The Indian Economy at a Crossroads
The recent election of Prime Minister Narendra Modi offers a unique opportunity to reset the dialogue between the United States and India and work toward a constructive and mutually beneficial economic and commercial relationship, according to panelists during an event on the future of India’s trade and economic policies hosted by the Information Technology and Innovation Foundation (ITIF) on Friday, May 30.
According to Congressman Ami Bera (D-CA), who serves as a member of the Congressional Caucus on India and Indian Americans, in order to boost Foreign Direct Investment (FDI), the Government of India (GOI) must realize that foreign investors want policies with more predictability. He believes the Prime Minister, who ran on a pro-business, pro-growth platform, understands this imperative.
Stephen Ezell, ITIF senior analyst and author of the report in discussion, “The Indian Economy at a Crossroads,” outlined for attendees the damage caused by India’s recent turn toward industrial localization and innovation mercantilist policies which destroy long-term growth and investor confidence. However, Ezell noted that the new Prime Minister has the opportunity to turn India’s policies around in ways that produce robust, sustainable levels of innovation as well as economic and employment growth. Mark Elliot, co-chair of AFTI and executive vice president of the U.S. Chamber of Commerce’s Global Intellectual Property Center (GIPC), also expressed the U.S. business community’s eagerness to work with India, but noted the significant Intellectual Property (IP) challenges in India that must first be reformed. India ranked dead last in this year’s GIPC International IP Index.
Overall, the United States and India share many common aspirations and now have an unprecedented opportunity for developing a new direction in the partnership. Through open dialogue and a willingness to work together, the countries have an opportunity to create a trade relationship that dramatically benefits both economies.