By increasing the cap on foreign direct investment (FDI) in certain sectors like defence and insurance, India has taken some steps to address concerns of the US business community, a top US trade official has said.
"We've seen some movement, even this week they lifted certain caps on FDI in certain sectors. And so they have taken some steps," US Trade Representative Mike Froman told lawmakers during a Congressional hearing.
"The key for them is to be able to convey that India is a place that people want to do business and that people can rely on as a place to do business. And that's in our mutual interest," Froman said in response to a question from lawmakers, who expressed concerns over the Indian policies in some areas of trade and businesses.
"Over the last few months, I've become concerned on what we've heard regarding the environment for American businesses operating in India.
Whether it be patent violations and compulsory licensing in pharmaceutical industries, piracy within the software and film industries, local content rules in the technology sector, or forced localisation in green-tech industries, the news coming out of India has not been good for American innovators," Congressman John B Larson, said.
"These challenges, however, are of great concern to me because of what they mean for American businesses and American workers. America is at the heart of the nations of innovators. Millions of American jobs, including thousands in my state of Connecticut, rely on this very important innovation," he said.
Froman said the frustration coming from the business community and others is mainly because this relationship is not nearly achieving its potential precisely because of such policies of India.
"That's the message we conveyed to our Indian government counterparts last week, both from ourselves and the American business community that it's interested in India, and wants India to succeed and wants to invest there," he said.
