PM Modi’s Maiden US Visit Over, India To See Investments Pouring In?

The visit of Indian Prime Minister Narendra Modi to the US, which had much fanfare around it, has come to an end today. And both India and the US are expecting some humongous results from this visit.

The two head of states have discussed various issues spanning across economic, political and cultural arenas. But now, the public at large wants to know what tangible results has this high-profile visit brought back home. BI India lists down a few sectors that may gain substantially from the initiatives discussed during PM Modi’s visit.

Infrastructure
The two-way trade between India and the US has grown five-fold in the past fourteen years to nearly $100 billion. Both India and the US realise that both countries have played pivotal roles in each other’s economic growth.

Hence, one of the major developments of this visit has been the setting up of Infrastructure Collaboration Platform. The infrastructure projects have delayed in the country and the decline in the economic growth has only worsened the situation.

“They pledged to establish an Infrastructure Collaboration Platform convened by the Ministry of Finance and the Department of Commerce to enhance participation of U.S. companies in infrastructure projects in India,” tellls a joint statement issued after thePrime Minister Modi and President Obama meeting.

If reports are to be believed, then several American firms have shown interest in the infrastructure and energy sectors of the country. However, they want clarity and a better understanding of the current scenario in the energy sector following the Supreme Court’s verdict on coal block allocations.

Besides, the US has shown keen interest in becoming a partner in development of smart cities in the country. India will welcome two-trade missions in 2015 that will focus on providing US technology and services to meet the country’s infrastructure needs.

Capital Markets

Since the beginning, India has been heavily dependent on investments by foreign institutional investors. Therefore, the leaders pledged to establish an Indo-U.S. Investment Initiative led by the Ministry of Finance and the Department of Treasury, with special focus on capital market development and financing of infrastructure.
Interestingly, Laurence D Fink, CEO of the world’s largest investment management firm Blackrock , has promised PM Modi that the firm may invest over $6 billion in India by early next year. In India, the firm is one of the leading mutual funds investment company. Fink, after his meeting with PM Modi will also host the global investors meet in India early next year.

Pharmaceuticals

There has always been a tussle between the Indian pharma industry and its American counterpart. However, it seems PM Modi has been able to clear apprehensions that most pharma companies in the US have regarding India’s Intellectual Property Rights (IPR) laws.

According to a report, Kenneth Frazier, CEO of pharma major Merk & Co and Michael Ball of Hospira had raised the issue of India’s IPR laws. In his response, PM Modi explained that he understands that pharma companies in the US spend a huge amount in the research and development of drugs, while India is producing and selling them at a cheaper price.

Manufacturing

The staggering manufacturing sector in India may get a tremendous boost if it is able to attract investors in the US. In his meeting with the top corporate honchos of the US, Indian PM Modi has managed to convince them to consider investments in the Indian manufacturing sector.

Following their meeting, National Institute of Standards and Technology’s Manufacturing Extension Partnership program is expected to engage with its counterpart in India to develop “best practices in manufacturing and work toward greater harmonization of standards” in the sector.

The two countries will also hold public-private discussions early next year to facilitate better technology in the manufacturing sector.

While, these are just a few sectors that have been discussed here, the US has shown keen interest in other sectors as well including IT and education.