Mathai, on his first bilateral visit to the US in his capacity as the Foreign Secretary, expressed hope that the economic challenges in the US would not lead to protectionism and concerns of the Indian IT industry will be addressed.
He is believed to have raised the issue in his meeting with the officials of Commerce Department on Monday. "We do hope the current economic challenges in the US would not lead to protectionism and that concerns of Indian IT industry will be addressed quickly," Mathai said in his address to the Centre for Strategic and International Studies.
NASSCOM estimates that Indian industry employs over 100,000 in the US up from 20,000 six years ago, he said adding it supports 200,000 other jobs, including indirect ones, apart from enhancing the competitiveness of some the US industries.
"Most Indian companies are setting up development centres. Indian IT industry contributed USD 15 billion in taxes over the last five years. This success story should not be set back by stringent visa regulations which act as a non-tariff barrier," he said.
"According to a back of envelope calculation – Indians paid over USD 200 million in visa fees. Perhaps USD 30-50 million has been taken from young aspiring Indians working in businesses whose US visas were rejected. The pink slip has become a greenback!" Mathai said.
"It needs reiteration that the targets of these discriminatory actions are precisely those who have contributed intellectually to the climate of reform in India, and who have been votaries of strong India-US relations," said the Foreign Secretary.
As the two economic ties deepen, India and the US will obviously have a growing range of policy and regulatory concerns with each other, he noted.
"But, we have in place an elaborate set of bilateral mechanisms to address them. While we should expeditiously conclude a Bilateral Investment Treaty, we must look beyond it, too," he said, noting that the US is the only advanced economy in the world with which India has not concluded or is pursuing a Comprehensive Economic Partnership Agreement.
"So, we should not only focus on expanding trade and investment, but also use the power of innovation to make our economies global leaders in the 21st century, and at the same time, address the needs of the poorest sections of the population in the world and find solutions to the challenges of clean energy, food security, health, education," Mathai said.
India and the United States, he said, can and must strengthen their economic partnership.
The flow of trade in goods and services, and investments in both directions has grown several times in the past two decades increasing to USD 40 billion of US imports, both goods and services.
"Indian businesses have invested perhaps USD 26 billion in the US in five years. All this has created new job openings in the US. It is also natural that as the Indian economy continues to grow and modernize, as the US economy recovers its momentum and as the global economic situation improves, our trade and investment relations will surge to higher levels," he said.
"India’s planned infrastructure spending of USD 1 trillion in the next five years; the modernisation of our agriculture sector; our shift to clean energy; implementation of the civil nuclear agreement; burgeoning defence trade; cooperation in higher education; and, the growing ability of the Indian companies to compete in the US market could take our economic ties to an entirely new level," he said.
Mathai said New Delhi remains committed to pursuing economic reforms in India in their broadest sense.
"The debate in India is not a question only about economic growth, efficiency and openness, but about equity, empowerment and opportunities for a large section of the population, which feels left behind during the country's two decades of rapid economic growth," he said.