India's national carrier doesn't have the aircraft to operate flights to Cyprus but Cyprus Airways does and is also anxious to have a code-share arrangement. Cyprus Airways offered Air-India $9 per passenger but Air-India demanded $25. The talks broke down and it was only on the intervention of the Prime Minister's Office that an annual figure of $150,000 may be agreed upon.

Indeed, this European visit of Vajpayee demonstrated yet again that there are two Indias jostling for supremacy. One looks to globalisation and big power status for realising national potential. The other is bogged down in pre-1991 insularity and prickliness. Overseas, one side prevails. Back home, it is often a different story altogether.