Against the backdrop of a growth downgrade and a plummeting rupee, Union Ministers P Chidambaram and Anand Sharma are in Washington to address American concerns over India’s purportedly “discriminatory” economic policies and make the pitch for investments in key sectors, notably infrastructure.
In what is being viewed as a new bid to sell the India story in the face of some daunting economic indicators, the two Ministers will deliver keynote speeches to the US India Business Council’s annual summit and interact with top guns of Corporate America. They will also meet their American counterparts and key lawmakers. With some tactical decisions lately, such as the review of the thorny issue of Preferential Market Access (PMA), Chidambaram and Sharma are expected to focus on the policy measures taken to shore up the industrial climate and attract foreign direct investment.
The visit by the two ministers comes close on the heels of an orchestrated campaign by American business, with some extraordinary backing from US Congress, against what has been dubbed India’s “discriminatory” policies giving Indian companies an unfair advantage and appearing to violate World Trade Organisation (WTO) obligations.
But New Delhi’s recent decision to reconsider the PMA policy, apparently to accommodate the concerns of foreign investors, is expected to enthuse US corporations. The USIBC has lauded the announcement, with its president Ron Somers commenting that the rethink “sends a strong and welcome signal that India is listening to investors”.
Reflecting the wishes of American corporates, the USIBC has been arguing for “market-based incentives, not mandates, to encourage manufacturing in India”. Chidambaram is slated to hold a meeting with a select group of business leaders, including Brad Smith, Microsoft’s General Counsel and Executive Vice President, legal and Corporate Affairs; Pat Dewar, CEO, lockheed Martin International; Scott Price, CEO, Asia, Walmart; Henri Croupon, CEO, IlFC and Sheperd W Hill, president, Boeing International.
The Finance Minister will also be meeting his American counterpart, Treasury Secretary Jack lew, Senate Finance Committee chairman Max Baucus and Senate India Caucus co-chair Mark Warner. Previewing the business summit, Somers said the USIBC is looking forward to productive meetings aimed at eliminating investment barriers and deepening commercial ties.
“The result will be economic growth and job creation for both countries,” he said. Commerce and Industry Minister Anand Sharma, besides delivering a keynote address to the business summit, is also expected to take up with the Obama administration some “protectionist” issues of acute concern to India.
These include the long-pending visa issue, targeting Indian IT giants operating in America, at a time when even more punitive measures of concern to the Indian companies are on the anvil as part of the omnibus immigration reform legislation. The proposed restrictions on the IT companies over deployment of professionals working in the US on H-1B and l-1 visas are regarded as a crippling blow to the Indian IT sector.
Sharma is expected to take up the trade issues during his meetings with the new US Commerce Secretary Penny Pritzker and the new US Trade Representative Michael Froman.