U.S. Seeks More Relaxation In India FDI Policy
Steven Mnuchin and Nirmala Sitharaman. (Source: Ministry of Finance's official Twitter handle)

U.S. Seeks More Relaxation In India FDI Policy

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U.S. Treasury Secretary Steven Mnuchin on Friday sought further relaxation in India's foreign direct investment rules to facilitate American companies to increase investment in the country for boosting economic growth and be a partner in achieving $5 trillion economy.

Addressing media after the 7th India-U.S. Economic and Financial Partnership meeting here, he said both the countries are working together to promote growth and improve economic security.

"I look forward to the government's goal of $5 trillion. And I think that they're going to hit that goal, even faster than they expect with what are great economic opportunities as they promote growth," he said.

Prime Minister Narendra Modi has set a target of achieving $5 trillion economy by 2024-25.

Mnuchin said that the U.S. welcomes the growing bilateral foreign direct investment flows between countries.

"We look forward to the opening up of certain markets where U.S. companies can continue to invest here. We discussed the importance of paying greater attention to transparency and debt sustainability and development lending in Asia and beyond," he said.

On the U.S.-China trade deal, Mnuchin said both the countries are making progress as per the direction of President Donald Trump and Chinese President Xi Jinping.

Speaking about the meeting, Finance Minister Sitharaman said India-U.S. relationship is at an all-time high particularly after the Prime Minister's visit to the U.S. in September 2019.

India the U.S., as the world's largest democracies have shared an interest in each other's economic prosperity and in ensuring economic security, she said.

"Our discussions took stock of the efforts undertaken to further improve mutual corporation on wide range of bilateral and multinational subjects including macroeconomic policies to raise growth, improving financial market development, anti-money laundering and combating financing of terrorism.

"We not only discussed policies to stimulate growth but also deliberated on significant steps, India and the U.S. have taken to strengthen the financial sector, including banks recapitalisation and plan to merge some of the state-owned banks. We discuss capital flows investment in infrastructure, closer people to people ties and as also cooperation in the overall global economic context," she said.

With regard to Iran ties, the Finance Minister said, India did explain its position mainly the need for maintaining land-based access to Afghanistan, particularly need for Chabahar link.

"Through Chabahar rail link to reach out to Afghanistan and also to recently how recently Afghanistan was able to export 700 tonne of agriculture produce using this access to sea port. Also for strategic and other reason to continue with that. It was well heard taken cognisance of by the American side."

"So we've explained the need for us to have to maintain our links through Chabahar side for Afghanistan. Considering the extent of our commitment for developing the social and other infrastructure in Afghanistan. Also in the context of Pakistan continuously denying us access to through land road," she said.

Earlier this week, the U.S. and six Gulf countries agreed to jointly impose sanctions on 25 corporations, banks and individuals linked to Iran's support for militant networks, including Hezbollah, making import of oil from the country more difficult.

However, Mnuchin said the U.S. has been working with allies to make sure that there is significant supply in the market of oil to offset the sanctions.

"I just came from the Middle East, was in Saudi Arabia where I met with the energy minister and others. And they and others have done a very good job so that it doesn't have an economic impact. We are sensitive to the fact that India has tremendous energy needs. We look forward to working with India on LNG (liquefied natural gas) and expanding capabilities," he added.

Also read: Sitharaman, Mnuchin Commit To Cooperation In Tackling Money Laundering

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