US excited by India trade, despite WTO woes
Washington, Apr 25: The United States expects economic ties with India to grow rapidly in the new few years, despite frustration that New Delhi has not been more helpful in world trade talks, a top US trade official said today.
A landmark civil nuclear agreement, which still must be approved by Congress, ''is a crucial component in moving the relationship to the next level,'' Deputy US Trade Representative Karan Bhatia said in an interview.
Although the deal, which provides India with US nuclear technology -- including reactors and nuclear fuels -- is controversial with some members of Congress, Bhatia said he expected it to be approved.
''I think there is sufficient momentum behind this. I think everybody recognises the important role that this deal plays in our relationship with India,'' he said.
US-India trade totaled about 26.76 billion dollar last year, less than one-tenth of the 285.3 billion dollar in trade between the United States and China.
''We should have a very substantial economic relationship with India and although we're getting there, we're not there yet,'' Bhatia said. ''We need to do more to grow the relationship.'' The United States and India recently set a goal of doubling trade within three years and conditions are ripe for investment between the two countries ''to take off,'' he added.
Major Indian companies like the Tata conglomerate and drug manufacturer Ranbaxy already have invested the US market and many small and medium-sized Indian companies are following their lead, Bhatia said.
''You're also seeing American companies obviously look at India as an attractive investment opportunity. You're looking at 1.1 billion people, a fast-growing middle class.''
The nuclear deal opens the door for US companies to help India meet its fast-growing energy needs and should have positive spillover effects in other sectors.
''I ... think you're going to see it build a level of confidence in high-technology trade that will lead to greater US exports and investment there,'' he said.
At the same time, Bhatia said USTR was aware that many American companies have liability and insurance concerns about doing business in India after the 1984 gas leak at a Union Carbide plant in Bhopal, which killed an estimated 3,800 people and disabled thousands more.
''We've raised those concerns with the Indians. I'm hoping that they will be addressed to the satisfaction of our companies ...,'' he said. ''At the end of the day, India has worked very hard for this deal and ... I would assume is not going to want their own domestic corporate laws to stand in the way of them actually benefiting meaningfully.''
But many US business leaders believe India is playing a negative role in world trade talks by insisting that developing nations be allowed to block imports, while developed countries open their markets to more foreign goods.
Bhatia said he agreed that India, along with many other leading developing countries, needs to ''be more forthcoming in the current round.'' While it is understandable New Delhi is worried about hundreds of millions of farmers who depend upon agriculture, a new world trade pact would open new markets for Indian service companies and manufacturers, he said.