The Hindu Business Line : `Top priority to infrastructure must'

Dr David Mulford, US Ambassador, having a word with Mr K.N. Memani, outgoing Chairman, Amcham, at its 12th AGM in the Capital on Friday. — Ramesh Sharma

New Delhi , April 30

THE US Ambassador to India, Dr David Mulford, on Friday said that India would need to look at various issues, including the question of sectoral cap on foreign direct investment (FDI), development of infrastructure such as ports, roads and airports, and the continuation of financial sector reforms if the country is to grow at 8-10 per cent on a sustained basis.

Addressing the 12th annual general meeting of the American Chamber of Commerce in India (Amcham), Dr Mulford said that, in his opinion, the development of infrastructure was the most important thing for the economic development of India.

"This is something which should be taken up on a priority, equal to that of fighting a war. In my opinion, nobody can grow at 8-10 per cent on a long-term basis with the kind of infrastructure which exists," the US Ambassador said.

On the issue of hiking FDI ceiling in different sectors, Dr Mulford emphasised that while this was one thing which the US would like to see opened, it was something which India should also want to do to achieve higher growth. "Countries which have opened up have grown three-to-four-to-five times faster than closed regimes. Besides, open trade is absolutely critical to achieve higher growth," Dr Mulford pointed out.

Turning his attention to outsourcing, the US envoy said that this was not a problem between India and the US, but a function of globalisation. "Outsourcing is not restricted to US-India or US-China, it is a phenomena of the way the world works," he said.

Commenting on outsourcing, Dr Mulford gave the example of how a particular US company, which provides loans on phone, was outsourcing some jobs to India.

He pointed out that the company gave the choice to the American consumers to wait for three days for their loans to be cleared if they wanted it to be processed in America. However, the same job when outsourced to a company in India would be completed in a day.

Dr Mulford said that the two Governments were anxious to enlist the support of the private sector in carrying forward the economic dialogue between them.

Later, responding to questions, the Ambassador felt that a change in the Presidency in the US was unlikely to lead to any major change on the issue of outsourcing.