India should allow foreign direct investment in multi-brand retail besides taking other economic reforms to further enhance the country’s economic growth, US Ambassador to India Nancy J Powell has said.
“For India to return to faster growth, new policies and economic reforms need to be put in place by the government in areas such as opening multi-brand retail up to foreign direct investment,” Powell said .
She said that as the global economy slowed in 2011, India’s Gross Domestic Product (GDP) growth too slowed to about 7 percent. “Yet despite the economic challenges we all faced over the past year, each day, my embassy colleagues and I are uncovering new ways to link one the world’s fastest growing economies—India – with the US,” she added.
On July 15, US President Barack Obama had said that India has prohibited FDI in too many sectors such as retail and cited concerns over deteriorating investment climate.
The US-based Walmart, world’s largest retailer, is keen to open stores in multi-brand retail sector in India.
The decision to allow 51 percent foreign direct investment (FDI) in multi-brand retail was announced in
November last year. But its implementation was put on hold after a strong protest from various parties including key UPA-ally Trinamool Congress.
After that, the government has renewed its efforts to forge a consensus on the politically-sensitive issue. Further, she also said the US private sector has expressed concerns about long-standing business challenges in India, including high-tariff and non-tariff barriers, restrictions on foreign investment, lack of transparency and defence offset requirements.
Commenting about the bilateral trade, Powell said last year, the US exports to India touched $21 billion. “Our total bilateral trade in goods and services is expected to reach $100 billion this year.
India has leapt from our 25th largest trading partner to our 13th largest trading partner in just over a decade,” she said adding increasing number of Indian businesses are interested in investing in America.
She said that the US provides huge opportunities for investment for Indian companies.