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Remarks by Secretary Panetta at the Institute for Defence Studies and Analyses in New Delhi, India

Presenter: Secretary of Defense Leon Panetta
June 06, 2012

            SECRETARY LEON PANETTA:  Thank you very much, Mr. Ambassador, Dr. Gupta.  Thank you for inviting me to the Institute for Defense Studies and Analysis, and thank you for your leadership of this distinguished organization.  It's a special honor for me to have this opportunity on my first visit to India as secretary of defense to be able to address the issues in the defense arena that involve both the United States and India.

            This trip has taken me from the Pacific Command headquarters in Hawaii to the Shangri-La Dialogue in Singapore to Cam Ranh Bay and Hanoi in Vietnam.  It's appropriate that as I've had the opportunity to define our new defense strategy for the 21st century that I am now here with a very key partner in India, particularly in this important region.

            Over the past two days I have held some very excellent meetings with Prime Minister Singh, with Defense Minister Antony, with National Security Adviser Menon.  And I want to thank them all for welcoming me back to this country.  I've had the opportunity to visit here a number of times in my prior capacity as director of the CIA and now have the opportunity to visit as secretary of defense.

            I also want to take this moment to thank Ambassador Chandra for his role in helping to convene and moderate today's discussion.  And I also want to thank him for his contributions.  He's made a number of very important contributions in helping to advance United States-India relationship during his career in public service.  And I had the opportunity to see that personally during the time I was in the White House.

            His first year in Washington as India's ambassador overlapped with the end of my tenure as President Clinton's chief of staff in the 1990s.  It was a time when the legacy of the Cold War and the suspicions that developed during that period still loomed large.  And though the United States and India shared many values and many common interests, our bilateral relationship suffered from many of those suspicions.

            My former boss, President Bill Clinton, I think got it right at the time twelve years ago here in New Delhi when he said, and I quote, "India and America are natural allies, two nations conceived in liberty, each finding strength in its diversity, each seeing in the other a reflection of its own aspiration for a more humane and a more just world," unquote.  Thanks to the efforts of past presidents, both Republican and Democrat, our two nations, I believe, have finally and irreversibly started a new chapter of our history.

            When I returned to government in 2009 to serve as director of the CIA, I found a transformed United States-India relationship.  We had acted together to get past our differences and re-establish better cooperation.  It required that we get beyond our outdated notions about one another.  And today, thanks to President Obama and Prime Minister Singh, along with Indian leaders from across the country's political spectrum, our two nations now engage actively and effectively as partners on a whole host of bilateral, regional and global issues.

            President Obama has said that the United States and India will be one of the defining partnerships of the 21st century, and I believe that to be true.  Today we have growing economic, social, diplomatic ties that benefit both of our nations.  But for this relationship to truly provide security for this region and for the world, we need to deepen our defense and our security cooperation, and this is why I have come to India.

            America is at a turning point.  After a decade of war, we are developing a new defense strategy for the 21st century, a central feature of that strategy is rebalancing toward the Asia-Pacific region.  In particular, we will expand our military partnerships and our presence in the arc extending from the Western Pacific and East Asia into the Indian Ocean region and South Asia.  Defense cooperation, defense cooperation with India is a linchpin in this strategy. 

            India is one of the largest and most dynamic countries in the region and, for that matter, in the world, with one of the most capable militaries.  India also shares with the United States a strong commitment to a set of principles that help maintain international security and prosperity.  We share a commitment to open and free commerce.  We share a commitment to open access by all to our shared domains of sea, air, space and cyberspace.  We share a commitment to resolving disputes without coercion or the use of force and in accordance with international law.  We share a commitment to abide by international standards and international norms -- rules of the road, if you will -- which promote international stability and peace for the world.  One of the ways we will advance these principles is to help develop the capabilities of countries who share these values, and India certainly is one of those countries.

            Our two nations face many of the same security challenges: from violent extremism and terrorism to piracy on the high seas, and from the proliferation of weapons of mass destruction to regional instability.  Handling these challenges requires a forward-looking vision for our defense partnership and a plan for advancing it month by month and year by year.  We have built a strong foundation, and we will enhance this partnership over time in the spirit of equality, common interest and mutual respect.

            In particular, I believe our relationship is, can and should become more strategic, more practical and more collaborative.  Our defense cooperation is strategic, in that we consult and share views on all major regional and international security developments.  Our defense policy exchanges are now regular, candid and invaluable.  Our partnership is practical because we take concrete steps, through military exercises and exchanges, to improve our ability to operate together and with other nations to meet a range of challenges.  And our defense relationship is growing ever more collaborative as we seek to do more -- more advanced research, more advanced development, share new technologies and enter into the joint production of defense articles.

            Let me share my view on the progress we have made in each of these areas and outline additional steps that I believe we can take in the coming months and years.  First of all, with regards to strategic cooperation, we've built a strong strategic relationship.  That is the nature of the relationship between the United States and India.  In my own experience, including during my visits here as director of the CIA, my Indian counterparts always offer clear strategic analysis and recommendations.  We are transparent.  We are honest in our discussions, something that has come to define the strength of our relationship.

