When I was living in India last year, I met a handful of people in the ISRO and asked them about this. I have been very impressed by India's space efforts in the past -- with only 15,000 employees and $300 million, they have developed an entire family of launch vehicles and satellites, including such difficult items as resartable LOX/H20 upper stages and so forth. An altogether frugal and impressive program. My hope was that the (not insignificant) rivallry that they feel with India would spill over into their space activities, and that they would commence a human space program in response.
Unfortunately, the folks I had dinner with all felt that this was unlikely. They said that there hadn't been any real steps taken in the direction of human spaceflight, and that India's only real concern right now was developing an indigenous communications and remote-sensing capability, and the launch vehicles to support it. They all felt that no matter what China did, a space race like the US-USSR one was very unlikely.
As for what Prime Minister Vajpayee said... well, he's always been a bit of a kook, and I wouldn't put too much stock in it.
I'd really like to be wrong about this, though. If India does decide to jump into a space race, I have no doubt that they'd do it tremendously well, to the benefit of all of us.
Cheers,
Nathan.
Space/Science » in reply to India plans Moon landing
Interesting, but doubtful.
