U.S. hopes to boost commerce with India mission

The largest trade mission ever assembled by the U.S. government descends on India this week, hoping to boost commerce with one of the world’s fastest-growing economies.

A total of 239 participants from 189 companies will participate in the mission, which includes a business summit in Bombay on Wednesday and Thursday, followed by meetings in Calcutta, New Delhi and other Indian cities. Companies represented on the mission include such well-known firms as Anheuser-Busch Cos. Inc., Lockheed Martin Corp. and UPS, as well as smaller companies from sectors including health care, industrial machinery and telecommunications.

U.S. exports to India last year rose 30.6 percent to about $8 billion, while imports totaled about $19 billion, up 20.9 percent over 2004, according to U.S. Commerce Department figures. India ranks as America’s 22nd largest export market, behind the United Arab Emirates and ahead of Thailand.

“We have historically been underperforming in that market, and the market itself has been underperforming,” Franklin L. Lavin, undersecretary of Commerce for international trade, told reporters last week.

“So you can look through the entire array of what we have to offer, from soybeans to laptops to insurance companies to jet engines, and you can say, does India want this or need this, and the answer’s going to be yes,” Mr. Lavin said.

India is a mature economy, Mr. Lavin said, larger in population and less affluent in terms of per capita gross domestic product, but with the same range of tastes and needs as the U.S. economy.

“So simply getting people to show up, finding the customer base, finding the distribution network, finding the wholesaler who will carry their goods, is a big part of the puzzle for American companies in India,” he said.

U.S.-India Business Council President Ron Somers noted that, with legislation having passed both the House and Senate to allow the U.S. to share civilian nuclear technology with India, this week’s trade mission will include the first delegation of nuclear power companies to visit India in an official capacity, including General Electric Co. and Westinghouse Electric Corp.

India’s economy, which weighs in at under $1 trillion today, is expected to grow to $27 trillion by 2050, according to investment bank Goldman Sachs. By comparison, the $13 trillion U.S. economy is expected to expand to $37 trillion.

Mr. Lavin last week hailed Indian steps to reduce barriers to trade, including lowering tariffs on industrial goods from an average of 15 percent to 12 percent, and extending patent protection last year to pharmaceuticals, farm chemicals and food products.

At the same time, he called for more steps to increase trade, including further opening of the retail sector; eliminating limits on foreign equity investment in the financial services and protection of intellectual property rights.

“Right now, an estimated 74 percent of software in use in India is pirated, and India is one of the world’s leading manufacturers of counterfeit pharmaceuticals,” he said.

The trade mission is expected to boost U.S.-Indian commerce but not necessarily produce a major announcement.

“We’re looking for incremental positive steps, we’re not looking for big-bang breakthroughs,” Mr. Somers said.