            During my two days here we discussed the new defense strategy that is guiding the United States’ military rebalance to the Asia-Pacific region.  We also talked about the value of the ASEAN (Association of Southeast Asian Nations) regional architecture in promoting international norms and in guaranteeing freedom of navigation.  We discussed Afghanistan, where we have embarked on a transition to Afghan responsibility for security, for governance and for economic affairs. 

            India has supported this process through its own significant investments in Afghan reconstruction and has signed a long-term partnership agreement with Afghanistan.  We are making significant progress towards a successful transition.  The United States now has an enduring partnership agreement with Afghanistan, and we are committed to the long term in assuring that Afghanistan is a stable nation in this region of the world.

            I urge India's leaders to continue with additional support to Afghanistan through trade and investment, reconstruction and help for Afghan security forces.  We both realize how important it is to ultimately have a stable Afghanistan if we are to have peace and prosperity in this region.

            We also discussed India's immediate neighborhood.  In particular, I welcomed the initial steps that India and Pakistan have taken to normalize trade relations.  This is a process that we believe is key to resolving their differences and to helping Pakistan turn around its economy and counter extremism within its borders.  Pakistan is a complicated relationship, complicated for both of our countries, but it is one that we must continue to work to improve.

            And finally, we exchanged views about other key issues, like piracy and terrorism, tensions in the South China Sea, our concerns about Iran, about North Korea's destabilizing activities, and new challenges like cyber-intrusions and cyberwarfare.

            Second, what is -- what is it we can do to improve a practical defense partnership?  At a very practical level, our defense partnership is coming of age.  Expanded military exercises, defense sales, intelligence sharing are key examples of the relationship's maturation.  Last year alone we held more than 50 cooperative defense events.  Some of the most significant include our military exercises, which enhance our ability to prepare for real-world challenges.

            The annual MALABAR naval exercise has grown from a passing exercise for our ships into a full-scale engagement across all functional areas of naval warfare.  In March U.S. Army soldiers joined their counterparts in India to rehearse scenarios involving United Nations peacekeeping and humanitarian assistance/disaster relief in a post-conflict setting.  U.S. soldiers even had the chance to participate in a Holi celebration, in which, I gather, all experienced a colorful -- a colorful occasion.  One month later the SHATRUJEET exercise took place at Camp Pendleton in California, my home state, with amphibious operations and other exercises between U.S. Marines and Indian soldiers.

            These engagements, these exercises provide opportunities for our militaries to learn from each other.  This will sharpen our skills the next time we are called upon to interdict a weapons of mass destruction shipment or break up a terrorist plot or respond to a future tsunami.

            We've also increased our defense sales relationship from virtually nothing early in the last decade to sales worth well over $8 billion today.  Our sales are rapidly growing.

            For example, India and the U.S. have agreed to sales of maritime surveillance and transport aircraft.  India will soon have the largest -- the second-largest fleet of C-17s in the world, expanding the reach and strength of India's forces and their ability to rapidly deploy.  Your C-130J transport aircraft and P-8I maritime surveillance aircraft purchases are also historic.  In fact, India and the United States will be the only countries operating the P-8I aircraft.

            In providing such world-class capabilities to the Indian armed forces, we also enabled new training and exchange opportunities between our militaries.  For example, our sales of transport aircraft included U.S. Air Force training of Indian pilots, loadmasters and maintenance staff.

            The third area is defense collaboration.

            Finally, in terms of building collaboration, we have some early successes and are poised to embark on technology sharing, co-production and other initiatives that will be a great value to each of our nations.  Lockheed Martin, Sikorsky, India's Tata Group are already jointly manufacturing spare parts for transport aircraft in Hyderabad.  This project benefits each of our nations by creating jobs in India and America and strengthening our defense industries.  Our shared goal should be to solidify progress and deepen defense engagement and cooperation in all of these areas.

            So now let me turn to the future.  At a strategic level, we have worked together to counter piracy, to counter terrorism, and now we should join forces to tackle new and even more complex threats.

            We can do more to drive the creation of a rules-based order that protects our common interests in new areas like cybersecurity and space.  We need to develop rules of the road in these domains to help confront dangerous activities by states and non-state actors alike.

            In terms of regional security, our vision is a peaceful Indian Ocean region supported by growing Indian capabilities.  America will do its part through doing things like rotating the presence of Marines in Australia.  We will have littoral combat ships rotating through Singapore.  And we will have other deployments in the region.  But the fundamental challenge here is to develop India's capabilities so that it can respond to security challenges in this region.

            The United States supports Southeast Asia multilateral forums such as the ASEAN Defense Ministers' Meeting-Plus, or ADMM-Plus.  These mechanisms will prevent and manage regional tensions.  As I told my Indian colleagues over the past two days, India's voice and involvement in these international forums will be critical.

