ABOUT 25,000 girls a year are victims of sexual trafficking in the state of Orissa, in India. The difference between this form of trafficking and others, such as into bonded labour, is that when the girls are working as prostitutes they do not, at that point, see themselves as victims.

So a remarkable woman, Sunitha Krishnan, trains ex-prostitutes to get alongside girls still working in the trade in order gradually to wean them away. On a recent visit to her organisation, Prajwala, a group of MPs and peers saw some of these girls engaged in welding, carpentry, and printing - on the way to making a new life for themselves. Some of them had been trafficked as young as three years old. Many had AIDS. Sadly, one third died before they left school.

Krisnan has been beaten up 14 times, and her injuries include a broken arm and permanent deafness in one ear. The organised gangs opposing her have been able to block her applications for planning permission for a permanent site for her work. When I asked her what kept her going, she said: "Anger, and my spirituality."

I share that anger, together with near-despair - and sheer admiration for her and people like her trying to do something. Despair, first, at the sheer scale of India's problems: 400 million people are still living on less than 80p a day.

This is one third of the world's poor and more than in the whole of Africa. The average income is one third of that earned by someone in China. Only one in four in the state of Bihar has access to a lavatory. Since 1996, a quarter of a million farmers have committed suicide. This is in a country that graduates two million students a year, and provides two-thirds of the world's software engineers.

My second reason for despair is the politics. Good people on the ground can do little without political support. With 1.2 billion people, India is the largest democracy in the world, and the fact that it works at all is a significant achievement.

But does the political will exist to translate good work done locally over the whole country? Although India has exemplary laws against discrimination, and in favour of positive action on behalf of the disadvantaged groups such as the Dalits, enforcement is poor.

When I asked a member of Lok Sabha (the lower chamber) about this, he immediately launched into a defence of India's human-rights record. If even a member of the Communist Party, which he was, would not acknowledge the issue, what hope is there?

One problem is that those at national level are cut off from the realities of life as lived by the vast majority. Apart from a rapid visit once every few years at election time, they probably don't go into the villages or urban slums.

An interesting contrast was provided by the northern MPs in our group. When they returned to the hotel in the evening after a busy day visiting projects, they had literally hundreds of emails from constituents about welfare and immigration.

Against the despair, I would put the wonderful work being done by a variety of aid agencies, including DfID, which continues to support India, despite criticism from some quarters.

A group of young Dalit girls travelled 12 hours to meet us. A small grant enables them to stay on at school, and the result is hugely encouraging. We were all struck by their dignity and confidence. Coming from a background of abject poverty and discrimination, where most of their fathers were day labourers, they now thought in terms of being teachers or doctors.

Another meeting that lifted our spirits was with women from self-help groups in the urban slums. Each group elected a woman to represent them, who, in turn, elected women to represent larger groupings. These groups saved and invested money together, starting small businesses. The mutual support and strength that came from these groups was getting real results.

Encouraging, too, were the business ventures started by Indians returning to their own country. One young couple who had been working in London decided that they wanted to put something back into their home state of Orissa; so they started a milk-processing plant.

As the average farmer has only one cow, this involves a widespread network of collecting-points in each village, complete with testing apparatus and a quick cooling system. They now work with 15,000 farmers, and aim to involve more than 100,000.

Another high-powered couple, who had worked in America, had returned to Hyderabad, where they now researched and produced new vaccines for the Indian government.

ONE man I spoke to highlighted three great social ills in India, which he regarded as far worse than anywhere in the world: discrimination, foeticide, and the treatment of women. The words of Gramsci came to the minds of both of us: "Pessimism of the intellect, optimism of the will."

For me, the optimism comes from the resilience and endurance of the Indian people, together with their extraordinary capacity, despite everything, to find joy in life.

But the balance between despair and hope is a very fine one. Indeed, that is the theme of the great novel by Rohinton Mistry A Fine Balance, which depicts the heart-breaking political and social evils of India during the decade 1975-85. Some improvements have been made since then but, sadly, the India described there is still all too recognisable.

The Rt Revd Lord Harries of Pentregarth is a former Bishop of Oxford and an Honorary Professor of Theology at King's College, London. He is the author of Faith in Politics? (DLT).