US Under Sec (Commerce) urges lifting of all ownership caps

Mumbai, Nov 29 (UNI) The US Under Secretary of Commerce, Franklin L Lavin, today urged the Indian Government to lift all kinds of ownership caps and fully open the Indian economy to international participation for ushering in greater efficiencies, which in turn would ultimately benefit Indian consumers.

Addressing the inaugural session of the US-Indo Business Summit here, Mr Lavin said ''Eliminating foreign equity caps in the financial services, banking and insurance sectors and allowing US companies to compete in the pension sector, will let investment flow where it is needed the most.'' More open markets will lower borrowing and premium costs, increase the volume and effectiveness of capital allocation and increase the product offerings Indian consumers deserve, Mr Lavino who is leading a 238-member business delegation from his country to India, explained.

As of 2005, India had received USD 45 billion in Foreign Direct Investments (FDI) with USD 8 billion of that from the US alone.

Compare that to Singapore, which has received more than USD 186 billion in FDI, with USD 48 billion from the US alone, he pointed out.

Lamenting the steep Indian tariffs, he said that India's tariffs are still the highest compared to the rest of the world. India's tariffs average a high of 36 per cent and in some cases are more than 100 per cent in comparison to the rest of the world, he rued.

The creation and enforcement of laws that protects the rights of patent and copyright holders will encourage Indian entrepreneurship and creativity by protecting innovations and brands. Robust intellectual property rights protection will encourage investment and give India an edge in environments such as healthcare, energy and aerospace, he said.

Some of the other areas suggested by him to improve US-Indo economic relationship include allowing more US investments in broadcasting and telecoms, ensuring common sense postal reform to allow continued competition from express delivery companies like UPS and FedEx and eliminating non-tariff barriers to trade in areas such as medical devices.

US Ambassador to India David C Mulford said, ''India Inc, instead of spending it's entrepreneurial energy exploiting or avoiding the license raj stranglehold of yesteryear, is rechanneling it's innovative spirit into the development of sophisticated technologies, new products, new markets, and new partners, which drive India's economic growth.'' UNI KKD WD AW1540