A number of issues are to be discussed by Indian and US officials during the visit of US commerce secretary Penny Pritzker to India, beginning June 30.
Issues expected to dominate the talks include curbs on mobility of high-skilled workers, especially in view of increased cases of rejection of visas applied by IT professionals, state-wide restrictions on off-shoring IT projects by US government departments, enforcements in pharmaceutical business, “Buy American” norms and the double avoidance treaty. Further, irritants that have come up in the IPR such as incremental innovation and data protections would also figure during proposed talks.
A Federation of Indian Chambers of Commerce & Industry (FICCI) spokesman told Business Standard that Indian companies are concerned about some specific restrictions including 50-50 requirement, higher wages, increased audits, additional recruitment and reporting requirements and added scrutiny by US agencies. They have flagged off many US state governments increasingly pushing for legislation aimed at creating more local jobs, as they cope with high unemployment rates.
The Indo-American Chamber of Commerce & Industry’s national president Chella Srinivasan suggested that avoidance of double taxation in the social security tax needs urgent attention by the US administration. Around $500–$700 million contributed mainly by the H1B visa holders of India are lying unused in the US. This apart, he pressed for re-energising the Indo-US Business Forum to resolve business to business problems.
A Confederation of Indian Industry (CII) spokesman said there has been a slowdown in India-US bilateral trade and Pritzker’s visit is expected to pave the way to resume dialogue on various bilateral initiatives, which has been stalled for a while now. The discussion will focus on the United States and India’s economic relationship and opportunities for expanding trade and investment. Further, the Centre and industry bodies are likely to take up the issues of Indian generic pharma industry in the United States. Indian drug manufacturing facilities have accounted for the highest number of enforcements from the US Food and Drugs Administration and, so far this year, about 20 drug manufacturing factories across India were barred from supplying medicines to the US.
According to CII and FICCI, the “Buy American” sentiment has raised concerns among Indian industry. The American Recovery and Reinvestment Act or ARRA, enacted by the 111th US Congress in February 2009, requires that all the iron and steel, to be used in infrastructure projects, be produced in America. Besides, the ARRA also requires that uniforms which are to be used by Transportation Security Administration employees managing security at all American airports, be made in America.
Pritzker will arrive in Mumbai on July 30 and hold talks throughout the day. Only July 31, she will be in New Delhi for talks with central government officials after which she will return to the US.
