As India woos American investors trying to dispel misperceptions about the business climate in India, New Delhi has signalled a readiness to begin talks with the US on a bilateral investment treaty.
"We have said that 'yes, we are ready to be in talks'. We have signalled our acceptance," Indian commerce and Industry Minister Anand Sharma told reporters Friday after meetings with US Trade Representative Michael Froman and other US officials.
"We would be definitely in favour of enhancing our economic partnership," throough BIT or a free trade agreement, he said at the end of a four-day US visit during which he and finance minister P Chidambram addressed US concerns about Indian policies in meetings with US lawmakers, officials and business groups.
Sharma said while no date had been set for the first round of talks on the BIT outlining the terms and conditions for US and Indian investment in each other's country, he and Froman had "agreed to have an uninterrupted dialogue on the ministerial level" on economic issues.
The India-US Trade Policy Forum, the premier bilateral forum for the discussion and resolution of trade and investment issues between them, would meet in New Delhi later this year.
Asked if the US-India Business Council's goal of boosting bilateral trade in goods and services to $500 billion annually in the next five years was a realistic target, Sharma said "if we make a real effort, we can reach it by 2020."
Though two-way trade between the two countries had risen to $106 billion annually, he said there was clear recognition on both sides that "our economic engagement though robust was still below potential."
India was far more welcoming of American business than believed here, Sharma said, and "we are doing everything to correct the perception."
To get that message across about ease of doing business in India, the National Manufacturing Policy proposes to raise the share of manufacturing from 16 percent of GDP to 25 percent of GDP in a decade.
The US and India, he said, had also agreed to work together to ensure that the December meeting of the World Trade Organization in Bali was a success.
"We have agreed to put together a work programme. We will work very closely with all our partners to get a broad consensus around the key issues of trade facilitation and food security," he said.
"We are for a healthy, positive and balanced outcome."
According to a statement from the USTR's office, in a separate meeting Froman and Chidambram too "discussed the value of strengthening cooperation between the United States and India on strategic economic issues, including through a potential US-India Bilateral Investment Treaty."
Froman, it said expressed appreciation for Chidambaram's efforts to address concerns about the investment climate in India, including through proposed reforms to lift foreign direct investment restrictions.
Froman, the statement said underscored the importance of avoiding policies that disadvantage foreign goods and services, and reiterated the US welcoming of news that India's Preferential Market Access Policy is to be reviewed and modified.