            As the United States and India deepen our defense partnership with each other, both of us will also seek to strengthen our relations with China.  We recognize that China has a critical role to play advancing security and prosperity in this region.  The United States welcomes the rise of a strong and prosperous and successful China that plays a greater role in global affairs and respects and enforces the international norms and international rules that have governed this region for six decades.

            And again, with regard to Pakistan, India and the United States will need to continue to engage Pakistan, overcoming our respective and often deep differences with Pakistan, to make all of South Asia peaceful and prosperous.

            And to improve our practical cooperation, I do believe that the United States' and India's participation in military exercises, which are already strong, should continue to be more regular and complex.  And we must move beyond a focus on individual arms sales to regular cooperation that increases the quantity and the quality of our defense trade.

            I want to stress that the United States is firmly committed to providing the best defense technology possible to India.  We are both leaders in technology development, and we can do incredible work together.  Indeed, I think a close partnership with America will be key to meeting India's own stated names -- aims -- of a modern and effective defense force.

            The Obama administration is hard at work on export control reforms, in cooperation with our Congress, in order to improve our ability to deliver the best technologies even more quickly.  Meanwhile, we look to India to modernize its own regulations in areas like defense procurement and nuclear liability legislation.

            But to realize the full potential of defense trade relations, we need to cut through the bureaucratic red tape on both sides.  For that reason, I've asked my deputy secretary, Ash Carter, to lead an effort at the Pentagon to engage with Indian leaders on a new initiative to streamline our bureaucratic processes and make our defense trade more simple, more responsive and more effective.

            Believe me, I know this is not going to be easy.  This is hard.  But that's the nature of the democratic systems that we share.  Your leaders understand the challenges I face, and we understand the obstacles you face.  But we both need to persevere to support our defense needs and our strategic interests.  Over the long term, I am certain that we will transition our defense trade beyond the buyer-seller relationship to a substantial co-production and eventually high-technology joint research and development.

            During my visit to Asia this week, I have sought to bring closure to some of the past chapters of the United States involvement in this region.  The government of Vietnam opened three new areas to search for our missing in action from the Vietnam War. 

            And here in India, I'm pleased to announce that the Indian government will allow a team to return to India to continue the search for U.S. service members that were lost during World War II.  This is a humanitarian gesture by a government with whom we share so many values.  The ability to return these heroes and the remains of these heroes to their loved ones is something that America deeply, deeply appreciates. 

            America's involvement in Asia has an important past, but it has an even more important future.  India is at the crossroads of Asia.  It is at the crossroads of a new global economy, and it is at the crossroads of regional security.  We, the United States, will stand with India at those crossroads. 

            I began my trip across the Asia-Pacific region eight days ago.  Along the way, I have laid out how the United States military plans to rebalance towards this region.  As I come to the end of my trip, I'm struck by the opportunities for closer cooperation, the strong support throughout this region for the rebalance, and the hope that this cooperation can help forge an even brighter future for this region and for the world.

            The United States and India have built a strong foundation for defense cooperation in this new century.  My country is committed to an even greater role in the Asia-Pacific, extending all the way to the Indian Ocean, and our attention and resources will advance partnerships throughout the region, including in particular a partnership with India.

            Our two nations -- our two nations may not agree on the solution to every challenge that faces us.  And we both face the challenge of political gridlock at home that sometimes prohibits advancing our broader strategic objectives.  But I am sure that we will continue to draw closer -- closer together because we do share the same values, because the same challenges and threats confront both of our countries, and we share the same vision of a just and stable and peaceful regional order.

            Our people, our businesses, our militaries and our governments will all be partners in this effort to serve the dream that guides both of our great democracies, the dream of building a better and more prosperous future for our children.  Together as partners, we will help one another realize this great dream of the 21st century.  Thank you.  (Applause.) 

            MODERATOR:  Thank you, Secretary Panetta, for a very lucid statement.  You have very comprehensively covered almost every area and subject of great interest to us -- (inaudible).  I think -- I think I have not heard such a clear enunciation of policy and -- (inaudible) -- in a long time.

            I wanted to ask you if you would be willing to take a few questions, and in the interest of proper management of time, which is going to be very difficult, I would request, friends, to be to the point, and I know most of you, but it would help if you would please identify yourselves before you ask the questions.  And pointed questions will be most welcome.  Comments, if any, might be of interest also.

            So may I request the gentlemen -- (inaudible) to go first.

            Q:  Mr. Secretary, I congratulate you for a most illuminating -- (inaudible).  The first point I have, 60 percent of your warships are being moved into the Pacific.  Is that enough?  Warships can't operate on their own.  I presume that you are moving ground forces, amphibious forces; we have not heard about that.  But warships can't be all alone; they need ground backing.

            Secondly is command and control.  With the center of gravity moving to the Western Pacific, would Hawaii be a suitable place for command and control?  In World War II, you remember MacArthur operated from Australia.  So as the center of gravity is shifting to the western seaboard of the Pacific, I hope you are taking that into control -- into consideration.  The -- otherwise you need amphibious forces.  No word on that.  I see a Marine Corps general here.  Presumably the Marines will do that.

