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US lawmakers express concern over Indian economic policies

India is one of largest recipients of benefits under the generalised system of preferences.

Written by PTI | Washington |
June 7, 2013 9:12:39 am

US lawmakers and some top business organisations of the country have alleged that the “restrictive” and “protectionist” policies of India is hampering bilateral trade,an issue said to be of deep concern for the Obama administration.

“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 US President Barack Obama,said yesterday.

“I’m very concerned with the deterioration in the environment for protection of US intellectual property rights and innovation in India. The government of India continues to take actions that make it very difficult for US innovative pharmaceutical companies to secure and enforce their patents in India,” Froman said.

Froman listed out compulsory licensing,patent issues,preferential market access,localisation as some of the issues of concerns,as a number of influential Senators alleged that the recent Indian policies have been detrimental to the India-US relationship.

“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. I

think these actions are in disregard of WTO rules; I think they’re fundamentally disruptive to innovation. I think,frankly,it’s a major concern,because it could spread,” said the Ohio Senator.

Senator Robert Menendez too piled on to the complaint against India.

“I have been hearing from the pharmaceutical industry,I’ve been hearing from the high-tech industry,I’ve been hearing from other industries about how India’s inadequate protection,to put it mildly,and enforcement of intellectual property rights is a real challenge,” he said.

Noting that India is one of the largest recipients of benefits under the generalised system of preferences (GSP),Senator Orrin Hatch alleged that India is increasingly

shutting down US companies out of its markets through a variety of measures,including restricting its imports of products to force companies to manufacture in India.

However,US believes that it is in interest of both India and the US to expand their trade and business relationship.

“We believe that it is in both the United States and India’s interests to continue to expand our trade and business relationship,” Laura Lucas,spokesperson of National Security Council told PTI.

Meanwhile,16 American business organisations have written a letter yesterday to Obama seeking his intervention on the alleged trade barriers put up by India .

Alleging that the Indian Government is discriminating against a wide range of US exports,jeopardising domestic jobs and putting at risk a growing bilateral trade,valued at USD 60 billion last year,the letter said it is time that New Delhi end discrimination against US exporters and took steps to ensure it is not repeated in the future.

“To achieve this result,we urge the US Government immediately to initiate bilateral engagement at the highest levels and to co-ordinate closely with the European Union and other like-minded economies,” the letter said.

Signatories to the letter included the US Chamber of Commerce,National Association of Manufacturers,CropLife America,Telecommunication Industry Association,United States Council for International Business,Emergency Committee for American Trade,National Electrical Manufacturers Association,and American Foundry Association.

“Over the last year,the courts and policymakers in India have engaged in a persistent pattern of discrimination designed to benefit India’s business community at the expense of American jobs. Administrative and court rulings have repeatedly ignored internationally recognised rights – imposing arbitrary marketing restrictions on medical devices and denying,breaking,or revoking patents for nearly a dozen

lifesaving medications,” alleged the letter to Obama.

“Reversing discrimination and restoring trust would be a win win enabling domestic exporters to further invest in India’s future and helping India grow its economy and create opportunities for its people,” the letter said.

Less than a fortnight ago,Ajay Banga,chairman of US India Business Council (USIBC) and president and CEO of MasterCard Worldwide,had urged Obama to push for the much needed economic reforms in India.

“We ask that you and your representatives lay before our Indian friends an agenda of key changes in Indian policy which,if undertaken,will go a long way towards improving the business climate and restoring confidence in the Indian economy,- he said in a letter to the President.

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