Bush: U.S., India 'Closer Than Ever'

In a speech ending his three-day visit, President Bush declared Friday that the U.S. and India "are closer than ever before." And though some American jobs have been exported to India, Mr. Bush argued that expanded trade more than makes up for it, CBS News White House correspondent Mark Knoller reports.

"The United States will not give into the protectionists and lose these opportunities," Mr. Bush said in a speech at Purana Qila, a historic fort here. "For the sake of workers in both our countries, America will trade with confidence."

Mr. Bush leaves India with a landmark nuclear deal that is the centerpiece of America's new romance with this 1 billion-strong democracy, the world's largest. Later Friday, he was heading to Pakistan for an overnight visit under extraordinary security to a close anti-terror partner struggling with terrorism problems.

Mr. Bush said his nation and India will stand together against terrorists.

"They target democracies because they think we are weak and they think we can be frightened and retreat," Mr. Bush said. "Terrorists have misunderstood our countries. Americans and Indians love our freedom and we will fight to keep it."

Mr. Bush told several hundred people from a brightly lit stage that he's been "dazzled" by India.

"The United States and India, separated by half the globe, are closer than ever before, and the partnership between our free nations has the power to transform the world," he said.

An estimated 80 percent of Indians live on less than $2 a day.

Yet India's middle class has swelled to more than 300 million, a number larger than the entire U.S. population, and India's exploding economy has created millions of jobs. The country's outsourcing industry alone is expected to bring in $22 billion in revenue this fiscal year, much of that generated by U.S. companies.

The president said the United States should see this rapidly growing nation as a land of opportunity instead of a threat. America's best response to globalization is not to erect economic barriers to protect workers, but educate them to make sure they can compete on any stage, Mr. Bush said.

"In my country, some focus only on one aspect of our trade relations with India — outsourcing," he said.

But he also urged India to lift caps on foreign investment, lower tariffs that penalize American agricultural markets and protect its workers and children from abuses.

"India has responsibilities too," he said.

"The president's trade speech was directed at both the U.S. public and Indian politicians," said CBS foreign affairs analyst Pamela Falk, "the message was that outsourcing has downsides but the upside is U.S. retailers and investors are eyeing the India market and that can create new jobs if the ballooning U.S. trade deficit with India decreases."

"Outsourcing is a big problem for the U.S. because Americans lose jobs but the flip side of the coin is that U.S. retailers want to sell to India and as long as the president levels the playing field the agreement can benefit American workers," Falk added. "The message was that trade and investment must be a 2-way street and India needs to remove its barriers to U.S. business."

Mr. Bush spent much of Friday in Hyderabad, one of India's high-tech hubs that's driving economic expansion.

He met with young entrepreneurs at a business school, and visited an agricultural college that is researching biotechnology and ways to increase yields and output. Roughly 65 percent of India's population makes its living off agriculture, but the nation's farm sector lags behind.

In another part of the city that Mr. Bush didn't see, black flags flew above buildings in the predominantly Muslim Charminar quarter, where shops were closed in protest. Several hundred communist and Muslim demonstrators, chanting "Bush hands off India" and "Bush go home," carried posters of Osama bin Laden and burned an effigy of the president.

"We are protesting against George Bush because he is a warmonger," said B.V. Raghavulu, a leader of the Communist Party of India (Marxist).

Once Mr. Bush returns to Washington over the weekend, he must sell skeptics in Congress on the deal he inked with Indian Prime Minister Manmohan Singh for the United States to provide nuclear fuel, reactors and know-how to help India meet its growing demand for power.

As the president headed to Pakistan, Mr. Bush aides said officials were satisfied adequate security precautions were in place. National security adviser Stephen Hadley acknowledged, though, that "this is not a risk-free undertaking."

Just a day before Mr. Bush arrived, a suicide car bomber killed an American diplomat and three others in a strike near the U.S. consulate in the southern port city of Karachi, a hotbed of Islamic militancy hundreds of miles from Islamabad, where the president was staying.

Despite the attack, security and terrorism expert Neil Livingstone says it's safe for the president to be in Pakistan as long as the right precautions are taken.

"It is safe being in a very dangerous country but the keys are speed and unpredictability," Livingstone told CBS News' The Early Show.

"He's going to go into Islamabad for a very short period of time. It's going to be unpredictable. When Clinton went there six years ago there were so many vehicles in the convoy, nobody knew where the president was at all. It was like a show game. They'll do the same thing for President Bush on this."

Mr. Bush has promised to raise with President Gen. Pervez Musharraf the need to do more to hunt down al Qaeda members. Osama bin Laden is believed to be hiding along the porous and mountainous border with Afghanistan.

He also will talk about the need for additional democratic reforms.

But a public show of solidarity for the Pakistani leader, who has survived repeated assassination attempts in part because of his support for the U.S. war on terror, was taking center stage.

"I will meet with President Musharraf to discuss Pakistan's vital cooperation in the war on terror and our efforts to foster economic and political development so that we can reduce the appeal of radical Islam," Mr. Bush said. "I believe that a prosperous, democratic Pakistan will be a steadfast partner for America, a peaceful neighbor for India and a force for freedom and moderation in the Arab world."