             (Off mic.)  (Laughter.)

            Q:  I worked with them in World War II.  They're great guys.  I -- the other thing is, better interaction is now required between the U.S.A. and India.  There has not been enough of it.  We should work closely together.  We have common interests.  I'm not really going into details; other people want to speak.  But I will just finish with a quotation from George Canning.  Do you remember George Canning?  The Monroe Doctrine?  (Laughter.)  He said:  I called a new world into existence to redress the balance of the old.  Surely that is what is required now.  Thank you.

            SEC. PANETTA:  Thank you.  Thank you very much for your questions and for that last statement, which I think is very appropriate to the moment.

            Q:  Monroe doctrine was really George Canning.

            SEC. PANETTA:  I know. 

            With regards to the rebalancing issue, to the Pacific, we will -- as we transition, as I stated the other day, we will move to a 60/40 balance in the Pacific, and I listed the ships that would be involved in that transition.  At the same time, we will not only maintain a significant ground force in the Pacific -- we have a large number of forces in the Pacific at the present time, most of them located in Korea.  We have a presence elsewhere.  And our hope is to expand what we have termed a rotational presence throughout the Pacific.  The Marines are locating in a rotational process in Australia.  We've already located some there.  They'll -- that will continue to expand.  We're exploring the rotational -- a rotational presence in the Philippines as well as elsewhere.  In Okinawa, where we just arrived, in an agreement with the Japanese, we will continue to maintain a presence there, but we are moving those troops as well, these are Marines, to Guam.  And we will establish a larger presence in Guam.

            So part and parcel of our focus on the Pacific will involve obviously the kind of forces that you identify, to ensure that we have ground forces in place to be able to enhance that capability. 

            With regards to command and control, our view is that the present PACOM, which operates out of Hawaii, provides the kind of joint force capability that is going to be very important for the Pacific.  Admiral Sam Locklear -- who incidentally commanded the effort in Libya which required a very significant coordination capability.  A number of nations were involved in that effort, and he was remarkable at the way that coordinated effort became successful in returning Libya to the Libyan people.  He brings that same capability to the Pacific. 

            We have -- we believe in joint forces.  We will have a significant Air Force as well as Army and Marine Corps and Navy presence in this region.  But more importantly, he also believes very strongly in working with other countries to improve their capabilities, and that's one of the things that I want to point out to all of you that we are not -- we are not in the process of doing what we did in the Cold War of establishing permanent bases from which we can project our power.  Our approach here is to work with the countries in the region to develop their capabilities so that they can play a larger role in helping to secure and defend their countries in this region.  We think that is a better way to promote peace and prosperity and security in the region. 

            So I think the headquarters at PACOM is very efficient and effective at being able to take charge of this rebalancing effort.  And again, with regards to amphibious forces, we do have a significant number of Marines in the region, and we will continue to maintain those.

            MODERATOR:  Going back to World War II and earlier makes me recall that today, the sixth day of June, that as we discuss this, I think the light forces that were in the process establishing a foothold on the beaches of Normandy -- so that's about the quality of sacrifice (inaudible) at this moment.  

            MR.            :  (Inaudible.)

            Q:  Secretary Panetta and Maresh -- (inaudible) -- I cover strategic affairs for Business Times (inaudible) It's one of our -- (inaudible) -- news -- (inaudible).  And you would be aware that not everyone in India will -- (inaudible) -- support the India and U.S. developing relationship, and their hands get strengthened every time there's some apparent friction between the two sides.

            Now given that the United States has made an arms and defense cooperation one of the tenets and one of the pillars of the relationship, it appears to be a bit surprising that on this ongoing -- on the ongoing FMS sale of Javelin missiles, the United States has cut down India's request to just half.  I don't want to get into individual arms deals, but this seems to be a contradiction of the United States' statement that it wants to work with India.  Could you tell us something about why this was done, especially given that the Javelin is essentially a defensive -- (inaudible)? 

            SEC. PANETTA:  Yeah, no, I'm -- I'd be pleased to address that issue because it's just not true.  We have not cut the sale in half; I don't know where the hell that story came from, but we get used to those stories appearing every now and then in the press.  But I want to assure you that we're committed to a full sale of the Javelin to India.  And we are -- we are working very closely with India not only on that sale, but on other sales as well to try to improve their capabilities.  So I want you to know that, you know, I recognize, as I said in my statement, that as we provide these new technologies that oftentimes we run into the barriers of various laws that have been passed either by our Congress or your congress and that sometimes provide bureaucratic barriers to trying to complete these sales. 

            What my goal is -- in appointing my deputy's -- my deputy secretary to oversee this effort is to try and develop a broader strategy if we can:  What is it that India needs?  What is it that we can be helpful on and therefore be more effective in trying to reduce the barriers and improve the efficiency in those sales?  So that -- that's the approach that I'm hoping to take, and I think it will benefit not only your country but our country as well. 

