India's diaspora policy over the last 15 years has proved to be a bag of mixed blessings for the foreign policy establishment. With India's strong economic growth and greater integration with the global economy, the rich Indian diaspora, concentrated in the developed world, has emerged as a powerful agent of investment and economic development in India. Buoyed by the prospect of overseas Indian investment, India's Prime Minister, Manmohan Singh called for greater participation of Persons of Indian Origin (PIOs) in India's social development in fields such as health care, education, and infrastructure during the 6th Pravasi Bharatiya Divas meetings (7-9 January 2008) in New Delhi. However, there is a negative side of the story as well. A large number of PIOs, living in the developing world (Fiji and Malaysia, for example), are economically poor, deprived of social rights, and politically marginalized. The economic and political rights of ethnic Indians in these societies have witnessed both moderate and violent contestations from native sociopolitical agencies. Many within the large ethnic Indian community in Malaysia fall into this category.

Such a situation has brought forth two important moral and political challenges for the Indian government. First, if India can ask for investment from overseas Indians, should it not also help their social and economic development especially when they are living in politically and/or economically challenging environments? The challenges facing ethnic Indians in Fiji and Malaysia serve as bona fide examples in this regard. Second, in what ways can India help the cause of ethnic Indians without being misunderstood as interfering in the domestic affairs of the host country and without jeopardizing its relationship with the host country? The first issue has been settled with the Indian government taking strong exception to the political discrimination against ethnic Indians in Fiji and Malaysia. India's External Affairs Minister, Pranab Mukherjee, expressed concern over the political and economic conditions of ethnic Indians in Malaysia in the Parliament. Ethnic Indians have a role to play in India's efforts toward global integration and national development.

Now the question arises as to what are the policies that the Indian government can adopt to help improve the conditions of poor ethnic Indians. The issues discussed and suggestions offered here are confined to the case of ethnic Indians in Malaysia only. India's 'balancing act' and 'case-by-case' approaches have not been able to address any of the problems facing ethnic Indians in Malaysia. These approaches are to be seen mainly as 'safe exit' strategies aimed primarily at maintaining goodwill at both ends rather than a concerted policy framework for the social and economic development of the Malaysian Indians.

The Indian government needs to adopt a three-pronged policy framework, which can facilitate economic empowerment of Malaysian Indians and help in making the ceremonial PBD meetings more meaningful. First, the politics of rhetoric should be replaced by a conscious effort on the part of the Indian government towards empowering the Malaysian Indians. While both Tamil Nadu Chief Minister and India's External Affairs Minister expressed concerns over the condition of Indians in Malaysia, there was no policy initiative announced by the Minister for Overseas Indians in the three-day PBD meetings to offer assistance to poor ethnic Indians in Malaysia. The long-standing demands of the Malaysian Indians as enumerated in the High Level Committee Report on Indian Diaspora (December 2001) need to be fulfilled on a priority basis.

Second, the Indian government can initiate various capacity-building programme aimed to develop the human resources among ethnic Indians in Malaysia. While there are a few Tamil schools, there are fewer Tamil teachers available in Malaysia. The Indian government can persuade the Malaysian government to outsource Tamil teachers from India. Such proposals have been made in the past but never seriously pursued. Moreover, along the model of India's capacity-building initiatives in the CLMV countries, the Indian government can open up Centres for English Language Training and Entrepreneur Development Centres in Malaysia. The proposed PIO University in India should be set up on an urgent basis which could offer technical education to deserving Malaysian Indian students. These initiatives will enable Malaysian Indians to better utilize resources available both in Malaysia and India.

Finally, the Indian government can facilitate creation of an Indian Diaspora corpus fund, which could generate resources for the implementation of some of the initiatives proposed above. Some steps have already been taken in this regard. During the 6th PBD meetings, it was agreed that a corpus fund would be created out of the contributions from the rich Indian diaspora, to manage the administrative expenses of the proposed PIO University. The scope of the funding can be extended further to run some of the capacity-building programme for the benefit of poor ethnic Indians. These initiatives will also draw both financial and administrative support from the Malaysian government, which has already expressed its approval for such initiatives.

Through these initiatives, the Indian government can help promote the cause of poor ethnic Indians, facilitate greater integration among diverse Indian diaspora scattered all over the world, and generate goodwill among them toward their mother country. The Malaysian government's suggestion of opening up branches of Indian educational institutions in Malaysia with reservations for ethnic Indians and its willingness towards allowing such Indian initiatives is a step in the right direction. These initiatives will also strengthen the bilateral relationship between India and Malaysia.