US manufacturers tone down anti-India stand
The reversal of its strident anti-India stance by a leading American business group will go a long way in reviving trade relations between the two countries. On Wednesday, the National Association of Manufacturers, America's largest manufacturing association and a strong voice among lobbyists in Washington, DC, expressed in no uncertain terms its willingness to engage with the Indian Government and business community. This was in sharp contrast to its previous position wherein it had criticised Indian trade practices and also attacked this country’s Government and the judiciary for supporting and endorsing such practices. NAM, in association with the US Chamber of Commerce's Global Intellectual Property Center, also spearheaded a major campaign in Washington against what it perceived to be discriminatory Indian trade practices that threatened jobs and economic opportunity in the US. The Alliance for Fair Trade with India, which included several US companies from across the corporate spectrum, aggressively lobbied the Obama Administration to take up the matter at the highest levels in New Delhi. This was followed by the Office of the United States Trade Representative ordering a unilateral investigation into Indian business practices. India has been on the OUSTR's ‘Priority Watch list' for long but this was the first time that it was subjected to such an enquiry.
The singular event that brought about the change of heart at NAM was the election of Mr Narendra Modi to the Prime Minister's chair. Mr Modi's pro-market reputation, coupled with his promises to reform the way India does business and drive up economic growth, has given foreign investors much hope. NAM and, indeed, business leaders around the world are optimistic about the Indian market, which unfortunately had lost much of its competitive edge under the Congress-led UPA regime. With a corrupt and rudderless Government at the helm, and an antiquated body of laws and regulations, this country put off investors, despite its tantalisingly large market. Hopefully, with Prime Minister Modi in charge, many of these issues will now be resolved. However, having said this, a word of caution is necessary: While the new Government can be expected to clean the mess on this side, one must not assume that all the differences will be resolved quickly. Some of these problems are not just about complicated regulations but stem from divergent national interests and perspectives. The fight over intellectual property rights in India's pharmaceutical market, which came to the fore last year with the Supreme Court's pro-consumer judgement on anti-cancer pills in the Novartis case, is a good example. Another instance is the solar power dispute, currently being fought at the World Trade Organisation. In this case, the US has accused India of protectionist policies that hurt American exports while India has argued that that the US is making untenable demands.