            MODERATOR:  (Inaudible.)

            Q:  (Inaudible) -- Secretary Panetta, I am a graduate of Fort Leavenworth of the bicentennial era and thank you for those very kind words and for words that encourage strengthening of India-U.S. defense relationship.  You've spoken extensively about Asia-Pacific, and during your presentation, you mentioned about your conversations with our leadership on Afghanistan.

            I want to ask you a question about Afghanistan.  Firstly, what is the U.S title -- the new -- (inaudible) -- about Afghanistan good enough as a policy?  Because we are not clear what that means.

            Secondly, I do believe that the United States as part of this defense cooperation, they seek more intensive Indian efforts inside Afghanistan on what India can do on security cooperation with the Afghan national security forces or in other areas.  Did you, in your conversations with the ministry of defense or other -- the defense minister or the national security adviser, make any specific requests other than what is in the ambit of the India-Afghanistan strategic partnership that you would like Indians to do in Afghanistan for a post-2014 scenario?

            Thank you, Secretary.

            SEC. PANETTA:  Thank you very much for the question.  My goal -- the United States' goal in Afghanistan is to complete the mission.  This isn't about good enough; this is about completing the mission.  And what the mission is, is to have an Afghanistan that can secure and govern itself.  That's what our mission is about, so that Afghanistan never again becomes a safe haven for terrorism and for those that would attack not only our country, but other countries as well.

            So the fundamental mission that we are embarked on is the mission of establishing an Afghanistan that can secure and govern itself, obviously be sovereign, be independent, but more importantly, be stable in its ability to be able to proceed and join the family of nations in this region.

            That's our goal.  We think we are on the way to accomplishing that mission.  General Allen has laid out a plan for transition.  I believe 2011 was a turning point in the Afghan war.  We weakened the Taliban significantly.  The levels of violence went down.  They continue to be down.  Even though we are seeing efforts at trying to increase their attacks, the level of violence still remains down.  We have seen an improvement in the operations of the Afghan army and police.  There are roughly about 346,000 in the Afghan army.  Our goal is to achieve a number of 352,000 and to be able to use the Afghan army in the transition process.

            We are also proceeding with the transition of key areas in Afghanistan to their control and to their governance.  As we speak, 50 percent of the Afghan population has been transitioned into Afghan security and control.  We announced -- President Karzai announced -- a third tranche of areas, to be completed, hopefully, by the end of the summer.  When we do that, 75 percent of the Afghan population will be under their security and control.

            So we are proceeding on a very effective plan that General Allen has laid out and has now been endorsed by the 50 nations of ISAF (International Security Assistance Force).  Both NATO and our partners in Chicago are committed to that transition towards -- and drawdown -- towards the end of 2014.

            In addition, we are -- we have signed a strategic partnership agreement with Afghanistan that will have us maintaining an enduring presence in Afghanistan.  We will continue beyond 2014.  We will continue working on counterterrorism, we'll continue to provide training and assistance to their forces, and we will continue to provide support.  That's a commitment that the president has made and that we have made clear we will maintain in Afghanistan.

            What I asked of the leaders here is that they continue to provide the training that they are providing now.  My understanding is that the training takes place here in India for the -- those that are brought here.  What I urged is that they continue to do that, if possible expand that training in order to improve the efficiency of the Afghan army.  There was nothing said about doing anything in terms of additional military efforts in Afghanistan itself.

            MODERATOR:  (Inaudible.)

            Q:  (Inaudible.)  And my question also pertains to Afghanistan and what you have said -- (inaudible).  Number one, you have many of us sitting here in this room today who do not share your feelings about NATO and ISAF forces for the ability of the Afghan national security forces to take over independent charge of security in Afghanistan after the departure of NATO and ISAF in 2014 so as to prevent the Taliban from taking over the country once again.  Is there a plan B in place already?  And what are your views on the regional peacekeeping and stabilization force but as under the U.S. plan?  Thank you.

            SEC. PANETTA:  No, as always when these things -- when these efforts begin, there are -- there were questions raised about the capability of the Afghans to be able to develop an effective armed forces and an effective police force to maintain security.

            I should say the same questions were raised in Iraq, and a large question’s about whether or not they would be able to develop their capabilities.  They did.  The reason that we were able to withdraw from Iraq is because Iraq was able to secure and defend itself and govern itself.

            Is there -- are there -- are there going to be bumps in the road?  I - as a democracy, you bet.  But that's the nature of democracy.  India goes through bumps in the road.  The United States goes through bumps in the road.  And the fact is that we have established a democracy, a governing system there in which they can defend and secure themselves.  That's our mission.  That's true in Afghanistan as well.

            And what I saw happening in 2011 was that the Afghan army has indeed developed the capability to engage with our forces in operations and to maintain stability in those areas that they're involved with in terms of securing.  When the bombing attacks took place in Kabul, the army and the police were very effective at securing Kabul as a result -- (inaudible).  We've seen that happen now in the southern part of Afghanistan.  We've seen it happen in the other areas that we've transitioned.  The Afghan army is taking control, and they are taking the battle to the enemy.  That's the important point.

