US senators, business heads slam India's economic policies

Some influential US lawmakers and business representatives have formed a united front against alleged ''restrictive'' and ''protectionist'' trade and investment policies followed by India.

With US business losing their competitive edge in the wake of low-cost quality products offered by emerging economies, the US manufacturers are desperately looking for ways to bulldoze into larger emerging markets in order to survive.

Associations representing 17 industry groupings in the United States have signed on to a multi-industry CEO letter addressed to President Obama that calls on the US administration to address current trade imbalance caused by India's ''discriminatory practices'' against US exports.

"We're very concerned about the innovation and the investment environment in India at the moment," Mike Froman, national deputy security advisor on economic policies to President Barack Obama, said on Thursday.

Froman raised issues such as compulsory licensing of drugs, preferential market access, localisation requirements etc as some of the issues that concern US manufacturers.

According to them, the recent Indian measures have been detrimental to India-US ties, particularly business ties.

"We have a lot of concerns about what's going on today in India especially their emerging market access barriers, protectionist measures," said Senator Rob Portman.

"One is the lack of respect for patents. Basic intellectual property protections are being set aside. They've invalidated and broken American drug patents, as I say. These actions are in disregard of WTO rules; they they're fundamentally disruptive to innovation. I think, frankly, it's a major concern, because it could spread," he said.

The White House believes that it is in interest of both India and the US to expand their trade and business ties. India is also one of the largest recipients of benefits under the generalised system of preferences (GSP). However, the senators allege that India is increasingly shutting down US companies out of its markets through a variety of measures, including import restrictions and forced manufacture in India.

India, they allege, is also forcing US companies to give up their intellectual property rights while at the same time offering preferential access to local manufacturers, especially in the information and communications technology space.

The senator piled on complaints against India which, they allege, failed to protect the interests if US pharmaceutical industry, but, instead posed a real challenge to intellectual property rights.

The senators' comments follow a representation made by 17 top American business organisations to President Obama seeking his intervention on the alleged trade barriers in India.

The 17 organisations signing the letter include the National Association of Manufacturers, US Chamber of Commerce, CropLife America, BIO, Telecommunications Industry Association, PhRMA, United States Council for International Business, Emergency Committee for American Trade, American Business Conference,   National Electrical Manufacturers Association, Air Conditioning, Heating and Refrigeration Institute, Association of Home Appliance Manufacturers, American Foundry Society, Semiconductor Industry Association, Dental Trade Alliance, National Foreign Trade Council and Solar Energy Industries Association.

The move comes fess than a fortnight after Ajay Banga, chairman of US India Business Council and president and CEO of MasterCard Worldwide, wrote to President Obama urging him to push for economic reforms in India.