India – US strategic commercial dialogue
Following the decision of Prime Minister Shri Narendra Modi and President Obama in 2015 to elevate the India-US Strategic Dialogue to a Strategic and Commercial Dialogue, reflecting the significance of the trade and economic engagement between the two countries, India and the United States will meet for the 2nd Strategic and Commercial Dialogue (S&CD) on Tuesday, 30th August 2016 in New Delhi.
The engagement is likely to cover the discussion between Indian and US CEOs in the forenoon of 30th August. In the afternoon, the S&CD Plenary is scheduled to be held and will be led from the Indian side by India’s External Affairs Minister, Smt. Sushma Swaraj and Minister of State for Commerce and Industry, Smt. Nirmala Sitharaman. The United States delegation will be led by Secretary of State, Mr. John Kerry and Secretary of Commerce, Ms. Penny Pritzker. Two Co-Chairs of CEOs Forum, Mr. Cyrus Mistry, Chairman of Tata Group from Indian side and Mr. Dave Cote, Chairman and CEO of Honeywell International from US side would also be present at S&CD plenary. The bilateral discussions would be held thereafter, separately under the two tracks, at 4.30 p.m.
The first S&CD plenary was held in September 2015 at Washington D.C and identified the focused areas of cooperation under the two tracks – Strategic and Commercial. The current S& CD would be reviewing the progress made so far in strengthening the agreed upon issues and lay down the road map for the ensuing year, under the two tracks.
The Commercial Track of S & CD will be led by Smt. Nirmala Sitharaman from India side and Ms. Penny Pritzker from United States. The two Ministers will preside the CEO Forum along with Mr. Cyrus Mistry, Chairman, Tata Sons and Mr Dave Cote, Chairman, Honeywell as the two co-chairs from India and United States respectively. The Forum during its meeting held in January, 2015 and September,
2015 submitted comprehensive recommendation covering issues across the sectors. The Governments on both sides have taken into account the recommendations and have also encouraged greater B to B exchanges. Some of the major areas of intervention following the CEO Forum recommendations are as follows:
In line with the CEO Forum recommendations to boost the renewable energy sector, the both sides are working on the US-India Energy Finance Initiatives, which is expected to mobilise upto $400 million by 2020.
Similarly, to ease the defence production procedures, the Government of India has introduced a new Defence Procurement Procedure which has made it much simpler to take advantage of the immense opportunity for defence production in India.
The Government of India has shortlisted 33 cities for development as smart cities and will be collaborating with U.S on three of these. Also, the U.S.-India CEO Forum developed a Smart Cities Strategic Framework.
In addition, given the focus on Innovation and Entrepreneurship, various policies and measures, including the creation of Sister Innovation Hubs, and develop the Innovation ecosystem in the country. There has been very productive U.S-India CEO Forum-led Digital Infrastructure Best Practices Exchange Workshops in New Delhi, Jaipur, and Visakhapatnam from August 2-5, 2016.
Both sides are working together to encourage participation of all stakeholders in the regional Global Connect conference to be held on September 15, 2016 in New Delhi.
FDI reforms: As part of FDI reform measures, the FDI policy has been further simplified and conditions relaxed. Norms have been relaxed in brownfield pharma sector, processed food, defence production, railways etc.
FDI inflow trends: Reforms undertaken in the recent months have shown positive results and FDI inflows into India has increased at a time when globally, there is decline in the investment flows. Total FDI inflow into India which was at US$ 36 billion during 2013-14 increased to US$ 44.2 billion in 2014-15 and has further shown an increasing trend as during the year 2015-16, India received US $ 55.4 billion as FDI, the highest in a year so far.
FDI from USA: FDI from USA has also shown a positive growth trend and during the years 2013-14, 2014-15 and 2015-16 it was US$ 806 mill., US$ 1824 mill. and US$ 4190 mill., respectively. This corresponds to an increase of 500% in two years.
The CEO Forum Meeting, to be held on 30th August, will review the status on the action taken on the recommendations submitted by the Forum in its two meeting held in 2015 and make fresh recommendations for further expanding trade and investment between both the countries.
The two sides had agreed on four work streams to facilitate economic development initiatives, namely, (a) infrastructure collaboration and smart cities, (b) ease of doing business, (C) Innovation and Entrepreneurship and (d) Standards. The discussions are expected to take place regarding smart city master planning activities for three cities for which MoU has been signed between India and US, i.e. Ajmer, Allahabad and Vizag. Similarly both sides are expected to discuss the possibilities for collaboration in the areas of Innovation and Entrepreneurship and also exchange information and best practices relating to improving ease of doing business. The collaboration between National Physical Laboratory and BIS on the Indian side and National Institute of Standards and Technology (NIST) on the US side relating to reference material production (RMP), metrological standards, physical and mechanical standards which are crucial to ensure adherence to international quality requirements for a range of products. The CII-ANSI MoU signed during the last S & CD for development of a portal is also likely to be discussed.
A new work stream is also being proposed in the current S&CD meeting on the area of Tourism Sector. The broad parameters for continued engagement as part of the 2017 Travel and Tourism Partnership Year, announced during Prime Minister Modi’s visit to the United States in June 2016, is to be worked out by both sides. The broad areas of discussion would be regarding enhanced cooperation in promoting two-way tourism. Potential topics for engagement are likely to be identified during the ‘C” Track meeting with the United States.
On the sidelines of the S & CD a Roundtable is also being organised to discuss the issues relating to Standards and Conformity assessment on 29-08-2016. The Roundtable is organised by Confederation of Indian Industry (CII). Cooperation in Standards is one of the 4 work streams identified under S&CD Commercial Track by India and US.
The ties between the United States and India have never been stronger – as reflected by unprecedented commercial cooperation, high levels of bilateral trade and highest ever FDI inflows. The bilateral cooperation under the aegis of S&CD has yielded fruitful gains to both the nations and both sides would be looking forward to maintain the momentum further in the current S&CD. India’s recent economic and trade initiatives under the able leadership of Prime Minister Shri Modi, such as Make in India, initiatives for improving ease of doing business, FDI reform measures, start-ups and so on, are going to pave way for more dynamic and strong partnership between India and United States.
India is looking forward to the S & CD for healthy discussions between the business and government of both sides which are likely to lay the roadmap for much stronger partnership between the two largest democracies.