US official to focus on Doha, infrastructure during visit

By Arun Kumar, IANS

Washington : The Doha round of world trade talks, improving India’s infrastructure and building an International Financial Centre (IFC) in Mumbai top the agenda of US Treasury Secretary Henry Paulson during his India visit.

Support TwoCircles

Discussing how to make progress in the Doha round would be a key priority of Paulson, who is set to meet Finance Minister P. Chidambaram and participate in the US-India CEO Forum Infrastructure conference, a senior official said Thursday.

But “Secretary Paulson’s trip is not in any way focussed on negotiations around trade”, Treasury Under Secretary for International Affairs David McCormick told reporters at a briefing ahead of the visit Oct 27-31.

“His message will be simply reinforcing what the president (George W. Bush) has said, and that’s that Doha is enormously important, and that we simply can’t let it fail,” McCormick said.

Paulson had said at a meeting Wednesday that India could play a leadership role in a Doha trade deal if it were to show willingness to provide more access to its non-agricultural markets, especially services.

How to finance physical infrastructure improvements with greater private sector involvement and how US can help building an IFC in Mumbai to strengthen India’s financial system would be two other key focus areas of the visit, the official said.

Describing poor infrastructure as a major obstacle to attracting foreign capital, McCormick said the Indian leadership recognised it as a problem and was focussing on it.

“The US wants to support this effort to attract private financing,” he said, noting that India was looking to the private sector to fund up to one-third of close to $500 billion to be spent over the next five years for this purpose.

Paulson will participate in the India Infrastructure Finance Conference in Mumbai to highlight the opportunities of India’s infrastructure initiatives to US businesses.

Asked how building an International Financial Centre in Mumbai would help the US, McCormick said around the world Washington focussed on more access to markets. Mumbai’s development into an IFC is an important element of its agenda to help advance the Indian government’s economic reforms.

US experience can help the Indian government and industry as they work to develop an IFC in Mumbai. “Potentially we want to work together in supporting what India is already doing,” he said.

The India-US trade relationship offered enormous opportunities to US companies and enormous benefits to the Indian companies, McCormick said, noting that Indian exports to the US have almost doubled to $21 billion, while US exports to India have doubled to $10 billion in recent years.

Similarly, investment flows have increased dramatically. Indian firms have invested $2 billion in the US. And US companies invested about $2 billion in India last year.

Paulson would stress that by accelerating economic reforms the Indian government can help ensure that the country’s growth rate would be at least eight percent for the foreseeable future as projected, he said.