NEW DELHI – In an effort to reinvigorate commercial ties between the world's two biggest democracies, India is ready for talks with the United States on a bilateral investment treaty,a report said Saturday.
The announcement comes days after China and the United States agreed to relaunch talks on a similar bilateral investment treaty.
"Economic engagement in both trade and investment, though robust, is well below potential, given the opportunities a growing economy like India offers and the opportunities in the largest economy of the United States," said Minister Anand Sharma.
Sharma and Finance Minister P. Chidambaram have been in the United States this week meeting U.S .political and business leaders to pitch for greater investment in Asia's third-largest economy. They are seek to spur India's economic growth which has been running at a decade low of five percent and boost the rupee which has been hitting lifetime lows.
"We would definitely be in favor of enhancing our economic partnership," Sharma said, adding the two countries' target of achieving $500 billion in two-way trade by 2020 is doable.
Bilateral trade between India and the United States currently runs at $106 billion annually.
Sharma, who declared India will be the world's new manufacturing hub, added there will be huge opportunities for the U.S. businesses in India's proposed National Investment and Manufacturing Zones offering tax breaks and other perks.
India has approved setting up of 13 such industrial townships as part of its new national manufacturing policy.
The scheme aims to raise the share of manufacturing as part of India's gross domestic product from below 16% to at least 25% within a decade.
The goal is to create 100 million skilled jobs to employ India's burgeoning youth population.
U.S. legislators and business leaders have been pressing Sharma and Chidambaram to ease bureaucratic hurdles to make it easier for foreigners to do business in India and to step up reforms to liberalzse the still heavily state-dominated economy.
"Over the last two years, we have felt a cooling when it comes to US interests in investing in India," Honeywell chief executive David Cote told the Press Trust of India separately.
Foreign direct investment in India has fallen in three out of the last four financial years amid investor worry over political paralysis and widespread corruption.
Sharma told reporters New Delhi is "far more welcoming" toward U.S. business than is perceived, the news agency reported.
Copyright Agence France-Presse, 2013