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Move faster on trade barriers, US Commerce Secy to tell New Delhi

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Indira Kannan New York

As he prepares to lead a trade mission to India from February 6 to 11, US Commerce Secretary (meaning, minister) Gary Locke wants the Indian government to take more steps to open its economy, particularly in dealing with trade barriers.

Noting that in the past two decades, India has moved “faster and further” on this front than anyone could have anticipated, Locke said the US was keen to boost bilateral trade in a way that would create jobs in both countries.

He was speaking from Washington to a select group of journalists on the visit. Answering a question from Business Standard, the Secretary said the US had brought up the issue of tariff and non-tariff barriers, including restrictions on Foreign Direct Investment and concerns about Intellectual Property Rights, during President Barack Obama’s visit to India last November, and will raise these again next week.

 

“The US is one of the most open markets in the world,” Locke said. “If we are so open, so should our trading partners.”

The trade mission led by Locke will include several US trade officials and representatives from the Export-Import Bank and 24 American companies, more than half of which are small and medium-sized enterprises. Large corporations like Boeing, Lockheed Martin, GE Hitachi Nuclear Energy and Westinghouse Electric Company are also part of the delegation. The mission will focus on opportunities in the defense and security, civil aviation, nuclear energy, and information and communication technology sectors. The team will visit New Delhi, Bangalore and Mumbai.

Easing barriers Locke observed the US had delivered on President Obama’s announcement in India to reform export control laws. He said the purpose of his trade mission was to “take advantage of that opened door for increased high-tech trade between the US and India”. Last month, the US removed nine Indian space and defence companies from its Entities List that placed them under export controls.

Referring to some Indian companies that still remain on the Entities List, an administration official at the briefing said these were mainly weapons-related or non-safeguarded facilities and they would not affect US commitments towards civilian nuclear energy trade with India.

During his visit, Locke will meet his Indian counterpart Anand Sharma, civil aviation minister Vayalar Ravi and other senior officials. He will attend the Aero India show in Bangalore, where the US pavilion will be the largest foreign presence at the expo. US companies Lockheed Martin and Boeing are in a fierce race with four European rivals to win a multi-billion dollar order from the Indian Air Force for 126 Medium Multi-Role Combat Aircraft. Locke said winning this deal was “high priority” for the US.

Locke will also address three major Indian industry groups – CII, Ficci and Nasscom– during his stay. The question of the rise in H1B and L1 visa fees for some companies to finance US border security is expected to come up. Locke called the visa fee hike -- pushed through by the legislature, the US Congress) -- “an unfortunate vehicle to finance border security” and said the administration would need to work with the Congress on this issue. Also on his schedule is a meeting with Reserve Bank of India governor D Subbarao in Mumbai, where Locke is expected to lobby for the opening of India’s financial sector. Other meetings include those with officials of HAL, Isro, the Department of Atomic Energy and Nuclear Power Corporation of India, as well as a visit with Mumbai’s famed tiffinwallahs.

The US estimates trade with India would hit the $50-billion mark in 2010 once all the data was compiled. While India’s exports to the US showed a greater increase during the first eight months of 2010, US exports to India grew 17.5 per cent in that period. The upcoming trade mission is part of the Obama administration’s target to double US exports by 2015.

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First Published: Feb 05 2011 | 12:08 AM IST

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