US wants trade with India to match China
(Agencies)
Updated: 2005-06-17 01:27

WASHINGTON - The United States wants trade with India to jump rapidly to a level close to that of China, a senior US official said in yet another indication of warming ties between the two countries.

US trade with India stood at 22 billion dollars last year compared to a whopping 231 billion dollars with China.

"Let me say that the United States is eager to collaborate with India to increase the level of trade to a level closer to the volume of trade we currently have with China," said acting deputy commerce secretary David Sampson.

"I know that's a huge goal but I think it's a goal worth pursuing," he told American and Indian business leaders and scientists gathered under the US-India High Technology Cooperation Group, a bilateral forum to expand high-tech trade.

Sampson said while there had been much improvement in US-India strategic and political ties, only modest progress has been made in bilateral trade.

The United States has made wide-ranging moves to improve ties with India in what analysts see as a counterbalance to China.

Sampson said India could boost investment and trade volume with the United States if it beefed up its infrastructure and removed barriers to investors.

He noted that India at present was only the 24th largest export market for the United States while American investments in India "also tells story of growth but unrealized potential."

US foreign direct investment in India amounted to just 3.6 billion dollars as of the end of 2003.

"This makes the United States India's largest foreign investor. But US companies invest vastly larger sums elsewhere," Sampson said.

Investors, he said, would be reluctant to come unless India's rules and regulations were streamlined, and made significantly more transparent and predictable.

One untapped potential for bilateral trade is in the high-tech sector but Sampson said India needed to improve on recent legislation to extend product patent protection to pharmaceutical and agricultural chemicals.

He cited the need for India to fight copyright, trademark and patent infringement, saying protection of intellectual property rights was a very high priority for the US administration.

Sampson also said that the United States and India had well-educated work forces for potential scientific and technological breakthroughs.

"I believe we're reaching a tipping point in biotechnology cooperation, agricultural and medical research, and the development of new pharmaceuticals," he said.

While pledging biotech investment reforms at the forum, India's Science and Technology Minister Kapil Sibal asked the United States to relax conditions for exporting biological materials crucial for rapid development of India's pharmaceutical industry.

The conditions were tightened after the terror attacks on September 11, 2001 amid fears of biological terrorism.

Sibal said the United States and India could jointly establish protocols for such exports and licensing arrangements for transfer of American biological material to the private sector in India for vaccine development.

"That is one whole area that must be looked at immediately, because only then can we all jump on to the train to move forward to other destinations," he said.

India currently ranks fourth largest in the production of pharmaceuticals by volume, Sibal said, adding that it wanted to become the world's hub for vaccines and clinical trials.

Amit Mitra, the secretary general of the Federation of Indian Chambers of Commerce and Industry, said there were 900 biotech companies in India with turnover expected to hit five bilion dollars in the next three to four years from the current one billion dollars.

"We can expand rapidly with joint collaboration with US," he said. "The US is the discoverer of molecules and we will do the drug development, taking it from preclinical trials to clinical trials to formulation creation."

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