The US today asked India to consider relaxing local sourcing norms in single brand retail trade, a move that would help American companies like Apple to set up stores in the country.
The issue, among others, was discussed during a meeting between Commerce and Industry Minister Nirmala Sitharaman and US Trade Representative Michael Froman. They met under the 10th India-US Trade Policy Forum (TPF) meeting.
"The US encouraged India to consider relaxing local sourcing requirements in single brand retail trade," a joint statement issued after the meeting said.
It said India informed the US delegation about the recent foreign direct investment (FDI) reforms providing relaxation in local sourcing norms in specific cases.
In July, the government announced relaxation of FDI norms by giving a three-year exemption from local sourcing to foreign players in single-brand retail and a five-year relaxation for state-of-art and cutting-edge technology providers.
But companies like technology major Apple had sought a blanket exemption.
At present, 100 per cent FDI is permitted in single-brand retail, but FIPB permission is required beyond 49 per cent.
The statement also said that Sitharaman and Froman highlighted the important role of the services sector and the significant potential for increasing investment.
To advance this goal, India and the US discussed efforts to promote foreign investment in key services sectors, it said, adding that both sides stressed the need to explore policy measures that would facilitate enhanced mutual ties.
Further, the importance of e-commerce, retail and direct selling in facilitating trade in goods was acknowledged by both sides.
India stated that 100 per cent FDI is now permitted in the marketplace model of e-commerce as well as in the distribution of food products produced in India, including through e-commerce.
"To ensure that e-commerce companies can take full advantage of this market opening, India noted the continuous efforts for facilitating investment in e-commerce," it said.
Both the sides also recognized that legal, financial, information technology, and accountancy services can be assets to Indian and US companies and can facilitate growth in trade and investment.
"Both countries agreed to continue discussion of promoting liberalisation in these sectors," it added.
Sitharaman and Froman noted efforts that each country is
undertaking to promote ease of doing business and attract investment in manufacturing.
"Both countries stressed the importance of providing a transparent and predictable policy environment and simplified compliances to help attract investments in manufacturing, the joint statement said.
The ministers reaffirmed their commitment to exchange information on standards, Conformity Assessment procedures and the Common Criteria Recognition Arrangement (CCRA) in the electronics sector.
India and the US also agreed to continue their dialogue on conformity assessment based on international standard systems across various sectors by respective regulators, it added.
Further, the leaders emphasised that the timely resolution of disputes through a strong judicial system fosters an attractive investment climate and improves the ease of doing business.
"Both sides agreed that creating a transparent, predictable and open business environment that reduces administrative burden and protects innovation is essential for attracting investment, promoting manufacturing activity, and providing the confidence necessary for businesses to bring new technologies across borders," it said.
The leaders also expressed their desire to implement reforms that promote the ease of doing business and attract investment in manufacturing, emphasising the benefits of policies that facilitate open market production and sourcing decisions.
India and the US proposed to convene the eleventh round of the TPF in the US in 2017.
