Indian sectors protected, press Modi on trade: US Lawmakers to Prez

Washington: Leading US congressmen have called on President Donald Trump to press Prime Minister Narendra Modi to remove barriers to US trade and investment when they meet for the first time on Monday.

The lawmakers, from the Republican and Democratic parties, said in a letter to Trump that high-level engagement with India had failed to eliminate major trade and investment barriers and had not deterred India from imposing new ones.

“Many sectors of the Indian economy remain highly and unjustifiably protected, and India continues to be a difficult place for American companies to do business,” they wrote, noting that a 2017 World Bank report ranked India 130th out of 190 countries for ease of doing business.

The lawmakers - Republican House Ways and Means Committee Chairman Kevin Brady and Ranking Member Richard Neal, and Republican Senate Finance Committee Chairman Orrin Hatch and Ranking Member Ron Wyden - said the bilateral economic relationship “severely underperforms” as a result of India’s failure to enact market-based reforms.

They said the barriers covered multiple sectors and included high tariffs, inadequate protection of intellectual property rights, and inconsistent and non-transparent licensing and regulatory practices.

Among US goods affected were solar and information technology products, telecommunications equipment and biotechnology products, they said.

The lawmakers also pointed to limitations on foreign participation in professional services, restrictive foreign equity caps for financial, retail, and other major services sectors and barriers to digital trade and Internet services.

“The list is long and growing,” they said.

Modi is due to meet with about 20 leading US CEOs in Washington on Sunday before his first meeting with Trump on Monday at the White House, when he will seek to revitalise ties that have appeared to drift, in spite of the priority they were afforded under former President Barack Obama.

While progress is expected in defense trade and cooperation, Trump, who campaigned on an “America First” platform has been irritated by the growing US trade deficit with India and has called for reform of the H-1B visa system that has benefited Indian tech firms.

Other signs of friction have included Trump accusing New Delhi of negotiating unscrupulously at the Paris climate talks to walk away with billions in aid.

Indian officials reject suggestions that Modi’s “Make in India” platform is protectionist and complain about the US regulatory process for generic pharmaceuticals and rules on fruit exports to the United States.

They stress the future importance of the huge Indian market to US firms and major growth in areas such as aviation which will offer significant opportunities for US manufacturers.