India must catch up with China which does trade five times that with USA – Barack Obama at Indo US Biz Summit
By TN Ashok / Economic Editor
New Delhi, Jan 27 : US President Barack Obama exhorted India to take Indo US business and trade investment relations to a new high comparable with what it was doing with China as tremendous opportunities for expansion existed. While trade and investment with India was over US $ 100 billion, the same was over US $ 560 billion with China on an annual basis.
Obama said “We do about $100 billion a year in trade with India, which is a great improvement since I took office; Obama however noted that we do about $560 billion a year with China. “That gives you some sense of the potential both for the kind of growth that India might unleash, and the potential for greater trade between our two countries. So I think everybody here will agree, we’ve got to do better. I know Prime Minister Modi agrees, and he just shared his expansive vision on this issue with you.
Obama told the Indo US Business Council meeting at the Taj Mahal hotel here that on his part he was announcing additional steps — a series of U.S. initiatives that will generate more than $4 billion in trade and investment with India and support thousands of jobs in both of our countries.
“Specifically, over the next two years, our Export-Import Bank will commit up to $1 billion in financing to support “Made-in-America” exports to India. And OPIC will support lending to small and medium businesses across India that we anticipate will ultimately result in more than $1 billion in loans in underserved rural and urban markets. And our U.S. Trade and Development Agency will aim to leverage nearly $2 billion in investments in renewable energy in India, “ Obama said to applause from a distinguished gathering of India’s top industrialists and CEO’s of prominent companies as well as top CEO”s of American companies.
Taking Prime Minister Modi on what he frequently referred to as “improving ease of doing business”, Obama said we have to keep working to make it easier to do business together in both our countries. “ For the past two years, business leaders like you voted America as the best place in the world to invest. I’m pretty happy about that. We’re going to keep working through what we’ve called SelectUSA, an initiative to cut red tape, streamline regulations so that even more companies like yours — from India and around the world — come and set up shop in America, “ Obama said.
Referring to India , Obama said, as the Prime Minister just discussed, there are still too many barriers — hoops to jump through, bureaucratic restrictions — that make it hard to start a business, or to export, to import, to close a deal, deliver on a deal. “ We hear this consistently from business leaders like you. And right before coming out here, the Prime Minister and I joined some of you in a roundtable where you described some of the challenges that you face.”
Sounding a note of optimism to US businessmen, Obama said Prime Minister Modi had initiated reforms that would help overcome some of these barriers, including a new government committee dedicated to fast-tracking American investments. And we enthusiastically support these efforts. “ We need to be incentivizing trade and investment, not stifling it. “, he said.
We need to be fostering a business environment that’s more transparent and more consistent, and more predictable, the US President pointed out.
Obama described his 2nd visit to India as President of USA as one rich with symbolism, and one of great substance. “ We’re advancing the vision that I laid out on my last visit — India and the United States as true global partners. And a core element of this vision is greater trade, investment and economic partnership. Our two business communities — all of you — have been some of the strongest champions for a closer relationship, and I want to thank you for your commitment”, he said.
Obama oserved that in a globalized world, the fortunes of the United States and the fortunes of India were inextricably linked. “ We can grow and we can prosper together, and establish a set of global norms in terms of how business is done that will benefit not just our two countries, but people around the world. And when I spoke to you on my last visit, I pledged to broaden and deepen our economic ties — and that’s what we’ve done. “
The US President pointed out that trade between India and the USA had increased by 60 percent. Today, it’s nearly $100 billion a year — which is a record high. And this is a win-win.
It’s a win for America and our workers, Obama said as , U.S. exports to India were up nearly 35 percent, and those exports support about 170,000 well-paying American jobs. At the same time, Indian investment in our country is growing, as well. And those Indian investments are supporting jobs across America. We’ve got high-tech jobs in upstate New York, manufacturing jobs in North Carolina, engineering jobs in places like Michigan and Ohio.
Obama said our growing trade is a win for India, because increased U.S. exports and investment here mean more American-made planes flying passengers on India’s airlines all over the world, more American-made turbines generating the energy India needs to continue with its growth, more American-made machinery upgrading India’s infrastructure.
And because we’ve made it easier for foreign companies to sell and invest in America, India’s exports to the United States are also increasing — and that means more jobs and opportunities here in India, Obama declared saying in the end, that’s the purpose of trade and investment — to deliver a better life for our people. And both Indian and American workers are and can benefit even more in the future from close ties between our two countries.
“ So we’re moving in the right direction, Obama said adding that the U.S.-India economic relationship is also defined by so much untapped potential. Of all America’s imports from the world, about 2 percent come from India. Of all of America’s exports to the world, just over 1 percent go to India — 1 percent to over a billion people.
Obama listed the number of concrete steps forward on his 2nd visit to India. New breakthroughs will help us overcome some key issues and move us toward fully implementing our civil-nuclear agreement. We’ve taken another big step forward in our defense cooperation with a new technology and trade initiative so that Indian and American companies can jointly develop and produce new defense technologies.
We’ve agreed to resume discussions that would move us toward a bilateral investment treaty that would facilitate Indian businesses making more investments in the United States, and U.S. businesses making more investments, Obama pointed out saying that at the same time entrepreneurs and innovators need to feel confident that their hard work and, in particular, their intellectual property will be protected.
On the goal of developing new technologies together that could help India leap forward, Obama said US
companies represented here were ready to partner with Indian firms to build next-generation trains that run on cleaner energy and to lay the new railways India needs for the future. They’re ready to help upgrade roads and ports and airports to make it easier for Indians to connect with each other and with the world. They’re ready to install broadband connections to give communities reliable access to the Internet and to help build the smart cities that Prime Minister Modi has called for.
Obama said that on this visit, we’ve paved the way to mobilize American expertise and investment in three of these cities. And we’ll send two trade missions to India this year focused specifically on upgrading India’s infrastructure. And finally — and I know this is something that is of great concern to Prime Minister Modi and is of great concern to me and the United States — we need to make sure that economic growth in both our countries is inclusive and sustained.
India’s astonishing growth in recent decades, Obama observed had lifted countless millions out of poverty and created one of the world’s largest middle classes. It can’t just be measured by GDP. It can’t just be measured by the bottom line on a balance sheet. Growth, in the end, has to make people’s lives better in real, tangible and lasting ways, he said.