The US investments in India cover important segments - manufacturing (48 per cent), energy (19 per cent) and banking (18 per cent) amongst others.

Political solutions need to be found for several of the problems facing the Indian business environment, he averred.

FD Neterwalla, president Indo-American Chamber of Commerce pointed out that India should concentrate on its core sector. India is the second largest producer of rice, wheat and sugar in the world. But the yields per hectare that we get are abysmally low compared to what is achieved elsewhere in the world.

SH Khan, formerchairman and managing director, IDBI pointed out that the government must start spending the amounts it had allocated for various sectors like infrastructure and housing, if the demand revival in the economy is to take place. ``Select segments of the Indian industry like airconditioners, two wheelers etc., have done well going by the latest quarterly results. We have a mix of segments doing well and not so. But there are firms within bad segments still doing well,'' he said.

While giving a comprehensive profile of the current business environ, Khan pointed out that the financial institutions are not in a position to offer cheaper credit to the industry, given that the government is borrowing funds at 12 per cent per annum and provident funds earn 12.5 per cent.

If the inflation rate stays down to four to five per cent consistently, then only the institutions can think of lending at 9 to 11 per cent.