In his brainstorming session with business leaders of India and the US and a motley group of 15 select entrepreneurs just ahead of his address at the US-India Business Council summit, President Barack Obama got very excited about the prospects of Mahindra & Mahindra’s electric car, the Reva, and its US-based partner, Curtis.
A White House statement was equivocal: “Through this partnership, Mahindra Reva and Curtis are advancing the commercialisation and adoption of clean vehicles in India and across the globe.”
It’s a new partnership based on innovation, market access and creation of new jobs. What followed was his 25-minute speech to the big industry boys and, at the end of it, an apprehensive India Inc came out charmed.
A larger economic opportunity instead of beating Indian corporations with the outsourcing stick surely came in as a pleasant Diwali gift. “He seemed sincere in his approach,” summed up HDFC Chairman Deepak Parekh who just hours earlier was candid with the US President about what India can teach US in financial reforms.
Ratan Tata, chairman of the Tata group and a key catalyst behind the Indo-US CEOs’ forum, was equally positive: “We are encouraged by Obama’s commitment to India-US business. The lifting of the export restrictions is a good sign forward.”
Reliance Power Chairman Anil Ambani, who signed a Rs 10,000-crore deal with General Electric Chairman Jeff Immelt, said this was a defining moment in Indo-US energy cooperation.
From clean energy, biotech to shale gas opportunities, India Inc has seen newer scope for partnerships and technology exchange going forward. “Obama has outlined the roadmap and it’s time for both India and the US to strive for job creation,” pointed out Mukesh Ambani, chairman and managing director of Reliance Industries.
“He has made it very clear that coexistence has to happen,” said Rajan Mittal, vice-chairman and managing director of Bharti Enterprises and the current chairman of Federation of Indian Chambers of Commerce and Industry. Obama’s indirect mention of opening up the retail sector had special significance for him, being Walmart’s partner in India.
For India’s IT sector, besieged by the outsourcing backlash, Obama’s emphasis on a level playing field couldn’t have come at a better time. But most would still prefer to be cautious or outright practical.
“Indian companies should make an effort to create jobs in the US. We will have to live with the anti-outsourcing rhetoric,” observed Anand Mahindra, vice-chairman and managing director of Mahindra & Mahindra.
“I think overall it was a very positive speech. Especially his comments on how the India-US partnership could be one of the highlights of this century and also about the perception problem that exists at both the sides.”
“While this might help in reducing the anti-rhetoric sentiment, I would like to wait for the next two days and see what comes out of these discussions,” said N Chandrasekaran, CEO and managing director of India’s largest IT services firm, Tata Consultancy Services.
Rahul Bajaj, however set the agenda for the Indian policymakers. “Our partnership with the US should be that between equals. Obama is striving for his companies. I hope our leaders will strive for our corporate. Trade cannot just be a one way street.”
With deals worth $10 billion signed that will generate over 50,000 jobs, the US administration and the 200-member CEO delegates will be a pleased lot. Even before Air Force One landed in Mumbai around noon, the American CEOs laid out the groundwork for the economic engagement.
“He wouldn’t be here if he didn’t think the role and the opportunities for American business [were] strong,” said Terry McGraw, chairman, president and CEO of McGraw-Hill Companies, to the media.
Dave Cote, chairman and CEO of Honeywell, said expansion in India, and the outsourcing of US jobs to Indian call centers, does not mean jobs are not grown in the States. “Economics is not a zero-sum game, we end up growing everywhere,” he said. “We’ve started [adding] as we’ve started growing.”
Paul Hanrahan, the CEO of the global power company AES Corporation, said that overseas expansion means jobs at home. “The way we create jobs is by taking advantage of expanding markets. Where we expand into a new market, there are jobs created in the US. I think we need to keep that in mind — that investment overseas is also something that benefits US companies.”
But one CEO warned that America needs a long-term job growth strategy. “Jobs don’t happen because you want them,” said Indra Nooyi, chairman and CEO of PepsiCo. She said she hopes for a long-term business plan for the country, “to keep a base of employment going through the future, [to] figure out how we prepare a long term plan for the country so we can grow the country’s manufacturing base in a very deliberate way.”
In the end, this trip for the president and American companies therefore is to expand into new markets, creating jobs everywhere. “Hundreds of business people are here looking for those opportunities,” said McGraw.
