Develop manufacturing sector without distorting international trade: US Trade Representative Michael Froman

WASHINGTON: The US and its businesses that have invested heavily in India, want New Delhi to develop a manufacturing sector but without distorting international trade, a top Obama Administration official has said. 

"We want a manufacturing sector (in India). We understand their (Indians) desire to have a manufacturing sector," said the 
US Trade Representative (USTR) Michael Froman in his interaction with the American business community at the US Chamber of Commerce here yesterday. 

"It's how you go about doing it and whether you go about doing it in a way that distorts trade and distorts investment, discourages investment, or whether you do it in a way that encourages investment and encourages better ties between our countries," he said. 

"And that's what we're trying to work with them on is how do they achieve their legitimate desire to have a manufacturing sector, to feed their people, to have farmers who are able to make a living and at the same do so in a way that doesn't distort international trade," Froman said in response to a question. 

Froman was responding to a question from Thomas Donohue, president and CEO, US Chamber of Commerce on the concerns of the business community with regard to Indian policies. 

"We've had some personal meetings with the Indian representatives on behalf of our constituents. You have done much of the same thing, perhaps with different challenges. But we find this much different than other places because of the stability or the strength of an agreement," he said. 

"An agreement can be made today, and sometime later on the agreement doesn't stick or the protection of patents are under a lot of attack. It is not totally unique to India, but the way it's being done is unique and I believe could have a very negative effect on our relationships with India," Donohue said. 

Froman said he share a number of those concerns. "We have had a number of interactions with Indian officials of late," he said. 

"Each of those instances, we had very frank discussions about our concerns and the business community concerns about the innovation and investment 
environment in India, pointing to a number of the things -- intellectual property rights protection, the way that various tax laws are enforced, whether contracts are being fully enforced, localisation rules and local content requirements," he said. 

"The concerns that have been expressed by the business community here are among the business community that are very much engaged in India. They want India to be successful. They've invested enormous amounts of capital there. They have a lot of employees there. 

"And so the message to them is not that we don't value or don't think that their concern about developing a manufacturing sector is legitimate; we do," Froman said.