Political India: Engaging America

From The Hindu

“There is a liability which needs to be resolved… [and] we have not seen that [Dow Chemicals] has been able, or responsible enough, to come around” despite the matter being in court for many years, said Rajan Bharti Mittal, President of the Federation of Indian Chambers of Commerce and Industry (FICCI), during a press conference here.

Mr. Mittal, along with Amit Mitra General Secretary, FICCI, spoke to media during a visit aimed at promoting Track II discussions in the aftermath of the recently concluded United States-India Strategic Dialogue.

While noting that he was not familiar with the commercial terms of the acquisition by Dow Chemicals of Union Carbide Company — the entity responsible for the Bhopal gas tragedy of 1984 — he added, “I would say that any company that was going to do business… of such magnitude that can have loss of life which is very large in the sense that a village of a township could be wiped out, they need to be responsible… not only on their technology, but to see that their backup [insurance] is enough.”

However, he argued, such liability needs to be capped even if, in cases such as the British Petroleum oil spill in the Gulf of Mexico, it may be difficult to allocate the liability to BP or some insurance company.

Yet Mr. Mittal hinted at the need to further resolve the liability associated with the Bhopal gas tragedy. Again drawing a parallel to the BP spill he said, “The President and the administration are saying ‘Let’s talk about it later. First fix it, then let’s talk about liability.’

Prognosis for nuclear liability bill

Mr. Mittal also touched upon the related question of the nuclear liability legislation that the Indian Parliament is considering, especially given concerns that the liability has been capped at a relatively low level. He said, “I think… there will be some adjustments and some tinkering will be done because there is a precedent.” He added that he had seen “many figures” for the amount of liability across the world and they could range from “around $30 million to almost a $1 billion liability”.

Discussing some of the key factors that could determine the outcome of the negotiations on nuclear liability Mr. Mittal said, “At the end of the day, [it will] depend on [the question]: Is private enterprise going to join hands on nuclear power generation? Because if the private [parties] are there it is very different [compared to a situation where] the Government of India is going to do it.”

He also threw his weight behind the idea of manufacturer liability in the event of gross negligence regarding the equipment supplied. Mr. Mittal said that his real concern was over what would happen when the government handed over nuclear power generation to private hands, arguing that “the manufacturers of nuclear power generation [plants] will have to take their responsibility… for $100 million, You cannot say, ‘I have a bad manufacturing situation, and the operator is to be hung for that.’” … If it is a manufacturing defect, you have to hold the manufacturers responsible as much.”

Labels: Bhopal gas tragedy, Dow Chemicals, FICCI, Rajan Bharti Mittal, Union Carbide

From The Hindu

Reflecting continuing concerns within the Indian industry over tight restrictions on technology exports from the United States to India, the head of the Federation of Indian Chambers of Commerce and Industry (FICCI) expressed hope that the major relaxation of export control restrictions hinted at by the U.S. would become a reality by the time President Obama visits India later this year.

Speaking at a press conference here, Rajan Bharti Mittal, President of the FICCI, said, “It is a little unfortunate that when we have the first Indo-United States Strategic Dialogue on the one side, and then you have, with your own strategic partner you defined, dual technology denials, or entities which are on a list or watched.”

Mr. Mittal added that while the U.S. was, on the one hand, discussing collaboration on space with India, on the other, it was preventing the Indian Space Research Organisation (ISRO) from using U.S. space technology by keeping it on the Entities List.

Also, he said, “While you talk about the most [joint] defence exercises being done between India and the U.S. … you [however] have the Defence Research and Development Organisation… on their banned list.” Thus, there was a need to look at the Indo-U.S. strategic relationship, “in a very different way”, he said.

To a question from The Hindu on when an announcement could be expected with regard to the relaxation of export control restrictions Mr. Mittal said that while the ongoing review of these restrictions by the U.S. was “not processed, it is work in progress”. He added that after his recent visits to Washington, he was “much more hopeful and encouraged by the response that now the needle is moving in the right direction”.

Mr. Mittal then observed that while the political authorities would decide the exact date of the announcement in this matter, “If some substance has to be delivered from [the U.S.’] side when the President visits, I think this could be the one that they would want to get much closer to delivering.”

Boosting Indo-U.S. investment flows

In the wake of the U.S.-India Strategic Dialogue last month, private sector representatives from both sides have engaged in numerous talks, and industry bodies such as FICCI have also been holding discussions with the Deputy U.S. Trade Representative (USTR).

