The government’s move to impose local content requirements for procuring products and services, and financing are the two biggest challenges for India’s ambitious plan to build 100 smart cities, Bruce H Andrews, US deputy secretary of commerce, said on Tuesday.
Local content requirements “end up being counter-productive,” and act as an “artificial trade impediment” which does not help trade in the long term, Andrews told FE. The US administration has expressed its concern on the rules to the Indian government, he said. Instead, if India eases the rules, then the country could potentially benefit from best of technologies, he said.
The US deputy secretary of commerce is leading a delegation of about 18 firms to explore business opportunities in the smart cities project in India. The delegation, which consists of representatives of companies including Qualcomm , and Mastercard, also includes Leocadia I Zak, director of US Trade and Development Agency, and Raymond Ellis, vice-president for global business development at Export-Import Bank of The United States.
The delegation had met government officials, business chambers and also businesses in New Delhi, and would be heading to Mumbai and Chennai, during its current visit. The members of the delegation are here to understand the streamlining of processes, and ease of doing business in India.
Of the 100 smart cities planned, the government has already announced 20 cities in the first phase. US, firms are actively engaged in building three smart cities of Vizag, Allahabad and Ajmer.