            So, we don't have a plan B because we don't think we need a plan B.  This is about plan A, which is to give the Afghans the capability to govern and secure themselves.  And so our goal will be to continue to train and support and assist the Afghan army so that they will be a permanent force that can protect that country in the future.  And the fact that we will be there past 2014 is additional insurance to assure that they continue to train and develop as they must in order to maintain a stable Afghanistan.  I honestly believe that they are developing the capabilities they need in order to do the job.

            MODERATOR:  (Inaudible.)

            Q:  Sir, two questions.  Every time you have a drone attack in Pakistan, or when you kill Osama, the Pakistanis come to you charging that violating their sovereignty.  How do you counter that?  It's one of their terrorist (inaudible) sanctuaries.

            Second on the aircraft carriers.  You've been quoted as saying that you will be stationing about six aircraft carriers, six or about seven in Asia Pacific region, which actually  means that your entire carrier force will be committed to India, oh sorry, the Asia Pacific region because -- (inaudible) -- to go back for replenishment and the other -- (inaudible).  You have always been wanting some foothold in the Indian Ocean.  (Inaudible)  I remember in 1980 I’d gone to Sri Lanka and I heard that you were looking for a justification -- (inaudible).  I reported that and of course Mrs. Gandhi opposed it very strongly.  (Inaudible) -- in the region would still oppose that, and also probably in the same circumstances might. 

            It is reported here on one of the TV stations here that Bangladesh -- (inaudible).  Can you just kindly elaborate how would you deploy, how long?  Thank you.

            SEC. PANETTA:  Sure. 

            Q:  I would also mention that you deployed three aircraft carriers off Pakistan during operation Osama -- (inaudible) – did Pakistanis in some way not interfere with your operation at that time?

            SEC. PANETTA:  They didn’t know about our operation.  (Laughter.)  That was the whole idea.  (Laughter.)

            With regards to the aircraft carriers first, we have 11 aircraft carriers in our fleet.  And we will maintain 11 aircraft carriers.  The carriers -- when we say that 60 percent will move to the region, that means that some of them are going to be based on the Pacific.  So they'll be ported.  They're not all going to be floating around the Pacific.  They're going to be in ports on the Pacific side, probably along the West Coast as well as, obviously, Hawaii, and the other bases in Japan that we currently use.  So we're not looking for additional bases.

            Q: Also Diego Garcia?

            SEC. PANETTA:  Pardon me?

            Q:  Also Diego Garcia?

            SEC. PANETTA:  That's correct.  I mean, those -- the ones we use now are going to supply for the force that we need to maintain here, but we are moving them into the Pacific and porting them on the Pacific side so that if we need to deploy them, they'll be there for that purpose.

            With regards to the drones, again without getting into operational details on that, look, this is about our sovereignty as well, because there were a group of individuals who attacked the United States on 9/11 and killed 3,000 of our citizens.  And we went to war against those who attacked the United States of America. 

            The leadership of those that were involved in planning this attack are located in Pakistan, in the FATA (Federally Administered Tribal Areas).  And we have made clear to the Pakistanis that the United States of America is going to defend ourselves against those that would attack us.  And we have done just that.  We have gone after their leadership, and we have done it effectively, targeting at -- targeting al-Qaida leadership and terrorists.  And very frankly, the terrorists who threaten the United States threaten Pakistan, as well.  This is not just about protecting the United States; it's also about protecting Pakistan.  And we have made very clear that we are going to continue to defend ourselves. 

            Q:  (Inaudible.)  You spoke about the American planes that went out during World War II -- (inaudible).  You brought this up with prime minister.  Can you tell us exactly what you told the prime minister, what the reaction was?

            As far as another issue is concerned, you said that you will stand by India -- (inaudible).  What happens to these three agreements that you are looking at -- (inaudible)?  Did they come up during the discussions, and what was the Indian reaction?  Also, did you mention the evaluation to Mr. Antony today when you met?

            SEC. PANETTA:  First of all, on the 400 pilots, the prime minister was very moving and -- in the discussion, because I think he understands how important it is to be able to do what we can to return the remains of those that we are able to find, for their families.

            We always -- we have a pledge in the military that we leave nobody behind.  And for that reason, we do try to seek the remains of those that were lost in combat.  And I must say that India has been very cooperative in that effort.  We deeply appreciate their cooperation as we try to determine whether or not those -- we can find those remains.

            With regards to -- no, we did not -- we did not discuss the agreements.  I know that my predecessor had raised the issue of the -- with the agreements.  Frankly, my view is that, look, we can continue discussions in those areas. 

            But I believe we have a strong relationship.  We have good cooperation.  I think we can continue to move towards the goals that I outlined in my speech; that even though we might -- you know, we might not always agree with regards to the specific agreements that we're discussing, I don't -- I don't see those as barriers to improving our relationship with India.

