Violence runs through this 'stable' India, built on poverty and injustice

In the past five years bomb attacks claimed by Islamist groups have killed hundreds across the Indian cities of Mumbai, Delhi, Jaipur, Varanasi, Bangalore, Hyderabad and Ahmedabad. An Indian Muslim was even involved in the failed assault on Glasgow airport in July last year. Yet George Bush reportedly introduced Manmohan Singh to his wife, Laura, as "the prime minister of India, a democracy which does not have a single al-Qaida member in a population of 150 million Muslims".

To be fair to Bush, he was only repeating a cliche deployed by Indian politicians and American pundits such as Thomas Friedman to promote India as a squeaky-clean ally of the United States. However, Fareed Zakaria, the Indian-born Muslim editor of Newsweek International, ought to know better. In his new book, The Post-American World, he describes India as a "powerful package" and claims it has been "peaceful, stable, and prosperous" since 1997 - a decade in which India and Pakistan came close to nuclear war, tens of thousands of Indian farmers took their own lives, Maoist insurgencies erupted across large parts of the country,and Hindu nationalists in Gujarat murdered more than 2,000 Muslims.

Apparently, no inconvenient truths are allowed to mar what Foreign Affairs, the foreign policy journal of America's elite, has declared a "roaring capitalist success story". Add Bollywood's singing and dancing stars, beauty queens and Booker prize-winning writers to the Tatas, the Mittals and the IT tycoons, and the picture of Indian confidence, vigour and felicity is complete.

The passive consumer of this image, already puzzled by recurring reports of explosions in Indian cities, may be startled to learn from the National Counterterrorism Centre (NCTC) in Washington that the death toll from terrorist attacks in India between January 2004 and March 2007 was 3,674, second only to that in Iraq. (In the same period, 1,000 died as a result of such attacks in Pakistan, the "most dangerous place on earth" according to the Economist, Newsweek and other vendors of geopolitical insight.)

To put it in plain language - which the NCTC is unlikely to use - India is host to some of the fiercest conflicts in the world. Since 1989 more than 80,000 have died in insurgencies in Kashmir and the northeasternstates.

Manmohan Singh himself has called the Maoist insurgency centred on the state of Chhattisgarh the biggest internal security threat to India since independence. The Maoists, however, are confined to rural areas; their bold tactics haven't rattled Indian middle-class confidence in recent years as much as the bomb attacks in major cities have.

Politicians and the media routinely blame Pakistan for terrorist violence in India. It is likely that the ISI, Pakistan's intelligence agency, was involved in the bombings two weeks ago in Ahmedabad and Bangalore, which killed 46 people. But their scale and audacity also hints that the perpetrators have support networks within India.

The Indian elite's obsession with the "foreign hand" obscures the fact that the roots of some of the violence lie in the previous two decades of traumatic political and economic change, particularly the rise of Hindu nationalism, and the related growth of ruthlessness towards those left behind by India's expanding economy.

In 2006 a commission appointed by the government revealed that Muslims in India are worse educated and less likely to find employment than low-caste Hindus. Muslim isolation and despair is compounded by what B Raman, a hawkish security analyst, was moved after the most recent attacks to describe as the "inherent unfairness of the Indian criminal justice system".

To take one example, the names of the politicians, businessmen, officials and policemen who colluded in the anti-Muslim pogrom in Gujarat in 2002 are widely known. Some of them were caught on video, in a sting carried out last year by the weekly magazine Tehelka, proudly recalling how they murdered and raped Muslims. But, as Amnesty International pointed out in a recent report, justice continues to evade most victims and survivors of the violence. Tens of thousands still languish in refugee camps, too afraid to return to their homes.

In an article I wrote for the New York Times in 2003 I underlined the likely perils if the depressed and alienated minority of Muslims were to abandon their much-tested faith in the Indian political and legal system. Predictably Hindu nationalists, most of them resident in the UK and US, inundated my email inbox, accusing me of showing India in a bad light.

It is now clear that a tiny but militantly disaffected minority of Indian Muslims has begun to heed the international pied pipers of jihad. Furthermore, there is no effective defence against their malevolence. Conventional counter-terrorism strategies - increased police presence or greater surveillance - don't work in India's large, densely populated cities. Nor do draconian laws such as the Prevention of Terrorist Activities Act, which allowed police to hold suspects without charge for six months and was repealed in 2004.

Gung-ho members of the middle class clamour for Israeli-style retaliation against jihadi training camps in Pakistan. But India can "do a Lebanon" only by risking nuclear war with its neighbour; and Indian intelligence agencies are too inept to imitate Mossad's policy of targeted killings, which have reaped for Israel an endless supply of dedicated and resourceful enemies.

As we now know, the promoters of pre-emptive strikes and rendition have proved to be the most effective recruiting agents for jihad. In that sense the Indian government's inability to raise the ante, to pursue an endless war on terror or to order 150 million of its poorest citizens to reform their religion is a good thing. For it helps to maintain a necessary focus on terrorism as another symptom of a wider crisis that will be alleviated not so much by better policing, intelligence gathering or consultation with mullahs as by confronting socioeconomic frustrations and political grievances.

The absence of "tough" retaliation also leaves the jihadi terrorists incapable of dealing more than a few glancing blows to the Indian state. Certainly, a hysterical response of the kind that followed the 7/7 attacks in London - a crackdown on civil liberties and demonisation of Islam - would in India only have accelerated the radicalisation of the Muslim minority.

It is true that nihilist terrorism has no greater adversary than people who refuse to be terrorised or provoked. There have been remarkably few instances of retaliation against Muslims in the wake of terror attacks. In Mumbai, where nearly 200 people were killed by bomb explosions on commuter trains in 2006, normal life resumed even more quickly than in London in July 2005.

But the resilience of India's poor, who have no option but to get on with their lives, should not be taken for granted, or used to peddle India as a stable, business-friendly country. For their stoicism in the face of terror also expresses the bitter wisdom of the weak: that violence is far from being an aberration in the inequitable world our political and business elites have made.

Pankaj Mishra, the author of Temptations of the West: How to Be Modern in India, Pakistan and Beyond.