Indo-US partnership will help world bounce back from COVID-19 crisis: Modi

Stating that open markets mean more opportunities, Modi said during the last six years the government has made many efforts to make the Indian economy more open and reform oriented.

Prime Minister Narendra Modi on Wednesday pitched India as a land of opportunities for US investors and said the partnership between the two nations can play an important role in helping the world bounce back faster after the coronavirus pandemic.

Modi saw too much focus on efficiency and optimisation as a pitfall for the global economy and said improved domestic manufacturing together with healthy financial systems and diversified international trade was the answer to the shocks triggered by COVID-19.

"India offers many more opportunities. We have what is needed to power the global economic recovery," he said.

Speaking at the US-India Business Council's 'India Ideas Summit' through a video link, he sought US investment in sectors ranging from healthcare to energy, defence and space, saying the country was open to doing business with the world.

"The US-India friendship has scaled many heights in the past. Now it is time our partnership plays an important role in helping the world bounce back faster after the pandemic," he said.

"There are few better partners than the United States of America and India. India and the USA are two vibrant democracies with shared values. We are natural partners."

Stating that the world needs a better future, he said the recent experience has showed that the global economy has been too focused on efficiency and optimisation.

"Efficiency is a good thing. But, on the way, we forgot to focus on something equally important.

“That is resilience against external shocks. It has taken a global pandemic to remind us how important resilience is," he said.

Global economic resilience, he said, can be achieved by stronger domestic economic capacities, which mean improved manufacturing capacity, restoration of the health of the financial system and diversification of international trade.

Making a strong pitch for US investments, he said India got more than $20 billion of foreign investment during the pandemic times.

"American investors often look out for the perfect timing to enter a sector or a country. To them, I would like to say: there has never been a better time to invest in India," he said.

Foreign direct investment (FDI) inflows into India in the fiscal year ended March 31, 2020 stood at $74 billion, 20 per cent higher than the previous year.

"Every year, we are reaching record highs in FDI," he said, adding pledged investment from the US has already crossed $40 billion this year.

"The rise of India means a rise in trade opportunities with a nation that you can trust, a rise in global integration with increasing openness, a rise in your competitiveness with access to a market which offers scale.

“And a rise in your returns on investment with the availability of skilled human resources," he said.

The prime minister sought US investments in healthcare, energy, defence, space, civil aviation, infrastructure, finance and insurance sectors, saying his government has eased foreign investment caps and ushered in path-breaking reforms.

"When the markets are open, when the opportunity is high and the options are many, can optimism be far behind?

“You can see the optimism when India rises in key business ratings. Particularly, the Ease of Doing Business ratings of the World Bank," he said.

Modi said the FDI cap for investment in the insurance sector has been raised to 49 per cent, while 100 per cent foreign investment is permitted in insurance intermediaries.

While the space sector has been opened up for the private sector, the FDI cap for investment in defense sector has been raised to 74 per cent.

"India has established two defense corridors to encourage the production of defense equipment and platforms," he said.

"Civil aviation is another area of great potential growth.

“The number of air passengers is expected to more than double within the next eight years.

“The top private Indian airlines plan to include over a thousand new aircraft over the coming decade," he said.

Also, India is witnessing the largest infrastructure creation drive in its history and US firms can partner in building housing for millions and constructing roads, highways and ports.

They can also invest in energy as the nation evolves into a gas-based economy, offering big investment opportunities for US companies.

There are also big opportunities in the clean energy sector, he said.

"India invites you to invest in healthcare. The healthcare sector in India is growing faster than 22 per cent every year.

“Our companies are also progressing in production of medical-technology, telemedicine, and diagnostics," he said.

Modi further said his government recently ushered in historic reforms in the agriculture sector and it now offers investment opportunities in agricultural inputs and machinery, agriculture supply chain management, ready-to-eat items, fisheries and organic produce.

Modi said during the last six years, the Indian economy has opened up more and become reform-oriented.

Reforms have ensured increased competitiveness, enhanced transparency, expanded digitisation, greater innovation, and more policy stability, the prime minister said.

"The options to invest in India are extensive," he said.

Giving examples of sectors where US companies can invest, Modi said India's food processing sector is expected to be worth over half a trillion dollars by 2025 and this was the best time to tap investment opportunities in the agriculture sector.

Also, huge opportunities are available for any investor who chooses to set up manufacturing facilities in the civil aviation sector.

"To give flight to your aviation targets, this is an ideal time to invest in the Indian aviation sector," he said.