On Monday, FICCI announced that it had signed a Memorandum of Understanding with the Competitiveness Council, an MoU that would spur “innovation and competitiveness in many fields, including energy security, healthcare, education, food, manufacturing in the 21st century and also business processes”, according to Mr. Mittal.

FICCI along with several partners have also come out with a report on ‘How America Benefits from Economic Engagement with India’, a volume that hopes to set at ease concerns within the U.S. that it may be losing jobs to India. According to the report, jointly compiled by FICCI, the U.S. World Affairs Institute and the University of Maryland, India is also the third-fastest growing investor in the U.S.

Among other issues, the report notes that 127 'green field' investments worth $5.5 billion were made by Indian companies in the U.S. between 2004 and 2009. These projects accounted for nearly 17,000 jobs created in the U.S., said Amit Mitra, General Secretary, FICCI. Mr. Mitra added that in addition to the new investments, Indian companies had also made 372 acquisitions worth $21 billion, and these amounted to saving companies and jobs that might have otherwise been lost in the U.S. economy.

Touching upon the need for greater investment flows from the U.S. to India, particularly in the infrastructure sector, both Mr. Mitra said that such investments were needed in airports, railways, ports and roads.

FICCI representative Ranjana Khanna also underscored that the U.S. would also benefit from such investments, for example, the purchase of every Boeing aircraft led to the creation of 10,000 jobs across 15 states in the U.S., she said.

Ms. Khanna added that India and the U.S. were also looking to apply their combined economic potential to other areas, particularly in Africa. To this end FICCI, along with the Carnegie Endowment think tank, would holding discussions on prospects for Indo-U.S. investments in Africa later this week, she added.

Labels: FICCI, Rajan Bharti Mittal, U.S. export control restrictions

From The Hindu

Nirupama Rao, India’s Foreign Secretary, will co-chair a meeting of the India-United States High Technology Cooperation Group (HTCG) with Dennis F. Hightower, U.S. Deputy Secretary of Commerce on March 15, according to Mr. Rahul Chhabra, Minister for Press, Information and Culture.

With a focus on expanding bilateral trade in strategic and high technology areas including “sensitive items”, the forum aims to provide a platform through which industry suggestions could substantively feed into inter-government meetings to be held the following day.

This industry dialogue is organized in partnership with the Confederation of Indian Industry (CII) and the Federation of Indian Chambers of Commerce and Industry (FICCI).

Speaking to The Hindu Ms. Ranjana Khanna of FICCI said that at the forum FICCI would hope to highlight export control issues. Citing the controls implied by the “Denied Persons List” of the U.S. Bureau of Industry and Statistics, Ms. Khanna added that reducing such controls would help spur trade in areas such as defence, aviation, life sciences and nanotechnology.

Apart from meetings in the Commerce Department, Ms. Rao will also be meeting senior members of the U.S. administration as well as the members of Congress. She is also slated to participate in a discussion at the Wilson Center on “Two Democracies: Defining the Essence of our Partnership”.

At her State Department meetings Ms. Rao will “review the progress made on various elements of the Revised Dialogue architecture”, according to Mr. Chhabra. She will also discuss plans for the visit of Indian External Affairs Ministry officials to the U.S. later this year, for the next round of Strategic Dialogue between the two countries.

Commerce and Industry Minister Anand Sharma will also be in Washington DC on March 17-18, and in New York on March 19. Top on his agenda is a series of meetings with United States Trade Representative Ron Kirk, Secretary of Commerce Gary Locke and Secretary of Agriculture Tom Vilsack.

On March 17, Mr. Sharma and Mr. Kirk will sign the India-U.S. Trade Policy Forum Framework for Cooperation on Trade and Investment. The Framework aims facilitate trade and investment flows between the two countries, and will address five areas, according to a statement by Mr. Chhabra: tariff and non-tariff barriers, services, agriculture, investment and creativity and innovation.

The visits by both Mr. Sharma and Ms. Rao come amidst clear signs that the Prime Mininster’s state visit last November has led to a wide spectrum of engagement between India and the U.S.

Their interactions will add momentum to such industrial lobbies as the India-U.S. Private Sector Advisory Group, the Board of U.S. Council for International Business, the India Business Forum and the new India-US Economic and Financial Partnership. In particular the Partnership will be formally launched in New Delhi on April 6, by Finance Minister, Mr.Pranab Mukherjee and U.S. Treasury Secretary, Mr. Timothy Geithner.

Labels: CII, FICCI, Foreign Secretary, Nirupama Rao, State Department, United States