Ajay Banga, the new head of the US India Business Council (USIBC), has said that India needs to do more on economic reforms and the US should liberalise its immigration policy.
Both issues have been the bone of contention between the two countries, and Banga listed them among his priorities in his first interview since taking over as USIBC chairman.
Mastercard CEO Banga took over from Harold Terry McGraw III earlier this month as only the second chairman of USIBC of Indian descent; the first being Pepsico chief Indra Nooyi.India has several things going for it such as the demographic advantage, but it "cannot presume investment will flow there without making tough choices and implementing progressive steps to create a welcoming business climate," Banga told The Wall Street Journal in an email interview.
He also addressed the current global concerns over a retrospective tax law that finance minister Pranab Mukherjee proposed in his budget speech. The USIBC has publicly opposed it.
“Changing rules in the middle of the game will discourage investment every time,” he said.
But this was not an isolated issue. “India’s quest to develop its manufacturing base in electronics and in other high technologies by mandate rather than creating a welcoming investment climate will spurn investment, not attract it.”
About the US, Banga said the USIBC would push for a more liberal immigration policy. “We need a visa regime in the US that moves professionals with specialised knowledge back and forth freely to build on the knowledge economy that is at the heart of the US-India commercial relationship.”
New report to pave the way
The Confederation of Indian Industry (CII) will on Wednesday release a report detailing Indian investments in the US on the basis of a survey of leading companies. A report in 2011 had said that 35 Indian firms employed more than 60,000 people across the US. Indian acquisitions in the US were worth $5.9 billion since 2005, the report had said.