The Hindu Business Line : Nooyi calls for an India-US bilateral investment treaty

(From left) Ms Indra K. Nooyi, Chief Executive Officer of Pepsico Inc &Chairperson of the US-India Business Council; Mr Kapil Sibal, Minister for Science & Technology; and Mr Ron Somers, President, US-India Business Council, at a conference on ‘A fresh beginning: US-India Relations & The Third Wave of investments & reforms,’ in the Capital on Wednesday. —

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New Delhi, Sept. 24 Calling for the “unfettered opening of organised retail in India”, Ms Indra Nooyi, Chairman and CEO, PepsiCo, also gave her thumbs-up to the civil nuclear cooperation between India and the US.

“India’s economic prosperity depends on access to reliable electricity supply,” said Ms Nooyi, who as Chairman of the US-India Business Council (USIBC) was addressing a gathering of the USIBC and CII.

Suggesting the launch of a bilateral investment treaty, Ms Nooyi said, “I am profoundly disappointed that US-India trade is one tenth that of the US trade with China. Now that we are partners in civil nuclear cooperation, we need to champion a successful ongoing trade partnership.”

Ms Nooyi listed out three core areas where she wanted both organisations to do more. These were fostering inclusive growth, infrastructure development, and scientific and technological collaboration. In the context of inclusive growth, she pointed out that initiatives in agriculture would help farmers, or a third of the 68 per cent of Indians living in rural areas.

Food spoils

According to Ms Nooyi, 40 per cent of India’s harvest — literally of every crop — spoils before reaching the marketplace.

“In a world that is hungry and where food shortages this year have unleashed the perils of inflation, it is criminal that so much of India’s harvest goes to waste due to spoilage.”

Other speakers at the event included the Union Minister of Science and Technology and Earth Sciences, Mr Kapil Sibal, who asked for companies not to “just look at return per dollar” but have greater exchange in science and technology, including satellite and defence.

While Ms Nooyi called for a second green revolution and said that opening up retail would do much to improve distributions efficiencies, Mr Raj Jain, President, Wal-Mart India, assured the media on the sidelines of the event that Wal-Mart’s plans were on track.

Retail show

The first of Wal-Mart’s 15 stores to come up over a period of seven years would open in 2009 in north India.

In October, when members of USIBC, who are also executives participating with the India business executives on the CEO Forum, would meet in New York, they would be discussing how they can re-invigorate US enthusiasm in investing in infrastructure development in India, she added.

But Ms Nooyi’s priority areas would only be achieved under certain conditions, that included a radical step-up of investment in education.

“I am a product of the outstanding educational system that existed in India in the 1960s and 70s.

But demand for this education is far outstripping supply, and diluting the quality of that supply,” said Ms Nooyi.

The death of the India CEO of an Italian company in Noida, and the recent blasts in Delhi could scare off US investment in India, warned the US-India Business Council President, Mr Ron Somers.

“While you and I know what’s actually going on here, the board of directors who don’t come to India very often are the ones making the investment decisions,” said Mr Somers at an event organised with the CII.

USIBC Chairman, Ms Indra Nooyi, had already pointed out that competition for capital was fierce, especially at the moment. “Cash is in short supply and there are many pressing infrastructure needs in the US too. But India can attract that investment with the right policies in power, roads, clean water, ports, airports and in cargo handling,” said Ms Nooyi.

When asked to comment on Tata Motors’ decision to withdraw from Singur, Ms Nooyi said that the West Bengal Government should sort through its issues and figure out whether it wants investments. However, she added that PepsiCo had a plant in Kolkata and had no complaints.

Ms Nooyi called for a second green revolution and said that opening up retail would do much to improve distribution efficiencies.

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