Indian FDI important for US economy

Written by Sanjay Jog | Mumbai | Updated: Sep 10 2009, 05:32am hrs
Investments by Tata Group, Infosys, Suzlon in the US are success stories and they are global case studies. India Inc has proven its best and now it is looking at global benchmarking, said Aaron Brickman, director, Invest in America attached to the US department of commerce. In an exclusive interview on Wednesday to FE, Brickman, who is here to encourage more investment in America, said its a win-win situation for both the countries as Indian companies can make the US as their profit centre.

Brickman said foreign direct investment from India, which is over $5.4 billion by end of 2008-09, is quite underrepresentative. Financial markets, taxation, trade policies and the business cycle all play a major role in foreign companies investment decisions. The US treats all investors including those from India equally and there are zero incentives. FDI from India is picking up but it needs to grow further. The US businesses and industries have no problem if FDI from India rises, Brickman noted.

In fact, FDI from India as well as other countries impact the US economy in many positive ways. FDI creates new jobs, boosts wages, increases US exports, strengthens manufacturing and services, brings in new research, technology and skills. More importantly, it contributes to rising US productivity. Productivity is a key factor that increases US competitiveness abroad and raises living standards at home, Brickman said.

Despite global meltdown, Brickman informed FDI in the US rose by 16% compared to other developed countries such as UK, Germany and Netherlands. During recession there was FDI from India. US sees that India and China are very much in growth mode and expect more investments from them in the US, he said.

As reported by FE, the recent greenfield investment by Indian companies include: Reliance ADAs $161 million project in Illinois to create 252 jobs (May 2009), Veethree plans to invest $6.7 million in Florida creating 50 jobs (April 2009), Centrum Capitals $13.4 million investment plan in California to create 70 jobs (November 2008), HCL Groups $3.2 million project in North Carolina to create 500 jobs (August 2008), Bilcares $16.5 million project in California to create 70 jobs (August 2008), Essar invested $1.6 billion in Minnesota to create 700 jobs (June 2008).