            A last point -- I'm sorry.  What was the last point?

            Q:  Haqqani.

            SEC. PANETTA:  On the Haqqanis.  Yes, I did discuss this with the -- with the Indian leadership.  Look, Afghanistan -- the effort to succeed in Afghanistan in many ways is dependent on our ability to eliminate the safe haven in Pakistan.  We can't have a stable Afghanistan if we don't have a stable Pakistan that is dealing with the threats that come across the border.

            And the principal threat that we're confronting right now are the Haqqanis.  The Haqqanis were involved in some recent attacks on our forces.  And that raises great concern that -- we cannot allow those who simply come across the border, attack our -- attack and kill people on our side of the border, to attack our troops, and then escape back into a safe haven -- and so we have urged and we will continue to urge Pakistan to take steps to deal with that safe haven in order to prevent that from happening.

            This -- the ability to achieve the kind of Afghanistan that we want -- one that can secure and govern itself for the future -- it is going to be in large measure dependent on a Pakistan that is able to confront terrorism within their own borders.  That's an important issue that has to be confronted by Pakistan.

            MODERATOR:  (Off mic.)

            Q:  (Inaudible) Just two quick questions.  One is about the -- (inaudible) -- relations between the U.S. and India, how are they going to impact on China -- (inaudible) -- amazing relationship that -- (inaudible)?  Do you think that that -- (inaudible) – have adverse reaction?

            And secondly, on Pakistan and U.S. relations -- (inaudible) -- seem to have sort of dipped quite a bit over the last few weeks and months and years.  So is that going to impact on your pullout from Afghanistan and your fight against terrorism in the region?

            SEC. PANETTA:  On the first point, I believe, in the discussions that I've had here, that I think both India and certainly the United States recognize that it is in our interest to develop a cooperative relationship with China.

            I'm in the process of trying to strengthen our military-to-military relationship with China.  I met with Vice President Xi in Washington and then met with General Liang and discussed ways to try to improve our military-to-military relationship. 

            I believe that it is important that we have strong lines of communication and that we improve the transparency between our countries with regards to what we're seeking to achieve.  I mean, I believe that it is in China's interest -- in China's interest to be able to have a region that is secure and prosperous and peaceful. 

            Now China faces the same threats that we all face in this region.  They face the threat of terrorism.  They face the threat of piracy.  They face the threat of humanitarian and disaster needs that have to be met.  They face the threat that if we don't have free trade in this region, it could impact on everyone's economies.  The ability to use our sea-lanes, the ability to protect maritime rights on our oceans are something that is extremely important to all nations in this region.  And we also face the threat of, frankly, nuclear proliferation from an unstable North Korea -- that's something that is as much a threat to China as it is to others in this region -- and the proliferation of weapons of mass destruction. 

            All of these things are common threats.  They're not -- they're not just threats to the United States.  They're not just threats to India.  They're not just threats to other countries -- Philippines, Indonesia.  They're threats to all of the countries in this region.  And it’s for that reason that we all have to work together in developing a cooperative relationship and developing the capabilities of these countries so that we can all confront these issues -- so that we can all confront these issues. 

            So my goal is to do what I can to improve our mil-to-mil relationship with China.  I think India's goal is to try to improve that relationship as well with China.  I think that's the healthy way to try to approach a better relationship between the powers in the Pacific. 

            You asked one other thing. 

            Q:  (Inaudible) U.S., Pakistan.

            SEC. PANETTA:  Yes.  No, it -- just as India views the relationship with Pakistan as complicated, so do we.  (Laughter.)  And it is.  It's a -- it's a complicated relationship, oftentimes frustrating, oftentimes difficult.  But at the same time, it is a necessary relationship. 

            India shares a border with Pakistan.  It's important that you continue to try to make what progress you can in dealing with Pakistan in trying to resolve your differences.  The same thing is true for the United States.  We are fighting a war in the FATA.  We are fighting a war against terrorism.  We have -- I think what I try to stress with the Pakistanis is that terrorism is just as much a threat to their country as it is for ours.  They have lost many lives in their country as a result of terrorist attacks. 

            They also happen to be a nuclear power, and it's extremely important that we maintain the relationship with them. 

            They had been cooperative oftentimes in the efforts that we've engaged with as far as what we've done in going after those that threaten our country.  They, they have provided some cooperation.  There are other times when, frankly, that cooperation is not there.

            The United States cannot just walk away from that relationship.  We have to continue to try to do what we can, to try to improve what -- you know, areas where we can find some mutual cooperation.  We are now engaged in negotiations to try to see if we can open up the transit centers; it's an important area for us.  We're engaging in negotiations with them to try to see if we can arrive at an agreement that would reopen those areas.

            We've been going through the north right now.  We have the northern transit center.  It, you know, obviously meets our needs.  It's a little more expensive because we do have to go farther in terms of the routes that we're involved with.  We would prefer -- we don't prefer, we would -- we would like to have the additional transit centers through Pakistan as well.

