“For in Asia and around the world, India is not simply emerging; India has already emerged.” President Obama, November 8th in India.By George Lauriat, AJOTIn May of 2009, President Barack Obama was critical when talking about reforming the tax code that allowed multinationals to pay ’‘lower taxes if you create a job in Bangalore, India, than if you create one in Buffalo, New York.’’ The comment was less about Bangalore, or for that matter Buffalo, than as a follow up to a campaign pledge to reform the tax code that allows multinationals to pay lower corporate taxes on outsourced business than keeping the jobs at a home, during one of the worse economic periods in recent history. The President’s comments weren’t as well received in Bangalore (or any where else in India) as they were in Buffalo, New York. In India, the comments were labeled “anti-outsourcing,” and there were calls to take the matter before the WTO (World Trade Organization). India’s Prime Minister Manmohan Singh retorted to the Bangalore allusion, “India is not in the business of stealing jobs from the US… outsourcing (work to India) has helped improve the productive capacity and productivity of America.” Although President Obama’s comments were directed more at the outsourcing of manufacturing jobs than IT, they nevertheless hit a raw nerve in India. This was the same President that wanted to limit H1B visas (work visas). In 2009, Indian nationals with 123,002 H1B visas represented the largest immigrant group with over 36% as skilled professionals. From India’s perspective, US trade policies have for the last two administrations focused too much on the “China trade” and too little on India. US-India trade issues Since the middle 1990s, India has been engaged in a process of liberalizing its economy. Outwardly, the Indian economy has been booming with the IT and manufacturing sectors leading the way. During the recession, India’s GDP has grown 6.4% in 2008, 5.7% in 2009, and 9.7% projected for 2010. This compares very favorably with China as the only large economies with significant growth during this period. But in truth, it has been a very uneven process. While the IT sector has drawn in countless hi-tech aspirants, civil engineering has lagged; and it shows in the struggles to maintain basic infrastructure. From the US perspective India has great-untapped potential for US exporters. India is the world’s second most populous country with a rapidly growing middle class - a seemingly made-to-order opportunity for US exports. But India’s trade barriers have hindered progress for the acceptance of US goods. Many of the barriers have been erected to protect India’s agricultural sector. According to FAS (Foreign Agricultural Service), US agricultural “imports are generally viewed negatively, partially due to the fact that roughly 65% of the population depends on agriculture for their livelihoods and agricultural imports are seen as providing unwanted competition.” The FAS reports that while India has reduced some import duties in recent years, the average “bound rate still exceeds 100%, while the average applied rate is about 35%.” Normally, high duties are applied to protect domestic industries, but in India’s case, duties also act as a source of government revenue. Besides high duties, India also uses non-tariff barriers to block imports. Sanitary and phytosanitary barriers are employed to keep out US dairy products, meats, grains, oilseeds, and nearly all biotech products. India and the US (and Europe) have an ongoing battle on duties that India imposes on wine, beer and other distilled spirits. For example, USTR (US Trade Representative) said “additional duty” of 20%-75% on imports of beer and wine and from 25% to 150% on imports of distilled spirits on top of the basic customs duties is applied to these products. In addition, India applies an “extra additional duty” of 4%. The result is the aggregated duties on these imports range from between 150% to 550%. USTR said th