Finance minister Pranab Mukherjee on Monday said India and the US are negotiating an investment treaty for encouraging investment flows into the country from the US as the latter remains a prime source of investment and a trading partner for India.
“We are negotiating a Bilateral Investment Treaty and are committed to take further initiatives that will contribute to creating a more conducive environment for investment flows,” Mukherjee said while addressing the Indo-US CEOs forum.
Highlighting that India has emerged as an attractive global investment destination, he said, infrastructure sector alone requires investment of $514 billion for the 11th Plan (2007-08 to 2011-12). Almost 30% of this investment is envisaged to come from private sources.
For the 12th Plan, the investment in infrastructure is envisaged at $1 trillion, he said, adding that this magnitude of investment would require innovative modes of financing.
The meeting was attended by Treasury secretary Timothy Geithner, commerce secretary Gary Locke, agriculture secretary Thomas Vilsack from the US side, and commerce and industry minister Anand Sharma, deputy chairman, Planning Commission Montek Singh Ahluwalia, from the Indian side, among others.
“As we make efforts to increase investment in infrastructure, and give a fresh impetus to the manufacturing sector, the importance of our partnership with the US will increase,” Mukherjee said.
This mutually beneficial engagement would stimulate innovation, spur job creation, and promote sustainable and inclusive growth in both countries, he said.
Meanwhile, Mukherjee also urged for support from the US companies that can play a role in delivering financial inclusion, a prime thing on India’s economic agenda, like designing physical products like technology for poor and financial products and services relevant for poor.
Earlier in the day, Geithner met Mukherjee and discussed ways of deepening economic ties and re-balancing global growth. The two ministers are understood to have discussed the cooperation at the G20 forum, which would lead the economies worldwide to a higher growth terrain.
They also discussed technical cooperation on capital markets, infrastructure finance, and anti-money laundering and combating the financing of terrorism.
