Indo-Asian News Service, Hyderabad, Feb 24: India continues to be perceived as a tough place to do business even while there is renewed enthusiasm and confidence in the Indian economy and great potential for US-India business collaboration, the US said Tuesday.
US envoy Richard Verma, addressing the Indian School of Business here, pushed for both sides inking a “high-standard bilateral investment treaty (BIT)”. He said India ranks at 142 in the World Bank ranking, measuring the ease of doing business. “Investor confidence is still shaky.”
India’s “intellectual property enforcement is perceived as weak” and “many sectors still remain closed to outside investors and businesses”, Verma said. “We know that the Prime Minister has made rationalization of bureaucratic procedures a high priority on his list of reforms, and we eagerly anticipate substantive progress in this direction.”
Permits too many
About the difficulties in doing business in India, he said one hotel chain CEO recently mentioned that it takes on average 80 permits to build a hotel in India, but only six in Singapore. “Moreover, according to the World Bank, it takes an average of nearly four years to resolve a commercial dispute here – the third longest average in the world – while creditors wait even longer, 4.3 years, to recover funds from a company that’s become insolvent.”
“Indian courts face a backlog of 30-40 million cases nationwide, and companies simply cannot afford to invest in or provide financing for an economy where legal justice comes too late, when it comes at all. As they say, justice delayed is very often justice denied,” he remarked.
US committed to BIT
The US envoy said that some of these challenges could be addressed by a high-standard bilateral investment treaty, “and that’s why the United States remains committed to negotiating a BIT with India”.
On IPR, he said, “And the United States and India have more of a common interest in intellectual property rights than many of you may think. If India wants the best technologies, newest products, and innovations, then it must also be known for the best intellectual property protection regime.”
He said that two-way trade has nearly quintupled in the last dozen years from $19 billion to almost $100 billion.
US firms’ focus on Hyderabad
American companies are keen to invest in Hyderabad, according to US Ambassador to India Richard Verma. On his first visit to the southern city after taking over as the ambassador last month, Verma Tuesday met Telangana Chief Minister K. Chandrasekhar Rao.