Business groups push White House, Congress to improve US-India relationship

U.S. businesses groups are urging President Obama and Congress to make progress on the U.S. economic relationship with India during Prime Minister Narendra Modi’s June visit to Washington.

In letters sent to the president and congressional leaders, the Alliance for Fair Trade with India, which includes a broad range of groups from manufacturers to pharmaceutical and telecommunications firms, said that Modi’s trip presents an important opportunity to discuss and resolve many important commercial matters that are limiting India’s own trade engagement and growth.

{mosads}“We hope you will use this visit to engage with the Prime Minister to advance both discussions and concrete action to produce a stronger and more-promising U.S.-India commercial relationship,” they wrote.

“A strong and vibrant U.S.-India relationship is beneficial not only to our two countries, but also to greater growth and opportunity throughout the world.”

Businesses are concerned that “the high hopes and positive rhetoric” that accompanied the beginning of Modi’s tenure two years ago have yet to translate into concrete measures that improve the Indian business environment for U.S. workers and companies operating in and exporting to India.  

Modi will address to a joint session of Congress on June 8.

The groups argue that while India has taken a few concrete steps, such as some investment openings and fostering more competition for investment among states, “persistent issues remain, such as forced localization barriers, high tariffs as well as new tariff increases, longstanding IP challenges, new foreign investment barriers and proposed bans on foreign direct investment.”

On Tuesday, Sen. Bob Corker (R-Tenn.), chairman of the Senate Foreign Relations Committee, called for a more “pragmatic approach” to U.S.-India relations to deal with outstanding differences while acknowledging overall cooperation between the two countries remains at “an all-time high.”

“We’re not as brutally honest about our relationship with India as we should be, and it benefits neither them nor us,” Corker said during a hearing.

“U.S.-India relations would be better served by a more sober and pragmatic approach that could go a long way toward laying the groundwork for genuine progress in areas that would be mutually beneficial to both the United States and India,” Corker said. 

Corker credited India for efforts to expand maritime defense cooperation with the United States and for supporting peace and stability in Afghanistan.

However, he said there is “widening expectations gap” between Washington and Delhi on promised reforms to reduce trade and investment barriers for American firms eager to enter the Indian market.

“Prime Minister Modi has made repeated statements about undertaking economic reforms and making India more hospitable for foreign investors, and there have been some small movements in certain sectors such as defense,” Corker said. “However, the rhetoric has far outpaced the reforms.