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US lawmakers seek investigations into Indian industrial policy

In an extraordinary step, bipartisan group of powerful US lawmakers from both the senate and the House of Representatives have sought a 'fact-finding investigation' into India's trade and industrial policies.

world Updated: Aug 03, 2013 08:15 IST

In an extraordinary step, bipartisan group of powerful US lawmakers from both the senate and the House of Representatives have sought a "fact-finding investigation" into India's trade and industrial policies.

Noting in a letter that American exports to India are low given the size of its market, congressional leaders asked the US International Trade Commission (ITC) to detail policies India has in place that restrict trade and violate intellectual property rights, as well as the effect they have on US exports, businesses and jobs.

USITC has been asked to submit a report by November 30, 2014.

The Congressional leaders are the senate finance committee chairman Max Baucus, its ranking member Orrin Hatch; the House Ways and Means Committee chairman Dave Camp and its ranking member Sander Levin.

"We are writing to request that the US International Trade Commission (Commission) conduct an investigation regarding Indian industrial policies that discriminate against US imports and investment for the sake of supporting Indian domestic industries, and the effect that those barriers have on the US economy and US jobs," lawmakers wrote in a letter to Irving A Williamson, chairman, US International Trade Commission.

The letter dated August 2 was released to the press.

The investigation allows the US government to better understand specific international trade issues and develop appropriate responses to address them.

"This investigation is completely warranted given India's systematic disregard for intellectual property protection standards," said Mark Elliot, a co-chair of Alliance for Fair Trade with India (AFTI) and the executive vice president, Global Intellectual Property Center, US Chamber of Commerce.

"Only through a true partnership can the United States and India achieve innovative progress that benefits both economies. The Indian government must take steps to protect IP standards while building their innovative future," he said.

"This fact has rightly prompted congressional leaders on both sides of the aisle to request a full investigation," Dempsey said.

Following the letter, USITC will make detailed inquiries and will ultimately present a final report to the requesting Committees.

"India has introduced new localisation-forcing measures such as local content and technology transfer requirements in the green technology and information and communications technology sectors," lawmakers said in their joint letter.

"And India has not yet taken action to fully and effectively protect and enforce copyrights, including in the digital environment, and has applied its patent law in a discriminatory manner.

"We are very concerned about the broader impact that India's trade policy may be having on the global trading system, both in terms of the model it is setting for other countries and the drag it is exerting on multilateral trade negotiations," they said.

Congressmen asked the Commission to provide an overview of trends and policies in India affecting trade and foreign direct investment in that country's agriculture, manufacturing and service sectors, as well as the overall business environment.

"The overview should take a historic view, but focus on the period since 2003. It should include examples of changes in tariff and nontariff measures, including measures related to the protection of intellectual property (IP) rights, and other actions taken by India's government to facilitate or restrict the inflow of trade and FDI," it said.