India-US trade relationship broadly balanced: Shankar

From Lalit K Jha
Washington (PTI) - Describing Indo-US trade ties as
"unique", outgoing Indian Ambassador Meera Shankar has said it
is broadly balanced to the benefit of the two sides and sought
the focus on infrastructure debt funds in India where American
insurance firms are expected to find new opportunities for
investment.
"The relationship is growing, so that itself will propel
momentum for stronger economic ties. But more than that the
Indian economy is growing. If we are able to sustain robust
growth in India then demand in India will also increase, for
goods services, tie ups, Indian companies will become more
global in their reach," Shankar told PTI.
Shankar, whose tenure as the Indian Ambassador to the US
is officially coming to an end Sunday, was the Minister
Economy at the Indian embassy here when New Delhi liberalised
economy in early 1990s.
"The India-US trade and economic relationship is unique
because it is a relationship where both sides are benefiting,
it is broadly balanced in both direction and it is growing in
both directions. This year, again we have seen trade increase
by 20 per cent in terms of figures of the trade in the first
quarter of the year," she said.
One area where India clearly wants the US to focus is
infrastructure, Shankar said. "Recent policy changes which are
being made in India with regard to permitting the setting up
of the infrastructure debt fund would propel new interest by
the US Pension Fund and Insurance companies in investing in
India."
"Till now our policy basically allowed foreign investment
in infrastructure through equity. You had to invest directly
in the project. But the infrastructure debt fund would mean
that you could have long term debt instruments with long term
payment. This could be 20 years, 30 years debt instruments of
bonds," Shankar said.
Therefore, US pension funds and insurance companies which
are actually sitting on quite a lot of resources might find
this of interest in terms of outlet for their fund, which will
get them the returns over a long period and India will find
this of interest as this could provide financing for the
priority sector such as infrastructure, she said.
"The Reserve Bank of India is currently drawing up
guidelines for this purpose; the Finance Ministry has approved
this in principle and I think once those are ready, then we
should have new opportunities," Shankar said.
She said as the Indian economy grows, opportunities for
trade and economic cooperation between companies in India and
the US will certainly grow.
"Initially it was the IT sector, which took off. I
remember, when I was here as Minister Commerce in the early
90s there was some cynicism that why we are so much focusing
on IT.
"At that time we launched India US Commercial Alliance
and we held a big conference with about 200 companies
participating in the West Coast and Ron Brown as Commerce
Secretary and P Chidambaram as Commerce Minister interacting
then. At that stage the exports in IT were something in the
range of may be USD 300 million," she said.