"We have made our intentions clear to make India a manufacturing hub for small cars... in textiles, leather and gems and jewellery and I invited the US side to take advantage of these opportunities," Finance Minister P Chidambaram told corporate honchos at the India-US CEOs forum in New Delhi.
Chidambaram said he was aware of some existing concerns in the financial services sectors such as insurance and banking but he asserted that FDI limits were not entry barriers.
"The 26 per cent cap in insurance is not an entry barrier. Indian market is still hugely untapped with only 10 per cent of people in the insurance net. There are still many companies who are not present in India and as we go forward we can persuade the Parliament to amend the Insurance Act (for increasing the FDI cap)," he said.
On banking, the Finance Minister said the sector was in the first phase of opening up and provided a lot of opportunities and it would be further liberalised after 2009 when the second phase begins.
The confidence of foreign investors in India has been rising, he said, while citing the AT Kearney report that ranks the country as second best country after China.
However, he said the total investments into India in the last 15 years at about $37 billion was very low.
The US investments at $5 billion was also way below potential, he said, adding both countries are also trying to double trade to $40 billion in the next 2-3 years.
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