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Prime Minister Singh: Open India for Business
India is a strategic partner and close ally of the United States, but most people are surprised when they learn that India is not a top-10 trading partner of the United States. The reality that the trade relationship between the U.S. and India is far below where it should be isn’t just a coincidence, it’s the result of baffling anti-business economic policies in India.
From currency problems, market access issues, and intellectual property (IP) rights degradation, global businesses are second-guessing whether India is indeed the next frontier. And this isn’t splitting hairs here. Doing business in India is particularly troublesome for investment-heavy IP-intensive sectors.
Earlier this week, former U.S. Trade Representative Charlene Barshefsky noted that it’s easier to do business in Russia, China, and Nigeria than in India. Barshefky’s comments couldn’t be more spot-on: GIPC’s inaugural International IP Index found that not only is India’s intellectual property rights environment behind Russia and China’s, it ranked dead last compared to the other economies measured, like Malaysia and Brazil. Even the New York Times has taken notice saying outright that India’s economy has shifted “in reverse” and the country has “become even less hospitable in recent years.”
What should India expect when it shutters its doors to the American business community? Companies are hesitant to invest when internationally-recognized patents are being revoked or denied left and right. Or when the software and entertainment piracy runs rampant. Or when boosting the domestic market means taking the intellectual property from the rightful holders.
If you look at India’s foreign direct investment (FDI) numbers, you’ll see a clearer picture of the hesitation of international business. India attracts less FDI than its BRIC counterparts and over the last 20 years has lagged behind other nations which started out on similar footing with similar IP regimes and similar FDI intakes.
This deterioration in India’s business environment has caused immense concern from many leaders in the global economy, causing the formation of the Alliance for Fair Trade with India, of which the Global Intellectual Property Center (GIPC) is a co-chair.
With Indian Prime Minister Manmohan Singh’s visit next week, American industry and the GIPC will raise these very serious concerns with the Indian government and we hope that these economic issues will be on the agenda of discussion between the Prime Minister and President Obama as well.