Reflecting its concerns over the issue of outsourcing, the United States on Monday sought "greater balance and greater liberalization" on India's part to ensure that US investors have as many opportunities here as Indians have in that country.
The US and India also need to work together in the Doha Round of WTO and elsewhere to identify ways to open new markets rather than close those that are already open, US Charge d'Affaires Robert O Blake told reporters in New Delhi.
"India can help in this task by accelerating its programme of trade liberalisation and by helping build positive momentum in the Doha round talks and setting ambitious goals for new commitments," he stressed.
The US believes that free trade and open market brought benefits to all countries that commit to them. "But the commitment to and benefits of trade must be reciprocal. To succeed, trade must be a two-way street," he said.
Blake said US Trade Representative Robert Zoellick will visit India later this month. The outsourcing issue is expected to figure prominently during his parleys with Indian government.
He underscored the need for "greater balance and greater liberalisation on the part of India so that US investors have as many opportunities here as Indians have in the US," he said.
Asked what specifically the US was seeking from New Delhi, Blake said: "The most important step India can take to counter efforts to restrict outsourcing is to continue to open its markets."
In the last month, the Indian government has taken "some important steps" in this direction. He described as a "welcome step" the tariff tax and investment liberalisation announced by Finance Minister Jaswant Singh.
He spoke about US interest in financial services, insurance and telecom sectors in India but noted there were caps on foreign investments in all these areas.
"We are very optimistic about the economic side of our partnership which has seen a lot of growth recently. We know that India is going to be increasingly an important global player on the economic front," he said.
Observing that Indo-US relations have never been better, Blake expressed confidence that the world's oldest and largest democracies would be able to handle differences over issues like outsourcing in a "business-like manner without rancour."
Highlighting the growing strategic partnership between the two countries, he said this was recently reinforced by the statements made by US President George W Bush and Prime Minister Atal Bihari Vajpayee last month.
The statements were on the next steps in their strategic partnership in the areas of high technology trade, civil nuclear and space cooperation and on expanding dialogue in missile defence.
Blake said one of the hallmarks of the maturity in Indo-US relations was the ability of the two sides to manage their differences.
Citing the example of Iraq, he said for domestic reasons, Prime Minister Vajpayee decided that India cannot commit its troops. "President Bush expressed understanding for that decision," said Blake.
The differences over Iraq did not disrupt the momentum of improvement in bilateral ties, he said.
He hoped outsourcing can be another issue which could be handled by the two sides through 'positive dialogue.'
"From the perspective of the Bush Administration, outsourcing helps US firms improve competitiveness and profitability and offers US consumers lower-cost high quality services," he said, adding that "this can be a win-win situation for both countries."
"The way for India to counter efforts to restrict outsourcing in the US and other countries like the United Kingdom is to continue to open its markets so that jobs will be created in the US," he said.
He said the US is India's largest trade partner with bilateral trade touching 16 billion dollars. While US exports to India grew by 19 per cent, Indian exports to the US increased by 11 per cent last year. However, the trade deficit is still large, he said.
American companies were attracted to India for outsourcing of a wide range of services because of the well-educated work force in this country having a large number of English-speaking people as well as lower wages.
Blake candidly spoke about the perception in the US, in an election year, that jobs are falling out of that country to others like India which are less open to similar trade and investment opportunities. "One of our top priorities is creation of jobs," he said.
"The US remains committed to open market in which business partnerships allow resources to be allocated in a way that allows markets to outsource effectively," he said.
"We welcome a robust commitment to trade and services within the WTO by India," he said.
India has an opportunity to move forward to strengthen trade and investment with US in sectors like accounting and financial services, he said.
"This will reinforce the message that India is committed to the kind of economic cooperation in trade and investment that would allow us to achieve balance in our trade and employment generation," he said.
About the recent Senate bill restricting government outsourcing to contractors who will do the work in the US itself, thereby excluding India and others for this work, he felt that the law would affect only a tiny percentage of total outsourcing to India.
He emphasised that 'active efforts' are needed by India to assure that the benefits of globalisation are divided in a manner that balances employment, income and social gains.
The US diplomat made it clear that Washington was not seeking any 'quid pro quo' from India. Both countries should open their markets so that it was mutually beneficial.
Washington also wanted India to join in going further in the WTO commitments.