            So we'll continue to negotiate on that.  We'll continue to discuss with them the drone operations.  We'll continue to discuss with them other forms of assistance.  Our goal is to try to do what we can to try to improve the relationship with them.  That is not easy, but it is necessary that we continue that effort.

            MODERATOR:  (Inaudible) --

            Q:  Thank you --

            MODERATOR:  -- with the confusion, and I would like, I mean, to -- have patience and understanding if your turn doesn’t come before -- (inaudible).

            Is there some --

            Q:  Thank you, sir.  Sir, I want to request your views on the timings which you have chosen to announce the change in your strategies, with more -- (inaudible) -- and force being deployed in the Asia-Pacific.  Normally -- (inaudible) -- I'm sure it has been done because you realized after 10, 15 years a change in the strategic environment in the region while you have -- (inaudible) -- philosophy that you are developing stronger relationship with China and you hope to succeed.  Actually, it doesn't appear to be so.  Otherwise, why would you change the -- (inaudible) -- of your forces from the one side to the other?

            And secondly, do you visualize or foresee in the coming years a greater cooperation between Russia and China, becoming again one superpower, or of several of the world organizations -- (inaudible) – America so that you are able to take action -- (inaudible) -- or is it because any other reason?  Thank you, sir.

            SEC. PANETTA:  Thank you for that question.

            Look, as I indicated, we are at a turning point after 10 years of war in the United States.  It's been the longest continuous period that we've been at war.

            And what we now see is that, you know, we have brought the mission in Iraq to a conclusion.  We were in the process of hopefully being able to transition in Afghanistan.  We certainly have impacted on terrorism.  We have significantly impacted the leadership of al-Qaida.  We had a strike yesterday that hit another deputy leader in al-Qaida.  And as you know, we were successful at going after bin Laden.  And we have impacted their ability to have command and control so that they can -- they cannot effectively put together a 9/11-type attack, because of our efforts.  We were successful in the NATO effort in Libya.  So we are in a period where after 10 years of war, you know, hopefully we are -- we are able to turn a corner here.

            At the same time we are facing budget constrictions in the United States.  We are running a high deficit and a high debt in the United States.  And the Congress, in what was called the Budget Control Act, passed a number in defense savings of roughly $487 billion over 10 years that I was asked to reduce the defense budget by.

            So faced – faced with a turning point, faced with the need to find additional savings, but also facing a world in which there are continuing threats -- we continue to face the threat of terrorism, not just in Pakistan but in Yemen and Somalia and North Africa.  We continue to face the instability of North Korea and the potential for some kind of conflict with that country.  We face the same thing with Iran.  We face turmoil in the Middle East.  We're facing cyberattacks now, which has become a whole new arena, a whole new battlefield for the future.

            So you put all of that together, we are continuing to face some major threats in the world.  And so my view was, faced with that, it was important for the United States to sit back and develop a strategy for what our defense strategy ought to be not just now, but into 2020 and beyond.  And so that led us -- myself, the service leaders at the Pentagon, the undersecretaries, the president of the United States -- to sit down and develop the strategies that we felt were important in order to deal with the challenges we face in the future.

            It’s made up of five elements.  The rebalancing is one of those, but there are five elements.  Let me just summarize them.  One, we know we are going to be a smaller force.  We'll be a leaner force.  But we have to be agile, we have to be deployable, we have to be flexible and we have to be on the cutting edge of technology.  That's one.

            Two, we felt it was important to focus on the two areas that represent the biggest problems that we are going to confront in the future.  One is the Pacific -- Pacific region -- because of the threat from North Korea, because of other challenges that we think are going to be extremely important to our future prosperity and security; and secondly, the Middle East.  The Middle East is a -- continues to be an area that we have to maintain a focus on.  So those two major refocuses.

            Three, we have to maintain a presence in the rest of the world as well.  We can't just walk away from that.  And so what we've developed is this innovative and, I think, very creative, approach to rotational  presence, where we can send our forces in, do exercises, develop new partnerships, develop new alliances, work with the capabilities in those countries to develop their capabilities as well.  We'll do that in Latin America; we'll do that in Africa; we'll do that in countries in this region; we'll do that in Europe.

            In addition to that, we felt it was very important to have enough power so that we could confront more than one enemy at a time.  For example, if we have a war in Korea and we face a threat in the Straits of Hormuz, we have to have the ability to address both of those and to win.  And we think we have projected a sufficient force to do that.

            And lastly, we thought it was important to invest, not just to cut back, but to invest in areas for the future.  We need to invest in cyber.  We need to invest in space.  We need to invest in unmanned systems.  We need to invest in special forces.  And we need to invest in the capability to mobilize if we have to, if we are facing a crisis.

            All of those elements I just described are part of the strategy that we've developed for the 21st century.

            MODERATOR:  I'm told we have completely run out of time, so I regret -- (inaudible) -- those who were very anxious -- (inaudible).  But I want to thank you -- (inaudible).  

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