[Ip-health] US India BIT - Economic Times 9 Feb 2016

leena menghaney leenamenghaney at gmail.com
Tue Feb 9 03:01:10 PST 2016

US wants bilateral treaty modelled on India's FTAs with Japan & South Korea

By Dipanjan Roy Chaudhury, ET Bureau | 9 Feb, 2016

NEW DELHI: A draft copy of the proposed India-US Bilateral Investment
Treaty is not ambitious enough to attract American investors to India,
feels Washington, which would rather prefer an agreement similar to the
ones Delhi has signed with Japan and South Korea. "What India has proposed
is not yet attractive enough for the US," an American government source

India had shared a model text of the proposed treaty (BIT) with the US last
year. The issue had come up for discussion at the US-India Trade Policy
Forum (TPF) meeting in Washington last year, and bet over the past year,
both sides held formal negotiations on BIT either in person or through
video conferencing.

According to the US source, the Barack Obama administration feels that the
current form of agreement does not provide robust market access. There are
differences over the issue of

Japan or Indo-South Korea trade treaties should be the model for the
India-US BIT. Japan and South Korea are two big investors in India. Signed
in 2009, the Comprehensive Economic Partnership Agreement (CEPA) is a free
trade agreement betover agreement eases restrictions on foreign direct
investments and companies can own up to 65% of a company in the other

Indo-Japan CEPA came into force in 2011. The pact seeks to abolish import
duties on most products, increase access for Indian professionals and
contractual service suppliers to the Japanese market and liberalise
investment rules.

According to the officials in the Obama administration, US investments into
India and vice-versa are being carried out irrespective of a bilateral BIT.
American investments in India amount to $28 billion and Indian investments
in the US amount to $ 18 billion.

Sources feel that under such circumstances, the Narendra Modi government
has to make attractive offers for concluding the BIT as the Obama
administration has entered its last leg.

Incidentally, both governments separately decided to review their model
texts of BITs and reviews happened consecutively. When Barack Obama visited
Delhi in January 2015 the two sides decided to pick up threads on BIT.


Leena Menghaney

Head of South Asia

Access Campaign, Médecins Sans Frontières

Mob: +91 98 113 65412

Leena Menghaney
Mobile: 9811365412

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