Indian economy should open up more: US official

Washington, Jul 11: Despite India enjoying tremendous economic growth as a result of its reform policies, it has not yet taken further steps towards ''more economic openness'' in bilateral trade ties with the United States or in its approach to the World Trade Organization's (WTO) Doha round of negotiations, says US Assistant Trade Representative Douglas Hartwick.

Addressing the Heritage Foundation, a conservative think tank, here yesterday, Hartwick noted that US-India trade was growing at an annual rate of 30 percent and ''what we're beginning to see is they're reaping the benefits of a steady, sustained path of economic reform that the Indians have chosen for themselves''.

He said the greatest progress has come in areas where tariffs have been removed and regulations dismantled, but regretted that India has not yet shown any flexibility in opening up its agricultural sector or allowing foreign investment in retail operations or insurance.

India has been even less forthcoming in multilateral discussions with the WTO, Hartwick said.

''The United States' efforts to open market access across the board with all of our trading partners in the context of the WTO has run into the reluctance of India to open up its agriculture and perhaps in other areas of services,'' he said.

As a leader of the G-20 group of developing nations, India has been at the forefront of efforts to protect the developing countries' agricultural sectors from liberalization under the WTO negotiations.

Even while acknowledging the political pressure within India to protect the agricultural sector given its size and relative inefficiency, Hartwick said India should not be afraid of expanding its economic reforms to that sector of the economy.

''Economic reform is not meant to be punishing those who are disadvantaged but in fact create economic growth trajectories that allow many of these to be better off over the next several years.'' Heritage Foundation trade analyst Daniella Markheim echoed Hartwick. ''Freer trade would promote greater efficiency and productivity, helping to advance longer-term economic growth and helping to allocate the wealth and jobs generated from that growth across more of India's workers, lessening the pervasiveness of poverty,'' she said.

Hartwick said in the context of bilateral trade discussions, India has urged the United States to show greater flexibility in issuing non-immigrant visas to facilitate business travel.

This remains a sensitive issue in the United States, he added.

UNI